Lifespan and Care New England Withdraw Application to Affiliate
(posted February 26, 2010)
The leaders of Lifespan and Care New England announced today that they have withdrawn their application currently pending before the Rhode Island Department of Health and Rhode Island Attorney General to merge these two organizations.
“Since the proposed Lifespan-Care New England merger was announced in July of 2007, there has been dramatic and rapid change in the regional marketplace and in the national arena,” said George A. Vecchione, president and CEO of Lifespan. “The deteriorating financial condition of the state, significant increases in uncompensated care, the uncertainty of federal reimbursements for health care services and the accelerating pace of regional competition require the full attention of these institutions at this crucial time.”
Nearly three years after the initial announcement of the merger, and subsequent to submitting tens of thousands of pages of information to state regulatory agencies, there is no clear timeline to complete this process. The Health Care Conversion Act was written to protect local nonprofit hospitals from out-of-state, for profit hospitals entering Rhode Island. The statute was not designed for the merger of healthy, nonprofit hospital systems with the size and complexity of Lifespan and Care New England, which requires the merging of 9 entities (seven hospitals and two health systems).
“The extensive resources necessary to successfully navigate the regulatory process is detracting from our organizations’ ability to focus on sustaining our core missions to improve the health of residents of Rhode Island and the surrounding communities and to confront the increasingly aggressive posture from hospitals and health systems in the region,” said John J. Hynes, Esq., president and CEO of Care New England.
The organizations continue to believe the combination of both systems would have greatly enhanced the clinical, academic and research missions, reduced costs and improved the patient care environment. Both organizations are committed to partner in ways that are appropriate from a legal perspective and allow them to best serve the needs of the community.