NH Department of Justice – January 6, 2025
Concord, NH – Attorney General John M. Formella announces the resolution of an Attorney General’s Office review of the proposed acquisition of Catholic Medical Center (“CMC”) by Manchester Health Services, LLC, a subsidiary of HCA Healthcare, Inc. (“HCA”). The statutory review, conducted separately by both the Attorney General’s Charitable Trusts Unit and the AG’s Consumer Protection and Antitrust Bureau, was undertaken to ensure that the transaction aligns with the public interest and complies with applicable laws that exist to preserve competition in the healthcare market.
After thorough evaluation and discussions, the Attorney General’s Office has accepted settlement terms designed to ensure continued access to healthcare for residents of Manchester and the surrounding area, promote community health, and preserve competition. “This settlement represents a thoughtful approach that both addresses the insurmountable financial challenges CMC is facing and ensures that the healthcare needs of New Hampshire residents continue to be met. Through this transaction, HCA’s financial stability and commitment to preserving essential services will secure a future for CMC and its patients,” said Attorney General Formella. “The Attorney General’s Office remains dedicated to ensuring that New Hampshire residents have access to affordable, quality healthcare services and that New Hampshire consumers continue to benefit from a competitive healthcare marketplace.”
Transaction Background
CMC’s present financial condition and deferred maintenance of its facility threatening its continued operation, has rendered it unable to recover without substantial intervention. HCA, with its strong financial standing, has agreed to acquire nearly all of CMC’s assets, including its 330-bed acute-care hospital and other healthcare services. The Attorney General’s Office carefully reviewed the acquisition to ensure it would safeguard access to healthcare, preserve critical services, and maintain fair competition in the local healthcare market.
The review concluded that HCA’s involvement would stabilize CMC and help preserve essential healthcare services for the Manchester and surrounding communities. The acquisition is viewed as a critical step to securing the hospital’s future and preventing the loss of vital services.
In response to concerns about the preservation of healthcare services and the impact on regional competition, the Attorney General’s Office negotiated terms with HCA that address these issues, ensuring continued access to high-quality, affordable healthcare for the public.
Key Terms of the Settlement
The terms of the settlement are outlined in an Assurance of Discontinuance (“AOD”) and the Charitable Trust Unit Report. The following are some of the key commitments that have been agreed upon:
- Expansion of Healthcare Capacity:
HCA will add 10 Designated Receiving Facility (“DRF”) beds at its New Hampshire hospitals within two years of the transaction’s closing. This expansion will be part of HCA’s $200 million capital investment commitment to strengthen healthcare infrastructure in the state.
- Community Contributions:
HCA has committed to contributing a total of $2 million over the next three years to local community health initiatives. This includes annual payments of at least $300,000 to Healthcare for the Homeless and Poisson Dental Clinic.
- Core Services Preservation:
Critical healthcare services, including pregnancy care and emergency behavioral health services, will be protected, subject to certain contingencies, for at least ten years following the acquisition. HCA must make good faith efforts to ensure that no contingencies are triggered.
- Financial Commitment to New Hampshire and Manchester Healthcare Programs:
The AOD provides for payment of $7.5 million over ten years to the Healthcare Consumer Protection Trust Fund. These funds will be used to support community health programs in the Manchester community and other initiatives to benefit New Hampshire healthcare consumers.
- Consumer Protections:
The AOD prohibits certain anti-competitive contracting practices that may limit consumer choice, including most-favored-nation clauses, anti-tiering clauses, and similar restrictive practices. The AOD also provides a mechanism for patients at CMC to remain in network with their commercial health plan upon the acquisition by HCA.
- Health Data Reporting:
Following the completion of the transaction, HCA will submit claims data regarding its self-insured health benefits plan to the New Hampshire Comprehensive Health Care Information System.
Enforcement and Compliance
To ensure that these commitments are upheld, the Attorney General’s Office will ensure compliance with the terms of the AOD for a period of ten years and will have authority to enforce all conditions of the CTU Report through court action if necessary. HCA will provide an annual public report ensuring that the commitments are fulfilled and that healthcare services continue to meet the needs of New Hampshire residents.
Preservation of Catholic Identity
Under the terms of the proposed transaction, HCA is required to enter a “Catholic Identity Commitment Agreement” (“CICA”) with the Bishop and the newly formed Foundation. The CICA requires HCA to operate CMC in compliance with the Ethical and Religious Directives for Catholic Healthcare Services (“ERDs”). In addition to receiving approval from the Bishop of Manchester, on December 6, 2024, CMC received confirmation of approval of the Holy See in Rome. The Holy See’s review included assessment about how the sale ensures continued adherence with the ERDs and compliance with Canon Law.
Conclusion
The terms of this settlement represent a balanced approach to addressing the concerns raised during the review process. By preserving essential healthcare services and promoting community health initiatives, this agreement benefits New Hampshire residents and strengthens the state’s healthcare system for the future. More information regarding the analysis conducted by the Attorney General’s Office can be found in the Charitable Trust Unit’s final report.