Northeast Health System Completes its Affiliation Review Process; Announces Plans to Create Affiliation with Lahey Clinic

Northeast Health System and Lahey Clinic to form a new integrated healthcare delivery system serving northeastern Massachusetts

July 19, 2011

Beverly, MA   The Northeast Health System (NHS) Board of Trustees announced today that, by unanimous vote, it has accepted the recommendation of its Affiliation Advisory Committee that Northeast Health System affiliate with Lahey Clinic through the formation of a new organization.

After an extensive review process, the NHS Affiliation Advisory Committee determined that an affiliation with Lahey Clinic provided the best opportunity for NHS to create an exceptional healthcare delivery system of high-quality, cost-efficient, community-based care in northeastern Massachusetts; one that is capable of managing patient care in accordance with changing community needs and new payment and healthcare delivery systems. NHS and Lahey have always maintained a complementary focus of providing community-based care and have a strong history of successful clinical collaboration. This is an affiliation of two well-respected and financially stable healthcare organizations. The affiliation will also enable Northeast Physician Hospital Organization and Lahey Clinic to develop more innovative approaches for effectively coordinating and managing patient care under current and proposed payment models.

In January, 2011, NHS announced its plan to proactively pursue various new organizational arrangements with the goal of establishing a new, integrated system of care that would serve a larger population at a lower-cost structure. NHS, which supports a full continuum of healthcare needs, includes Beverly Hospital, Addison Gilbert Hospital, BayRidge Hospital, Beverly Hospital at Danvers, Northeast Medical Practice, Northeast Behavioral Health and Northeast Senior Health. NHS is a financially sound health system serving communities throughout the North Shore and Merrimack Valley. The affiliation is one of a number of strategic initiatives taken by NHS President and CEO Kenneth Hanover and the NHS Board of Trustees to prepare NHS for the challenges of healthcare reform.

Under the new affiliation structure, a parent organization will be created by NHS and Lahey Clinic Foundation to govern both organizations. A new board will be created and consist of an equal number of representatives selected from the NHS board and Lahey Clinic Foundation board. Additional board members, unaffiliated with either organization, will be selected from the community. The new organization will be called the Lahey Health System, and will be led by Howard Grant, JD, MD, as president and CEO.

“With Lahey Clinic, we believe we will be able to create a premier healthcare delivery system that significantly increases the accessibility of leading-edge clinical services for our patients, while creating an infrastructure that promotes efficiencies, quality and synergy of services,” said Hanover. “This was our goal from the start of this process and we are very excited that we have landed at this decision and opportunity today.”

“Lahey Clinic and Northeast Health will make a great healthcare team,” said Howard Grant, president and CEO of Lahey Clinic. “This is a historic moment -- two superb organizations aligning to create an even stronger integrated healthcare delivery system. Together, we will provide greater value to patients by enhancing the scope and quality of services that can be delivered to patients in their own communities.”

Plans for the affiliation must now go through a standard regulatory process, which could take a number of months before plans are finalized. Additionally, forums are planned to explain this new organizational relationship to our communities.

“All of our discussions leading up to this decision revolved around creating a system that puts patients first,” said Irving E. Rogers, chair, Board of Trustees for Lahey Clinic. “Lahey and NHS have a long history of working together, and we now have the opportunity to build on that successful teamwork. We believe that this is a strong step forward in how healthcare institutions can align to improve quality and efficiency while reducing costs and remaining very competitive in the marketplace.”

Today’s NHS Board of Trustee’s announcement comes after months of analysis by NHS’ Affiliation Advisory Committee, which was comprised of physicians, community board members, and administrators working in conjunction with a top national healthcare consulting firm. The Affiliation Advisory Committee evaluated proposals from four high-quality organizations against specific criteria that included quality and service, medical staff and physician relationships, values and culture, and finance and infrastructure.

“We are an organization dedicated to our mission of quality, caring and community,” said David St. Laurent, chairman, NHS Board of Trustees. “Of significant importance to this process and decision was identifying an organization whose philosophy of care aligns with our own, and whose vision for the future complements our goals. This decision reflects our shared common values and our commitment to maintain and deploy resources in our local communities.”

The evaluation process also included site visits to hospitals run by each of the four organizations and multiple presentations to the Northeast Hospital Corporation medical staff.

“The medical staff was thoughtfully engaged in this process from start to finish and is confident in the decision making progress,” said Steven Defossez, MD, president of the medical staff, Northeast Hospital Corporation. “From a clinical point of view, we are two organizations dedicated to providing our patients with exceptional compassionate care and service. Through this affiliation, we’ll create opportunities to advance the care and services we can offer our patients.”

“We extend our deep felt gratitude to the members of the Affiliation Advisory Committee for their commitment to and tireless efforts in this important endeavor,” said St. Laurent.

Northeast Health System, Inc.

Northeast Health System, Inc. (NHS) is an integrated healthcare system comprised of a network of acute-care hospitals, behavioral health and senior health services dedicated to providing the full continuum of care to residents of the North Shore and Cape Ann. One of the largest healthcare service providers in its area, NHS collaboratively provides primary care; acute, medical and surgical care; outpatient and diagnostic services; physical therapy and rehabilitation services; wellness programs; substance abuse prevention and treatment; mental health services and treatment; senior health services, specialty care and assisted living. We are a system of more than 5,000 employees and 600 physicians dedicated to providing The Leading Edge of Caring. For more information please visit

Lahey Clinic Foundation, Inc.

Lahey Clinic, a physician-led, nonprofit group practice, is world-renowned for innovative technology, pioneering medical treatment, and leading-edge research. A teaching hospital of Tufts University School of Medicine, the Clinic provides quality health care in virtually every specialty and subspecialty, from primary care to cancer diagnosis and treatment to kidney and liver transplantation. Lahey Clinic nurses also earned Magnet status from the American Nurses Credentialing Center, a recognition only achieved by six percent of American hospitals. Lahey currently has more than 5,000 employees including 500 physicians and 1,100 nurses. For more information please visit


You can reach us Monday through Friday, 8:30 a.m. to 5 p.m. by contacting the Media Relations Department:

Kyle B. Reilly
Director of Media Relations
Lahey Health

Dan Marra
Senior Manager of Media Relations
Lahey Health

If you need to reach a member of the media relations team after normal business hours, please page them at 781.256.9373 and a member of the department will get back to you.