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Stein joins effort to halt hospital merger … in New Jersey

NC Attorney General Josh Stein

Nov. 9 — North Carolina Attorney General Joshua H. Stein, who approved the 2019 sale of nonprofit Mission Health System to for-profit HCA Healthcare, giving HCA a virtual monopoly on healthcare in Western North Carolina, today signed a legal brief in support of a district court’s ruling that halted the merger of two hospital systems in New Jersey.

Stein joined 24 other state attorneys general in filing the amicus brief with the United States Court of Appeals for the Third Circuit, arguing that hospitals facing less competition have the ability to charge higher prices without providing improvements to the efficiency or quality of care.

Asked by Asheville Watchdog to comment on why he entered the out-of-state legal fray over the proposed merger of Hackensack Meridian Health and Englewood Healthcare Foundation, his office responded:

“North Carolina, like other states across the country, has seen a wave of hospital consolidations over the past few years. While our office has a limited role in reviewing transactions related to consolidation, we are concerned about what they mean for North Carolinians’ health care.”

“Filing this brief is part of our continued efforts to do everything in our power to make sure that North Carolinians have access to affordable, quality health care, especially in rural and underserved areas in our state,” Stein’s statement to The Watchdog read.

But in the brief, Stein joined the other attorneys general in writing: “Mergers that substantially increase provider market share in local markets lead to increased healthcare costs in local communities and raise the overall cost of healthcare within the States . . . without any substantial improvements in quality for consumers.”

The $1.5 billion purchase of the six-hospital Mission Health System gave HCA a monopoly on healthcare in Western North Carolina. HCA raised prices by 10 percent six months after the sale, and in 2020 Mission Hospital ranked second among HCA’s 183 hospitals for the highest net patient revenues. The hospital’s safety ratings declined in the most recent ratings period.

Stein’s office has received hundreds of complaints from citizens and health care providers about rising costs and declining quality of care at Mission Hospital since he approved the sale to HCA. Stein has said he is “very concerned” about the reports.

In an interview with Asheville Watchdog in late August, Stein said that state law limited his ability to halt the sale of the Mission system to HCA despite “conflicts” uncovered by his investigation of the proposed transaction. Stein has not responded to The Watchdog’s questions about the nature of the conflicts his investigators reported finding.

Because of the law’s restrictions, Stein said in August, he would have no choice but to make the same ruling today as he did in 2019, when the 20 members of Mission Health’s volunteer board of trustees voted unanimously to sell to HCA, despite considering only one other bid. — Peter Lewis

[This post was updated to include a response from the attorney general’s office.]

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