BOSTON (AP) — Massachusetts and Partners HealthCare have reached a final agreement that will allow the state's largest hospital and physicians' network to acquire South Shore Hospital and Hallmark Health Systems, Attorney General Martha Coakley said Tuesday.
Hallmark Health Systems owns Lawrence Memorial Hospital in Medford and Melrose-Wakefield Hospital.
Coakley said the deal resolves her antitrust investigation into Partners. She said it will fundamentally alter the organization's negotiating power for 10 years while controlling health costs across Partner's entire network.
Under the agreement, Partners would be barred from raising costs more than the rate of inflation through 2020.
Partners would also be blocked from additional hospital expansion in eastern Massachusetts, including Worcester County, for the next seven years unless Coakley's office reviews and approves the expansion.
Partners spokesman Rich Copp said the agreement "supports our vision to provide more coordinated patient care, delivered closer to patients' homes in lower cost settings."
"Over the course of the coming days, we will work with the Attorney General and the court to finalize this process," Copp said in a statement.
The agreement was filed in Suffolk Superior Court on Tuesday and must be approved by the court. A monitor selected by Coakley's office and paid for by Partners is to make sure the agreement is followed. One approved by the court, if Partners violates the terms of the consent judgment, the company could be held in contempt of court and face penalties.
Some health care providers have voiced concerns over the pact, saying the deal could drive up costs and lead to the closing of smaller hospitals.
Coakley defended the deal, saying her office was the first "to shine a light on the ability of Partners to charge higher prices based on its negotiating power."
"While a lawsuit could have blocked Partners' expansion to South Shore Hospital, it also would have maintained the unacceptable status quo in the health care market," Coakley said in a written statement.
She said the resolution instead reduces the negotiating power of Partners, limits its ability to acquire physicians, and controls costs across its network.