The Federal Trade Commission filed an administrative complaint against the proposed merger of Advocate Health Care Network and NorthShore University HealthSystem, authorizing action to block the deal.
“Advocate is one of the largest health systems in the Chicago area, and it competes directly with NorthShore in the northern suburbs of Chicago,” said Debbie Feinstein, Director of the FTC’s Bureau of Competition. “This merger is likely to significantly increase the combined system’s bargaining power with health plans, which in turn will harm consumers by bringing about higher prices and lower quality.”
In a press release, FTC said the complaint alleges that if the merger takes place, neither entry by new providers in the North Shore area nor expansion by current ones will offset the likely harm to consumers caused by the lost competition. The complaint also alleges that the potential cost savings and purported quality improvements claimed by the parties to result from the merger are neither substantiated nor merger-specific, and are insufficient to outweigh the likely competitive harm resulting from the merger.
On December 28, 2015, the health systems agreed to a temporary restraining order to put the deal on hold. A U.S. District Court is set tot hear arguments for a permanent injunction in April.