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Why did hospital merger talks halt?

According to sources at the Boston Globe the supposed merger between Lahey Health, Beth Israel Deaconess Medical Center and the Atrius Health confederation of doctor groups just came to a screeching halt.  The formal merger talks concerning the creation of a health care system much like Partners Health Care System opened last April.  An agreement could not be reached.

In a statement the three groups said: “We have mutually decided to discontinue those discussions to focus attention on significant initiatives we are individually pursuing while leaving open the possibility of a more substantial partnership at a later date.”

merger talks

Lahey Medical Center

While some sources have speculated on one specific cause of the collapse in the collaborative conversation, some industry professionals were not so quick to point a finger as to the source behind the end of the merger talks.  Ellen Lutch Bender, president of health care consulting firm Bender Strategies in Newton, Massachusetts said: “There’s a freneticism in the market but the market hasn’t totally defined itself. The pursuit of opportunities doesn’t necessarily equate to the closure of deals.”

Prior to the end of negotiations Beth Israel chief executive Kevin Tabb reported that Beth Israel Deaconess was probably going to continue to grow through future acquisitions as well as affiliations with other like organizations.  On a similar note, Lahey Health is reportedly also considering the purchase of Winchester Hospital and its related facilities. This has raised concerns about how this would influence health costs locally and drawn the attention of the state’s Health Policy Commission which now plans on reviewing the planned Lahey-Winchester deal.

Tabb added: “We are in the midst of a sea change resulting in a smaller number of systems and a smaller number of independent hospitals.  We are much further along than we thought or even dreamed we could be 24 months ago. But we are not finished.”

Lahey chief executive Howard R. Grant stated that his organization has been kept busy upgrading the newly acquired Beverly Hospital and Addison Gilbert Hospital in Gloucester.  Their two-pronged effort involves bringing in additional patients to its flagship Lahey Clinic in Burlington while also keeping all local patients at their local facilities.  “There will continue to be consolidation,” Grant added.  “It’s unclear what teams everyone ends up on.”

(Image courtesy of PeabodyPatch)

About Will Phoenix

W. Scott Phoenix, B.A., B.S. was born in Hawaii, raised in Pennsylvania and resides in California. He has been a published writer since 1978. His work has appeared (under various names) in numerous places in print and online including Examiner.com. He is a single parent of three children and has also worked as an actor, singer and teacher. He has been employed by such publications as the Daily Collegian and the Los Angeles Times.