The state’s new Health Policy Commission is moving forward with a cost and market impact review of Partners HealthCare System’s plan to acquire South Shore Hospital in Weymouth, the first test of its ability to influence the hospital consolidation trend in Massachusetts.
A statement issued by the commission’s staff Wednesday afternoon said executives at South Shore and Boston-based Partners, which owns Massachusetts General and Brigham and Women’s hospitals, were notified that the commission will examine how the proposed merger of the two health care providers is likely to affect costs and the overall health care market.
Its preliminary inquiry found that “given Partners’ size and high costs, an expansion of the system to include South Shore Hospital, a large, high-cost community hospital, is likely to have a significant impact on the Commonwealth’s ability to meet its health care cost growth goals, and on the competitive market,” the commission’s statement said.
The commission was created by last year’s state health cost containment law as a watchdog to monitor changes in the health care business. It was formed at a time when providers had been banding together to better coordinate care, while insurers had been shifting toward fixed payments for overall patient care, rather than reimbursements for individual doctors’ visits, tests, and procedures. The state law set a goal of tying the overall increase in medical spending to the growth in the state economy, which is projected to be 3.6 percent this year.
It was widely expected that the commission staff would review the Partners-South Shore alliance, the largest merger now underway. The commission’s executive director, David Seltz, is set to report to the 11-member panel on June 19 regarding the staff’s initial findings. The commission will then determine whether to move forward with a more extensive review.
The proposed acquisition has been approved by the state Department of Public Health, which last month granted a license to transfer ownership of the 378-bed Weymouth hospital to Partners. But the transaction can’t be completed until 30 days after the commission issues its final report. The commission has no authority to block a merger, but it can refer its findings to the attorney general’s office for potential further action.
The US Justice Department has also been examining the deal.
The commission is set to decide by June 6 whether to review two other hospital merger deals: Mass General’s proposed takeover of Cooley Dickinson Hospital in Northampton, and Beth Israel Deaconess Medical Center’s plan for a clinical affiliation with Cambridge Health Alliance.