Patricia Wagner, a Member of the Firm in the Health Care and Life Sciences and Litigation practices, in the Washington, DC, office, was quoted in an article titled "Trade Commission Challenges a Hospital Merger."
Following is an excerpt:
Obama administration officials have been roaming the country, talking up their vision of a future in which doctors and hospitals team up to provide better care at lower cost. But a starkly different picture is unfolding this summer in a courtroom here, where lawyers from the Federal Trade Commission have been challenging a hospital merger in Toledo, Ohio.
The lawyers have put the transaction under a virtual microscope, taking hundreds of hours of testimony intended to show that the merger would stifle competition and drive up health care costs. In the process, they are scrutinizing details of the Toledo health care market that might seem more appropriate for investigation by state legislators or county commissioners.
The trial here, before the chief administrative law judge of the Federal Trade Commission, has implications far beyond Toledo. It illustrates the risks that arise when competing health care providers try to collaborate, as they are racing to do all over the country, in part because of incentives built into the new health law.
Federal officials are seeing a wave of mergers, consolidations and joint ventures in the health care industry. More and more hospitals are buying up medical practices that competed with one another. Groups of doctors, with the same or different specialties, are merging their practices.
Patricia M. Wagner estimates that "50 percent to 60 percent of physicians and hospitals are exploring ways" to team up. The health care law encourages such alliances and joint ventures but provides no exemption from antitrust law, which bans mergers that may substantially "lessen competition."
The trade commission says it is investigating at least a dozen cases in which competing groups of doctors are linking up with one another or with hospitals under a single corporate umbrella.