Pa. Blues Merger Plan Raises Eyebrows

“Just the leak of the possibility of a takeover led to a firestorm of protest by others, including immediate calls for investigation from the Pennsylvania legislature,” Capital Blue says in the statement.

“Given the inevitable adverse effects of the proposed combination, we expect it will be scrutinized for its long-term effect on, among other things, health care prices, costs and access, competition and local control over health care decisions,” the company says. “Experience demonstrates that the state’s health care system provides affordable, high quality health care when there is more competition, not less.”

Carolyn Scanlan, president of the Hospital & Healthsystem Association of Pennsylvania, Harrisburg, put out a statement of her own raising questions about the proposed deal.

“Such a merger has significant implications for hospitals and, more importantly, for the patients and communities that hospitals serve.” Scanlan says. “Hospitals and health systems will participate in the regulatory approval processes at the state and federal levels. We will be looking for detailed analyses and information about the proposed new company…. An open and transparent process by all parties in regard to all aspects of the merger is essential.”

Moody’s analysts describe regulatory hurdles as a potential hurdle for Highmark, but an S&P analyst says regulatory risk should be a manageable risk for Highmark.