Brown and Prospect surprised by CNE’s response to merger pitch

Brown University has its own plan for Care New England's future. / COURTESY BROWN UNIVERSITY
BROWN UNIVERSITY has its own plan for Care New England's future. / COURTESY BROWN UNIVERSITY

PROVIDENCE — Brown University and Prospect Healthcare’s joint pitch to merge with Care New England is ready if time runs out on the letter of intent between the Rhode Island health system and Partners Healthcare expiring Jan. 31, with pleas to community and economic benefits of local control over CNE assets their main selling points.

In late December, Care New England and Partners HealthCare agreed to extend a letter of intent to merge, set to expire on Dec. 31, through the end of January 2018. Following Brown’s Thursday announcement of their bid to acquire the company, Care New England was undeterred from seeking a Partners deal.

“While we appreciate their interest in the future of health care in Rhode Island, we will move forward with the important process we have set upon in the best interest of both CNE and those we care for. To that end, CNE will proceed in our exclusive discussion with Partners as set forth in our letter of intent and we look forward to the next steps in that process,” said Jim Beardsworth, CNE spokesman.

Beardsworth declined to comment on whether the end of January was proving sufficient time to address the complexity of the deal cited for the extension.

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“We were surprised by Care New England’s reaction,” said Brown University President Christina Paxson during a press conference call Thursday afternoon. “We are outlining an alternative that seeks to assist Care New England by offering significant investments to join with them and keeping health care in Rhode Island.”

When asked what other advantage the Brown-Prospect proposal may have over the Partners offer, “I think keeping health care in Rhode Island affordable, accessible, and capitalizing on the strengths of a local academic medical center, I believe that those are very powerful arguments for keeping health care in the state of Rhode Island,” Paxson said.

Paxson said it’s important for Rhode Islanders to know there is an alternative, which she hopes to discuss directly with CNE leadership if the exclusive letter of intent between CNE and Partners expires without a deal.

Very strong academic centers are drivers of economic growth around the country, Paxson said. If Partners were to move specialty care north, then the doctors and the researchers who supply that care would not want to stay in Rhode Island. Paxson said Partners, as a large health care system based in Boston, would have an incentive to move research and specialty care to Massachusetts, weakening the state’s economy.

Paxson said she has spoken to Partners’ leadership and shared her concerns with them.

“Prospect is not in that position,” Paxson said, “It has no incentive to shift care anywhere, and it’s proven to be an organization that believes in strong local governance and believes in strong local investments.

Lt. Gov. Dan McKee expressed optimism about the Brown-Prospect proposal. “I am glad that Brown University is opening up a discussion on locally-focused options for preserving our hospital system. Rhode Island residents need a solution that will protect industry talent and jobs and promote maintaining health services right here in our state,”

Several months ago, McKee said he urged Rhode Island to explore all hospital-related options that would support RI  interests and prevent a brain and job drain.

“Brown University’s announcement today is an encouraging development in the effort to find a way to best improve our healthcare system in Rhode Island,” McKee said.

United Nurses and Allied Professionals General Counsel Chris Callaci did not share McKee and Paxson’s good opinion of Prospect’s record.

“We find it difficult to understand why Brown University would risk its stellar academic reputation through a partnership with Prospect Medical Holdings – an out-of-state run, for-profit corporation with a documented history of jeopardizing patient safety and care. Prospect management represents the worst in profit-based medicine and we believe this move would be calamitous for Rhode Island patients and health workers,” said United Nurses and Allied Professionals General Counsel Chris Callaci.

Callaci noted two Prospect CharterCARE hospitals – Roger Williams Medical Center and Our Lady of Fatima Hospital – were cited and penalized by the Centers for Medicare and Medicaid Services after being ranked among the lowest 25 percent of U.S. hospitals for patient infection and injury.

“This is a remarkably bad deal for Rhode Island, and we urge state regulators and all elected leaders to look closely at Prospect’s extensive record of putting patient safety at risk,” Callaci added.

“Prospect is committed to maintaining high standards of quality care and patient safety across its entire system and has made significant investments to support this. CharterCare in particular has numerous quality and safety achievements to its credit and both hospitals were fully re-accredited by The Joint Commission in 2017,” said Otis Brown, Vice President, External Affairs at CharterCare.

Rob Borkowski is a PBN staff writer. Email him at Borkowski@PBN.com.

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