The Indiana Department of Health (IDOH) has approved a merger between Union Health and Terre Haute Regional Hospital, allowing the two organizations to move forward under the state’s Certificate of Public Advantage, or COPA, framework.

The approval clears the way for Union Health to acquire all assets of Terre Haute Regional Hospital, a 278-bed facility in Vigo County and the Wabash Valley region. The hospitals first filed their COPA application on Feb. 5, initiating a 120-day review by IDOH.

Under Indiana’s statute, approved mergers are exempt from traditional antitrust enforcement in exchange for state oversight that includes pricing restrictions, quality monitoring, annual and quarterly reporting, public listening sessions and other transparency measures.

Union Health had previously withdrawn a similar COPA request in November 2024, just nine days before the state was expected to issue a final decision. The revised application was submitted in February with updated financial and service commitments.

The Federal Trade Commission warned it may raise healthcare costs and reduce the quality of care.

Despite those objections, public sentiment largely favored the proposal. During a May 2 town hall hosted by IDOH, about 63% of speakers supported the merger, while 25% opposed it and 12% remained neutral.

Union Health defended the merger as essential for sustaining healthcare access in the Wabash Valley. The system pledged to invest $117 million in expanded services, recruit more than 30 new primary- and specialty-care providers, and launch additional community health programs.

In a public letter, Union Health emphasized that payers, not hospitals, determine pricing for nearly all patients.

As part of the approval, Union Health agreed to 45 conditions across seven categories: quality, pricing, access, service enhancements, employment, population health and other community impacts. These include an average aggregate price cap of 265% of Medicare, limits on billing changes related to site neutrality, and development of direct-to-employer contracts to promote transparency.

The merger will be closely monitored throughout the COPA term. Union Health must submit regular reports, hold public listening sessions and maintain a Healthier Together transparency website. The governor will also appoint two residents from the service area to the system’s board of directors to ensure community representation and accountability.

Union Health said implementation of the agreement will begin immediately under IDOH supervision.