Complaint filed against Phoebe acquisition

The Georgia Attorney General's Office filed a joint complaint with the Federal Trade Commission (FTC) on Tuesday in federal district court in Albany seeking to delay Phoebe Putney Health System's proposed acquisition of Palmyra Park Hospital after the FTC decided by a unanimous vote to request an injunction of the merger.

The Attorney General's Office and the FTC are seeking an order enjoining any transaction involving Phoebe Putney, the Hospital Authority of Albany-Dougherty County or Palmyra Park Hospital under which Phoebe Putney would acquire control of Palmyra's operations until the FTC's administrative proceeding and subsequent appeals are complete.

"I want all to know the Hospital Authority of Albany and Dougherty County and Phoebe Putney have cooperated 110 percent with every request made of it by the Federal Trade Commission," says Phoebe's CEO Joel Wernick. "It is disheartening that the FTC would attempt to block this transaction."

In an email the FTC Public Affairs Office says, "By a 5-0 vote, the Federal Trade Commission today challenged Phoebe Putney Health System, Inc.'s (Phoebe's) proposed acquisition of rival Palmyra Park Hospital, Inc. (Palmyra) from HCA, in Albany, Georgia. The FTC's administrative complaint alleges that the deal will reduce competition significantly and allow the combined Phoebe/Palmyra to raise prices for general acute-care hospital services charged to commercial health plans, substantially harming patients and local employers and employee."

The complaint by the Attorney General's Office and FTC says that the proposed transaction would violate federal law by eliminating competition that currently exists between Phoebe and Palmyra as well as the surrounding six-county area. The complaint also says that Phoebe has "used the Hospital Authority to cloak private, anticompetitive activity in governmental guise in the hopes that it would exempt the acquisition from federal antitrust law."

"All I know is that the Hospital Authority and Phoebe Putney Hospital for the last 100 years have served this community with its doors open to citizens regardless of their personal circumstances," says Wernick.

Wernick says there is a dire need to expand medical care in the community and that he's confident in the hospital's acquisition of Palmyra, but with all of the delays from the investigations, the community is not sure the Phoebe-Palmyra transaction will close at this point.

"I don't think the merger is going to happen. They keep putting it off over and over," says Natalie Richardson from Albany. "People are really concerned about it because Palmyra is a hospital on its own and we really want to see it grow."

"It's probably okay but competition is good, and if Palmyra goes away, Phoebe has the whole thing to themselves," says Harold Frantz from Albany.

"You need competition. Any time you have a monopoly then the prices go up and it's just really bad for the community when they don't have choices," says Al Walker who lives in Albany.

The complaint is not a finding or ruling that the defendants have violated the law. A complaint is filed only when there is "reason to believe" that the law has or is being violated.

The allegations will be ruled upon after a formal hearing by a judge, and Wernick says he is not sure when that will be.

To read more about the FTC investigation into Phoebe Putney and the HCA, read the following story from FOX 31.