Hospital Mergers Unlikely to be Affected by Antitrust Ruling

On Tuesday, however, the high court ruled that the appeals court had "loosely" interpreted a state law cited by Phoebe Putney to justify a merger that would give the consolidated health system control of about 85% of the market in the region. The high court reversed the appeals court ruling and sent the case back to federal district court.

Jay Levine, a specialist in healthcare antitrust issues with the Washington, DC office of Bradley Arant Boult Cummings LLP, says the high court's ruling clarifies a standard for state action immunity that could have broad implications for a broad array of industries beyond the healthcare sector.

Beyond that, however, Levine says the ruling won't apply for the majority of hospital mergers and acquisitions.

"The Supreme Court clarified that the 11th circuit interpretation of foreseeability was far too loose. In that respect it could have broader implications. But most transactions among hospitals today are not done pursuant to any hospital authority, are really just private transactions so state action really isn't applicable," Levine told HealthLeaders Media.

"For a normal private transaction between a hospital system, for example reducing the number of hospital from four to three, and not done pursuant to any state policy or not done under the auspices of a hospital authority or the like, this will not impact that whatsoever."

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