BOISE, Idaho — St. Luke's Health System's request to stay a court ruling that its acquisition of Nampa-based Saltzer Medical Group violated federal antitrust laws has been rejected.
U.S. District Judge B. Lynn Winmill in an order dated Wednesday told St. Luke's to immediately release Saltzer from its ownership to avoid harming competitors.
"Perhaps most importantly, a stay would lock into place the anticompetitive bargaining advantage that St. Luke's could continue to use to its advantage," Winmill wrote in the six-page ruling. "There are a myriad of ways to use this advantage other than price increases, and it could cause substantial injury to consumers."
St. Luke's Health System contended that its acquisition in 2012 of Saltzer Medical Group would drive down health care costs and improve health care.
Saint Alphonsus Regional Medical Center, the Federal Trade Commission, and Idaho Attorney General Lawrence Wasden in 2012 filed a lawsuit seeking to halt the acquisition. They argued that the buyout was an illegal market grab giving St. Luke's an unfair advantage.
Winmill in January ruled the year-old buyout needed to be unwound because it's likely the deal would raise health care costs by giving the hospital a dominant market position.
St. Luke's in March asked for a stay of the ruling pending an appeal. Winmill cited four reasons in his ruling Wednesday to reject that request.
First, he said, St. Luke's is not likely to have the initial decision reversed based on the merits of the case.
Second, he rejected St. Luke's argument that there is a probability of irreparable injury if the stay isn't granted. Winmill said there will be some hardship because of the unwinding, but that it "will not rise to the level of irreparable injury."
Winmill also rejected St. Luke's argument that other parties wouldn't be substantially injured if the stay were granted, noting that physician referrals to St. Luke's rise when a physician practice is acquired.
"There is no guarantee that will not continue if a stay is imposed, causing injury to the private plaintiffs in this case," he wrote.
Winmill in the ruling struggled again with the public interest aspect of the case, just as in his initial ruling, and whether a stay would be in the public's interest. He went so far as to quote his January ruling:
"The Acquisition was intended by St. Luke's and Saltzer primarily to improve patient outcomes. The Court believes that it would have that effect if left intact, and St. Luke's is to be applauded for its efforts to improve the delivery of health care in the Treasure Valley. But there are other ways to achieve the same effect that do not run afoul of the antitrust laws and do not run such a risk of increased costs. For all of these reasons, the Acquisition must be unwound."
After citing his previous ruling, he wrote in his most recent decision that "the public interest element is a wash because it both supports and rejects a stay."
On a related front, the Idaho attorney general, Saint Alphonsus Health System and Treasure Valley Hospital in March filed a motion seeking more than $10 million in reimbursement from St. Luke's to recover attorney fees.
"The Legislature made it very clear in adopting the Idaho Competition Act that taxpayers should not have to bear the financial burden of defending the law and protecting the marketplace," Idaho Attorney General Lawrence Wasden said at the time.
Information from: Idaho Statesman, http://www.idahostatesman.com