HUNTINGTON, W.Va. — One of the most vocal opponents of Cabell Huntington Hospital’s acquisition of St. Mary’s Medical Center has withdrawn its appeal of the hospitals’ cooperative agreement, effectively eliminating the final roadblock to the hospitals combining.
Steel of West Virginia withdrew its appeal in Kanawha County Circuit Court Tuesday afternoon, proposing that Judge James Stuckey dismiss the case from his docket.
“This merger is very bad for Huntington,” Steel of West Virginia CEO and President Tim Duke said. “Unfortunately, not enough people stepped up to stop this merger from happening.”
Steel of West Virginia, of Huntington, filed the appeal in August, contending the West Virginia Health Care Authority erred in its decision to grant the hospitals a cooperative agreement under a new state law passed in this year’s legislative session.
In granting the cooperative agreement, the health care authority and Attorney General Patrick Morrisey said they determined the benefits of the merger outweighed any negatives.
The agreement shields the hospitals from state and federal anti-trust regulations, replacing them with state oversight from the Office of the Attorney General.
The passage of the cooperative agreement law resulted in the Federal Trade Commission dismissing its complaint against the merger. The FTC maintained the combination of the two hospitals would eliminate competition, leading to higher health care prices and lower quality.
In a statement, Tim Duke said he still has the same concerns as the FTC.
Earlier this month, Steel of West Virginia lost an appeal of the certificate of need, with the Office of Judges determining the authority did not violate state code in approving the certificate of need.
Steel of West Virginia has the opportunity to appeal this decision by Nov. 4.
“In any event, Cabell and St. Mary’s remain committed to completion of the transaction and to bringing to the region the efficiencies, enhanced quality and expanded services which the combination of these two strong hospitals makes possible,” Fowler said.
Cabell Huntington began its $165 million acquisition of St. Mary’s in 2014, after the Pallottine Sisters announced they were selling the hospital.
A transfer agreement involving the hospitals was signed in November 2014, and an assurance of voluntary compliance agreement was filed in August 2015, then revised in November, by Morrisey and signed by the presidents of both hospitals. The agreement was meant to ensure no anti-trust laws would be violated.
The Health Care Authority approved the hospital’s certificate of need in January, and then approved the cooperative agreement at the end of June.
The hospitals still need approval from the Vatican.
Although Stuckey allowed the FTC to be a part of the case, he ruled in August that Steel of West Virginia was unlikely to win its appeal and denied the request to halt the hospitals from combining until after the appeal.
Still ongoing is Steel of West Virginia’s Freedom of Information Act lawsuit against Morrisey.
That case revolves around 350 documents related to Morrisey’s investigation into the merger prior to the voluntary compliance agreement. Steel of West Virginia filed a FOIA request for the documents prior to the certificate of need hearing in December.
Morrisey maintains the documents contain sensitive information and are exempt from FOIA.
The hospitals, Highmark West Virginia and the FTC have all given support to Morrisey’s claim.
Kanawha County Circuit Court Judge Tod Kaufman said during the last hearing Oct. 11 he needed more time to review the documents to determine if they are indeed exempt.
Follow reporter Taylor Stuck on Twitter and Facebook @TaylorStuckHD.
