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Lifespan calls Partners-CNE deal ‘devastating’ for RI, kicking off fight

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PROVIDENCE, R.I. (WPRI) — Rhode Island’s top hospital group Lifespan is launching a public campaign to fight Partners HealthCare’s proposed acquisition of local rival Care New England, arguing the state should not allow some of its most important medical facilities to fall under out-of-state control.

In a statement on behalf of the organization, Lifespan Chairman Lawrence Aubin said, “Allowing such an acquisition to move forward would have devastating consequences for Rhode Island and its health care delivery system, now and for years to come.”

Added Lifespan President and CEO Dr. Tim Babineau: “It is essential that Rhode Island have a locally controlled academic medical center that can attract top specialists and primary care physicians working for the people of Rhode Island. The proposed acquisition places that at great risk.”

Partners, the dominant hospital player in Massachusetts, first announced plans to take over Care New England — owner of Women & Infants, Kent and Butler — two years ago this month. The process has moved slowly, partly due to the closure of Memorial Hospital, but is now heating up as the Department of Health and Attorney General Peter Neronha start to review the proposal.

In a joint statement Wednesday responding to Lifespan, Brigham Health President and CEO Dr. Betsy Nabel and Care New England President and CEO Dr. James Fanale said: “Brigham Health’s proposed acquisition of Care New England will create a stronger health system for Rhode Islanders. Together, we’ll deliver affordable and world-class care right here in Rhode Island.”

Lifespan — owner of Rhode Island, The Miriam, Bradley and Newport hospitals — has eyed Partners warily from the start. Yet Wednesday’s moves indicate the company, Rhode Island’s largest private employer, is embarking on a more forceful effort to convince state leaders and the public Partners is the wrong choice. The campaign includes a website, protectrihealthcare.org, and upcoming paid advertisements.

“I know some people will interpret this as, ‘Oh, this is sour grapes’ — I can assure you, that is not the board’s motivation for doing this,” Babineau told WPRI 12, emphasizing that the not-for-profit organization’s 17 trustees are all volunteers. “They care about Lifespan; they care more about what’s right for health care, and they care more about what’s right for the community,” he added.

“This is probably one of the most important transactions that will occur in this state for years to come, and I just don’t think people have all the facts,” Babineau said. “And we just felt strongly they needed to have them and understand the potential unintended consequences.”

In choosing Partners, Care New England’s board spurned Lifespan’s offer to make a third attempt to merge. Lifespan and Partners later spent months negotiating a possible three-way deal before those talks fell apart in October.

Babineau declined to reveal what was on the table in those discussions, saying all three parties are bound by a non-disclosure agreement.

“We were working on something that we believe, at least at Lifespan, would have been good for the state, would have been good for Brown, would have been good for everybody,” he said. “And we just couldn’t reach an agreement on the terms, and the talks ended.”

He said Lifespan’s position remains that it should come together with Care New England and Brown University to form a unified academic medical center to anchor the state’s health care sector. Only after that, he said, should Partners join the discussions. He and Aubin also downplayed the possibility that federal regulators would block such a merger due to antitrust concerns.

Brown President Christina Paxson was initially an opponent of the Partners deal, as well, and has previously said Lifespan was unwilling to play ball when she suggested they join together in an alternative offer. Last year, however, Paxson swung her support behind the transaction after Partners made commitments to invest in academic medicine. (Babineau declined to criticize Paxson’s shift, saying Brown has been “a good partner.”)

Paxson reacted coolly to Lifespan’s offensive.

“In the past, I have advocated for an integrated healthcare solution that brings Care New England and Lifespan together with Brown to create a unified academic medical center in Rhode Island,” she said in a statement. “However, multiple previous attempts to realize this vision have failed.”

“While I remain committed to the vision of a thriving academic medical center, it’s uncertain that another attempt involving Lifespan and Care New England would be successful at present,” Paxson continued. “Brigham’s financial strength, its standing as a world-class medical center, and its stated commitment to locally provided care offer an attractive alternative to a ‘local’ solution.”

In making its case, Lifespan laid out a number of specific concerns.

“Partners intends to make no investment in CNE — pay $0 for CNE and commit no capital investment, just a takeover of community assets that were built by Rhode Islanders for Rhode Islanders,” Aubin said, citing information contained in Partners’ state application. “Loss of Care New England, a community asset, and the decision to turn these assets over to Boston at zero cost is a travesty.”

Another concern Lifespan flagged has come up before: the possibility that Partners will shift patients to its pricey Boston flagships, Brigham & Women’s and Mass. General, increasing the cost of care for Rhode Islanders and reducing the patient counts at local facilities. They cited a study by the health insurance commissioner that found Partners hospitals are among the most expensive in Massachusetts.

In a February interview with WPRI 12, Brigham Health President Dr. Betsy Nabel insisted the company has no plans to shift patients to Boston and wants to keep care local except in the most challenging cases. She also said the company will abide by formal and voluntary caps on medical spending growth.

“The acquisition by Brigham Health would further CNE’s recent financial turnaround and provide much-needed financial stability,” Nabel and Fanale said in their joint statement Wednesday. “We’re exploring the potential for clinical expansion, including the development of new, lower-cost, community-based ambulatory care centers, which could create more clinical jobs and lead to the recruitment of specialty physicians offering an expanded array of clinical services in Rhode Island.”

Lifespan’s leaders also warned about the potential perils of allowing an out-of-state corporation control major hospitals, noting Partners has said it will review whether it can streamline administrative jobs and that there has been no commitment so far to having a local governing authority in charge of CNE.

Still, Babineau insisted, “I have enormous respect for Care New England, its leaders, its doctors, its nurses, its board. I have enormous respect for the Brigham and Dr. Nabel and its board and its doctors. Those are great institutions. This has nothing to do with those two institutions. I like them, I admire them, they’re my friends, they’re my colleagues.”

“But the board felt strongly that as fiduciaries of the biggest health care system, they had an obligation to try to let people know what was about to happen,” he said. “That’s what this is about.”

Josh Block, a spokesperson for Gov. Gina Raimondo, reiterated her thinking after Lifespan’s announcement.

“A thriving local health care sector is critical to the state’s economy, and Governor Raimondo is committed to ensuring care remains accessible and affordable,” he said. “The governor has been clear that she will only support an agreement if it guarantees continued local, low-cost, high-quality health services for all Rhode Islanders.”

The next step in the Partners-CNE transaction is for state regulators to deem their application complete, at which point they will have 90 days to give the deal a fast-track review. Appearing last week on WPRI 12’s Newsmakers, Attorney General Neronha declined to offer a timeline for when that could take place.

“The ball is in their court to answer the questions we posed,” Neronha said. “And when we have all the answers, we will then go into the review process along with the Department of Health. Once you trigger that 90 days, you’ve got to get that done, so if we don’t have everything we can’t make the right decision for the people of this state.”

Asked about Lifespan’s comments Wednesday, Neronha spokesperson Kristy dosReis said, “We look forward to the public comment period, during which anyone interested in the proposed merger can share their views with us.”

Ted Nesi (tnesi@wpri.com) covers politics and the economy for WPRI.com. He is a weekly panelist on Newsmakers and hosts Executive Suite. Follow him on Twitter and Facebook

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