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Antitrust Keyed to Gavil, 5th Ed.
Federal Trade Commission v. Phoebe Putney Health System, Inc.
Citation:
133 S.Ct. 1003, 568 U.S. 216, 185 L.Ed.2d 43 (2013)Facts
In 1941, Georgia enacted the Hospital Authorities Law, creating public entities called hospital authorities with powers to acquire and operate healthcare facilities. The Hospital Authority of Albany-Dougherty County was established that year and acquired Phoebe Putney Memorial Hospital. In 1990, the Authority restructured operations by creating two private nonprofit corporations to manage the hospital: Phoebe Putney Health System (PPHS) and its subsidiary Phoebe Putney Memorial Hospital, Inc. (PPMH). The Authority leased Memorial to PPMH for $1 per year for 40 years, giving PPMH exclusive authority over operations. Memorial was one of two hospitals in Dougherty County, with Palmyra Medical Center being its only competitor. Together, they accounted for 86% of the market for acute-care hospital services in the area, with Memorial alone controlling 75%. In 2010, PPHS began discussions to acquire Palmyra from HCA, Inc. The plan involved the Authority purchasing Palmyra with PPHS-controlled funds and then leasing it to a PPHS subsidiary under the same lease agreement. The FTC challenged this transaction as anticompetitive.
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