GloucesterTimes.com, Gloucester, MA

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March 26, 2010

Payments show Northeast Health losing hospital battle

Shift comes amid reports of Northeast 'partnership' talks with Lahey

A rare glimpse into how much insurance companies pay hospitals and doctors shows that North Shore Medical Center has soared past Northeast Health System's facilities on the list of the state's highest-paid hospitals.

North Shore Medical Center — which includes Salem Hospital, North Shore Children's Hospital and Union Hospital in Lynn — is now among the top 20 highest-paid health care systems by the state's largest insurance companies, according to a report issued this month by the state attorney general's office.

Northeast Health System, the parent company of Gloucester's Addison Gilbert Hospital and Beverly Hospital, trails Salem in payments from Harvard Pilgrim Health Care, Blue Cross Blue Shield and Tufts Health Plan.

The rankings represent a reversal of fortune from a few years ago, and indicates that North Shore Medical Center is gaining the upper hand in the highly competitive health care market on the North Shore.

Former Northeast Health System CEO Robert Fanning said North Shore Medical Center has benefited from its relationship with Partners HealthCare, the state's largest health care organization, which includes Massachusetts General Hospital and Brigham and Women's Hospital.

"Basically what it means, No. 1, is that it's not a level playing field for Beverly Hospital and Northeast Health System," Fanning said. "Partners is the behemoth, and now they've staked out their turf. I think the (Northeast Health) system is at risk over time."

Details about how much insurance companies pay various hospitals and doctors' groups is usually private. But insurance companies were required to disclose their data to the attorney general's office as part of a state inquiry into what is causing soaring health care costs.

Payment records show that Northeast Health System was paid slightly more than North Shore Medical Center for the same services by Harvard Pilgrim in 2004 and by Tufts Health in 2005. By 2008, those numbers had turned in favor of North Shore Medical Center.

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