Massachusetts General Hospital and Brigham and Women's Hospital are officially Partners.
The two tertiary-care giants in Boston formally affiliated last week under a common parent corporation named Partners Healthcare System. The affiliation, announced Dec. 8, 1993, received determination-of-need approval on Feb. 18, and hospital executives heard on March 9 that state Attor- ney General Scott Harshbarger had completed a favorable review of the deal.
H. Richard Nesson, M.D., president of Brigham, was named chief executive officer of Partners; Samuel O. Thier, M.D., incoming president of Massachusetts General's parent corporation, was named president of the new healthcare system.
The two executives will oversee a newly created executive office that will seek to integrate operations, according to a joint statement. But all recent statements pointedly use the term "affiliation" to describe the new relationship, in contrast to earlier characterizations of the agreement as a merger and a combination of equals.
Dr. Thier said those who announced the deal "got out ahead of themselves in December" by calling it a merger.
Dennis Thomson, a spokesman for Brigham, said, "Merger connotes the coming together of two separate organizations into one." In this case, he said, "two venerable institutions agreed to form a new system. It's that new healthcare system that's the real news here." Hence, affiliation "is a far more descriptive term."
The affiliation will be directed by a 12-member system board that will appoint the boards of Brigham, Massachusetts General and seven affiliated institutions and healthcare services units, Dr. Thier said.
The hedging on "merger" is evidence that the system's purpose isn't so much to save money on streamlined operations but rather to grab a larger share of the Boston market, said Ellen Lutch Trager, director of healthcare strategies with the Boston law firm of Brown, Rudnick, Freed & Gesmer. She said managed care is at the root of the strategy: "The more lives that are controlled, the stronger their edge on the financial competition side."
But byproducts of that strategy could include operational and administrative savings, such as the ability to offer a single billing service, she said.
Dr. Thier said the development of an integrated regional system is a top priority, but cutting costs and planning for eventual consolidation are also key concerns.
Before the affiliation was announced, Massachusetts General had developed plans to trim $25 million a year from its budget during the next five years, and Brigham had set in motion a $60 million budget reduction over three years. Massachusetts General also plans to reduce its staffed beds to 900 from the current 1,027, he said.
Dr. Thier said guidelines are being developed to decide where to house new services; whether to replace or consolidate services when a major clinical leader retires or leaves; and whether to consolidate a service at one hospital as more clinical procedures move out of the inpatient setting and volume falls below what a single hospital can support.