Massachusetts AG OKs Partners HealthCare acquisition, alters hospital's power

An agreement between Massachusetts Attorney General Martha Coakley and Partners HealthCare System filed in court will alter the hospital's negotiating power for years to come--ending the antitrust investigation by her office and allowing the hospital to acquire South Shore Hospital, according to an announcement from Coakley's office.

The Massachusetts Health Policy Commission previously rejected a deal between the largest healthcare system in New England and South Shore Hospital because it would drive up prices, but the Coakley agreement addresses this concern and greenlights the acquisition.

The agreement also:

  • Allows payers to split Partners into separate contracting entities for up to 10 years

  • Prevents Partners from contracting with affiliate physician groups that are not part of its owned hospitals for 10 years

  • Caps health costs at the rate of inflation across the entire Partners network through 2020

  • Caps its physician growth for five years

  • Blocks further hospital expansion in eastern Massachusetts for the next seven years

"While a lawsuit could have blocked Partners' expansion to South Shore Hospital, it also would have maintained the unacceptable status quo in the healthcare market," Coakley said in the statement. "Today's resolution goes well beyond that by reducing the negotiating power of Partners, limiting its ability to acquire physicians, and controlling costs across its entire network."

Not everyone is pleased with the agreement, and some are frustrated with the process, WBUR, Boston's NPR radio station reported. 

Jamie Katz, senior vice president at Beth Israel Deaconess Medical Center, wanted a public review of the agreement and was disappointed the attorney general's office filed without notice, according to WBUR, although Coakley said that was required as part of ongoing negotiations.

The agreement, which still needs to be finalized in court, allows for a hearing by a judge, and parties who don't like the deal may be able to file briefs and present evidence about healthcare market size and clout.

"This agreement supports our vision to provide more coordinated patient care, delivered closer to patients' homes in lower cost settings," Partners spokesperson Rich Copp told WBUR

To learn more:
- here's the announcement
- read the article

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