Federal Trade Commission fighting WV merger, asking questions about MSHA-Wellmont deal

Alan Levine, CEO of MSHA, has led the effort to merge with Wellmont Health System by winning state approval through a Certificate of Public Advantage.

Mountain States Health Alliance CEO Alan Levine says the health system’s attorneys and Federal Trade Commission attorneys have had conversations about its proposed merger with Wellmont Health System.

“Our lawyers have been communicating with their lawyers and we’re certainly prepared to cooperate in any way, shape or form,” Levine said. “Their role is important. We respect it.”

There’s no guarantee the FTC will try to stop the Wellmont-Mountain States’ merger, but the agency hasn’t shied away from getting involved in recent years. Just last week the FTC tried to stop a hospital merger four hours away in Huntington, West Virginia.

The FTC filed an administrative complaint alleging the deal between Cabell Huntington Hospital and St. Mary’s Medical Center would lead to a “near monopoly” and could result in “higher prices and lower quality of care.”

That news comes as MSHA and Wellmont continue to move forward with their proposed merger; one that still needs state approval. Their hope is that process, which includes the filing of a Certificate of Public Advantage with both Tennessee and Virginia, will eliminate the need for the FTC to get involved.

The heads of both systems say the COPA process is just one way this merger is different than the one in West Virginia.

“I don’t think that the particular decision (by the FTC in West Virginia) necessarily has any impact on our efforts to merge our two organizations together under the COPA regulations in Tennessee and the Commonwealth of Virginia,” Wellmont Health System President and CEO Bart Hove said.

Levine says there isn’t a COPA process in West Virginia and beyond that, he argues the two mergers are different in other ways.

“We’re making an affirmative commitment to reducing the price of healthcare for the employers and the people buying in this region,” Levine said. “West Virginia didn’t propose that. The growth of cost is actually going to decline, because of what we’re proposing.”

According to Levine, the health systems will formally file their COPAs sometime in December. He says later this month they’ll file a pre-submission report, which will give the public a clearer picture about what they’re proposing.

“We’re going to make a clear and compelling case, a clear and convincing case that the benefits of this merger outweigh any of the potential risks or adverse effects that the FTC might want to suggest,” Levine said. “I think when people see it and the FTC sees it hopefully they’ll get a better understanding of the commitments we’re wanting to make.”

Although the states are in charge of regulating the merger there is still the possibility the FTC could get involved formally. If so, Levine says they are prepared.

“We don’t know what we don’t know,” Levine said. “The FTC certainly has the right, but remember the FTC can’t unilaterally stop anything. They have to go to court and in the courts the law matters and we certainly believe we have a very strong case.”

Levine says the merger is supposed to close by next summer. If the FTC does get involved there will most likely be a delay.

“The problem is that the more it’s delayed the more it delays our ability to reduce the growth of cost in the region,” Levine said. “It delays our ability to invest in research and academics in this region. It delays our ability to invest heavily in mental health.”

Copyright WJHL 2015. All rights reserved.

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