Idaho AG: Hospitals terminate deal

GRANGEVILLE — An Idaho attorney general’s investigation has concluded that Syringa General Hospital and Clinics and St. Mary’s Health in Cottonwood may have violated the Idaho Competition Act and have agreed to terminate a prior management agreement.

Attorney General Raul Labrador wrote in a news release Thursday that an investigation opened in 2023 in cooperation with the Federal Trade Commission has been approved by the court.

“My office is concerned about the trend of consolidation within healthcare markets in Idaho,” Labrador said in the news release. “We are committed to enforcing the laws that protect and promote fair competition in Idaho and we are pleased that we reached a resolution addressing our current concerns.”

The investigation stemmed from a management agreement between Syringa and Kootenai Health in Coeur d’Alene in 2017.

Under the agreement Kootenai Health hired and paid for Syringa’s chief executive officer, Abner King, making King an employee of Kootenai Health. As a result of this agreement, Kootenai Health had access to Syringa’s significant, competitively sensitive nonpublic information.

In 2020, Kootenai Health purchased St. Mary’s Health in Cottonwood and Clearwater Valley Health in Orofino from their out-of-state owner.

St. Mary’s, which is about 15 miles away from Syringa, is its nearest competitor. After the acquisition, Kootenai Health owned or had a substantial relationship with the only two hospitals in Idaho County.

The investigation found that as a result of this relationship between St. Mary’s and Syringa, the hospitals may have engaged in conduct that violates the Idaho Competition Act.

During the investigation, Kootenai Health and Syringa agreed to terminate the management agreement and, at the direction of the attorney general, sign a consent decree to provide further protections against potential future violations of the Idaho Competition Act.

The consent decree requires, among other things, that Kootenai Health terminate its employment of Syringa’s chief executive officer; the hospitals terminate all existing agreements, contracts, arrangements, collaborations, or affiliations between them, except where the attorney general does not object; and, in the future, provide notice to the attorney general of any proposed agreements, contracts, arrangements, collaborations, or affiliations between them.

The consent decree also prohibits any agreements limiting competition for labor and the exchange of nonpublic labor information, such as compensation and terms of employment.

In a prepared statement, Syringa said it was “happy to resolve these concerns, even though Syringa did nothing wrong. We can now apply even more focus on improving the health and well-being of our community.”

The consent decree will not hamper Syringa’s ability to hire and train staff, the news release said, or to transfer patients to appropriate levels of care at Kootenai Health or elsewhere. The hospital does not expect the consent degree to translate into any increased costs for Syringa patients.

As of December, King became a full employee of Syringa and remains at the helm of the hospital.

“Perhaps the greatest challenge was converting to a new group purchasing agreement,” the news release said. “Syringa vetted four different group purchasing organization proposals and is moving forward with a new agreement that is not expected to increase supply costs.

“As always,” the release said, “we are willing to work together with St. Mary’s and Kootenai Health to improve the access and quality of the healthcare in this community. Any future arrangements will be reviewed by the attorney general’s office.”

Hedberg may be contacted at khedberg@lmtribune.com.