Dartmouth Health/Granite One merger abandoned after Charitable Trust report cites lack of consumer protection

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CONCORD, NH – A Charitable Trusts Unit report released Friday by the NH Attorney General’s office details the state’s objection to the proposed merger of GraniteOne Health and Dartmouth Health, which is now off the table.

“Free, fair and robust competition is critical to providing employers and patients with options for lower cost and high-quality health care services,” said Attorney General John Formella. “Our state has experienced significant consolidation in health care over the past several years, and this transaction seeking to combine two of our top four largest systems is unacceptable without appropriate protections for consumers in place.”

A response from Dartmouth-Hitchcock issued shortly after the release of the AG’s report Friday confirms that, in light of the state’s objections, Dartmouth Health and Granite One Health will no longer pursue a merger.

“Although we disagree with, and are deeply disappointed by, the result of the regulatory review, we respect the process that led to this decision,” the statement reads. “As New Hampshire’s only academic health system, we have a fundamental obligation to our patients and communities to assure that we are delivering high-quality, safe and efficient care. What sets Dartmouth Health apart is our ability to provide this care through a network of large and small, exceptionally well-qualified regional hospitals, clinics and home health and hospice services that are deeply grounded in our respective communities.”

In his statement about the report findings, Formella noted the state’s decision was first and foremost a protective measure for New Hampshire consumers who “already pay exceptionally high prices for health care.”

“Our duty is to protect the public and we will use all enforcement tools available to us to do so. Considerable diligence was put forth to reach common ground with both health care systems. Without remedies in place protecting the public from harm and ensuring the combined system delivers on the promised benefits, the transaction as proposed is not something that I can approve,” Formella said.

The proposal as currently structured would have consolidated two competing health care systems with many hospitals, physician practices and outpatient services, resulting in a single system ultimately to be controlled by Dartmouth Health.

Before the type of transaction involved in this case may take place, New Hampshire law requires the Charitable Trusts Unit to review the proposal and determine whether, among other requirements, the transaction is permitted by applicable law. The Attorney General objects to the combination because the transaction, as proposed, fails this primary requirement.

Part 2, Article 83 of the New Hampshire Constitution requires “free and fair competition in the trades and industries.” In addition, RSA 356, the State’s Antitrust law, and RSA 358-A, the Consumer Protection Act, all protect free and fair competition. After a fact-intensive review by the Consumer Protection and Antitrust Bureau, the Attorney General has concluded that the completion of this proposed transaction would violate the law.

Specifically, the transaction, as proposed, would end the existing competition between the two systems that consumers rely on in several health care markets served by both GraniteOne and Dartmouth Health today and, therefore, would violate state and federal law without sufficient remedies to address the anticompetitive harm.

More than 10 years ago, Dartmouth-Hitchcock Health attempted to acquire Catholic Medical Center in Manchester, New Hampshire, which is currently GraniteOne’s flagship hospital. In 2010, the Charitable Trusts Unit issued a public report objecting to the transaction, and the parties ultimately decided to abandon the deal.

The Charitable Trusts Unit’s report issued today, May 13, 2022 is below, followed by the full response from Dartmouth Health.



 

About this Author

carol-robidoux

Carol Robidoux

PublisherManchester Ink Link

Longtime NH journalist and publisher of ManchesterInkLink.com. Loves R&B, German beer, and the Queen City!