More on Mergers & Acquisitions

Beth Israel Deaconess-Lahey Health merger is now official, with some conditions

The new health system is now the second largest in Massachusetts, employing 35,000 and overseeing 1.3 million patients.

Jeff Lagasse, Associate Editor

The proposed merger between two Massachusetts health systems, Beth Israel Deaconess and Lahey Health, is now official, and the combined entity now has a new name: Beth Israel Lahey Health.

According to a report from WBUR, the new company, BILH for short, encompasses 13 hospitals in eastern Massachusetts and boasts 4,300 physicians and 9,000 nurses. Overall, the system employs about 35,000 people and oversees 1.3 million patients.

The system is now the second-largest in the state after the nonprofit Partners Healthcare, and it isn't that far behind in terms of sheer size.

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With the new entity now up and running, some changes are afoot, including a plan to expand mental health and substance abuse treatment by inserting behavioral health clinicians into primary care practices -- more than 100 of them.

Dr. Kevin Tabb, president and CEO of BILH, told WBUR that this move will expand access to behavioral health resources to an additional 500,000 people.

Massachusetts Attorney General Maura Healey approved the mega-merger in November, but with some conditions, including a seven-year price cap and $71.6 million in financial commitments to support healthcare services for low-income and underserved communities.

The new system must strategize with its safety-net hospital affiliates, including planning for clinical service expansion or closure, and the opening, closing or expansion of facilities.


The state Department of Public Health cleared the merger with similar conditions; BILH will also be expected to bring more MassHealth patients into the new system's hospitals and medical offices, with compliance likely to be tracked by an independent monitor. MassHealth is the state's Medicaid system.

The price gap is in place for seven years following the merger, ensuring that BILH's price increases will not rise above the state's Health Care Cost Growth benchmark -- a threshold set by the state to control the annual growth of total medical spending. That limit is currently set at 3.1 percent.

The cap will avoid more than $1 billion of the potential cost increases projected by the Massachusetts Health Policy Commission, including $198 million of the increases anticipated in the first year post-merger out of the estimated $230 million in increases.


The conditions were imposed on BILH after Healey expressed concerns in July that the deal could impede access to care, push costs up and make it more difficult for independent hospitals to operate in the region.

In April 2018, the Massachusetts Public Health Council voted unanimously to approve the merger, which includes all Beth Israel Deaconess locations, Lahey Health, New England Baptist Hospital in Boston, Mount Auburn Hospital in Cambridge and Anna Jaques Hospital in Newburyport.

Twitter: @JELagasse

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