Novant Health, CHS file opposition to FTC’s attempt to block hospital deal

Novant Health and Community Health Systems have filed their opposition to the Federal Trade Commission’s attempt to block a $320 million deal to buy two North Carolina hospitals owned by CHS.

Novant Health and CHS are asking the court to deny the FTC’s request for a preliminary injunction against the acquisition, in a complaint filed on April 15 in federal court in the Western District of North Carolina.

The FTC filed a request for a preliminary injunction in March to stop the sale of CHS owned Mooresville’s Lake Norman Regional Medical Center and Statesville’s Davis Regional Medical Center.

Novant Health said it was proposing to acquire two struggling hospitals that were not “meaningful competitors.”

Why this matters
“The FTC’s arguments are premised on a distorted and artificially narrow view of healthcare competition in the Charlotte area,” Novant and CHS said in the complaint.

Atrium Health is by far the largest healthcare provider in the Charlotte area yet the FTC ascribes zero percent market share to that health system, the complaint said. The FTC argues that Atrium will become a competitor only when it opens a hospital in Cornelius in the Eastern Lake Norman area next year.

The larger trend
In January, the FTC sued to block Novant Health’s $320 million acquisition of two North Carolina hospitals from Community Health Systems, saying the proposal would likely increase annual healthcare costs by several million dollars.

The FTC said the deal threatens to raise prices and reduce incentives to invest in quality and innovative care that would benefit patients.

The not-for-profit Novant Health is among the largest – and most expensive – hospital systems in North Carolina according to the FTC. Healthcare Finance News