The FTC is moving to lift a stay on a review of the Hospital Authority of Albany-Dougherty County's purchase of the former Palmyra Medical Center, now known as Phoebe North Campus.
ALBANY, Ga. — The Federal Trade Commission has filed renewed motions in its ongoing litigation related to the now consummated acquisition of the former Palmyra Medical Center, now Phoebe North Campus.
In filing the motions in the U.S. Court for the Middle District of Georgia, the FTC is seeking a temporary restraining order and preliminary injunction to stop the further integration of Phoebe Putney Memorial Hospital and Phoebe North as a means to ensure Palmyra’s assets are maintained until an administrative trial, scheduled for Aug. 5, is conducted on the merits of the acquisition.
“As the Transaction is now consummated, we request that this Court enjoin any further integration of the acquired hospital’s assets and operations, and preserve the status quo at Phoebe North (formerly Palmyra), pending the outcome of the Commission’s expedited administrative proceeding,” the amended complaint states.
“... The ongoing administrative proceeding will determine the legality of the Transaction, subject to judicial review by a federal Court of Appeals, and provides a forum for all parties to conduct full discovery and present evidence regarding the likely effects of the Transaction and any affirmative defenses raised,” the FTC said.
On April 20, 2011, the FTC filed an action in U.S. District Court seeking to block the then-proposed combination of the two hospitals. The FTC contended the deal would reduce competition significantly and allow for a rise in prices for general acute-care hospital services charged to commercial health plans, harming patients and local employers and employees.
The agency further contended that the transaction positioned the Hospital Authority of Albany-Dougherty County as a strawman to shield the acquisition from federal antitrust scrutiny.
Officials at Phoebe Putney Memorial Hospital say the requested action would prevent any improvements or renovations planned for the facility to enhance patient care for the residents served by the hospital.
Phoebe officials also say that before this latest filing, the FTC, on two separate occasions, refused Phoebe’s offer to “stand down” and do nothing to alter the facility pending further administrative proceedings in Washington, D.C.
“We will proceed to protect the organization and community interests in court. It’s unfortunate that so many resources must be committed by Phoebe, interfering with the Phoebe mission to deliver the best possible care and exceed the expectations of all we serve,” said Tommy Chambless, Phoebe senior vice president and general counsel, in a statement.
“The Hospital Authority of Albany-Dougherty County purchased the former Palmyra Medical Center from Hospital Corporation of America (HCA). This transaction involving a willing seller and buyer occurred because Phoebe has a need for the space to expand its women’s and children’s services including neonatal services, to enhance trauma care for Southwest Georgia, to meet long term acute care needs in our part of the state, and to address capacity needs for the delivery of intensive care and rehabilitation care, among other healthcare objectives, all to better meet the growing and demonstrated needs of the community.”
A spokesman for the FTC responded to The Albany Herald's request for further comment after presstime Thursday stating that the agency would not be making any additional comment.
On June 27, 2011, U.S. District Judge Louis Sands ruled that the $195 million purchase was immune from federal oversight. The FTC appealed to the 11th U.S. Circuit Court of Appeals, which affirmed the district court’s ruling the following December — allowing the acquisition go through.
The FTC appealed to the U.S. Supreme Court. On Feb.19, the high court ruled unanimously that the state action doctrine did not give antitrust law immunity for the hospital acquisition and remanded the case to the 11th Circuit Court of Appeals. Shortly after the ruling, the commission moved to lift the stay of administrative proceedings that had been issued on July 15, 2011.
That motion was granted on March 14, at which time the commission pushed to have a hearing begin no later than July 15. Documents available on the FTC’s website show that Phoebe filed a motion to delay the start of the hearings until December.
That motion was denied, but a three-week extension was granted, the documents show.