PROVIDENCE, R.I. (WPRI) – Partners HealthCare will decide in the next two months whether to proceed with its proposed takeover of No. 2 Rhode Island hospital group Care New England, a Partners executive said Friday.
Partners, the largest hospital group in Massachusetts, announced in April it had reached a deal to acquire Women & Infants and the rest of Care New England’s hospitals, with the exception of Memorial in Pawtucket. A separate deal to sell Memorial fell through in October, and Care New England is now trying to close the hospital.
Peter Markell, Partners’ chief financial officer, told the Boston Business Journal on Friday that his company is waiting until Care New England nails down the estimated cost of closing Memorial before determining if the acquisition makes sense. He said talks between the two sides had slowed because of the situation.
“Part of the Memorial thing is they will keep an ambulatory or primary care type facility going on that campus and put the rest up for development,” Markell told the paper. “We will wait to see what impact that has, but the Care New England people are relatively positive they will get [to profitability]. We will have to see when we get through this and have the numbers.”
The union that represents nurses at Memorial filed suit on Thursday in an attempt to halt the hospital’s closure, arguing Care New England executives and state officials are not following the law that governs hospital ownership. Still, Markell expressed confidence regulators will eventually sign off on shutting Memorial’s doors.
“Right now, the process seems to be going better and smoother than I think most people would have expected. But until it’s over, it’s not over and we have to wait to see,” he told the Business Journal. “Like any closing of a hospital, it’s an emotional event, but Care New England and the regulators … seemed to have worked well to bring it to a resolution.”
Eyewitness News reported last week that Brown University and Prospect Medical Holdings, the California-based for-profit hospital chain, are in discussions about making an alternative bid for Care New England if the Partners deal falls through. Care New England’s leaders insist, however, the Partners deal remains on track.
“We have an exclusive letter of intent with Partners HealthCare and have had no discussions with other entities since entering this agreement,” Dr. James Fanale, Care New England’s incoming CEO, told employees in an internal email late last week.
In a statement Friday, Care New England spokesman Jim Beardsworth said, “We continue to closely follow the established regulatory process and await a final decision on our application specific to Memorial Hospital, while remaining committed to providing some community-based services.”
“Additionally, we continue to focus on key initiatives and financial targets that further position CNE for improved stability and strategic opportunities that will best prepare us for the future, including our ongoing efforts with Partners,” he continued.
Care New England’s operations lost $47 million during the 2016-17 fiscal year, which ended Sept. 30, the company has disclosed, though the numbers improved significantly in the second half of the year. Memorial was responsible for $21.5 million of that amount. The company’s operating losses have totaled about $115 million over the last two fiscal years.