New Hampshire’s attorney general on Friday objected to a proposal by Massachusetts General Hospital to acquire a local hospital and threatened legal action to stop it, dealing another setback to the expansion plans of Mass. General and its parent company, Partners HealthCare.
In a report released Friday, Attorney General Gordon J. MacDonald said Mass. General’s proposal to acquire Exeter Hospital — after its 2017 acquisition of Wentworth-Douglass Hospital in Dover, N.H. — would harm consumers by reducing competition and raising costs.
Exeter and Wentworth-Douglass sit about 18 miles apart and provide similar medical services.
MacDonald told the Globe that the transaction as currently proposed would “violate New Hampshire’s laws protecting free trade and competition.”
“If they proceed with this transaction as it’s on the table now, we would be prepared to seek remedies in court to stop it,” he said.
Mass. General and the two New Hampshire hospitals, along with their physician groups, had planned to create a regional health system that would be owned and operated by Mass. General.
Officials at the three hospitals have described their deal as critical for expanding health care services for residents of New Hampshire’s Seacoast region. In response to the attorney general’s report Friday, they said they remained committed to their transaction and would continue making their case to regulators. The deal needs approval from state and federal authorities.
The hospital leaders said in a joint statement that the rejection of their deal would deny Seacoast residents important benefits and jeopardize the long-term sustainability of Exeter Health Resources, the parent company of Exeter Hospital.
“This does bring value. This is not anticompetitive,” said Tony James, senior vice president of network development and integration at Mass. General. “We feel there is ample room for discussion around [the attorney general’s] concerns,” he said in an interview. “We think they all can be resolved.”
New Hampshire’s attorney general said he’s open to continuing the dialogue but was concerned that hospital leaders seem to think his objection to the deal is unfounded.
“That is not true,” MacDonald said. “We have spent one year taking a very serious look at this. This transaction raises serious concerns.”
The Federal Trade Commission is also reviewing the deal.
The setback in New Hampshire comes three months after Mass. General’s parent company, Partners, suffered another disappointment to its regional expansion plans. In June, more than two years after Partners announced it was seeking to acquire Care New England Health System of Rhode Island, the state’s governor asked Partners to walk away.
Governor Gina M. Raimondo said she preferred a local health care solution and urged Care New England to negotiate a deal with its primary competitor, Lifespan. Those discussions quickly broke down.
Raimondo’s position has not changed, her spokesman, Jennifer Bogdan, said in an e-mail Friday.
“Whether or not Rhode Island’s hospitals affiliate at some point with a larger out-of-state partner [like Partners], creating a more integrated, locally run system here first is what’s in the best interest of Rhode Island now and in the long run.”
Partners officials have no plans to resume talks with Care New England. “We respectfully withdrew our application in Rhode Island at the request of the governor,” spokesman Rich Copp said. He added that Partners’ regional growth strategy has not changed, despite the setbacks in Rhode Island and New Hampshire.
Partners is Massachusetts’ most powerful network of doctors and hospitals. In addition to acquisitions, the nonprofit health system is planning to grow by building new outpatient clinics. Mass. General is also planning a more than $1 billion expansion at its main campus in Boston.