POPLAR BLUFF HOSPITALS WIN MERGER APPEAL

Cape Girardeau well knows the frustration of hospital merger talks. After nearly a year of working toward a collaborative effort, Cape Girardeau's two hospitals were cut short when the state's attorney general, Jay Nixon, announced he would oppose such a union. The two hospitals then broke off their talks.

Cape Girardeau is not alone.

In Poplar Bluff, merger efforts between that city's two hospitals hit a snag when the Federal Trade Commission opposed the merger. But now the U.S. Court of Appeals has overturned a U.S. district court ruling that would have barred the merger of Lucy Lee Healthcare System and Doctors Regional Medical Center. Tenet Health Care Corp. of California had offered to buy Doctors Regional Medical Center, which is what sparked the merger effort.

That doesn't mean the merger has a green light. The Federal Trade Commission could continue to challenge the proposal.

But there is certainly food for thought -- both to the FTC and others who would quash such a proposal -- in the appellate court's ruling. The court astutely observed that the patient base of both Poplar Bluff hospitals is primarily those covered by Medicare and Medicaid and "thus remain largely insensitive to price differentials."

No doubt that large caseload is what's driving the merger talks in Poplar Bluff. The government promises much to dependent patients but manages to pay care givers at much lower rates than other insurance programs.

With an aging population, the pressures of less-than-sufficient Medicare payments is only going to get worse. These financial pressures may force more and more hospitals to either sell to larger corporations or merge with competitors.

No doubt other communities are keeping a close watch on what happens in Poplar Bluff. And while local merger talks are off the table, they haven't been forgotten.

While the government opposes many of these mergers through the FTC or Justice Department, it may be the government programs like Medicaid and Medicare that are fueling fiscal ills at many hospitals. That irony -- while lost on the federal government -- proves a bitter pill for a growing number of hospitals and health-care professionals.