FTC Blocks Merger Of Two New Jersey Hospitals

The Federal Trade Commission announced Tuesday that two hospital systems in New Jersey that were planning to merge have canceled those plans, following an FTC complaint that a merger would be anticompetitive. 

“The transaction would have combined two hospitals located less than a mile from each other, which also happen to be the only two hospitals in the city of New Brunswick, New Jersey,” Federal Trade Commission Bureau of Competition Director Holly Vedova said in a news release. “With combined shares of approximately 50 percent for inpatient general acute care services in Middlesex County, New Jersey, the transaction was presumptively unlawful and would have resulted in higher prices and lower quality of care for New Jersey residents.”

The hospitals planning to merge include RWJBarnabas Health, one of the largest healthcare systems in New Jersey with $6.6 billion revenue in 2021, and Saint Peter’s Healthcare System, which operates an independent hospital near RWJ’s general acute care hospital. The two hospital systems compete for inclusion in health insurance plans, and also compete for patients. 

“This difficult decision was not reached lightly,” said Barry H. Ostrowsky, chief executive officer of RWJBarnabas Health in a news release. “We are disappointed in the termination of the proposed transaction, which we believe would have transformed quality, increased access and decreased the overall cost of care for the people of this State through the creation of a premier academic medical center.” 

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