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Lahey Health, Winchester Hospital Expected to Finalize Affiliation by July

The Massachusetts Health Policy Commission unanimously voted yesterday to approve a final report finding Winchester (Mass.) Hospital's proposed affiliation with Lahey Health in Burlington, Mass., could reduce healthcare spending by as much as $2.7 million per year, according to a report from The Boston Globe.

The final report echoes a preliminary version approved in April. The savings would come from shifts in use from higher-priced hospitals to Lahey and possible reductions in prices for services provided by Winchester Hospital physicians.

The Health Policy Commission announced last December it would conduct a cost and market impact study of the proposed transaction. David Seltz, the commission's executive director, issued a statement saying the transaction raises the potential for Lahey to leverage for higher prices through joint contracting with Winchester Hospital.

In its preliminary report, the Commission identified two concerns it asked Lahey and the hospital to address before the commission voted on a final report in May. The first was that the merger could allow the two organizations to raise prices and ask for higher reimbursement from private health insurers. Second, the commission was concerned Lahey could drive up medical spending by adding facility fees to the hospital's service bills. However, Howard R. Grant, MD, Lahey's president and CEO, said his organization didn't plan on adding facility fees or raising prices at Winchester Hospital.

Dr. Grant said the Commission's final report is "a vote of confidence," and the deal is expected to close by July 1, according to the Globe.

Lahey signed a letter of intent last June to affiliate with Winchester, and the two organizations reached a formal agreement in September. Under the agreement, which is not a full-scale merger or acquisition, leaders from the 229-bed Winchester will join Lahey's board of trustees, and the hospital will become an affiliate of the system as part of a "shared governance" model.

More Articles on Hospital Affiliations:
Report: Lahey Health, Winchester Hospital Merger Could Save $2.7M Annually
Massachusetts Commission to Study Lahey Winchester Hospital Affiliation
Lahey Health, Winchester Hospital Reach Formal Affiliation Agreement 

 

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