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Policy and Regulation News

House Committee Passes Bill with Healthcare Merger Implications

The House Judiciary Committee has voted to change the review process of possible antitrust violations, which may impact future healthcare merger strategies.

House Committee vote may impact future healthcare mergers

Source: Thinkstock

The House Judiciary Committee has voted 16-10 in favor of a bill that would revise and standardize part of the process of reviewing mergers for potential antitrust violations.  

The Standard Merger and Acquisition Reviews Through Equal Rules Act (SMARTER Act) of 2017 would block the Federal Trade Commission’s (FTC) ability to challenge a merger and limits their power to court injunctions.

Amendments in the new bill gives the Department of Justice’s Antitrust Division and the FTC the same authority and procedures in reviewing mergers and similar acquisitions. The intent of the bill is to allow both the DoJ and FTC to freely review a possible merger, without the FTC’s internal ability to challenge DoJ litigation.

The result could be more streamlined mergers and acquisitions between healthcare organizations, including hospitals or private payers, says the American Hospital Association, which applauded the Committee for moving the legislation forward.  

“The SMARTER Act removes a regulatory roadblock to hospital realignment. While AHA supports enforcement of the antitrust laws, relying exclusively on the federal courts to determine the competitiveness of a transaction ensures that hospitals, and others, receive a full hearing on the merits,” said AHA Executive Vice President Tom Nickels in a letter addressed to the Congressional group.  

“Requiring both antitrust agencies to prove their case before a judge in the federal courts and not just internal proceedings in which the agency has an advantage protects due process and promotes efficiency. The SMARTER Act ensures a neutral judge makes a decision on the merits of each merger and leads to a quicker resolution so parties have certainty about their case.”

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