PROVIDENCE, R.I. (WPRI) – Federal regulators have given approval to Boston giant Partners HealthCare’s proposed takeover of Care New England, Rhode Island’s second-largest hospital system, according to Partners.
Partners spokesman Rich Copp confirmed in an email that the Federal Trade Commission had signed off on the merger. He said the company’s next step will be formally filing for approval in Rhode Island, which executives expect to do by the end of this month. Both the attorney general and the Department of Health must give their OKs before the acquisition can go through.
Betsy Lodan, a spokesperson for the FTC, said the agency does not technically approve mergers, but rather makes a decision on whether or not to challenge them by filing a complaint. “The FTC has not challenged this merger,” she said.
The FTC’s decision was announced by Peter Markell, Partners’ chief financial officer, in an interview with the Boston Business Journal. Neither company issued a statement about it in Rhode Island, and the decision was not referenced in their quarterly financial filings.
Partners first announced plans to buy Care New England in April 2017, but the process has moved slowly since then. Care New England owns Women & Infants, Kent and Butler hospitals, as well as the now-closed Memorial Hospital, and had more than 6,000 employees in Rhode Island at last check.
Rhode Island regulators have agreed to a fast-track review of the merger within 90 days of the paperwork being filed. Markell told the Boston paper he expects a decision by April.
Markell also indicated he does not expect Massachusetts regulators will require Partners to win approval there for the transaction.
The expected timing means the Partners-CNE deal will be one of the first major tasks facing Rhode Island’s newly elected attorney general, Democrat Peter Neronha. In an October interview on WPRI 12’s Newsmakers, Neronha said he would look at the merger in a broader context.
“We don’t have a health care strategy in this state,” Neronha said. “There hasn’t been a written health care strategy for Rhode Island since the late ’80s or early ’90s. … We’ve got to have a strategy in place to understand how these proposed mergers fit within that strategy – pretty hard to analyze an individual transaction without knowing where it fits from a larger perspective.”
“If you go around and think about why hospitals are where they are, there’s not a strategic purpose to them – it’s an accident almost of history,” he added. “So I think we’ve got to be more strategic in terms of our health care planning.”
State officials have already been preparing for the review. Applications were due to the Department of Health last week for economics consulting firms that want to be hired to assist on the process.
Partners had also been in talks about some sort of deal with Lifespan, Rhode Island’s largest hospital system, but those discussions ended recently without an agreement.
“The decision was let’s get CNE done and we will see where we go from there,” Markell told the Boston paper. “The parties were OK with that. And everyone still talks to each other.”
Care New England says its finances have been improving since Memorial closed. The company’s operations lost $27 million in its 2017-18 fiscal year, which ended Sept. 30, due primarily to ongoing costs tied to Memorial. The three active hospitals all posted profits, with Women & Infants’ performance improving by $20 million over the prior year.