Should Partners HealthCare System be Allowed to Acquire More Boston-area Hospitals?

A three week comment period has been ordered by a Suffolk Superior Court Judge before a final ruling permitting or denying a settlement between Massachusetts Attorney General Martha Coakley and the giant Partners Healthcare System. The proposed deal allows Partners Healthcare to expand in size by acquiring three hospitals while hiring more employees in exchange for stricter controls on their pricing policies and increased regulatory oversight.

Supporters of the deal argue that Partners Healthcare is likely to grow in size over time no matter what is done, therefore, the deal between the Attorney General and Partners Healthcare represents a chance for the government to have a role in monitoring and controlling their growth. Because of its size, Partners Healthcare has an outsized influence on prices and policies throughout the Massachusetts healthcare system. Coakley has argued that her agreement to allow some further growth, but only in exchange for greater regulation, represents a sensible balance between the rights of Partners Healthcare and the interests of healthcare consumers.

Critics are calling the settlement a sweetheart deal. They say that the restrictions on Partners Healthcare are vague and mostly to be determined at a future date. They point out that Partners Healthcare will be allowed to increase their revenues ten-fold under the settlement, which critics say is too much for a company that is already four times bigger than their next largest competitor. They fear that the resulting overwhelming market dominance by Partners Healthcare will actually serve to increase prices rather than restrain them.

Much controversy centers around the settlement’s placement of a cap on price increases based on the rate of inflation. Coakley believes this will place a significant break on future price increases, resulting in savings for consumers and taxpayers. Critics reply that economic indicators suggest that the rate of inflation will increase in coming years at rates that would make the caps meaningless.

Both sides are certain to use the three week comment period ordered by the judge to aggressively present their arguments. The question remains whether the court will then approve the settlement, or order it renegotiated.


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