A spokeswoman for the Department of Public Health declined to comment directly on the staff’s position, noting that Mass General Brigham has since withdrawn the suburban project.
The DPH staff recommendations are a good indicator of how the Public Health Council will vote on the projects next month, the final hurdle for the projects.
“Mass General Brigham remains dedicated to transforming care delivery so that our patients receive the right care in the right place at a lower cost,” Mass General Brigham chief executive Anne Klibanski said in a statement. “We will continue to honor our commitment to provide the best care to the 227,000 patients we currently serve at Mass General Brigham affected by the Department of Public Health’s decision.’’
The decision on the $223.7 million multisite outpatient expansion, the most controversial aspect of Mass General Brigham’s plans, is a setback for the state’s largest health care company. MGB has long held that the suburban outlets would result in lower overall health care spending by moving patients out of downtown hospitals and closer to home, and it spent heavily on an ad campaign to convince the public and officials the projects were critical. Yet it faced a torrent of opposition.
In November, Attorney General Maura Healey warned that MGB’s planned expansion would ultimately increase health care spending statewide if it drew patients away from lower-priced providers.
Healey’s report stopped short of voicing opposition to the projects, but said state officials should carefully weigh details about the project that her office uncovered through an independent civil investigation. The move was unusual for Healey, who usually does not weigh in on hospital capital projects and currently has little oversight of them.
A state health care watchdog agency, the Health Policy Commission, had also said Mass General Brigham’s outpatient expansion plans would raise annual health care spending by between $9.3 million to $27.9 million and would drain business from more lower-price competitors.
And, the commission warned that the two hospital projects would raise spending — between $6.4 million to $7.9 million for the Faulkner, and $30.3 million to $54.4 million for the MGH expansion. The same day that the commission questioned MGB’s expansion plans, the Health Policy Commission said it would more closely monitor the system and demand it contain spending after years of going above acceptable limits.
Several independent economists have sided with state regulators, arguing that there are few examples where expansion of a large and more expensive provider ultimately saves money.
Competitors, community groups, and the state’s insurance lobbying group also have been vocal opponents of the outpatient expansions, worried they would take patients out of community systems and funnel them through referrals to downtown facilities.
Lora Pellegrini, president of the Massachusetts Association of Health Plans, said Mass General Brigham should turn its attention to reining in costs.
“We are hopeful that Mass General Brigham will now work with the Health Policy Commission to … bring their costs in line with the state’s cost growth benchmark,” Pellegrini said.
Opponents, who formed an organization called the Coalition to Protect Community Care, said they were pleased with the development and thanked public officials “for their diligence and commitment to containing healthcare costs, protecting high-value community healthcare providers, and improving health equity as this proposal was undergoing review.”
House Speaker Ron Mariano, who has proposed revising how hospital expansions are regulated, said the pullback by MGB doesn’t change the need for the laws to be overhauled.
“The need remains for an update to our laws to prevent other hospital systems from attempting a similar tactic to increase their market dominance and command higher prices for treating patients,” Mariano said in a statement.
In addressing cost concerns on the hospital expansions, DPH staff said they would not approve adding 94 beds at MGH through the project. Instead, the new towers would create single-bed units that would replace double-bedded rooms. The staff said MGB can submit an amendment if it can demonstrate a need for the additional beds.
DPH staff also recommended a number of conditions be imposed on the MGH and Faulkner projects. In the case of the Mass. General expansion, those include monitoring a number of metrics to ensure the project is addressing inpatient needs.
The Faulkner project, the staff said, should also be monitored closely. The DPH said it would consider the project in violation of its order if transfers of patients from the Faulkner to the Brigham experience “a material increase,” or if wait times for imaging services increase. DPH staff also recommended the department monitor patients who transfer from the Brigham to Faulkner.
David Rosenbloom, a public health professor at the Boston University School of Public Health, said those conditions historically have only tinkered at the margins of controlling spending. But he added that the conditions sent a strong signal to Mass General Brigham about the state’s expectations.
Overall, Rosenbloom said, the DPH’s apparent rejection of a piece of the project was an example of state’s regulatory approval process working.
“I think it’s a recognition of the validity of the process of having external, neutral, and fact-based reviews of these major proposals,” he said.
David Brown, president of Massachusetts General Hospital, and David McCready, president of Brigham and Women’s Faulkner Hospital, said in statements that the approvals were welcome, and would ease capacity challenges and result in better care for their patients.