A proposed bill in Tennessee intends to update the law governing the state's Certificate of Public Advantage, a key statute that will significantly impact the planned merger of Johnson City, Tenn.-based Mountain States Health Alliance and Kingsport, Tenn.-based Wellmont Health System, according to News Channel 11 report.
Tennessee Senator Rusty Crowe (R-Johnson City) sponsored the bill.
"The statute as it is now is about 20 years old, and we wanted to make sure it did everything possible to protect the public in the case of a merger or an acquisition anywhere in the state," Sen. Crowe told News Channel 11.
MSHA and Wellmont stated that they would seek a COPA in Tennessee, according to the report. The COPA establishes a process for on-going government oversight of hospitals and health systems related to its services and prices. In gaining state approval, the systems hope to avoid an antitrust challenge by the Federal Trade Commission.
Sen. Crowe said the decision to update the COPA law came as the result of health systems in the Tri-Cities and across Tennessee contemplating mergers.
"One of the major factors that had to be analyzed was that the health of the region would be the primary focus and that the benefits of a merger would outweigh any disadvantages of the merger relative to the competitive atmosphere that was there prior to the merger or prior to an acquisition," Sen. Crowe told News Channel 11.
Last week, U.S. Representative Phil Roe (R-Tenn.) said he thinks the Wellmont-MSHA merger will create a monopoly in the Tri-Cities metro area.
Sen. Crowe's legislation was approved in a 7-2 vote in the Tennessee Senate Health Committee. It is now on its way to the finance committee, and if it passes, it will move on to the Senate for a vote. The bill must also be approved by the House.