Healthcare continues to be highly scrutinized by the antitrust enforcement agencies. The latest enforcement action involved the merger of two competing outpatient surgery center companies. On October 31, the Federal Trade Commission ("FTC") announced that it entered into a proposed settlement regarding its challenge of Surgery Partners' $792 million acquisition of Symbion. The proposed settlement requires Surgery Partners to divest its interest in the newly acquired Blue Springs Surgery Center in Orange City, Florida to an FTC-approved buyer within 60 days.
The antitrust enforcers consider multiple factors when evaluating a healthcare merger’s potential impact on consumers, including the merged company’s market share, the number of competitors in the market and whether new competitors can or will enter the market. The FTC's complaint alleged that the Surgery Partners-Symbion merger would combine the only two multi-specialty ambulatory surgery centers in Orange City, leaving only one meaningful alternative in the broader southwestern Volusia County area. The FTC alleged the merger would lead to increases in price and a decrease in quality or availability of outpatient surgical services. The merging parties’ agreement to divest the Blue Springs facility allows them to avoid litigating with the FTC.
This is not the FTC's first challenge of an outpatient surgical services acquisition. In 2012, a health system abandoned its proposed acquisition of Surgical Institute of Reading after the FTC filed an administrative complaint challenging the merger as anticompetitive. This latest case is further confirmation that healthcare companies contemplating an acquisition, merger, or other form of consolidation should fully consider the possible antitrust risks and consequences that the potential transaction may present.
A copy of the FTC's complaint may be obtained here.