FARGO 鈥� The Federal Trade Commission is aiming to block the proposed merger of Sanford Health and the Mid Dakota Clinic in Bismarck on grounds that it would reduce competition in the health care market.
The North Dakota Attorney General鈥檚 Office will join with the FTC in seeking federal court action to block the deal, arguing that it would violate federal antitrust law. The agencies announced Thursday, June 22, that they will seek a temporary restraining order and preliminary injunction to stop the deal pending an administrative trial, scheduled to begin Nov. 28.
鈥淭his merger is likely to reduce significantly the competitive options available to medical insurance providers, which in turn will lead to deteriorating terms for provision of medical care, including higher prices and lower quality,鈥� Tad Lipsky, acting director of the FTC鈥檚 Bureau of Competition, said in a statement.
鈥淭he parties currently compete to join commercial insurers鈥� provider networks, stimulating each other to improve their technology, expand services, recruit high-quality physicians and provide patients with convenient and accessible physician and surgical services,鈥� Lipsky added. 鈥淭he transaction would eliminate that competitive pressure.鈥�
Sanford and Mid Dakota Clinic issued a joint statement saying they intend to 鈥渧ehemently defend鈥� their planned merger, and expressing frustration over the legal challenge.
鈥淭he best way to describe our reaction is that we are exasperated with the delay that the FTC鈥檚 inquiry has already caused, and that these proceedings will continue to cause,鈥� Dr. Shelly Seifert, Mid Dakota鈥檚 board chairwoman, said in a statement. 鈥淚t is very disappointing because patients rely on us to continually look for ways to enhance care, improve quality and expand service and access for them and their families. That鈥檚 exactly what this merger does.鈥�
Dr. Craig Lambert, executive vice president of Sanford Bismarck, expressed bafflement over regulators鈥� actions.
鈥淲e intend to vehemently defend our efforts to enhance medical care in central and western North Dakota,鈥� he said in a statement. 鈥淭his partnership is good for patients, the community, and anyone who would come to us in their time of need. We are honestly shocked that the FTC and attorney general would continue to deprive people of access to enhanced medical care for an unknown period of time. It just doesn鈥檛 make any sense.鈥�
Sanford and Mid Dakota Clinic now are, according to the FTC, the 鈥渃losest rivals鈥� in the four-county Bismarck-Mandan region, an area with a population of 125,000.
The transaction would create a group of physicians with at least a 75 to 85 percent share of physician services in adult primary care, pediatric services, as well as obstetrics and gynecology.
Sanford Bismarck employs 160 physicians and 100 mid-level practitioners in its network of clinics. Sanford Medical Center Bismarck has 217 hospital beds. Mid Dakota Clinic employs 61 physicians and 19 advanced practice practitioners and operates six clinics in Bismarck, as well as a Center for Women and an ambulatory surgery center.
The Federal Trade Commission voted 2 to 0 to issue the administrative complaint and authorize its staff to seek legal action barring the merger.
The regulators鈥� move to block the merger comes one day after Sanford and Mid Dakota announced that they have signed an agreement, taking a step closer to the merger, and expect to join together soon.
The two organizations announced their intent to merge in September 2016.
Through a spokeswoman, Attorney General Wayne Stenehjem declined to comment on his office鈥檚 effort to block the merger. The North Dakota Attorney General鈥檚 Office said it had received four consumer complaints opposed to the merger.
All four complaints, via email messages, were received Thursday morning, according to copies obtained by The Forum.
鈥淧lease don鈥檛 allow the merger between Sanford and Mid-Dakota to take place,鈥� Fred Zeeb wrote. 鈥淚t takes away the freedom of choice for ALL citizens of the Bismarck/Mandan and surrounding areas. It gives Sanford a monopoly and too much power.鈥�
鈥淭he management of Sanford wants to own every hospital and clinic in North Dakota and South Dakota,鈥� Darryl Galt wrote. 鈥淓very time they purchase another hospital, clinic, etc., it gives them more control to raise prices and change hospital procedures in an effort to increase their profitability.鈥�
