Press Release  HPC ELECTS TO CONDUCT COST AND MARKET IMPACT REVIEW FOR NEW DANA FARBER AND BETH ISRAEL PROPOSED AFFILIATION

BOSTON — Thursday, January 25, 2024 — Today, the Massachusetts Health Policy Commission (HPC) Board of Commissioners voted to conduct a cost and market impact review of the proposed clinical affiliation between Dana Farber Cancer Institute (DFCI), Beth Israel Deaconess Medical Center (BIDMC), and Harvard Medical Faculty Physicians (HMFP) at BIDMC. The presentation materials and a recording of the meeting are available on the HPC’s website.

Under the proposed transaction, DFCI would form a new clinical affiliation with BIDMC and HMFP that would replace its longstanding collaboration with Brigham and Women’s Hospital (BWH). DFCI would construct a new DFCI hospital facility of over 300 beds adjacent to BIDMC and the parties would collaborate, through clinical affiliation agreements and joint ventures, to provide adult cancer services in the new facility and the greater Longwood medical area.

The proposed affiliation was filed as a material change notice (MCN) with the HPC in October 2023. The HPC determined that the affiliation is likely to have a significant impact on the competitive market for cancer services in Massachusetts and is likely to impact health care spending. As a result, the HPC will exercise its authority to conduct a cost and market impact review (CMIR).

The CMIR is a comprehensive, data-driven review that will assess the impact of the proposed clinical affiliation on costs and the Commonwealth’s ability to meet the health care cost growth benchmark, market functioning, quality of care, and health equity and access for consumers. The HPC leverages confidential information provided by the transaction parties and other market participants, public data sources including those collected by the Center for Health Information and Analysis, and the advice of expert consultant teams in order to build its analyses. The outcome of this process will be a public report detailing the HPC’s findings.

The proposed construction of the new hospital facility also requires a Determination of Need (DoN) review by the Department of Public Health (DPH). DFCI filed a DoN application for the project in October 2023, and that filing was deemed complete in early January 2024.

“We look forward to working with Dana Farber and Beth Israel to understand and assess this proposal’s impact on health care cost, quality, and access for patients and to provide that assessment to other state agencies and the public,” said Deborah Devaux, HPC Board Chair.

“The HPC’s cost and market impact review authority is essential to assess significant changes in the Massachusetts health care system, such as those proposed by the parties,” said HPC Executive Director David Seltz. “We will carefully review the potential impact on affordability, equity, and access and issue a comprehensive public report.”

The HPC does not have the authority to prohibit a transaction but may refer its report and findings to the Office of the Attorney General, DPH, or other state agencies for possible further action on behalf of consumers in the health care market. Through this process, the HPC also seeks to encourage providers to evaluate and take steps to minimize negative impacts and enhance positive outcomes of any proposed change.

Further detail on the HPC’s transactional review process is available on the HPC’s website.

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