FTC Challenges Reading Health System's Proposed Acquisition of Surgical Hospital

The Federal Trade Commission today authorized an action to block Reading Health System's proposed acquisition of Surgical Institute of Reading, according to an FTC report.

The FTC alleged that the combination of the two healthcare providers would substantially reduce competition in the area surrounding Reading, Pa., and lead to reduced quality and higher healthcare costs for the area's employers and residents.

The FTC, jointly with the Pennsylvania Attorney General, will file a complaint in federal district court next week, seeking a preliminary injunction to stop the deal pending an administrative trial. The FTC has also issued an administrative complaint, initiating a proceeding that will determine the legality of the transaction.

"The FTC is challenging this acquisition because it would lead to higher overall health care costs for employers and patients in the Reading area," said Bureau of Competition Director Richard Feinstein. "While SIR is not a full-service general acute-care hospital, it has injected important price and quality competition into the Reading area. That competition will be lost if this deal goes forward."

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