Abstract

The vast consolidation among health-care providers in the aftermath of the Affordable Care Act’s enactment has led to much debate over the benefits of mergers in the health-care industry. In 2016, the Federal Trade Commission filed motions in federal court to enjoin three hospital mergers in various parts of the country. This amounted to more challenges to hospital mergers in a single year than any year in recent history. Though two of these motions succeeded at the district court level, both were overturned on appeal, which led many to wonder what the effect of these decisions would be on future health-care mergers.

While many fear that hospital mergers lead to higher prices for consumers, there are also those who contend that mergers lead to efficiencies, which allow merging parties to utilize resources more effectively, increase the quality of patient care and coordination, and potentially save lives. This Note argues that the possibility of quality-enhancing or life-saving efficiencies is worth the risk that consumers see increased prices. To allow mergers that may realize these types of efficiencies, antitrust enforcement agencies and courts must begin placing greater weight on merging parties’ efficiency arguments by easing the current standard. Additionally, in light of new research suggesting that cross-market health-care mergers, or mergers between providers in different geographic markets, affect bargaining dynamics between providers and insurers, this Note argues that parties’ relative bargaining power must be considered in agencies’ and courts’ analyses of the competitive landscape relevant to a merger.