Dartmouth Health network’s already large influence in the Vermont health care market is likely to grow next year with the addition of Southwestern Vermont Health Care.
The board of trustees of the smaller network, which includes a hospital in Bennington and medical clinics in Manchester, Pownal and Wilmington, approved an “integration agreement” in late November that would allow it to become a member of Dartmouth Health, according to an email to staff from SVHC’s president and chief operating officer first reported by the Bennington Banner.
“Over the next 90 days, both organizations will be meeting with state officials and regulators, so we can officially close on the agreement,” the email said.
Dartmouth Health is the parent organization of Dartmouth Hitchcock Clinic and Mary Hitchcock Memorial Hospital, which form Dartmouth Hitchcock Medical Center in Lebanon, New Hampshire, and more than two dozen other nonprofit and for-profit entities. Those include Mt. Ascutney Hospital in Windsor and other smaller hospitals in New Hampshire in Lebanon, New London and Keene, all of which have become affiliated over the last 15 years.
Dartmouth Health network is roughly the same size as UVM Health Network in terms of employees and patients served, but roughly three-quarters of Dartmouth’s patients come from New Hampshire. It serves a much smaller percentage of patients from Vermont than the UVM network, but that may be changing.
Southwestern Vermont Health Care has been working closely with Dartmouth Hitchcock Medical Center for a decade. Its clinics in Manchester and Wilmington already are branded as Dartmouth Health clinics. Its cancer center and several other medical departments are already jointly operated by the medical center and physicians across the region are all affiliated with Dartmouth Hitchcock, an academic medical center with ties to the Geisel School of Medicine at Dartmouth College.
Southwestern Vermont Health Center’s greater “integration” into the Dartmouth Health network would provide several additional benefits to its 75,000 patients, according to statements from both organizations. Patients largely come from Bennington and Windham counties in Vermont and eastern New York’s Rensselaer County and Berkshire County in northwestern Massachusetts.
In particular, becoming a member of Dartmouth Health would allow Southwestern Vermont Medical Center to become a “regional referring hospital” and to integrate with Dartmouth’s electronic medical record platform. The move would allow SVHC to “participate in numerous initiatives such as joint purchasing, expansion of telemedicine services, education and research to name a few,” SVHC’s statement said.
Although the Green Mountain Care Board regulates hospitals, it does not have oversight of
affiliations. The primary regulatory hurdle to the integration agreement appears to potentially be a review by the Vermont Attorney General’s Office’s Public Protection Division.
Because SVMC is a nonprofit corporation, such a review would be triggered if the agreement involves the transfer of “all, or substantially all,” of its assets to another organization, said Lauren Jandl, the Attorney General’s Office’s chief of staff. The review would look only at whether the transfer is consistent with the original nonprofit’s mission and any restrictions on the assets.
SVMC staff declined to answer how the affiliation would impact its governance and debt structure. Southern Vermont Medical Center is midway through a $28 million expansion and upgrade of its emergency department.
New Hampshire law allows its Attorney General’s Office’s Charitable Trust Unit to conduct a more stringent review of transfers between health care nonprofits, including consideration of whether the transaction is in the best interest of the community being served. It was under that standard that the office denied an agreement that would have allowed an affiliation between Manchester’s Catholic Medical Center and Dartmouth Health earlier this year, finding that the affiliation would “adversely impact competition.”
Recent research has consistently shown that consolidation among health care providers is linked to increased costs charged to insurers. Americans spend roughly twice as much on health care on a per capita basis as other similarly developed countries.