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A California jury recently rejected antitrust claims brought by a class of California consumers seeking more than $400 million in damages from Sutter Health, a large Northern California hospital system. The case, Sidibe v. Sutter Health, Cas. No. 12-04854, N.D. Cal., originally filed in 2012, alleged that Sutter Health had abused its market position by imposing anticompetitive terms in its agreements with commercial insurers, thereby increasing the prices paid by insured consumers for healthcare in Northern California.
Continue Reading Long-Running Antitrust Case Challenging Sutter Health’s Restrictive Insurance Contracts Ends With a Defense Victory—But Does This Signal “All Clear” for Health Systems?

The Federal Trade Commission and the DOJ Antitrust Division recently announced that they would be reviewing, and likely revising, the Horizontal Merger Guidelines – the guidelines used by the agencies when assessing whether a proposed transaction may have adverse impacts on competition. (The announcement, issued on January 18, is available here).  In announcing the change, FTC Chairwoman Khan explained that the agencies must “ensure that the Merger Guidelines accurately reflect the realities of the modern economy,” and that “to accurately detect and analyze potentially illegal transactions in the modern economy,” changes to the Guidelines are required. 
Continue Reading New Merger Guidelines Could Have Significant Impact on Healthcare Transactions

The Federal Trade Commission (FTC) announced in July of this year that, going forward, whenever merging parties settled an FTC merger challenge, the settlement would impose restrictions on the ability of the merging parties to consummate any future acquisitions, regardless of size, for a period of ten years. This announcement reversed FTC policy (which had been in effect for 25 years), that – absent unusual circumstances – treated each merger, and each merging party, as a new and distinct matter, subject to long-standing merger principles.  In announcing the decision, FTC Director Holly Vedova stated that “The FTC should not have to waste valuable time and resources investigating clearly anticompetitive deals that should have died in the boardroom,” and that this new policy will “force acquisitive firms to think twice before going on a buying binge because the FTC can simply say no.”

Continue Reading Dialysis Provider Becomes the First Entity Subjected to the FTC’s New Restrictions on Future Mergers

A California Superior Court recently approved the settlement of a hospital merger challenge brought by the California Attorney General’s Office against Cedars-Sinai Health System and Huntington Hospital. The action – and subsequent settlement – is noteworthy for at least two reasons. First, unlike in most other health system merger challenges, the two merging systems in this matter were not direct competitors. Second, the merging parties agreed to a number of limitations on their conduct going forward – including price controls and the appointment of a “monitor” to oversee their compliance going forward – that are quite uncommon and restrictive.

Continue Reading California Attorney General Settlement of Hospital Merger Challenge Potentially Raises the Stakes for Hospital Mergers Nationwide

Claiming that “federal inaction” has caused a weakening of competition in many U.S. industries, on July 9 President Biden issued an Executive Order directing the Attorney General and the Chair of the Federal Trade Commission to “vigorously” enforce the antitrust laws.  While the Order seeks to increase antitrust enforcement across a wide range of industries, President Biden singles out the healthcare industry for special attention and heightened enforcement. See Executive Order Fact Sheet.

Continue Reading Biden Executive Order Calls out the Healthcare Industry for More Vigorous Antitrust Scrutiny

While much of the antitrust world is focused on the actions brought by federal and state antitrust regulators against “big tech,” the Senate Judiciary Subcommittee on Competition Policy, Antitrust and Consumer Rights recently held a hearing to consider the impact of hospital consolidation on the healthcare industry and consumers.  Led by Subcommittee Chairwoman Senator Amy Klobuchar, the Committee heard divergent views on the causes of hospital consolidation and its potential impacts on consumers.

Continue Reading Senate Antitrust Subcommittee Turns the Spotlight on Hospital Consolidation