The 7th U.S. Circuit Court of Appeals ruled in favor of the Federal Trade Commission (FTC) and the state of Illinois in an ongoing legal battle over a merger between Advocate Health Care and NorthShore University HealthSystem.
The appellate court turned the case back over to the district court that previously ruled to allow the merger, stating, “Even with the deference we give a district court’s findings of fact, the district court’s geographic market finding here was clearly erroneous.”
Advocate Health has 11 hospitals and a children’s hospital with two campuses. NorthShore has four hospitals. All are in Cook and Lake counties. The FTC believes that a merger would negatively affect competition in the region, leading to price increases at the Advocate-NorthShore hospitals. The circuit court judges also said insurers would likely have to pay higher prices to keep the Advocate-NorthShore hospitals in their provider networks.
The FTC’s proposed definition of the geographic market that would be affected by the merger includes 11 hospitals in the northern suburbs of Chicago, and six of them are Advocate Health or NorthShore hospitals. The health systems contend that the FTC’s definition excludes major competitors in the Chicago metropolitan area.
It is now up to the district court to decide whether to issue a preliminary injunction against the merger.