FTC Staff Provides Additional Comment and Testimony in Tennessee Opposing Mountain States’ and Wellmont’s Certificate of Public Advantage Application

Staff finds health systems’ application fails to show potential benefits of proposed COPA outweigh likely harm to consumers

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Federal Trade Commission staff submitted an additional public comment to the Tennessee Department of Health that opposes issuing a certificate of public advantage (COPA) to Mountain States Health Alliance and Wellmont Health System that would allow the two companies to merge. This comment responds to consultant reports commissioned by Mountain States and Wellmont and submitted in connection with their Tennessee COPA application, and supplements previous comments submitted in November 2016 and January 2017.

As in prior comments to Tennessee, staff of the FTC’s Bureau of Competition, Bureau of Economics, and Office of Policy Planning express concern that the lost competition from the proposed merger of Mountain States and Wellmont would significantly harm residents of northeast Tennessee and southwest Virginia. The staff emphasizes that the two hospital systems have failed to show that the consumer harm from the proposed merger would be outweighed by its purported benefits, or offset by the applicants’ proposed commitments. FTC staff conclude that the applicants’ consultants’ reports “fail to provide sufficient additional information or analysis to demonstrate by clear and convincing evidence that the purported benefits of this merger would outweigh the serious competitive harm that would likely result from creating a near-monopoly.”

FTC staff also delivered oral remarks at a public hearing before the Tennessee Department of Health in Blountville, Tennessee, highlighting some of the shortcomings with the applicants’ consultants’ reports and recommending that Tennessee deny the COPA.

The Commission vote to issue the staff comment and to authorize public oral testimony was 2-0. The comment was sent to the Tennessee Department of Health on July 18, 2017. (FTC File No. 1510115; 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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