Will negotiating teams from the same firm compete against one another?

The FTC ruled that a merger between two hospitals in Evanston reduced competition and raised prices to managed care organizations (MCO's). To see how such a merger could affect price, consult your favorite managerial economics textbook:

Suppose a managed care organization (MCO) ... puts together a network of hospitals to serve its client base. The MCO bargains with individual hospitals over whether to include them in the network and what price they’ll charge if included in the network. To get better prices, the MCO threatens to exclude one hospital in favor of a nearby substitute hospital. But if the two hospitals merge and bargain together, [the MCO's can no longer play the hospitals off against each other]. [1]

The interesting part of the FTC decision from a management point of view is the remedy requiring that the merged hospital establish separate and independent contract negotiating teams – one for each hospital – that will allow managed care organizations to negotiate separately with each hospital.

The remedy is designed to create a deliberate incentive conflict between the two negotiating teams. If insurers are able to play the two teams off against each other, then competition will be restored to pre-merger levels.
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[1] See Werden, Gregory and Luke Froeb, Unilateral Competitive Effects of Horizontal Mergers II: Auctions and Bargaining, Issues in Competition Law and Policy, W. Dale Collins (ed.), ABA Section of Antitrust Law, SSRN.