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The Federal Trade Commission on Thursday announced plans to block the proposed sale of Englewood Hospital and Medical Center to Hackensack Meridian Health because the hospital chain would monopolize the Bergen County market and push prices up.
Hackensack Meridian Health, one of New Jersey’s largest hospital and healthcare chains, announced last year that it had signed an agreement to acquire Englewood, one of the state’s last independent community hospitals.
But mergers and acquisitions require state and federal government approval, although they are rarely blocked.
Hackensack Meridian Health operates its flagship hospital, Hackensack University Medical Center, and partially owns Pascack Valley Medical Center.
In a press release Thursday afternoon, Ian Conner, director of the FTC’s Competition Bureau, said the commission is filing a restraining order against the merger because Hackensack Meridian is said to control three of the six acute care hospitals in County of Bergen.
“This acquisition would give the combined hospital system increased bargaining leverage, likely leading to higher prices,” Conner said. “The transaction would also remove the competitive pressures that have driven these hospitals to invest in quality improvements to benefit patients.”
“In addition,” the statement said, “eliminating competition would reduce incentives to improve quality.
A statement from the boards and management teams of Hackensack Meridian Health and Englewood Health expressed disappointment at the FTC’s actions.
“The decision to proceed with the merger was taken in September 2019 when the two organizations signed a definitive merger agreement,” the statement said. “We continue to firmly believe that this merger is in the best interest of our patients and communities at large.”
“As a result, we plan to vigorously defend the merger in court, which will give us the opportunity to further demonstrate the benefits that Hackensack Meridian Health and Englewood Health will achieve together,” the statement said.
Contrary to claims by the FTC, the merger “will save money and improve access to care,” according to the hospital statement. Englewood will expand cancer health care, cardiac and maternal and child care and add outpatient facilities in the area, the statement said.
A trial is scheduled in the matter on June 15, 2021, according to the announcement.
Englewood had been looking for a partner for two years before announcing the deal with Hackensack last year. It faces tough challenges as nearly all of New Jersey’s 71 hospitals are part of a chain that can share costs and charge competitive rates with employers and insurance companies.
The Englewood acquisition would give Hackensack Meridian control of 13 acute care hospitals in eight counties across the state.
Susan K. Livio can be reached at [email protected]. Follow her on Twitter @SusanKLivio.
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