Advocate, NorthShore drop proposed merger

A deal to merge Advocate Health Care and NorthShore University HealthSystem is off after a federal judge ruled against the plan Tuesday.

“We have determined with the Advocate Health Care leadership that the time, cost and uncertainty of pursuing any additional appeals would not be worthwhile,” NorthShore President and CEO Mark R. Neaman said in a written statement.

U.S. District Judge Jorge Alonso’s ruling comes after a federal appeals court asked Alonso to re-examine his decision to support the merger. The rationale for Alonso’s latest ruling was not made public Tuesday.

“We are disappointed, but not discouraged by the court’s decision,” Neaman said. “These past two years, we have seen enormous changes in the financing of health care — by both governmental and private insurers. Many individuals have experienced fewer choices of health care providers and huge increases in out-of-pocket expenses. During this same period, NorthShore has continued to invest in our people, technology and facilities with record results.”

Downers Grove-based Advocate, one of the largest systems in the country, announced plans in 2014 to merge with NorthShore to create a health system with 16 hospitals, 4,438 beds and 45,000 employees.

“We have believed since day one that this merger would be a big win for consumers and for health care. As a health care ministry, we pursued this merger because it aligned with our mission and values to advance care and lower costs for the patients and communities we are so privileged to serve,” Advocate President and CEO Jim Skosbergh said in a statement.

In December 2015, the Federal Trade Commission blocked the merger, saying it would cause “significant harm to consumers” because “health care costs will rise, and the incentive to increase service offerings and improve the quality of healthcare will diminish.”

In June 2016, Alonso denied a preliminary injunction preventing the merger.

The 7th Circuit Court of Appeals reversed Alonso and sent the case back for reconsideration.