FTC stalls hospital sale

FTC stalls hospital sale

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Prince William Hospital in Manassas

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By Susan Svihlik

Published: May 9, 2008

The Federal Trade Commission has authorized a temporary restraining order to stop the Inova Health System Foundation from buying the Prince William Health System, Inc., which owns Prince William Hospital.
A recent FTC press release stated that the commission voted unanimously to approve a complaint challenging the deal and issued a preliminary injunction to stop the sale pending an administrative trial.
The complaint held that if the sale went through, competition would be eliminated and health care costs would go up in Northern Virginia, the release stated.
“There is no question that Northern Virginia residents have benefitted from the robust competition between Inova and Prince William Hospital through better services and lower prices,” Jeffrey Schmidt, Director of the FTC’s Bureau of Competition wrote in the press release. “If Inova acquires Prince William Health System, this vital competition will be lost, health care prices will increase, and many residents will be forced to accept reduced health care coverage or no coverage at all.”
Trade commission spokesman Mitchell Katz could not predict when the administrative trial in federal district court would take place, but said the commission would probably expedite the process.
The action in federal district court will be brought jointly with the Attorney General of the Commonwealth of Virginia, the release stated.
“We’re planning, I believe, on filing the preliminary injunction action some time next week,” Katz said.
After the administrative law judge issues an a opinion, the loser can appeal to the full commission. Further appeals would be available at the higher appellate level as well, Katz said.
In a prepared statement Michael J. Schwartz, Prince William Health System president and CEO said the two companies were “extremely disappointed” that the deal was being challenged.
“The merger enjoys broad support from the community because residents, businesses and community leaders understand that it is critical towards addressing current and emerging health care needs in one of the nation’s fastest growing counties,” Schwartz said.
The Prince William organization sought the $200 million deal with Inova which Schwartz said would “transform PWHS into a high-quality, state-of-the-art hospital and ensure that PWHS continues to serve all residents of Prince William County, regardless of their ability to pay for such care.”
Speaking for Inova, Schwartz said the two companies would fight the challenge.

Reader Reactions

Posted by ( native1 ) on May 16, 2008 at 12:45 am

I hope INOVA buys PWHS. Prince William has the worst reputation around even INOVA nurses and doctors know that. I regret going there for medical treatment now. Prince William Hospital violates the HIPPA laws. I was standing in line to sign in and the nurse was triaging a patient out in public. I had no business knowing that the lady in front of me was depressed and taking Zoloft. They need to come up with a better system like INOVA when triaging patients.

Posted by ( KateRN ) on May 13, 2008 at 10:07 pm

Look at the facts--The CEO of PWHS has turned over his executive team at least twice. His credibility is held together by a thinning thread.  There is little doubt that INOVA won’t want him in the merger. The best thing that can happen for that hospital is to remove him before the merger so that INOVA can have clarity with what they are getting. The community would benefit from the innovative practices already in practice within the INOVA health systems. They however need good leadership to execute those practices.

Posted by ( John B ) on May 10, 2008 at 2:21 pm

I love the way Jeffrey Schmidt states that ““There is no question that Northern Virginia residents have benefitted from the robust competition between Inova and Prince William Hospital through better services and lower prices...” Anyone who’s had to go to the hospital at least once knows that NOBODY has benefited from the obscenely high doctors, hospital fees, and insurance cost at either hospital.  Competition is a misnomer in the health care industry as rates are kept high by the insurance conglomerates and the high dollar lobbyists.  The least the FTC could do is let us get good health care in our own county if we’re gonna go into debt for it.

Posted by ( BatemanMD ) on May 10, 2008 at 2:18 pm

I’m a Manassas resident, INOVA network physician and a survivor of the INOVA acquisition of Loudoun hospital, though the jobs of many of my co-workers did not “survive” that ‘merger’ (sale, acquisition or ‘take-over’ would be a more accurate term).  Even as a middle-aged resident with high cholesterol who would very much appreciate increased and improved cardiac-care in my immediate vicinity I still want to know how many Prince William jobs will be lost if the ‘merger’ occurs.  How many will lose their job and then be unable to afford their mortgage?  Until some answers are given and commitments made in writing, I do not believe the community will get behind the merger because PWHS is not just a healthcare resource, but a major area employer, as well.

