AG Won’t Block Merger

As he completed an antitrust investigation, Connecticut Attorney General George Jepsen announced Friday he will not seek to prevent Yale-New Haven Hospital from taking over the Hospital of St. Raphael.

The investigation came after the two New Haven-based hospitals, long seen as competitors signed a letter of intent to merge in March of 2011. Under the proposed deal, they would become one 12,000-employee, 1,477-bed entity at under the Yale-New Haven banner.

Jepsen launched an investigation along with the Federal Trade Commission (FTC) to determine if Yale’s acquisition of St. Ray’s would ​“substantially lessen competition for medical services in the Greater New Haven area by, among other things, providing the merged entity with the ability to use its bargaining power to force third-party insurers to pay higher levels of reimbursement.”

“Based on the evidence developed during the investigation, and in light of the law applicable to these types of transactions – including taking into consideration St. Raphael’s precarious financial condition and other expected efficiencies that will be realized through the acquisition – I have decided not to seek to block the merger under Connecticut’s antitrust law,” Jepsen said in a press statement Friday.

The probe involved ​“extensive interviews” of ​“local employers, health insurers, doctors, competing hospitals and community groups.”

At Jepsen’s request, Yale agreed to ​“maintain current levels of charitable healthcare and financial assistance and provide the same level of service and assistance to patients receiving care on the St. Raphael’s campus.”