Union Health and Terre Haute Regional Hospital abandoned their plan to bring their operations together under one system. Credit: Sirisak_baokaew / Shutterstock.

Two competing hospitals in Terre Haute, Indiana, have withdrawn their merger application shortly before a state decision deadline and amid increasing opposition to medical monopolies.

Union Health and Terre Haute Regional Hospital, the only acute care providers in Vigo County, had planned to merge under a state provision known as a Certificate of Public Advantage (COPA) law.

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The decision to withdraw was made nine days before the 4 December deadline for state regulators to approve the merger.

In a statement, Union Health said: “Recognising the COPA process is a very complex, innovative approach to improving access and quality healthcare for area residents, we believe it is best to withdraw the current application.”

The hospital intends to resubmit a revised application, working closely with Indiana regulators to highlight potential benefits such as enhanced access and quality of care.

Neither Union Health nor HCA Healthcare, the parent company of Terre Haute Regional Hospital, have given details on what influenced their decision to retract the application.

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University of Missouri-Kansas City economist Christopher Garmon said: “There could be any number of reasons why they pulled the application with the stated intention to refile.

“Given the status of the application, it’s unlikely the deal was headed toward an approval.

“Either way, I think it’s clear that the state was not ready to approve the COPA with conditions similar to past COPAs.“

The development is part of a wider trend of challenges to hospital mergers under COPA laws, which exist in Indiana and 18 other US states.

These laws offer protection from scrutiny by the Federal Trade Commission (FTC), with states typically agreeing to monitor hospital performance and cap price increases.

While supporters of COPA laws believe state oversight can counteract monopoly harms, health economists and the FTC have argued that this is not a substitute for competition and that these mergers can harm patients.