Becker's Hospital Review

15 CFO / FINANCE Court halts New Jersey hospital merger By Ayla Ellison A New Jersey federal court on Aug. 4 grant- ed the Federal Trade Commission's bid to block the planned merger of Edison, N.J.-based Hackensack Meridian Health and En- glewood (N.J.) Health. e FTC, which requested a preliminary in- junction against the transaction, filed an ad- ministrative complaint in December. e court's decision allows the agency to pursue an administrative case against the deal. At the time of publication, the trial was slated to begin Oct. 12. In its complaint, the FTC said the proposed trans- action would eliminate close competition between Hackensack Meridian and Englewood, and the merged system would control half of the acute care hospitals in Bergen County, N.J. e court's opinion and reasoning were filed un- der seal, but more information will be released. e parties were ordered to tell the court by Aug. 18 which portions of the opinion should remain under seal and the legal basis for doing so. "Too many hospital mergers lead to jacked up prices and diminished care for patients most in need," FTC Office of Public Affairs Director Lind- say Kryzak said in a statement aer the court's de- cision. "It remains a mystery why these two hospi- tal systems decided to pursue a highly suspicious merger in the middle of a global pandemic. e court has hit pause on this merger, which the FTC alleges is unlawful. Hospital executives hatching merger plans should take note." Hackensack Meridian and Englewood Health, which signed a definitive agreement to merge in October 2019, said they would review the judge's opinion and evaluate their options. "is opinion is very unfortunate for the residents that Hackensack Meridian Health and Englewood Health serve," the organizations said in a joint statement. Hackensack Meridian Health and Englewood Health said the merger is in the best interest of pa- tients and would allow the organizations to invest in programs and services, achieve cost efficiencies, and improve access to care, quality outcomes and affordability of care. Hackensack Meridian Health and Englewood Health filed an appeal Aug. 26. e case is pending in the U.S. Court of Appeals for the 3rd Circuit. n Mayo Clinic quadruples operating income in second quarter By Ayla Ellison M ayo Clinic's financial and operating performance was strong for the second quarter, with revenue gains offsetting higher expenses, ac- cording to financial documents released Aug. 19. Rochester, Minn.-based Mayo's revenue totaled $3.99 billion in the second quarter of this year, up more than 26 percent from the same period a year earlier. Net medical service revenue was up nearly 38 percent year over year. The health system, which has hospitals in Minnesota, Arizona, Florida, Wiscon- sin and Iowa, said more surgeries were performed at its facilities in the second quarter of this year than in the same period of the previous two years. Outpa- tient visits and hospital admissions were up from 2020 but lower than in 2019. The health system's operating expenses climbed 15.5 percent year over year to $3.5 billion in the second quarter of this year. Mayo saw expenses increase across several categories, including supplies, and salaries and benefits. Mayo ended the second quarter of 2021 with operating income of $451 million, up from $97 million a year earlier. After factoring in nonoperating income and one-time adjustments, net in- come for the second quarter was $1.25 billion, up from $403 million in the same period of 2020. Mayo was in a strong financial position before the COVID-19 pandemic hit. The system had a record performance year in 2019, with revenue of $13.8 billion and operating income of more than $1 billion. The system's finances temporarily suffered after it deferred elective care in March 2020, and Mayo closed out last year with operating income of $728 million, a 23.5 percent year-over-year decrease. n Health systems vie for market share in East Georgia By Morgan Haefner S everal health systems in Georgia are eyeing expansions east of Atlanta at the state's border with South Carolina, according to Fox 54. Augusta University Health, University Health Care System and Doctor's Hospital — all in Augusta, Ga., — are planning projects in the area. Augusta University Health plans to open the first hospital in Columbia County, according to Fox 54. In a July interview, Augusta University Health CEO Katrina Keefer said: "It's very important for Columbia County for it to continue to have businesses wanting to come in and invest. Having a sustain- able health structure closer to home I think is going to be very important for future businesses to want to come in." University Health Care System is building a prompt-care and occupational health facility in Appling, Ga. Scott Ansede, COO of University Health Care System, told Fox 54 the system wants to be where the growth is. Doctor's Hospital also received approval to build a freestanding emergency department in nearby Evans, Ga. University Health Care System and Augusta Health System have appealed the project, according to the report. n

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