FTC ramps up MSHA/Wellmont hospital merger opposition in Virginia

Johnson City, TN (WJHL)  — The Federal Trade Commission is not letting up in its opposition to a deal that would allow the Tri-Cities two hospital systems to merger into a single new company.

On the same day Mountain States Health Alliance and Welmont Health System asked for more time to prove their case in the State of Tennessee after becoming the target of intense FTC criticism, the federal agency fired another shot – this time in Virginia.

Late Friday, the FTC sent a more than 40 page letter to Virginia State Health Commissioner Marissa Levine and Virginia Attorney General Mark herring them to block the proposed merger of MSHA and Wellmont.

CLICK HERE to read the entire FTC submission to Virginia officials.
The companies have to get state approval in Virginia and Tennessee because the merger would dramatically decrease competition.  MSHA and Wellmont said merging will improve their viability and improve local health care.

The letter, much like one sent to the Tennessee’s Commissioner of Health last week, outlines why the FTC thinks the deal should not be allowed to happen.  FTC staff have said the merger would hurt Tri-Cities healthcare consumers and that the companies have not sufficiently proven that the benefits would outweigh the negatives.

MSHA and Wellmont have called the FTC’s analysis of the merger “flawed”. Friday night, the companies issued a statement. “As with their previous letters, we believe the most recent FTC staff letter has significant and relevant omissions and several errors of fact.”

“The FTC staff have made clear their opposition to state statutes in Virginia and Tennessee that permit mergers such as the one we have proposed, despite the validation of those statutes by the U.S. Supreme Court,” the companies said. “We remain confident that our states are fully capable and uniquely qualified to determine whether our application meets the standards outlined in state policy and also to actively supervise the merged system to ensure the region benefits.”

MSHA and Wellmont said Friday night they plan to submit a formal response to the Virginia Department of Health.

“We remain confident we are taking the right approach to addressing pressing health needs, protecting access and enhancing the quality of care in our region. Our comprehensive proposal specifies enforceable plans to improve community health, limit health care cost growth, enhance health care services, improve health care value, retain local governance, expand health research and graduate medical education and attract and retain a strong workforce. Stakeholders in our community have overwhelmingly spoken out in support of our proposal, and we remain committed to pursuing these goals for the benefit of our region.”

The Southwest Virginia Health Authority approved the merger application late last year. Virginia’s deadline to rule on the application is February 5th.

Copryright 2017 WJHL.  All rights reserved.

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