HPC issues final report on cost and market impact review of new Dana-Farber-Beth Israel cancer care collaboration
BOSTON — Today, the Massachusetts Health Policy Commission (HPC) Board set the Massachusetts health care cost growth benchmark for calendar year 2026 at 3.6%. The HPC Board also issued the final report on the cost and market impact review (CMIR) of the proposed affiliation between Dana-Farber Cancer Institute (DFCI), Beth Israel Deaconess Medical Center (BIDMC), and Harvard Medical Faculty Physicians (HMFP) at BIDMC, submitting the report to the Massachusetts Department of Public Health (DPH) for consideration of additional or revised Determination of Need conditions. The HPC also submitted its report to the Office of the Attorney General (AGO) for future consideration in the context of the AGO’s authority to monitor the health care market, especially cancer care in Massachusetts.
2026 Health Care Cost Growth Benchmark
The health care cost growth benchmark, the cornerstone for the state’s cost containment efforts, is a statewide target for the rate of growth of total health care expenditures (THCE), the annual sum of all health care expenditures in the Commonwealth from both private and public sources, calculated on a per person basis. The benchmark does not cap prices or spending growth but is instead a measurable goal to track the state’s progress and to motivate collective action to moderate spending growth over time.
In determining the 2026 benchmark, commissioners considered testimony and data first presented at the Health Care Cost Growth Benchmark Hearing held in conjunction with the Joint Committee on Health Care Financing. THCE increased 8.6% from 2022 to 2023, totaling $11,153 in average annual health care spending per Massachusetts resident. This growth was largely driven by rising pharmaceutical costs and higher spending in hospital outpatient departments. Pharmacy spending net of rebates increased by $1 billion (10%), partially driven by increased use of GLP-1 medications and growth in prices of prescription drugs.
Considering these concerning health care cost growth trends, commissioners voted to keep the benchmark at 3.6% for another year, in line with the potential gross state product established in the consensus revenue process.
“The benchmark is an important tool for transparency and oversight. As the state grapples with the ongoing health care affordability crisis and a need for stability, support, and a sustainable path forward for patients, for the health care workforce, and for participants in the system overall, it is more important than ever,” said David Seltz, HPC Executive Director. “While the state’s recent health care legislation provides new tools to address some of these alarming trends, it is imperative that we must act to prioritize affordability and keep the growth in the cost of health care contained. The goal of below-benchmark cost growth brings us closer to realizing a future where our high-quality health care system is affordable, equitable, and accessible for all residents in Massachusetts.”
More information on the benchmark process is included in these FAQs and in this short explainer video.
Final CMIR Report on Dana-Farber Cancer Institute (DFCI), Beth Israel Deaconess Medical Center (BIDMC), and Harvard Medical Faculty Physicians (HMFP) at BIDMC
Commissioners voted to issue the final report on the cost and market impact review (CMIR) of the proposed affiliation between Dana-Farber Cancer Institute (DFCI), Beth Israel Deaconess Medical Center (BIDMC), and Harvard Medical Faculty Physicians at BIDMC (HMFP).
This independent, data-driven review was conducted by examining confidential information provided by the parties as well as other market participants; available data on measures of cancer care costs, prices, quality, and access in Massachusetts; and the response of DFCI to the HPC’s preliminary report published in February 2025. The HPC’s final 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.
DFCI’s response to the HPC’s preliminary report did not include information that substantially changed the HPC’s assessment of the likely impacts of the proposed transaction, although it did include commitments to enhance access to community-based care and ensure continuity of care during the proposed transition.
At the HPC’s request, DFCI provided additional commitments addressing some of the HPC’s outstanding concerns:
- DFCI will confidentially report to the HPC on its price increases for both inpatient and outpatient services, disaggregated by payer type, for five years once the new hospital is operational. This reporting will help the Commonwealth assess the extent to which the transaction impacts DFCI’s future price growth.
- DFCI will provide data and information to the HPC to provide information about the total cost of care for oncology patients, including information to allow HPC to monitor outpatient oncology drug pricing for DFCI and other market participants.
- DFCI will publicly report on its efforts to support delivery of cancer care in the community, including the number of community hospital patients DFCI providers round on at community providers, the number of patients treated at community sites that do not have an inpatient admission at DFCI’s main campus, and the number of annual consultations provided in community settings
Based on these findings, the HPC submitted the report to DPH for consideration of additional or revised conditions of the Determination of Need Application consistent with DFCI’s public commitments reflected in the report. The HPC also submitted report to the Office of the Attorney General for future consideration in the context of its specific authority to monitor the Massachusetts health care market.
“This transaction represents a significant change to cancer care delivery in Massachusetts, and we appreciate the collaboration of the parties during this review and public accountability process -- as well as their pledge of continued partnership and price data sharing with the HPC,” said Deborah Devaux, HPC Board Chair. “This substantial review was conducted in the service of protecting Massachusetts consumers, and DFCI’s related reporting and service continuity commitments align us in the shared goal of affordable health care for all residents.”
The transaction may not be finalized until 30 days following today’s publication of the final CMIR report.
Read more about the findings from the CMIR and the HPC’s transactional review process.
Other Topics at the HPC Board Meeting
Commissioner James Willmuth was introduced and welcomed to the HPC Board. Commissioner Willmuth fills the seat reserved for a member with demonstrated expertise in representing the health care workforce as a leader in a labor organization, through his work with 1199SEIU. Commissioner Willmuth will assume the vacancy left by the resignation of former commissioner Tim Foley.
Commissioners reviewed the activities of the HPC’s Office of Patient Protection (OPP) in the office’s newly released 2023 Annual Report. OPP safeguards the rights of health care consumers by regulating the internal grievance process and administering external reviews for consumers with fully-insured Massachusetts health plans and patients of certain provider organizations, administering health insurance enrollment waivers, and providing information and education about health insurance concerns. In 2023:
- OPP received 989 requests for waivers, issuing 796 waivers to eligible applicants (80% of all received requests) from Massachusetts residents seeking to buy insurance from the Health Connector or directly from an insurance company or insurance agent outside of open enrollment.
- Health insurance companies received 15,424 internal appeals from members challenging a denial of coverage, and 48% were resolved in favor of consumers.
- OPP received 1,599 inquiries through the OPP hotline.
Commissioners also reviewed the HPC’s Accountable Care Organization (ACO) LEAP 2026-2027 Certification Program standards. As of 2025, the HPC certified 17 ACOs, encompassing 90 risk contracts and 3.08 million ACO-covered residents. The meeting concluded with a number of agency updates in the Executive Director’s Report.
A recording of the meeting and presentation materials are available on the HPC’s website.
