The proposed Partners HealthCare purchase of Care New England won't get a thorough review because the two systems have different patient populations in different geographic areas and the deal likely won't affect patient care or costs in Massachusetts, the state's health policy commission reported.
The commission doesn't believe the Boston-based Partners' acquisition of Providence-based Care New England will affect competition and said it "did not review evidence that this transaction would have a negative impact on health care access" for Massachusetts patients.
Rhode Island officials are continuing to review the deal and its potential impact on the state and its residents. The Rhode Island Department of Health has granted an expedited review of the proposal.
Partners HealthCare is already the largest health system in Massachusetts with $13.4 billion in operating revenue in FY 2017. The system runs eight hospitals, including Mass General, Brigham & Women's and Mass. Eye & Ear. Partners also has its own health insurer, AllWays Health Partners, formerly called Neighborhood Health Plan.
Care New England is the second largest system in neighboring Rhode Island with $1.1 billion operating revenue in FY 2018. CNE owns one general acute care hospital, the 359-bed Kent County Memorial Hospital, as well as other facilities.
CNE is second behind Lifespan in terms of size in Rhode Island. Partners previously talked to Lifespan about a merger, but those discussions ended last year.
The Massachusetts commission's review found little if any overlap between the two systems. Partners' footprint is within Massachusetts. CNE's stretches only slightly over the Rhode Island border into the Bay State.
The commission doesn't believe the deal will affect competition and could help quality, particularly with population health management programs in Rhode Island. Health systems often point to reduce costs and improved quality when announcing M&A activity. However, those goals often aren't achieved.
The commission's report suggested two action areas for Massachusetts officials to take, including transparency and promoting "an efficient, high-quality, healthcare delivery system." More specifically, the commission recommended the state work to address administrative complexities within the systems, reduce pharmaceutical spending, improve out-of-network consumer protections, reduce provider price variation, cut down on unnecessary utilization and target social determinants of health.
The state commission's decision to limit scrutiny on the proposed deal goes against a general trend being seen for other transactions. A major reason the commission isn't too concerned about the deal is that the systems have different patient populations.
That's not the case with other recent deals that involve two health systems in the same geographic area, such as the proposed Beth Israel Deaconess Medical Center-Lahey Health deal in Massachusetts. An analysis by the Massachusetts Health Policy Commission warned that deal would likely result in higher prices.
Massachusetts Attorney General Maura Healey ultimately approved the merger in November, but added multiple conditions. Those include price controls, investments in safety net hospitals, required Medicaid participation and improved access to mental health and substance use disorder treatment.
The merged system, which will be called Beth Israel Lahey Health, will be the second-largest health system in Massachusetts. That deal is expected to close in the first quarter of this year.