The California Department of Justice denied a proposed merger between nonprofits Adventist Health System/West and St. Joseph Health System Oct. 31, stating it's not in the public's interest.
The transaction would increase healthcare costs and possibly limit healthcare access in Northern California, the department determined.
In June 2018, Roseville, Calif.-based Adventist and Irvine, Calif.-based St. Joseph requested to form a joint operating company to integrate 10 select facilities in Northern California. At the time, the systems said their integration would improve healthcare access, especially for vulnerable and underserved patients.
Sean McCluskie, chief deputy to California's attorney general, disagreed with those predictions.
"The California Department of Justice is responsible for ensuring that any proposed sale or transfer of a nonprofit health facility protects the health and safety interests of the surrounding community. After careful review, we found this proposal falls short of protecting consumers," he said.
In a joint statement to Becker's, Adventist and St. Joseph expressed disappointment about the department's decision.
"Our intent has always been to better serve our communities, increase access to services, and create a stronger safety net for families in Northern California," they said. "At this time, our organizations will need to take a step back and determine implications of this decision. The well-being of our communities remains our top priority."
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