CLAREMONT — Valley Regional Hospital in Claremont will become part of the Dartmouth Health system in spite of concerns that the relationship might result in a monopoly on health care services in Sullivan County, according to a Monday announcement from the New Hampshire Attorney General’s Office.

The two organizations worked with Attorney General John Formella to negotiate an agreement to allow Dartmouth Health, the state’s largest private employer and only academic medical system, and Valley Regional Hospital, a 25-bed independent hospital, to join forces without without unduly stifling competition.

The agreement also requires Dartmouth Health to establish and fund an addiction and treatment center at Valley Regional that will operate for at least 10 years.

Those and other agreements will “protect competition and ensure patients can access essential health care closer to home,” according to the press release from Formella’s office.

As part of the agreement, Dartmouth Health agreed to a number of stipulations designed to protect consumers and benefit the Claremont community. It will maintain essential services at Valley Regional for at least 10 years and will fund and operate a new medical office building on the hospital’s campus.

Dartmouth Health has also agreed to pay $2 million to the Health Care Consumer Protection Trust Fund, which was created by the legislature in 2023 and is administered by the Attorney General’s office. The purpose of the fund is to monitor the health care market to inform policy and provide transparency about pricing for patients.

Dartmouth Health began working to acquire Valley Regional Hospital in the fall of 2022, but ran afoul of antitrust regulations when the Consumer Protection and Antitrust Bureau (CPAB) ruled that the proposed partnership would create a “monopoly for inpatient general acute care services,” in Sullivan County, according to a news release issued Monday by Formella’s office.

The Dartmouth Health network already operates a health centers in Sullivan County: the Newport Health Center, which provides primary care and outpatient services. New London Hospital, a 25-bed critical access hospital, is in nearby Merrimack County.

Valley Regional has operated independently since it was founded in the 1890s. In a public hearing in May of last year, Dartmouth Health leadership fielded concerns about what level of control Valley Regional’s leadership would maintain over long-term decision-making and what the governing structure would be.

Under the integration agreement, Valley Regional’s leadership will manage day-to-day operations, while Windsor’s Mount Ascutney Hospital and Health Center and Valley Regional will be jointly managed by a “unified senior management team,” Michael Garrity, a spokesman for the Attorney General’s office, said Monday.

In response to questions Monday about the new agreement, Valley Regional Hospital and Dartmouth Health issued identical statements, saying that “regulatory clearance by the Attorney General is a testament to the fact that this arrangement promises to improve healthcare delivery for the greater Claremont community and residents in Sullivan County.”

Hospital officials have previously promoted the union, in part, by saying it would help bring financial stability to the smaller hospital, which has faced repeated financial challenges over the past two decades.

Upon approval by the Merrimack County Superior Court, “the final step in the process is for the respective boards of directors for VRH and Dartmouth Health to undergo a period of due diligence prior to a tentative closing in early July 2024.”

The Attorney General’s Office has previously been critical of Dartmouth Health’s attempt to add to its roster of hospitals. A 2022 attempt to partner with GraniteOne Health, which includes the Catholic Medical Center in Manchester, was rejected by the Attorney General’s office over concerns that reduced competition in the health care marketplace would drive up costs.

But the system has seen more recent success. It added the Southwestern Vermont Medical Center in Bennington last summer. Other members of the system include Dartmouth Hitchcock Medical Center and Alice Peck Day Hospital, both in Lebanon; Cheshire Medical Center in Keene, N.H., in addition to Mt. Ascutney Hospital and New London Hospital. The system employs 13,000 people and is the largest health system in New Hampshire.

Christina Dolan can be reached at cdolan@vnews.com or 603-727-3208.

CORR  ECTION: New London Hospital is located in Merrimack County. A previous version of this story misidentified the county in which New London Hospital is located.