Payer-provider lines blur, Partners acquires nonprofit insurer

Partners HealthCare System Inc., the largest hospital and physicians network in Massachusetts, is acquiring Neighborhood Health Plan, a Boston-based nonprofit insurer, which accounts for more than 240,000 members of mostly low-income residents, reports the Boston Globe.

"The traditional lines between the payer and the provider are beginning to blur a bit," said Neighborhood Health Plan CEO Deborah Enos. She added that the deal reflects a national trend of mergers and acquisitions aiming to align payers' and providers' mutual incentives to lower costs, according to the Boston Herald.

Partners Chief Executive Gary Gottlieb said it isn't trying to compete with large insurers in the private market. Neighborhood Health "does very small commercial business," he said, adding that many of Neighborhood Health's members seek medical care at safety-net hospitals that frequently serve low-income residents, the Globe notes. "We don't want to change the pathway of patients," he said. "We want patients to get the care where they want to get it."

Enos clarified that the deal wouldn't trigger exclusive contracts with Partners providers, reports the Boston Business Journal. "There is nothing inherent in this affiliation that would affect our relationships with other providers," she said. "This is an opportunity for us to look forward and position Neighborhood Health Plan to be better situated in the future."

Although no money would change hands under the deal, Partners would contribute an unspecified sum to provide grants to more than 50 community health centers affiliated with Neighborhood Health. The deal requires approval from the state attorney general, the state division of insurance, and the U.S. Department of Justice. State regulators, in particular, might scrutinize the acquisition because Partners' teaching hospitals have been cited for using their market power to command higher prices for medical care than smaller hospitals, notes the Globe.

To learn more:
- read the Boston Globe article
- see the Boston Herald article
- check out the Boston Business Journal article