Judge Appears Skeptical About Partners HealthCare Deal

Outgoing Massachusetts Attorney General Martha Coakley, a key player in the Partners deal. (Steven Senne/AP/File)

Outgoing Massachusetts Attorney General Martha Coakley, a key player in the Partners deal. (Steven Senne/AP/File)

In a packed courtroom on the 10th floor of Suffolk Superior Courthouse, the question on the docket appeared to be a simple matter: Should a judge in the Business Litigation Division say yes or no to a deal negotiated between Partners HealthCare and Attorney General Martha Coakley?

In any standard consent judgment, the judge would default to the attorney general.

But again Monday, as she did in September, Judge Janet Sanders made clear she will not say yes, no, or come back with a revised deal until she understands the details and possible consequences. Sanders wants to determine if consumers and the state would benefit from Partners’ proposed expansion.

She asked dozens of questions that suggest she is skeptical. And at the end of the day, she and Coakley engaged in what came across as a politely combative exchange. More on that later.

For an example of Sanders’ questions, let’s take the price caps. Under the agreement, payments to Partners could not increase more than inflation for six-and-a-half years.

Would Partners still have the highest-paid hospitals in the state? Sanders asked.

Yes, probably, said the AG’s office, except for Boston Children’s Hospital. This agreement doesn’t claim to correct historical problems, said Will Matlack, chief of the AG’s anti-trust division.

What happens, Sanders continued, if Partners jacks up prices in year seven? By then, Partners will be even bigger, and could demand more money than they can now, she suggested.

That’s speculation, said the AG’s office. And it’s not reasonable speculation, said an attorney for Partners, because there are lots of dynamics that could change the market between now and then.

But if Partners is a large entity that is already having an anti-competitive effect, Sanders began, and then stopped, interrupted when one of the Partners attorneys jumped up.

“You are making a finding,” said Bruce Sokler, “for which there is no evidence.”

Sanders paused. But I have to assume a harm — an alleged harm, she added — in weighing whether this agreement could be effective, don’t I?

Sanders says she isn’t sure that the AG’s agreement will fix the problem at hand: that Partners is paid more than other hospitals in Massachusetts, sometimes three or four times more, for the same service.

Deputy AG Chris Barry-Smith stood up at one point to stress that the AG does not have evidence to show that Partners is acting or has acted as a monopoly. So to question after question that Sanders raised about whether the agreement will limit Partners’ market power, the AG’s office told Sanders, in effect, “That is outside the terms of this deal.”

Sanders asked the AG’s office about the design of the Partners deal. Why, she wondered, did the AG choose a very intricate plan to try and change the way Partners does business, rather than requiring that Partners offload existing hospitals in exchange for adding those new hospitals, South Shore and Hallmark Health?

The downsizing option didn’t make sense in the context of the South Shore or Hallmark Health deals, said Matlack of the AG’s anti-trust division. He stressed, again and again, that the AG was only reviewing those acquisitions.

I really don’t want to be the health care czar.

– Judge Janet Sanders

Sanders is also worried about her on-going role in enforcing the Partners-AG decree.

“I really don’t want to be the health care czar,” Sanders said.

There are many more complicated agreements that the court oversees, said Barry-Smith. Sanders did not look comforted.

Now for the end-of-day drama.

Sanders had noted that with Coakley due to leave office soon, it might be wise to hear from the incoming attorney general, Maura Healey.

(Note: Healey said during an August debate that there were aspects of the deal she was “skeptical about.” See the full exchange here: Democratic AG Candidates Question Whether Partners Deal Will Cut Costs.)

Coakley, who was in the audience, requested permission to speak, and asked the judge to clarify: If she had all the evidence she needed, why did she need to speak to the attorney general-elect?

Both remained calm, but when Sanders assured Coakley that she had not meant to impugn the attorney general’s integrity, Coakley replied that well, she had.

Sanders explained that the case was so big and important that she did want to know where the incoming AG would stand on it.

As in, would she enforce it? Coakley asked.

Sanders said she’d like to hear if the incoming AG supported the deal.

The exchange ended with an agreement that Sanders would let Coakley’s office know if she did indeed feel the need to hear from Healey. Sanders did not indicate her plans for the next step in the proceedings, but did say she might not have a decision until January.

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