Mixed signals from government have chilling effect on mergers.

In recent years, the Department of Health and Human Services and Congress have encouraged hospitals to reduce excess capacity by sharing equipment and services and by consolidating where possible. On the other hand, the Justice Department and the Federal Trade Commission seem all too eager to prosecute those hospitals that decide to merge. These mixed messages have had a chilling effect on hospital mergers and, in general, have confused the health care community to the point where much needed community wide planning may be needlessly delayed, say experts.