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Massachusetts Approves Mass. Eye & Ear and Partners HealthCare Merger

Published online by Cambridge University Press:  06 January 2021

Abstract

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Type
Notes & Recent Transaction Comments
Copyright
Copyright © American Society of Law, Medicine and Ethics and Boston University 2018

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References

1 Priyanka D. McCluskey, State Formally Signs off on Merger Between Mass. Eye and Ear, Partners HealthCare, The Bos. Globe, Feb. 14, 2018, https://www.bostonglobe.com/business/2018/02/14/state-formally-signs-off-merger-between-mass-eye-and-ear-parthers-healthcare/OIpu8OOgPSGtkpH40pbHeJ/story.html.

2 Priyanka D. McCluskey, Merging Partners, Mass. Eye and Ear Would Raise Costs, Watchdog Says, The Bos. Globe, Nov. 1, 2017, https://www.bostonglobe.com/business/2017/11/01/partners-mass-eye-and-ear-merger-would-drive-costs-watchdog-says/QWCS83d2rveOCKuNWuLDMM/story.html; Mass. Health Pol'y Comm'n, HPC-CMIR-2017-1, Partners HealthCare System's Proposed Acquisition of Massachusetts Eye and Ear Infirmary, Massachusetts Eye and Ear Associates, and Affiliates (2017) at 10.

3 Mass. Health Pol'y Comm'n, supra note 2, at 10.

4 Id. at 11.

5 Id. at 10, 11.

6 Max Stendahl, State Gives Final Approval to Partners' Mass. Eye and Ear Acquisition, Bos. Bus. Journal, Feb. 14, 2018, https://www.bizjournals.com/boston/news/2018/02/14/state-gives-green-light-to-partners-mass-eye-and.html.

7 See generally Mass. Health Pol'y Comm'n, supra note 2.

8 Brett Ziegler, Health Care Rankings, Measuring How Well States Are Meeting Citizens' Health Care Needs, U.S. News, 2018, https://www.usnews.com/news/best-states/rankings/health-care.

9 McCluskey, supra note 1; Mass. Health Pol'y Comm'n, supra note 2.

10 See Mass. Health Pol'y Comm'n supra note 2 at 38.

11 Chapter 224 of the Acts of 2012 established “the health care cost growth benchmark, a statewide target for the rate of growth of total health care expenditures” in Massachusetts. The HPC sets the benchmark and the Massachusetts Center for Health Information and Analysis reports on the Commonwealth's performance. While Massachusetts met the benchmark in 2013, it exceeded the benchmark in 2014 and 2015. The HPC set the 2018 benchmark at 3.1%. Mass. Exec. Office for Admin. and Finance: Health Care Cost Growth Benchmark (2018).

12 Mass. Health Pol'y Comm'n, Annual Health Care Cost Trends Report: CTR 2016 (Feb. 2017).

13 Id. at 6.

14 Alyssa Rege, State Gives Unanimous Final Approval for Proposed Partners, Mass. Eye and Ear Acquisition, Becker's Hosp. Rev., Feb. 15, 2018, https://www.beckershospitalreview.com/hospital-transactions-and-valuation/state-gives-unanimous-final-approval-to-proposed-partners-mass-eye-and-ear-acquisition.html.

15 Priyanka D. McCluskey, Partners Moves Closer to Acquiring Mass Eye and Ear, The Bos. Globe, Jan. 2018, https://www.bostonglobe.com/business/2018/01/26/partners-healthcare-gets-key-state-backing-for-mass-eye-and-ear-takeover/GY7SXqEvagYahinpnt2iLP/story.html.

16 Id.; According to the HPC, the parties stated that Mass. Eye and Ear “‘will soon find it difficult to maintain all aspects of its clinical, research, and teaching missions’ due to a variety of financial pressures.” See Mass. Health Pol'y Comm'n supra note 2 at 13-14.

17 According to the HPC, “MGH's departments of otolaryngology and ophthalmology are staffed by MEEA physicians led by MEEI's department chiefs” and furthermore, “MEE also provides eye care to MGH emergency medical department patients, and MGH provides pathology services and surgical support to MEEI.” See Mass. Health Pol'y Comm'n supra note 2 at 14.

18 Id.

19 Id. at 15.

20 Robert Weisman, Partners Ends Bid to Acquire South Shore Hospital, The Bos. Globe, Feb. 17, 2015, https://www.bostonglobe.com/business/2015/02/17/partners-withdrawing-its-bid-acquire-south-shore-hospital/eEgezpjeQnNMmNfIIYSbYJ/story.html; Melanie Evens, Hallmark Health Ends Exclusive Talks with Partners Healthcare, Modern Healthcare, Dec. 18, 2015, http://www.modernhealthcare.com/article/20151218/NEWS/151219864 [https://perma.cc/X7NV-BW3K].

21 Id.

22 The Attorney General's complaint noted that, for example, MGH charged $105,000 for a spinal infusion, while a spinal fusion at Beth Israel Deaconess Medical Center cost approximately $40,000. Commonwealth v. Partners HealthCare System, Inc., No. SUCV2014-02033-BLS2, 2015 WL 500995, at *4 (Super. Ct. Suffolk Cty. 2015).

23 Id. at *15.

24 Id.

25 See Mass. Health Pol'y Comm'n supra note 2.

26 Rick Pollack, Health Care Mergers Benefit Patients, USA Today, Dec. 17, 2017, https://www.usatoday.com/story/opinion/2017/12/17/health-care-mergers-benefit-patients-editorials-debates/108704794/.

27 Monica Noether & Sean May, Hospital Merger Benefits: Views from Leaders and Econometric Analysis, Charles River Associates (2017).

28 Massachusetts, according to U.S. News, ranks 31st in the nation for health care quality, yet Massachusetts is number one in health care spending. Health Care Quality Rankings, U.S. News, 2018, https://www.usnews.com/news/best-states/rankings/health-care/healthcare-quality.

29 See Annual Health Care Cost Trends Report, supra note 9 at 12.

30 See Mass. Health Pol'y Comm'n, supra note 2.

31 Gregory Curfman, Everywhere, Hospitals Are Merging – But Why Should You Care? Harvard Health Publ'g, Apr. 1, 2015, https://www.health.harvard.edu/blog/everywhere-hospitals-are-merging-butwhy-should-you-care-201504017844.

32 Id.

33 Ron Shinkman, Massachusetts Hospitals Seek to Get Larger to Shrink Costs, NEJM Catalyst, May 3, 2017, https://catalyst.nejm.org/beth-israel-deaconess-lahey-baptist-seek-merger/.

34 Indeed, following the merger approval, Partners Chief Financial Officer Peter Markell stated, “If we can't build credibility with what we're doing and saying, you're going to hit us in future transactions.” See Max Stendahl, supra note 6.