Proposed mega-merger of CareGroup, Lahey Health gets greenlight from Massachusetts Health Department

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A massive alignment in New England took a big step forward this week, when the Massachusetts Department of Health recommended approval of the full-asset merger of the CareGroup System, which includes Beth Israel Deaconess Medical Center and several affiliates, Lahey Health and a stand alone hospital in Newburyport.

David Passafaro, senior vice president for CareGroup's orthopedic hospital New England Baptist and the elected spokesperson for the proposed entity, said the plans have been underway since November 2017 and a letter of intent was signed in late January. So far, there have been three public hearings on the matter, in Boston, Gloucester and Newburyport. A fourth hearing is scheduled for April 4th with the Massachusetts Public Health Council, where DPH will outline their recommendation for approval, the systems involved will speak and the public will again have the chance to comment as well.

Passafaro specified that this is a determination of need process through DPH and is about change of ownership not the building of a facility. If the merger goes through, the new combined system will be a 5.5 billion operation and will be the second largest system in eastern Massachusetts.

"We are trying to grow in a  geographic sense and Lahey has a big footprint in the north so we could expand there," Passafaro said. " There is lots of opportunity for cross pollination for the hospitals that will be part of the new system."

The deal still must be approved by the state's Public Health Council, though it typically accepts staff recommendations. Assuming all goes as planned on the 4th, work will continue with the health policy commission that is slated to take around four months with further process beyond that, including the state attorney general's weigh-in.

Passafaro said the new system would have numerous primary care physicians in various communities and have estimated that a PCP from the new combined network would be within 5 miles of any resident in eastern Mass. 

The new combined system would bring a shared governance model wherein Kevin Tabb, current CEO of BIDMC, will assume the role of Chief Executive Officer. Ann-Ellen Hornidge, current Chair of Lahey Health Board of Trustees, will chair the Board of the combined system. BIDMC will name six members to the combined system's Board, as will Lahey Health. Finally, four to six independent members will be named to the combined system's Board.

The BIDMC affiliates include BI-Milton, Needham, and Plymouth, New England Baptist and Mount Auburn, located in Cambridge. The Lahey affiliates involved include Winchester Hospital, Beverly Hospital, Addison-Gilbert in Gloucester, Lahey Peabody and a Lahey behavioral health facility, as well as the standalone Anna Jacques Hospital in Newburyport.

"What we want to do is reimagine healthcare in our communities," Passafaro said. "We want to create a different and highly coordinated way for people to get care with specialists who are part of the same network and close to where you live and work."

Twitter: @BethJSanborn
Email the writer: beth.sanborn@himssmedia.com