The Federal Trade Commission (FTC) has implemented stricter premerger notification requirements for the healthcare sector in order to enhance antitrust oversight. This is the first update in 45 years and aims to improve the agency's ability to detect potentially illegal mergers and acquisitions before they are finalized.
The revised rule, which spans 460 pages, reflects the increasing complexity and volume of corporate transactions in recent years. The FTC has emphasized that these changes are necessary due to evolving corporate structures and market dynamics that have created information gaps.
The new requirements are expected to significantly increase the filing burden on healthcare companies, with the average time needed to prepare a filing estimated to rise from approximately 37 hours to 144 hours. The American Hospital Association (AHA) has criticized the additional paperwork, arguing that it could overwhelm the agencies and detract from patient care.
Despite stakeholder feedback, the AHA remains dissatisfied with the rule, viewing it as a "tax on mergers" that diverts essential resources away from healthcare services.
Under the finalized rule, companies will be required to submit detailed information about minority stakeholders and investors involved in the transaction, as well as transaction documents from their deal teams and a limited set of high-level business plans related to competition.
The FTC is also launching a new online portal to facilitate transparency and public engagement, allowing market participants, stakeholders, and the general public to submit comments on proposed transactions under review.
The FTC's decision to enhance premerger notification requirements highlights its commitment to maintaining competitive markets, particularly in the healthcare sector.