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At a public hearing in Abingdon, Virginia, held today, FTC staff presented oral remarks to the Southwest Virginia Health Authority and the Virginia Department of Health summarizing staff’s analyses and conclusions that the cooperative agreement application submitted by Mountain States Health Alliance (Mountain States) and Wellmont Health System (Wellmont) should be denied. If approved, the cooperative agreement would purport to allow the merger of Mountain States and Wellmont to proceed.

Responding to the Authority’s request for public comment, Federal Trade Commission staff submitted a written comment stating that the cooperative agreement would not benefit consumers. Staff of the FTC’s Bureau of Competition, Bureau of Economics, and Office of Policy Planning set forth their concern about the cooperative agreement, following a year-long investigation of the proposed merger to near-monopoly between Mountain States and Wellmont.

“The proposed merger presents substantial risk of serious competitive and consumer harm in the form of higher healthcare costs, lower quality, reduced innovation, and reduced access to care,” the written comment states. Moreover, FTC staff notes that the harms to consumers likely “would not be outweighed by any potential benefits of the merger, nor would it be eliminated or effectively mitigated by regulating the combined entity’s post-merger conduct. Competition is the most reliable and effective mechanism for controlling healthcare costs while preserving quality of care.”

The Commission vote to issue the staff comment was 3-0, as was the vote to authorize public oral testimony. The comment was sent to the Southwest Virginia Health Authority and the Virginia Department of Health on September 30, 2016. (FTC File No. 151-0115; the staff contacts are Goldie Walker, Bureau of Competition, 202-326-2919, and Stephanie Wilkinson, Office of Policy Planning, 202-326-2084).

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