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DOJ investigating Partners HealthCare System for potential antitrust violations

The Department of Justice (DOJ) is conducting a civil investigation of Partners HealthCare System Inc., a regional hospital and physician network founded in 1994 by Boston-based Brigham and Women's Hospital and Massachusetts Hospital, for possible anticompetitive behavior, reports the Boston Globe.

DOJ investigators on April 19 sent letters to Partners, as well as to three of Massachusetts' largest health insurers, seeking documents that pertain to the nonprofit system's "contracting and other practices" in eastern Massachusetts. The DOJ wants to assess whether Partners wielded its considerable market power in violation of the Sherman Antitrust Act (i.e., to limit trade or artificially raise prices). The Justice Department has ordered Partners and the insurers--Blue Cross and Blue Shield of Massachusetts, Harvard Pilgrim Health Care and Tufts Health Plan--to reply by May 19.

The DOJ ordered these companies to provide detailed information on Partners' process for negotiating contracts with health insurers and how much the insurers pay the network's Boston teaching hospitals, including the two founding members.

The information requested by the DOJ is "the same information that we have provided to the attorney general's office," Partners spokesman Rich Copp tells the Boston Globe. Massachusetts Attorney General Martha Coakley instituted a review of Partners' contracting methods last year. Partners plans to "continue to cooperate with both government agencies during this ongoing analysis of health care in Massachusetts," says Copp.

Last month Coakley released a report on cost drivers in the Massachusetts healthcare market that revealed that some Massachusetts hospitals and physicians are paid up to twice as much as other hospitals that provide the same services. The Coakley report attributed price variations to market leverage rather than quality of care, the sickness of the population or other factors. Partners hospitals were among those that negotiated some of the highest payments, reports the Patriot Ledger.

To find out more:
- read this Boston Globe article
- read this Patriot Ledger article
- review the Coakley report

Related Articles:
Partners HealthCare defends costs to state regulators
Partners posts $45M gain for fiscal '09

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