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The U.S. Court of Appeals for the 3rd Circuit reversed the FTC's May loss in the Penn State-PinnacleHealth case, temporarily pausing the proposed merger while the agency takes on administrative review of the case. The 3rd Circuit judges said the lower court ignored the impact of the proposed merger on insurers when it ruled against the FTC, saying its analysis of the FTC's and Pennsylvania state regulators' proposed geographic market for the challenge was “economically unsound” and ignored commercial realities in the healthcare market. (Teichert, 9/27)

Since the beginning of 2013, five rural hospitals in the state have closed, and many others are struggling financially, such as Phoebe Worth and Southwest Georgia Regional. Gilman’s remarks illustrated how small hospitals often feel caught between forces they can’t control. Each of her hospitals, she said, has had to sink more than $1 million into an electronic medical records system to comply with federal regulations. Meanwhile, “we are unable to improve our facility infrastructure.” (Miller, 9/27)

A state health care watchdog agency on Tuesday warned that medical costs in Massachusetts are likely to rise if Boston Children’s Hospital moves ahead with a controversial $1 billion expansion plan. The Health Policy Commission cannot block the project, but its views will be considered by the state Department of Public Health, which has the final say. The commission’s warning comes on top of opposition from competing hospitals and activist groups and may complicate the chances of swift approval for facilities that Children’s says are urgently needed. (Dayal McCluskey, 9/27)

St. Christopher's Hospital for Children did not do enough to determine why nine of its patients died after heart surgery, according to a sweeping report by state investigators. The findings stem from a surprise three-day inspection of the North Philadelphia hospital one month after the Inquirer reported in February that the death rate among newborn heart-surgery patients there was nearly triple the national average. (Avril, Purcell and Fazlollah, 9/24)

After Amy Lam prematurely went into labor and gave birth to their baby at home, her husband, Gilbert Kwok, thought the worst was over. Once emergency responders had arrived and loaded Ms. Lam, 34, into an ambulance, the couple took photos with the newborn and called family members, smiling and elated that — despite the unexpected circumstances — their son had arrived. Less than 12 hours later, on Aug. 1, Ms. Lam was pronounced dead. She had bled to death after a series of surgical procedures at Harlem Hospital Center. (Schmidt, 9/28)