AHA urges two changes to FTC/DOJ merger guidelines

As the Federal Trade Commission and Department of Justice contemplate changes to their guidelines for horizontal and vertical mergers, AHA today urged the agencies to update the guidelines to properly recognize the benefits that mergers can provide to some hospitals and health systems and their patients and communities.

“Mergers enable hospitals to improve clinical care, lower costs, upgrade facilities, and offer new and higher quality services,” AHA wrote. “For these reasons, it is essential that the antitrust agencies employ analytically sound merger guidelines that fairly account for the lifesaving benefits that hospital mergers produce. Changes to the guidelines should reflect years of scholarship that have documented these pro-competitive efficiencies.

“The merger guidelines do not need major revisions. But they should be revised in two specific ways to improve how the agencies analyze hospital mergers. First, the guidelines should require the agencies to correct defects in the economic models that they use to evaluate hospital transactions. Second, the guidelines should enable the antitrust agencies to account for the improved coordination of care that mergers enable. These revisions are necessary to ensure that the antitrust agencies properly recognize the benefits of hospital mergers when reviewing proposed transactions.”