ProMedica denied hearing in Supreme Court, must divest St. Luke's
ProMedica merged with Maumee, Ohio community hospital of St. Luke’s in 2010, before a lower court ruled that it created a monopoly in the region.
U.S. Supreme Court
The U.S. Supreme Court on Monday denied hearing a petition by ProMedica Health System Inc. to overturn a lower court decision that dismantled its merger with St. Luke’s Hospital.
The denial upholds a Federal Trade Commission order for ProMedica to divest St. Luke’s.
ProMedica, the dominant provider in the Toledo, Ohio area, merged with the independent community hospital of St. Luke’s in 2010. Five months later, the FTC challenged the deal saying it adversely affected competition and would lead to higher consumer prices.
ProMedica appealed the FTC’s order to the 6th U.S. Circuit Court of Appeals. It lost in a decision handed up in April 2014.
[Also: FTC upholds order for ProMedica to divest St. Luke's Hospital]
The merger gave ProMedica a market share of over 50 percent in the area, and above 80 percent for obstetrical services, according to court records. The lower court upheld the FTC’s claim that ProMedica violated antitrust laws when it acquired St. Luke’s Hospital.
ProMedica attorneys argued the merger served the public interest, as St. Luke's was struggling financially and faced closure if left as an independent hospital. They also said the argument that greater market share led to price increases, was flawed.
On May 1, the Supreme Court considered the case, which is being watched for its implications for other mergers and acquisitions in the healthcare industry.
While the FTC challenges hospital consolidations, smaller providers are eyeing mergers as they struggle to stay afloat amid Affordable Care Act mandates and new value-based systems for reimbursement.
Twitter: @SusanMorseHFN
