A Federal Trade Commission lawsuit challenging New Orleans-based LCMC Health’s acquisition of three regional hospitals as a possible antitrust violation has been transferred from Washington, D.C., to Louisiana.
D.C. District Judge Amy Berman Jackson issued the transfer order to the Eastern District of Louisiana May 23 in an action welcomed by LCMC Health. LCMC acquired the hospitals – Tulane University Medical Center, Lakeview Regional Medical Center and Tulane Lakeside Hospital – in January without informing federal antitrust agencies.
In April, the FTC sued the health system to stop further integration of the New Orleans-area hospitals pending a review of whether the purchase violated federal antitrust laws. But LCMC, which filed a parallel case in New Orleans challenging the FTC actions, argues that the acquisition is immune from an antitrust challenge due to the purchase’s authorization by the state Legislature and state attorney general.
“We wholeheartedly agree with the court’s action to transfer this to Louisiana, and we support the decision that the merits of our partnership with Tulane University will be considered in our own community,” Ayame Dinkler, LCMC’s chief administrative officer, said in a statement emailed to the Louisiana Record. “We remain steadfast that the LCMC Health-Tulane University partnership is of significant benefit to our community and region, bringing another academic center of excellence to the region and enhancing patient care for all.”
On May 17, six health care groups, including the Louisiana Hospital Association, urged the FTC to end its challenge to the LCMC merger.
“The commission’s actions appear to be part of a growing pattern of what one former commissioner called an agency-wide policy of ‘gratuitously taxing’ mergers and acquisitions, which he explained ‘does nothing for competition,’” the letter says. “We urge the commission to rethink this policy and abandon its efforts to impede this merger through a costly and burdensome regulatory process.”
The FTC argues in its lawsuit that federal courts should freeze the integration of the three hospitals so that the commission can consider whether the merger violates amendments to the Clayton Act and would lead to excessive consolidation within the health care industry.