Baker, Gonzalez should oppose health care duopoly

Beth Israel-Lahey mega merger will raise, not lower, costs

I WILL NOT be the governor who allows Massachusetts to become a health care duopoly.”

That’s a bipartisan pledge that Republican Gov. Charlie Baker and his Democratic challenger, Jay Gonzalez, should make regarding the future of health care in our Commonwealth.

This pledge concerns the 13-hospital mega merger between Beth Israel Deaconess Medical Center and Lahey Health, which is currently under review by state regulators.

The merger seeks to form a new health care giant to rival Partners HealthCare, which is the largest and most expensive hospital system in the state. Beth Israel and Lahey argue that under a merger they can compete against Partners and ultimately drive down health care costs in the state.

What Beth Israel and Lahey don’t say is that their merger will dramatically increase the cost of care for everyone. And it sets the stage for a two-tiered system in Massachusetts, where two large conglomerates control the market at will.

Ironically, both Baker and Gonzalez are former health care executives who have spent years professing their commitment to expanding access to affordable care. They should be deeply troubled that two massive and profitable companies are seeking to dominate the market.

If Baker and Gonzalez do not step in and oppose the merger, Massachusetts’ health care costs will rise and community hospitals will be in danger of disappearing over the long run.

Earlier this summer, the Health Policy Commission released the first major public accounting of cost and access issues around the BI-Lahey mega-merger. The commission’s report found that a merger would increase health care costs by at least $250 million per year for Massachusetts residents – way beyond the state’s cost-containment benchmark.

More troubling, the commission found that the merger would exclude patients who don’t generate the types of big profits the hospitals are chasing, such as communities with low-income, non-white, and Latino residents, or those who rely on Medicaid coverage.

Latino patients, in particular, have unique health care needs, such as cultural and linguistic assistance and higher rates of diabetes and liver disease than whites, according to the Centers for Disease Control and Prevention.

Furthermore, patients in places such as Lawrence, Lowell, and parts of Brockton rely on public transportation to access health care and would likely not be able to afford long driving distances to the nearest BI-Lahey facilities, or the costs such facilities will charge.

The Health Policy Commission gave BI-Lahey an opportunity to respond to its report with a revised merger proposal that addresses the cost and access issues. Instead, BI-Lahey issued a report attacking the HPC’s findings and did not offer any solutions to most of the concerns expressed regarding the merger.

Rather than integrating more Medicaid and diverse patients into its merger as state regulators suggested, BI-Lahey’s proposal continues to focus on serving wealthy communities in the suburbs of Boston that will bring top dollar to the merger.

Attorney General Maura Healey raised these red flags about the merger earlier this summer. But despite her wide-ranging oversight roles, Healey does not have the same power to scrutinize and stop the merger as the Department of Public Health, which Gov. Charlie Baker oversees.

This mega merger is a real test for Massachusetts’s new health care regulatory system and Baker. Without a doubt, if the merger is allowed, Massachusetts will devolve into a two-tiered health care system where wealthy individuals can access expensive care that works for them, while low-income people and communities of color who rely on Medicaid have fewer choices and less access to care.

In addition, community hospitals, which are already struggling to stay open, will face the choice of closing or being acquired by these more expensive hospitals.

Baker must use his role overseeing the Department of Public Health to take action to prevent the negative impacts of this merger, and Jay Gonzalez should pledge to do the same if elected.

Meet the Author

James Jennings

Professor emeritus, Tufts University
This is yet another leadership opportunity for Massachusetts policy makers to set a national example that protects access to affordable health care for all residents – regardless of their socioeconomic status, race, or ethnicity.

James Jennings is professor emeritus of urban and environmental policy and planning at Tufts University and a member of the Make Healthcare Affordable Coalition, which opposes the merger.