A year after Mass Gen. Brigham pulled out of an attempted takeover of Exeter Health Resources, the New Hampshire health system has a new suitor in Massachusetts: Beth Israel Lahey Health.
BILH announced on Tuesday that it had signed a letter of intent to acquire the system, which includes Exeter Hospital, Base Physicians and Rockingham Visiting Nurse Association & Hospice. The parties expect to sign a definitive agreement within the next 90 days, which would kick off federal and New Hampshire regulatory approval.
“The combination of the fact that New Hampshire residents were already regular commuters to [Massachusetts]including to our facilities for both routine and complex care, and the fact that we think New Hampshire is an important place for us locally to be able to provide care, just meant that it was something that made absolute sense for both parties,” said Kevin Tabb, president and CEO of Beth Israel Lahey Health.
The deal will bring 2,400 New Hampshire Hospital, Physician Network and VNA employees into the 36,000-employee BILH system, adding one hospital to BILH’s 12 and increasing the company’s footprint for the first time. BILH out of state.
Exeter officials said the integration into a wider system was intended to strengthen the organization for the future.
“The opportunity to be part of BILH’s integrated healthcare delivery system provides Exeter with access to critical resources that will underpin healthcare delivery in the future,” said Kevin Callahan, President and CEO. from the management of Exeter Health Resources, Inc. The determining factors in the selection of BILH by our Board of Directors were its demonstrated commitment not only to maintaining local care within the community, but also to investing deeply in the advancement of this care.
Governance of the New Hampshire system is still under discussion, although Tabb said Exeter’s leadership would not change as part of the deal.
While BILH’s academic medical centers are likely to gain referrals through expansion, Tabb said the goal of the acquisition was to strengthen care in New Hampshire. Immediately, that will mean installing a new electronic medical records system in Exeter, bringing specialty care to the New Hampshire market, and boosting recruitment of primary care physicians in the state. Ultimately, the system may seek to expand outpatient sites or other locations in New Hampshire.
Beth Israel Lahey Health was created in 2019 through the merger of five health systems. The organization added Joslin Diabetes Center specialty hospital in 2021. Despite its size, the system remains a lower-cost provider in Massachusetts, in part because Massachusetts regulators instituted price caps for seven years.
Since Exeter is outside of Massachusetts, it would not be subject to the same price cap limit, although Tabb noted that a conversation about expenses and costs would take place with the New Hampshire attorney general. during the State’s review of the transaction.
MGB had attempted to acquire Exeter in 2018, seeking to combine the Exeter-based system with Wentworth-Douglass, a Dover-based hospital that Mass General Brigham had acquired the previous year.
The deal faced regulatory backlash, and in 2019 the Granite State Attorney General’s Consumer Protection and Antitrust Office issued a notice of intent to halt the transaction due antitrust issues. Mass General Brigham eventually backed out of the deal in January 2021.
BILH picks up where MGB left off. Tabb said Exeter was looking for a partner and approached BILH as part of a year-long competitive assessment of various health systems in the state and region.
Although Exeter suffered an operating loss of $20.6 million in financial year 2020, the most recent year available, the system reported black trading from at least 2016 to 2019 Tabb said the acquisition plans were not due to financial peril, but because Exeter saw the benefits of being part of a system, particularly during the pandemic.
“Everything from the ability to respond with agility to increased patient numbers, the need to move resources, people and equipment and other things meant that hospitals that were part of a system were just better able to weather the storm,” Tabb said. . “My feeling is that before the pandemic they thought (joining a system) was important, but it’s really been reinforced during the pandemic.”
This is the second time this year that BILH aims to expand its market. In January, BILH announced it would partner with Cape Cod Health, bringing more doctors from Boston and Burlington to the Cape and expanding the brand of the largest hospital further south.
While other systems such as Mass General Brigham have sought to expand into several states surrounding Massachusetts, Tabb said the expansion into New Hampshire was not a sign of bigger ambitions for growth outside of it. State.
“There’s no grand plan bigger just to get big for fun,” Tabb said. “We will continue to assess opportunities as they arise. But I don’t think it signals a significant shift in our strategic approach.
Jessica Bartlett can be contacted at [email protected]. Follow her on Twitter @ByJessBartlett.
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