Court blocks settlement that would allow Partners to acquire hospitals

State judge says provision was not in public interest since it would allow the healthcare provider to grow too big.

A Superior Court Judge has rejected a state settlement with Massachusetts-based Partners HealthCare that would have conditionally approved acquisitions by the health system.

Partners, the parent of Massachusetts General and Brigham and Women’s hospitals, has been trying to acquire South Shore hospital in Weymouth, the two-hospital Hallmark Health System in Melrose and Emerson Hospital in Concord as part of a strategy to provide care more locally and adopt population health reforms.

[Also: Partners acquisitions under fire]

The acquisition plans were approved by the former attorney general, Martha Coakley, on the condition that Partners — long criticized for requiring high commercial payer reimbursements — keep prices indexed to inflation for six years and cap the size of its physicians groups for five years.

New Massachusetts Attorney General Maura Healey on But on Jan. 26, announced that she intended to block the regulatory settlement if it was it approved.

On Friday, Suffolk Superior Court Judge Janet Sanders rejected the agreement on the grounds that it was not in the public interest — effectively putting Partners back at the beginning of its more than two-year acquisition request.

The settlement “would cement Partners' already strong position in the healthcare market and give it the ability, because of this market muscle, to exact higher prices from insurers for the services its providers render,” Sanders concluded. The settlement, she wrote, “contains temporary price caps and other so-called ‘conduct-based’ remedies,” and “does not reasonably or adequately address the harm that is almost certain to occur as a consequence of the anticompetitive conduct by Partners that the Complaint describes.”

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Healey praised the decision and vowed to challenge the acquisitions if Partners starts from scratch.  “In light of the court’s ruling, it is now Partners’ decision whether to proceed,” Healey said. “Our office is prepared to litigate to block this transaction if Partners chooses to move forward."

Partners has not commented on the decision or its next plans yet.

Twitter: @AnthonyBrino