Limits of the Elzinga-Hogarty Test in Hospital Mergers: The Evanston Case

Kenneth Elzinga and Anthony Swisher

International Journal of the Economics of Business, 2011, vol. 18, issue 1, 133-146

Abstract: The Elzinga-Hogarty (E-H) test for geographic market definition has been widely used by both government enforcement agencies and merging parties in hospital merger cases. However, two characteristics of hospital services markets - the Silent Majority Fallacy and the Payer Problem - may tend to undermine the utility of the E-H test in hospital merger cases. Where direct evidence of anticompetitive effects attributable to a merger is available, its use may diminish the need to rely on geographic market definition tools such as the E-H test. Such direct evidence is most readily available in post-closing merger challenges such as the FTC's Evanston case. It remains to be seen, however, whether the E-H test will continue to be relied on in more traditional, pre-closing merger challenges.

Keywords: Hospital Mergers; Elzinga-Hogarty Test; Relevant Markets; Antimerger Policy (search for similar items in EconPapers)
Date: 2011
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Citations: View citations in EconPapers (12)

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DOI: 10.1080/13571516.2011.542963

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