Braun approves Terre Haute hospital merger

After two years, two Terre Haute hospitals have received state approval to merge, despite anti-trust concerns.

Union Hospital and Terre Haute Regional Hospital will combine under ownership of Union Health System, which already owns the former. The merger was approved by the Indiana Department of Health (IDOH).

Gov. Mike Braun’s office claimed the approval as a victory in a press release and a boon to community health.

“The result of this merger will be lower prices and more healthcare services available to residents of Terre Haute and Vigo County because of the strict operating terms and conditions that Union accepted,” Braun said in a statement.

But government agencies and individual Hoosiers are worried this deal could do the opposite.

Union Hospital and Terre Haute Regional Hospital first applied for approval in 2023 but withdrew their proposal after the Federal Trade Commission said it would violate antitrust laws.

The two hospitals resubmitted a merger application earlier this year.

Because the FTC considered the plan illegal, the hospitals applied for a Certificate of Public Advantage (COPA) from the IDOH, which would allow them to go ahead if they agreed to commitments on pricing, employment and other categories.

Prior to adding those conditions, the FTC urged Indiana against approving the merger in no uncertain terms.

“Union Health and (Terre Haute Regional Hospital’s) COPA application would shield the proposed merger from antitrust scrutiny,” the commission wrote. “The FTC warned that the merger poses substantial anticompetitive risks such as higher healthcare costs for patients and lower wages for hospital workers.”

The Office of the Indiana Attorney General also opposed the plan. Todd Rokita said in April that the merger would lead to a monopoly, “reducing access to care for the citizens of Terre Haute.”

Public comment on the merger was also largely negative. In 110 pages of comments gathered by IDOH, only a few individuals wrote in support of the merger. The rest expressed worries about declining customer service, treatment costs and employee benefits.

Union and Regional Hospital submitted their own list of commitments to the state, which used those to create terms and conditions for the merger, including:

• A 10-year pricing commitment including an absolute limit to an average price of 265% of Medicare in the aggregate  

• A five-year commitment to maintain the quality of services and protect at-risk jobs at Regional Hospital 

Terre Haute Mayor Brandon Sakbun expressed approval of those terms in an interview.

“I’m happy he did approve it,” he said referring to Braun. “There’s some specific guardrails on that COPA that prevents some of the negatives to monopolization."

“The policies embedded in the commitments are designed to go beyond simply eliminating potential harm,” the IDOH wrote in its determination. The department and Union Health both declined requests for an interview.