CADE challenges Unimed Blumenau’s acquisition of Hospital Santa Catarina

On 22 May, the Administrative Council for Economic Defense (CADE) referred the case of Unimed Blumenau’s acquisition of Hospital Santa Catarina to be reviewed by the Tribunal of CADE.

The Hospital Santa Catarina is the main general hospital of Blumenau, in the Brazilian state of Santa Catarina (SC), and Unimed Blumenau is the main Health Insurance Plan Operator of the city, covering over 75% of their health insurance beneficiaries.

The merger would encourage vertical integrations that include health insurance plans from Unimed and medical-hospital services from Hospital Santa Catarina, mainly from the segment of general hospitals in Blumenau.

Evidence revealed strong indications of incentive and ability to foreclose, from input to costumer foreclosure, on vertical integration involving health insurance plans and general hospital.

The results of the application of the vertical arithmetic methodology were used to analyse the competitive implications of vertical integrations, in accordance with the expert opinion of the Department of Economic Studies of CADE (DEE) and qualitative aspects related to the health insurance market and the transaction.

Representative market

After the market foreclosure of general hospitals for different health insurance plan operators, there may be negative effects on competition due to reduced offers from other health insurance plans that are Unimed’s competitors, or a limited growth of those rivals, considering the likelihood of a smaller availability of hospital beds to care for its beneficiaries in the associated network.

There is also a risk that Unimed could remove the competing hospitals from Hospital Santa Catarina. As a result of the analysis, the DEE identified incentives for the foreclosure of Hospital Santa Isabel, the main rival of Hospital Santa Catarina.

In addition to the complete market foreclosure, one cannot ignore potential partial foreclosures, such as sending beneficiaries to be seen in rival general hospitals for specific procedures.

Thus, considering the importance of Unimed Blumenau as a contracting buyer of hospital services in the region, there may be negative effects in the market of general hospitals in the city of Blumenau (SC).

According to the Office of the Superintendent General at CADE (SG), structural remedies cannot be applied to mitigate the potential harm to the competitive environment. The remedies would be overly burdensome for both the authority and merging parties without restoring competitive market conditions.

In this regard, the SG recommended the blockage of the transaction. After the case submission for a final decision, a commissioner will be assigned for a close analysis, followed by the adjudication of the Tribunal members.

Access Case no. 08700.012808/2025-11