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SALT LAKE CITY — The Federal Trade Commission announced on Thursday that it is filing a lawsuit and an administrative complaint against a Utah health care merger.
HCA Healthcare, known as MountainStar Healthcare in Utah, announced it had acquired Steward Health Care System's five Utah hospitals in September. The FTC, however, is attempting to stop the merger that it says would eliminate competition in the Wasatch Front region.
"As the second- and fourth-largest health care systems in the Wasatch Front region of Utah, which surrounds Salt Lake City, HCA Healthcare and Steward Health Care System help to keep costs down for consumers by competing vigorously with each other," said FTC Bureau of Competition Director Holly Vedova in a statement.
Vedova said competition between the two companies leads to both lower prices and innovative services which would be lost after a merger. The FTC statement said HCA Healthcare and Steward Health Care System compete for insurer network inclusion, health care quality and nurses and physicians.
Steward Health Care is currently a low-cost competitor for inpatient general acute care hospital services, and a merger could change that. The FTC said a merger would enable HCA to raise its rates and some of that cost would be passed to employers and health plan members through increased premiums, deductibles and expenses.
According to the statement, the FTC voted unanimously to authorize seeking a temporary restraining order and preliminary injunction which would stop the merger until the lawsuit is resolved. An administrative trial is scheduled to begin on Dec. 13.
A public version of the lawsuit is not yet available.
When announcing the acquisition agreement, HCA Healthcare said that the added facilities would help them meet the growing health care needs in Utah.
"We believe the addition of these facilities will help us improve health care network options for patients and enable investment in services to meet increasing demand for health care. We look forward to welcoming them to the HCA Healthcare family," said CEO Sam Hazen.
The Steward Health Care-owned hospitals in the state include Davis Hospital in Layton, Jordan Valley Medical Center in West Jordan, Jordan Valley Medical Center-West Valley Campus, Mountain Point Medical Center in Lehi and Salt Lake Regional Medical Center in Salt Lake City.
HCA Healthcare's MountainStar hospitals in Utah include Brigham City Community Hospital, Cache Valley Hospital in North Logan, Lakeview Hospital in Bountiful, Lone Peak Hospital in Draper, Mountain View Hospital-Payson, Ogden Regional Medical Center, St. Mark's Hospital in Salt Lake City and Timpanogos Regional Hospital in Orem.
Steward Health Care said in a statement that they are disappointed by the FTC's decision.
"We believe the FTC has misread the pro-competitive potential of this transaction and completely ignored the fact that the market is, in fact, dominated by two different major health systems," the statement said.
Steward Health Care said the FTC analysis did not take into account outpatient migration patterns. They company said it is exploring options for its next steps and continues to believe the sale will increase health care access and improve competition.
"We will continue to advocate strongly for this sale that would not only support continued investment, but also expand care options for communities across the state of Utah, driving down health care costs and continuing to increase quality," it said.
Another Utah health care system completed its own merger in April, with Utah-based Intermountain Healthcare joining with Colorado hospital system SCL Health, making Intermountain the U.S.'s 11th-largest nonprofit health care system. Intermountain officials said the combined companies employ more than 59,000 people, operate 33 hospitals and 385 clinics across seven states and insure 1 million people in Utah and Idaho.
