Justice Department resolves antitrust case against Central Pennsylvania healthcare providers

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Justice Department resolves antitrust case against Central Pennsylvania healthcare providers

Press releases may be edited for formatting or style | March 04, 2021 Business Affairs

If approved by the court, the proposed settlement, filed today in the U.S. District Court for the Middle District of Pennsylvania, would resolve the competitive harm alleged in the complaint. The terms of the settlement are intended to prevent Geisinger from exercising any form of control or influence over Evangelical and to restore the defendants’ incentives to compete with each other on both quality and price. In addition to capping Geisinger’s ownership interest in Evangelical, the proposed settlement restricts Geisinger from increasing its ownership interest in Evangelical, making any loan or providing any line of credit to Evangelical, or exerting any control over Evangelical’s expenditure of funds. Defendants are also each required to implement an antitrust compliance program.

While fully addressing the harm threatened by the partial-acquisition agreement, the settlement allows procompetitive aspects of defendants’ proposal to move forward. Specifically, the settlement permits Evangelical to obtain new electronic health records information technology systems and related IT support from Geisinger, enabling Evangelical to upgrade its electronic health records systems and improve the delivery of care to patients in central Pennsylvania. The settlement also requires Evangelical to use the funds associated with Geisinger’s passive investment for specific projects that will benefit patients and the community.

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Geisinger is an integrated regional healthcare provider of hospital and physician services in Pennsylvania. It operates 12 hospitals as well as urgent-care centers and outpatient facilities, and owns physician practices throughout Pennsylvania. Its flagship hospital, Geisinger Medical Center, is a 574-bed hospital located in Danville, Pennsylvania. Geisinger Health’s annual revenue in 2019 was approximately $7.1 billion.

Evangelical Community Hospital is a 132-bed independent community hospital in Lewisburg, Pennsylvania. It also operates an urgent-care center and several other outpatient facilities, and owns a number of physician practices in central Pennsylvania. Its annual revenue in 2019 was approximately $259 million.

As required by the Tunney Act, the proposed settlement, along with a competitive impact statement, will be published in the Federal Register. Any person may submit written comments concerning the proposed settlement during a 60-day comment period to Eric Welsh, Chief, Healthcare and Consumer Products Section, Antitrust Division, U.S. Department of Justice, 450 Fifth Street NW, Suite 4100, Washington, DC 20530. At the conclusion of the 60-day comment period, the U.S. District Court for the Middle District of Pennsylvania may enter the final judgment upon finding it is in the public interest.

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