Behemoth and Leviathan, watercolor by William Blake from his Illustrations of the Book of Job.
From Robert Whitcomb’s “Digital Diary,’’ in GoLocal24.com
So consolidation of New England’s health-care biz continues apace. Two big Massachusetts-based health insurers – Harvard Pilgrim Health Care and Tufts Health Plan -- plan to merge. This follows Beth Israel Deaconess Medical Center and Lahey Hospital merging this year into the very big Beth Israel Lahey Health, and Rhode Island-based CVS taking over health insurer Aetna. And huge Partners HealthCare, the Boston-based hospital and physicians network group (Massachusetts General Hospital, etc.), made a run this year at taking over Rhode Island-based Care New England. And the latter outfit was in failed talks to merge with Lifespan, a merger that economics might still force – to be followed by that merged creature being eaten by a Boston group, producing a flock of golden parachutes for redundant executives?
The economics of the health-care business mean that there will be more such mergers. Big will get bigger. This may include Partners coming back to Rhode Island to try to gobble up Care New England or Lifespan or both. Or maybe Beth Israel Lahey Health will try to invade the Ocean State.
With the huge economic power – especially pricing power – and lobbying clout of the new insurance behemoths, state regulators will have their hands full trying to regulate them. Still, the merger, which would affect several million New England customers and their families, would create an entity with impressive bargaining weaponry to curb the very high prices enabled by the size and global prestige of the hospital behemoths. So let ‘em merge.
