Pennsylvania AG and Geisinger Health System Settle Hospital Merger Antitrust Concerns | Practical Law

Pennsylvania AG and Geisinger Health System Settle Hospital Merger Antitrust Concerns | Practical Law

Attorney General of Pennsylvania Kathleen G. Kane announced an agreement between her office and Geisinger Health System Foundation arising out of a merger between Geisinger and Lewistown Hospital.

Pennsylvania AG and Geisinger Health System Settle Hospital Merger Antitrust Concerns

by Practical Law Antitrust
Published on 29 Oct 2013 • USA (National/Federal)
Attorney General of Pennsylvania Kathleen G. Kane announced an agreement between her office and Geisinger Health System Foundation arising out of a merger between Geisinger and Lewistown Hospital.
On October 28, 2013, Attorney General of Pennsylvania Kathleen G. Kane announced an agreement between her office and Geisinger Health System Foundation, a non-profit parent of five hospitals, over antitrust concerns arising from Geisinger's acquisition of Lewistown Hospital and its physician group. The Attorney General's office was concerned that the merger would negatively affect pricing and competition for hospital services in Mifflin and Junjata counties.
The agreement will be in effect for eight years and requires:
  • That neither the hospitals nor their physicians arbitrarily increase prices for their services.
  • Lewistown Hospital to continue operation as an acute-care hospital for at least the duration of the agreement.
  • That Lewistown Hospital's primary care physicians can leave Geisinger's employ within two years of the agreement with no non-compete restrictions.
  • Maintenance of health plan contracts for Lewistown Hospital and its physician group for the remainder of their terms.
  • Good faith negotiation of future health plan contracts.
  • Geisinger to continue to not prohibit its health plans' tiered offerings.
The Attorney General's challenge to this merger highlights that:
  • Almost all mergers are subject to federal and state review.
  • States may seek remedies or stop deals independently from the federal government.
  • Health care continues to be a hot-button issue for both federal and state antitrust regulators.