Proposed affiliation and new cancer hospital would be a significant realignment for cancer care among major Massachusetts health care providers
BOSTON — Thursday, February 27, 2025 — Today, the Massachusetts Health Policy Commission (HPC) Board of Commissioners voted to issue the preliminary report on the cost and market impact review (CMIR) of a new proposed affiliation between Dana-Farber Cancer Institute (DFCI), Beth Israel Deaconess Medical Center (BIDMC), and Harvard Medical Faculty Physicians (HMFP) at BIDMC.
Under the proposed transaction, DFCI would form a new clinical affiliation with BIDMC and HMFP, replacing its longstanding collaboration with Brigham and Women’s Hospital (BWH), and construct a new DFCI hospital facility including 300 beds adjacent to BIDMC. The parties would collaborate to provide adult cancer services in the new facility and the greater Longwood medical area of Boston.
After the proposed affiliation was filed as a material change notice (MCN), the HPC determined the affiliation was likely to have a significant impact on health care costs and market functioning and exercised its authority to conduct a CMIR to detail the impact of the proposed clinical affiliation on costs, the Commonwealth’s ability to meet the health care cost growth benchmark, market functioning, quality of care, and health equity and access for residents of Massachusetts.
The HPC conducted its independent, data-driven review by examining confidential information provided by the transaction parties and other market participants, as well as all available data on measures of cancer care costs, prices, quality, and access in Massachusetts. The HPC’s preliminary report concludes that this transaction would constitute a significant change in the delivery of cancer care in Massachusetts.
The HPC found that the proposed transaction will likely shift a large volume of oncology care to DFCI, which would likely reduce spending for inpatient care, but would likely substantially increase spending for outpatient care due to DFCI’s high outpatient prices, particularly for oncology drugs. The HPC also found that the transaction may concentrate oncology care in greater Boston and pull volume away from other oncology providers including community hospitals. DFCI and BIDMC are both internationally recognized for their high-quality cancer care and the HPC found that the proposal will likely not negatively impact patient care quality in the long-term and may provide opportunities for care delivery, quality, and access improvements.
However, implementation of the affiliation will require significant coordination and planning to minimize patient care and workforce disruptions during the transition period. Commitments by the parties, including any provided in the parties’ written responses to the HPC’s preliminary report, may help to address concerns raised in this report.
“This new relationship will represent a major change in the delivery of cancer care in Massachusetts, and we appreciate Dana Farber and Beth Israel’s cooperation in working with the HPC on this important evaluation,” said Deborah Devaux, HPC Board Chair. “We hope that the parties address the questions raised in the preliminary report to ensure that the next steps taken represent the best path forward for an affordable, accessible, and equitable health care system in the Commonwealth.”
“The HPC’s market oversight authority is essential to assessing considerable changes in the Massachusetts health care system with data and objective rigor,” said HPC Executive Director David Seltz. “In this 10th CMIR, we provide analyses that allow other state agencies, industry stakeholders, and the greater public to understand the potential impact that market changes may have on health care costs, quality, and access. For patients seeking cancer care in Massachusetts, this would be a significant realignment for cancer care among major health care providers. The HPC’s findings in this review highlight the likely impact of the proposal on future health care spending, which, absent further commitments from the parties, may exacerbate ongoing affordability challenges in Massachusetts.”
Summary of Preliminary Findings
- The proposed transaction and the construction of the new DFCI facility would likely lead to large shifts in oncology care to DFCI. BIDMC would also likely gain surgical oncology volume.
- At current prices, the proposed affiliation would likely result in net savings for inpatient care, but a net increase in spending on outpatient care due to DFCI’s outpatient prices, which are generally high compared to other oncology providers. Based on HPC modelling, care shifting to DFCI and BIDMC is likely to decrease annual commercial spending by $22 to $28 million for inpatient care, offset by some anticipated increased spending at BWH, but increase annual commercial spending by $39 million for outpatient care. These impacts are based on current pricing; any change to the parties’ pricing will impact these spending impacts.
- The proposed affiliation may also pull volume away from other hospital oncology providers, including community providers. As DFCI works to staff its new hospital, increased competition in the labor market may further increase costs for these providers. If these pressures destabilize or diminish the ability of other oncology providers to invest in or maintain facilities and staff, it is likely to impact health equity and access as well as potentially increase health care spending.
- DFCI’s new facility would significantly expand inpatient medical oncology services in Boston. While regionalization may promote beneficial specialization, it also may challenge oncology service accessibility in other parts of the state and at other oncology providers.
- Available data does not raise concerns about patient care quality, and the parties are developing plans intended to promote clinical quality and access to services, although the parties will need to work to avoid disruptions in continuity of care during the transition.
Should the proposed affiliation proceed, commitments by the parties and public monitoring may help to address concerns raised in the HPC’s report.
These areas include:
- DFCI’s high current prices for outpatient services including oncologic drugs;
- Commitments regarding future inpatient and outpatient price increases for DFCI;
- Coordination of care among oncology providers during and after the transition of DFCI’s affiliation from BWH to BIDMC; and
- Continued focus on and investment in the parties’ proposed quality improvement, access, and equity initiatives, including reporting on the implementation and results of the parties’ plans in these areas, including the parties’ mix of publicly insured patients and any continued efforts to expand access for MassHealth patients.
Next Steps in the CMIR Process
At today’s meeting, commissioners voted to submit the preliminary report to DPH to be considered in its DoN review.
Following the release of the preliminary report on the CMIR, the parties to the transaction have 30 days to submit written comment, including any commitments based on the findings. The public and other interested parties may also submit comments to the HPC during this time. The transaction may not be finalized until 30 days after the HPC publishes its final report on the CMIR, which the HPC expects to issue in April.
The proposed construction of the new freestanding hospital facility also requires a Determination of Need (DoN) review by the Department of Public Health (DPH). DFCI filed a DoN application for the project in October 2023, an independent cost analysis was completed in January 2025, and a staff report was issued regarding the proposal on February 18, 2025. The DFCI project will likely be voted on at a Public Health Council meeting on March 20, 2025..
The HPC does not have the authority to prohibit a transaction but may refer its report and findings to the Office of the Attorney General, DPH, or other state agencies for possible further action on behalf of consumers in the health care market. Through this process, the HPC also seeks to encourage providers to evaluate and take steps to minimize negative impacts and enhance positive outcomes of any proposed change.
Further detail on the HPC’s transactional review process is available on the HPC’s website.
Advance Guidance for HPC’s Expanded Market Oversight Authority
HPC staff provided an overview of advance guidance for providers and provider organizations relative to the expansion of HPC market oversight authority (pursuant to Chapter 343 of the Acts of 2024). The meeting concluded with agency updates in the Executive Director’s report.
The preliminary report on the DFCI-BIDMC-HMFP CMIR, presentation materials, and a recording of the meeting are available on the HPC’s website.
