Prisma abandons plan to buy 3 more S.C. hospitals

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South Carolina's largest hospital system will not be buying three more hospitals, with Prisma Health announcing Friday that it was giving up the plans after an unfavorable court ruling and questions about whether the deal would give Prisma a near-monopoly over hospital care in much of the state's Midlands region.

Prisma will lose a $10 million down payment to Tennessee-based LifePoint Health, a for-profit firm that owns Providence Health and Kershaw Health. Providence Health has two hospitals in Columbia and a freestanding emergency room in Fairfield County, while Kershaw Health has one hospital.

Prisma Health said in a statement that "significant delays and challenges with the Federal Trade Commission and state regulatory authorities have made it prohibitive to move forward."

"Both companies continue to stand by their initial vision for this transaction. However, they have determined it is in the best interests of all organizations involved, their employees and those they serve to end their pursuit of this acquisition," Prisma said.

Prisma's potential market power drew opposition from Lexington Medical Center. That hospital sued after the state Department of Health and Environmental Control amended its rules to allow Prisma to use a 1997 certificate of public advantage to acquire the hospitals. The certificates allow states to grant exceptions to federal laws promoting business competition. Companies instead submit an annual report and make concessions to the state, avoiding full antitrust scrutiny.

A judge ruled the deal could not proceed using the existing certificate because it was a purchase and not a merger. That means public hearings and broader review would have been necessary. Prisma had appealed the ruling.

If Prisma had been successful, it would have owned all the hospitals in Richland, Kershaw, Sumter and Fairfield counties.

Kershaw County leaders had also expressed opposition.

Prisma was formed when Palmetto Health and Greenville Health System joined in 2017 and owns 18 hospitals. Prisma kept a separate legally incorporated Midlands division because of the original certificate.