PROVIDENCE – Care New England Health System has opted out of three-way discussions between Lifespan Corp. and Brown University, CNE announced Tuesday.
CNE’s board voted Monday to formally withdraw.
Pulling out of the talks with Lifespan and Brown was in CNE’s and the community’s best interest, CNE, the state’s second-largest health care system, said in a news release on Tuesday.
CNE cited a number of reasons for its withdrawal, including capital requirements, the system’s financial and organizational stability, anti-trust concerns and implementation risks.
A proposed acquisition of CNE by Massachusetts-based Partners Healthcare is now off the table as well, according to James E. Fanale, CNE’s president and CEO. Partners pulled the application at the beginning of the summer, after Gov. Gina M. Raimondo intervened in the merger.
“As far as them proceeding with the application process, we’re all going to step back,” Fanale said.
CNE still plans to strengthen its clinical collaborations with Partners, Fanale said, leaving open the possibility of a future deal with Partners.
“I think that nothing’s completely off the table, we are still very interested in that potential issue,” he said. “We worked on that for two years, we were close to the finish line, it’s hard to say we would dismiss it out of hand.”
Although the deal was already being reviewed by state officials, Raimondo requested in early June that CNE, Lifespan and Brown try again to reach an agreement on creating a unified in-state health care system.
Raimondo gave the sides until the end of the summer to reach an agreement, and previously said that the merger process between Partners and CNE could pick up where it left off if the talks between Lifespan, CNE and Brown were unsuccessful.
The governor’s office said that the parties met multiple times times over the six weeks of negotiations but did not specify how many times they met.
During the meetings, anti-trust concerns came to the forefront, creating worry that a potential agreement could mean a lengthy wait while officials pored over its legality, Fanale said.
“We anticipated that obviously there would be anti-trust concerns if two very large organizations in one state get together,” he said.
Partners did not answer inquiries about the CNE deal.
“We value our longstanding clinical affiliation with CNE and we remain committed to the health of patients in Rhode Island,” the system said in a statement to Providence Business News.
Raimondo said she is disappointed at the talks’ outcome, but hopes that future partnerships are possible.
“I’m disappointed that the parties were not able to come to an agreement. I continue to believe that a locally-run, academic medical center is what’s in the best interest of Rhode Island,” the governor said in a statement. “I have encouraged the parties to keep an open mind, remain open to future discussions, and to continue to pursue expanded collaboration that could pave the way to further integration down the road.”
In a joint statement, Lifespan president and CEO Timothy J. Babineau and Lawrence A. Aubin, chairman of its board of directors said will continue to push for the creation of an in-state academic health care system.
“We believe that a partnership with Lifespan, Care New England and Brown University remains the very best approach to ensure high quality, affordable health care and economic vitality for our state. We were optimistic that achieving a complete and unified academic medical center for the people of Rhode Island could become a reality and were working in good faith to achieve that goal,” Babineau and Aubin said.
Brown University President Christina H. Paxson said the end of the talks will not mean the end of its longstanding collaboration with CNE and Lifespan.
“We continue to believe that merging Lifespan and Care New England, in close partnership with Brown, would deliver enormous benefits to our community in the form of greater access to high-quality affordable health care, and job growth that stems from a thriving biomedical research sector,” Paxson said in a statement.
Elizabeth Graham is a PBN staff writer. You can email her at Graham@PBN.com.
