Lawrence General Hospital is expanding an alliance with Boston’s Beth Israel Deaconess Medical Center, in a deal bringing the community hospital into a fast-growing group that negotiates health insurance contracts for Beth Israel Deaconess hospitals, doctors, and affiliates.
The agreement unveiled Wednesday is the latest in a series of deals that have spurred rapid consolidation of the state’s health care industry.
It calls for 189-bed Lawrence General to join Beth Israel Deaconess Care Organization, the 16-month-old insurance contracting group. In addition, the Harvard-affiliated medical center will step up its specialty care assistance at Lawrence General. The two hospitals also will jointly hire more primary care doctors in the Merrimack Valley.
The deal comes less than a month after Lowell General Hospital, a rival community hospital in the Merrimack Valley, struck an agreement with another Boston teaching hospital, Tufts Medical Center, to join forces under a new parent organization. Just as that pact lets Lowell General continue operating independently, Lawrence General also will retain its independence despite stronger ties to the 649-bed Beth Israel Deaconess.
“It allows us to be part of a large and very effective institution and also to remain local,” said Lawrence General chief executive Dianne J. Anderson, who was senior vice president of clinical operations at Beth Israel Deaconess before taking the top job in Lawrence in 2009.
Kevin Tabb, chief executive of Beth Israel Deaconess, said the hybrid structure of the contracting group enables it to represent the community hospitals it owns in Needham, Milton, and Plymouth, as well as affiliated hospitals that include Cambridge Health Alliance and Anna Jaques Hospital in Newburyport, along with about 2,100 physicians.
“This is not an ownership transaction,” Tabb said of the Lawrence General alliance. “That works in some cases, but not all cases. We don’t believe that one size fits all.”
Like other expanding Boston health care organizations, such as Partners HealthCare System, Steward Health Care System, and Tufts, Beth Israel Deaconess wants to increase referrals to its Boston flagship hospital for complex care while keeping routine care in communities outside the city.
Lawrence has long been a fragmented market, however, and 70 doctors in a Lawrence General-affiliated practice — Pentucket Medical Associates — will still be connected to Partners Community Healthcare Inc., the Partners-owned physicians group.
Of the 500 doctors credentialed at Lawrence General, 110 belong to Beth Israel Deaconess Care Organization. Many others already make referrals to Beth Israel Deaconess.
Even before the new agreement, the Boston teaching hospital has been assisting with bariatric surgery, cardiac services, and intensive care at Lawrence General. The two hospitals plan to expand those collaborations, better coordinate protocols, and integrate electronic medical records.
But preventive care will be a priority, officials said. That is a key element of the risk-based contracts being negotiated with health plans, which give hospitals and doctors a fixed budget for managing patient care and reward them for coming in under budget.
“The way we’re going to succeed is together managing the care of patients outside the walls of the hospital,” partly by preventing readmissions, Anderson said.
Lawrence General competes not only with Lowell General and the Steward-owned Holy Family Hospital in Methuen and Merrimack Valley Hospital in Haverhill, but also with what Anderson calls the “leakage” of area patients to more expensive Boston hospitals.
Speaking of the Beth Israel Deaconess alliance, Anderson said, “We’ll be looking together at where we have gaps. Patients in the Merrimack Valley are looking for care at the local level. For patients, this is a very good move.”