Thursday, January 7, 2021
Policing hospital mergers has become a top enforcement priority among federal antitrust enforcers. In 2020 alone, the FTC sued to block three hospital transactions (Jefferson/Einstein, Methodist Le Bonheur/Tenet and Hackensack Meridian/Englewood) and submitted letters to state regulators opposing two transactions (Community/Hendrick and Community/Shannon), while the DOJ has challenged one transaction (Geisinger/Evangelical).
On December 8, the FTC lost the first of its 2020 hospital merger challenges. United States District Judge Gerald Pappert denied the FTC’s motion for a preliminary injunction to block the combination of Philadelphia-area Thomas Jefferson University and Albert Einstein Healthcare Network. The FTC quickly appealed, but the Third Circuit denied the FTC’s motion for an injunction pending appeal. (The FTC has since won a second merger challenge: On December 23, Methodist Le Bonheur abandoned its planned acquisition of two Tene
Faced with a December 8, 2020, Memorandum and Order by Eastern District Judge Pappert (
link) denying the Federal Trade Commission’s (FTC’s) request to enjoin the proposed Jefferson-Einstein merger, and the resulting right of the parties to complete the merger after 11:59pm on December 15, 2020 pursuant to the terms of a February 2020 temporary restraining order, the following procedural steps were taken:
On December 9, 2020, the FTC filed an Emergency Motion for Injunction Pending Appeal (
link) in the District Court.
On December 11, 2020, the FTC made a similar filing in the Third Circuit.
On December 11, 2020, Jefferson filed its opposition to the District Court Emergency Motion (see below).
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The Federal Trade Commission’s (“FTC”) recent winning streak in its ongoing challenges of hospital and physician mergers has, at least for now, ended in a Philadelphia U.S. district court. After six days of evidentiary hearings, in a 62-page opinion, Judge Gerald Pappert denied[1] the FTC’s and Pennsylvania Attorney General’s request to preliminarily enjoin a proposed merger between Thomas Jefferson University (“TJU”) and the Albert Einstein Healthcare Network (“Einstein”).
The FTC and Pennsylvania AG (together, the “Government”) brought suit to stop the merger in February. The Complaint alleged that the two hospital systems were close competitors for general acute care (“GAC”) hospital services, with TJU operating 11 GAC hospitals and Einstein operating three in the Northern Philadelphia area. The Government asserted that a combined TJU/Einstein would control at least 60% of the inpatient GAC ho
Friday, December 11, 2020
The Federal Trade Commission’s (“FTC”) recent winning streak in its ongoing challenges of hospital and physician mergers has, at least for now, ended in a Philadelphia U.S. district court. After six days of evidentiary hearings, in a 62-page opinion, Judge Gerald Pappert denied[1] the FTC’s and Pennsylvania Attorney General’s request to preliminarily enjoin a proposed merger between Thomas Jefferson University (“TJU”) and the Albert Einstein Healthcare Network (“Einstein”).
The FTC and Pennsylvania AG (together, the “Government”) brought suit to stop the merger in February. The Complaint alleged that the two hospital systems were close competitors for general acute care (“GAC”) hospital services, with TJU operating 11 GAC hospitals and Einstein operating three in the Northern Philadelphia area. The Government asserted that a combined TJU/Einstein would control at least 60% of the inpatient GAC hospital services marke
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The Federal Trade Commission (“FTC”) has failed – at least for now – in its efforts to derail a merger between Thomas Jefferson University Health System and Albert Einstein Health System, two Philadelphia-area health systems. In a decision announced on December 8, Judge Pappert, District Judge for the Eastern District of Pennsylvania, ruled that the FTC, which was joined in the action by the Pennsylvania Office of the Attorney General (“PA AG”), had failed to demonstrate that the merger should be enjoined. In reaching this decision, the Court held that the FTC had failed to show that there would be an insufficient number of alternative providers of hospital services in the region to limit the ability of the merged entity to increase prices post-merger. Accordingly, absent an appeal by the FTC and/or the PA AG to the Third Circuit, and a successful request for a stay of the lower Court’s ruling, the merging pa