The PWHS employees as well as Prince William residents deserve to know what the merger truly means for the current hospital, as do the surrounding communities and their businesses.  Our housing market in PWC is already in serious decline and if those who own homes and work near PWH lose their job then things will only get worse.  I doubt INOVA wants a presence in an area riddled with unemployment and foreclosures with a jobless, uninsured citizenry that is unable to afford medical treatment.  My HOA has already recommended residents in my subdivision write the FTC to oppose the merger because we have more than a dozen homes owned by PWHS employees in our midst, and the last thing any Manassas resident needs is yet another foreclosure bringing our already plummeting home values even lower.  If the merger ‘creates’ jobs at the expense of those currently employed, then it is not forward progress and not worth it.  The ‘merger’ will take away healthcare options, raise pricing and put an entire major suburban population under one organization’s thumb.

A release of a hospital-wide, unit-by-unit breakdown of what the merger entails for PWHS employees is a necessity that has long been ignored throughout all of the merger (SALE) talk.  If this means current employees would leave when they know that their job is not safe, find another job and SELL their house instead of LOSE it, then INOVA can foot the bill for agency employees and travel nurses.  They can afford it.  A fellow physician friend within PWHS is gravely concerned by all of this, which is why this individual suggested the means and method to contact the multitudes.  This doctor also witnessed the gutting of Loudoun and saw it transform from a community hospital to a franchise.  My corporate contacts here at INOVA laugh when they speak of the methods our lobbyists use when petitioning and pleading our case to the FTC, methods consisting of making PWHS look as ineffectual and incompetent as possible, though the numbers and critical reviews and accreditation of the hospital do not support this negativity.

In closing, there are no decent, humane reasons not to let people know what the merger will mean for them, not only for PWHS employees but the communities in which they live.  Unless answers are given to those deserving them, then the continued silence, apathy, negativity and overwhelming lack of support from the community will continue.  This same letter has been posted on various Manassas blogs and forums, e-mailed to Mr. Raker of INOVA and Ms. Ballou of PWHS (as suggested by the ‘merger’ website, pwcares.com) and has never received a response.  The current CEO of PWHS has announced he will be stepping down after the merger occurs.  He knows that the fallout will be severe.  We need to look at this a homeowners and neighbors so please forward it to yours.  Visit http://www.ftc.gov for contact info and how to express your feelings.

Posted by ( CaseyJones ) on May 09, 2008 at 10:15 pm

“shortytgs”....did you even read the article?  What “back and forth sale” are you referring to?  There has been no sale at all.  Also, your words should read “than they’re worth”...not “then their worth.” Too bad a third-party can’t come in and take over our county’s schools, too.  What “MASSIVE” screw ups are you writing about?  Every hospital makes mistakes and there is always human error involved in health care.  Have you heard about the guy who went blind when his INOVA nurses double dosed him on Heparin and he had a stroke?  Go take an English class and research your subject matter before you comment on a public forum, ‘shorty’.

Posted by ( wzacc ) on May 09, 2008 at 8:53 pm

Read the fine print folks!  The FTC says Inova is “buying” PWHS.  The CEO of PWHS says “merger”.  Who’s lying here and what kind of ‘spin’ is being sold to the employees and community?

Posted by ( shortytgs ) on May 09, 2008 at 4:59 pm

I am going to laugh hysterically at the part in this article where its stated that prince william county is getting better service from this back and forth sale. That is not true in the least! I can think of 3 cases off the top of my head where Prince william hospital has made MASSIVE screw ups and is costing more then their worth. This hospital takes more lives then it saves!

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