13 Local Hospitals Agree to Form Lower-Cost Regional Health System

BIDMC photo by Alex Lau

With talk of high healthcare costs dominating today’s political discussions, a group of local hospitals are banding together to do something about it.

The Beth Israel Deaconess system, Lahey Health, New England Baptist Hospital, Mount Auburn Hospital, and Anna Jacques Hospital announced Friday that they’ve signed a legally binding definitive agreement to form a new “high-quality, lower cost regional health system.” The involved parties signed a non-binding letter of intent in January, and are moving the plan forward with this agreement.

Kevin Tabb, who is currently CEO of the Beth Israel Deaconess system, will be CEO of the new network, assuming it’s approved by state and federal regulators. Beth Israel and Lahey have tried to merge before, but have never gotten to this point.

“Our new system will offer patients extraordinary care in the most convenient location, supported by world class research and medical education,” Tabb says in a statement. “In addition, the new system will strengthen our ability to make the investments in our facilities, technology and people that will help ensure our continued success. Together, we will improve patient care, help contain rising health care costs, and better position our member hospitals in a rapidly changing health care environment.”

The 13 member hospitals—employing among them 800 primary care physicians and 3,500 specialists—will keep their names and continue to operate largely independently, with a system board overseeing the entire cohort.

Partners HealthCare, which is anchored by Massachusetts General Hospital and Brigham and Women’s Hospital, is currently the state’s largest health system, comprising 15 hospitals and a slew of community health organizations. The new group would provide an alternative for patients across Eastern Massachusetts.

“There is a clear need for a cost-effective alternative health system in Massachusetts,” Ann-Ellen Hornidge, the new system’s chair of the board of trustees, says in the statement. “We are creating a strong new health system that focuses on what patients and their families rightfully deserve—a commitment to the highest level of care and clinical innovation at lower costs, with convenience of access for patients and their families.”