THE HEAD OF Partners HealthCare System on Tuesday pointed the finger at state regulators, saying the tight rein they have on hospitals is as much to blame for rising health care costs as anything providers do to try to control those prices.

Dr. David Torchiana, Partners president and CEO, said the decision earlier this year by Attorney General Maura Healey to oppose a merger with three suburban hospitals added to the difficulties of delivering low-cost care outside of Partners’ Boston facilities. He said the view by regulators – a view accepted by a Suffolk Superior Court judge – that the merger would have given Partners an unhealthy share of the market and stemmed competition was a red herring.

“We have to do it [acquire community hospitals] with the expectation that it will reduce costs,” he said.

Torchiana was part of a panel of industry officials who appeared at a hearing of the Health Policy Commission on future cost trends. With Partners holding nearly a quarter of the state’s health care market, much of the focus was on why the nearly $10 billion behemoth commanded the highest prices.

Healey, like her predecessor Martha Coakley, said earlier in the day that physician networks owned by Partners and other large hospital systems are often paid more by health plans even though their quality of care is no different from what other systems offer.

Torchiana, however, said it was disingenuous to think quality wasn’t the basis for patients choosing Partners. He acknowledged that Partners controls a lion’s share of the market but said that’s not why the hospital system gets the highest reimbursements from health plans. “It comes from the public perception of the quality of Partners,” he said.

Eric Schultz, president and CEO of Harvard Pilgrim Health Systems, seemed to disagree. “Most consumers believe if the cost is higher, the quality is better, and that’s not necessarily true,” he said.

Dr. Kevin Tabb, the CEO of Beth Israel Deaconess Medical Center, opposed the proposed Partners acquisitions, but has held merger talks with other hospital systems, including Lahey Health. He said expansion is necessary for hospital systems like his to offer low-cost services at satellite facilities. He said competition is the key to reducing medical costs.

“Unless we have more strong, viable competition, we’re going to be sitting here in 10 years asking why things haven’t changed,” he said.

The panel, which included four of the state’s leading health providers and the president of one of Massachusetts’ top health plans, managed to reach consensus on why it’s so hard to get a handle on spiraling costs: There is no “silver bullet.”

The five industry leaders blamed unnecessary tests, poor regulation, and inadequate competition for the failure to corral costs.

Schultz pointed to the “litigious nature of our culture” that’s causing physicians to order unnecessary procedures as well as waste in overprescribed and unneeded medications.

Wendy Everett, the commission’s vice chair, pointed out that the problems the industry officials ticked off such as medically unnecessary procedures and unnecessary readmissions, have been cited repeatedly with little done to change the problem. She cited a recent survey that found 76 percent of patients in the state’s emergency rooms went there for treatment because they did not have access to their own primary care physician after hours. She said taking more initiative to get people out of emergency rooms is one place to cut costs.

“There are things over which we have a lot of control and yet, for the third year in a row, we have no progress,” she said.

Schultz said regulators and legislators also opened a Pandora’s Box when they mandated treatment coverage for drug abuse to be covered by health plans.

“Are you going to do it for every single new issue?” he asked. “Did this create a precedent for other medical issues?”

Marylou Sudders, the secretary of health and human services and a member of the commission, said the substance abuse crisis was one that called for radical and immediate solutions and she said Gov. Charlie Baker, who once held Schultz’s job before running for governor, was in full support of the Legislature’s action. She said it would “hopefully not” open the door to using the same approach for other medical issues.

Schultz said looking for a quick turnaround and solutions will not solve the issues that have festered for years.

“We recognize we’re all frustrated over the speed of change even if it took us decades to get here,” he said.

Jack Sullivan is now retired. A veteran of the Boston newspaper scene for nearly three decades. Prior to joining CommonWealth, he was editorial page editor of The Patriot Ledger in Quincy, a part of the...

2 replies on “Partners head points finger at state”

  1. Thanks for this remarkable story on Dr. Torchiana’s attempt to blame state government for high Massachusetts health costs.

    His public presentation seems to establish a new Partners institutional best score of 18 points on the 10-point chutzpah scale.

    Blame the state? It might be fair to say that Massachusetts state government has done very little to prevent health costs from rising. Unless a generous soul were to count efforts like presenting data showing Partners persistently gets paid high prices–prices that aren’t warranted by anything except Partners’ ability to pry them out of Blue Cross, Tufts, Harvard-Pilgrim, and the other private payers.

    But can anyone credit Dr. Torchiana’s attempt to blame high costs on the state when it finally did in 2015 what it should have done in 1993-1994—preventing a Partners merger.

    If Partners and its physicians want to refer to lower-cost hospitals, physicians can apply for admitting privileges. (It’s a free country.) Partners doesn’t have to own those hospitals. It’s simply wrong for Dr. Torchiana to blame an AG and a judge for finally standing up to Partner’s own imperial and anti-competitive practices.

    Even if Partners’ mergers somehow saved it money (and Partners has adduced no evidence on this), those savings would go straight to Partners’ bottom line or enhance its ability to invest in costlier technologies or capacity, or in facilities located in higher-income areas.

    What mergers clearly have done is exactly what the Brigham and General sought in 1993-1994—avoid competing by price by allowing them to present a united front to payers. And this is a big reason new Partners hospitals and doctors have elected to put on gang colors.

    If Dr. Torchiana has a point, maybe it’s not the one he intended. Maybe state government is to blame. By facilitating and acquiescing in the original sin of the original Brigham-General merger (then-AG Harshbarger didn’t even call for a public hearing) the state enabled Partners to win high prices–unwarranted, undeserved anarchy prices.

    And that’s one of the many reasons our state has long had the world’s most expensive health care.

  2. #Torchiana & #Partners logic only reinforces the Economics Nobel Prizewinners Phishermen-Phools theory. Contratulations to Maura Healey for not allowing Massachusetts to be Partners’ phool

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