The antitrust lawsuit pitting St. Lukes Health System against Saint Alphonsus Health System, the Federal Trade Commission and the Idaho Attorney Generals Office was never pretty or uplifting because this was like watching a family squabble spill into the street.
U.S. District Judge B. Lynn Winmills decision Friday that St. Lukes broke antitrust laws when it bought Saltzer Medical Group, Idahos largest independent physicians practice, is a stark reminder that our hallowed health care systems are businesses, even though they operate as nonprofits pursuing altruistic goals.
We like to think all energy and resources of Idahos health institutions focus on healing and saving lives. Certainly the clinical branches do, and we in Idaho are served by some of the best. We are fortunate to have a choice for care.
Still, it is jarring to consider that the two pre-eminent nonprofit health care systems in the Treasure Valley just spent millions of dollars and considerable human resources fighting each other in court for a level playing field.
Winmill found St. Lukes to be wrongfully engaged in thwarting competition because of its purchase of Saltzer, which serves the Nampa-Caldwell corridor.
The acquisition was intended by St. Lukes and Saltzer primarily to improve patient outcomes. The Court is convinced that it would have that effect if left intact, and St. Lukes is to be applauded for its efforts to improve the delivery of health care in the Treasure Valley, Winmill wrote. But there are other ways to achieve the same effect that do not run afoul of the antitrust laws and do not run such a risk of increased costs. For all of these reasons, the acquisition must be unwound.
Reaction statements from Saint Alphonsus, the FTC, the Idaho attorney general, and St. Lukes and its CEO, Dr. David Pate a trained attorney and physician all include the word competition. Competition is not an ugly term or an ugly thing in health care. As patient care outcomes are more scrutinized in the post-Patient Protection and Affordable Care Act era, competition has the potential to promote more patient-focused care and reduced costs.
We have some concerns about the outcome of the relationship between Saint Als and St. Lukes after this, and about our own relationship with the courts. During the trial the majority of the testimony was redacted or done in a closed courtroom. The Statesman and several other news organizations filed suit in October against the court for access to all of the testimony not just what the lawyers deemed appropriate. That decision is still pending in the Ninth Circuit.
As St. Lukes ponders an appeal of Winmills decision, the half-life of what happened in this case reverberates nationwide in the hospital and health care industry. The new regulatory paradigm of Obamacare has awakened and broadened the competitive instincts of hospitals, many of which feel that they must ingest the medicine of mergers in their quest to survive and to lower costs.