Third Circuit Affirms Court Decision and FTC Effort to Block Hospital Merger

On March 22, 2022, the Third Circuit upheld a district court decision granting a preliminary injunction against Hackensack Meridian Health’s plan to acquire Englewood Healthcare, pending the outcome of an administrative trial by the Federal Trade Commission.

The decision aligns with the FTC’s view that the acquisition would reduce available alternatives for inpatient general acute care services in Bergen County, likely leading to an increase in premium and out-of-pocket costs and reducing the quality of care in the area.

The decision is the latest in a series of FTC enforcement actions against hospital mergers.  Prior to the year 2000, the antitrust agencies had a dismal record in challenging hospital mergers.  In the early 2000’s, the FTC launched a project to rethink the government’s approach to such mergers.  Since then, the FTC has racked up victory after victory in hospital merger challenges, winning nearly all of its cases except for a handful where state government intervention essentially blocked federal antitrust enforcement.  The FTC’s winning streak was recently halted by its loss in its challenge against Jefferson Health’s acquisition of Albert Einstein Healthcare network, but its victory before the Third Circuit in this case shows that the FTC’s approach to hospital mergers remains effective.

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