Fanale to step down as CNE leader Dec. 1; successor named

Updated at 3:09 p.m.

CARE NEW ENGLAND HEALTH SYSTEM announced Thursday Dr. James E. Fanale will retire as president and CEO on Dec. 1. Pictured is Care New England's Women & Infants Hospital in Providence. / COURTESY WOMEN & INFANTS HOSPITAL

PROVIDENCE – Dr. James E. Fanale will retire as president and CEO of Care New England Health System on Dec. 1, the health network announced Thursday. 

Dr. Michael Wagner, former president and CEO of Tufts Medical Center, will be his successor.

Fanale originally announced on May 11 he would retire in early 2023 following a failed hospital merger with Lifespan Corp. 

“Working alongside the leadership team at Care New England to improve the quality of health care in Rhode Island, while making it more readily accessible and affordable, has been among the highlights of my career” Fanale said in a statement. “It is truly bittersweet to retire while there is still so much work to be done, however, the time has come for me to pass the torch to someone well-equipped to handle the challenges of operating a healthcare system of this magnitude. I will forever be grateful to those who hold the same vision I do, and that’s to always put patients first, no matter the circumstances,” said Fanale in a statement.

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Fanale took the helm at Care New England in 2018 following the retirement of his predecessor Dennis Keefe, with a goal of righting the ship amid mounting financial challenges facing the hospital company, which is the state’s second-largest hospital system and includes Women & Infants Hospital, Butler Hospital, Kent County Memorial Hospital and other health care facilities around Rhode Island. Prior to becoming president and CEO of Care New England, Fanale was executive vice president, chief clinical officer, and chief operating officer for the company, which was founded in 1996. 

Dr. JAMES E. FANALE will retire as president and CEO of Care New England Health System on Dec. 1, the health network announced Thursday. / PBN FILE PHOTO

When Fanale became the CEO of Care New England, the company was pursuing a partnership with Partners HealthCare in Massachusetts, now known as Mass General Brigham, which was abandoned as state leaders including former Gov. Gina M. Raimondo pushed for a merger with Lifespan. 

However, after years of working toward a merger with Lifespan, the state’s largest hospital system that runs Rhode Island Hospital, The Miriam Hospital and Hasbro Children’s Hospital, the Federal Trade Commission and R.I. Attorney General Peter F. Neronha rejected that deal in mid-February.  And while other suitors expressed interest in CNE, its board of directors decided in July to remain independent and turn down all offers to either merge or be acquired.

“Dr. Fanale has been a steadfast leader at Care New England and for the health care field at large in Rhode Island,” said Arthur J. Sampson, president and CEO of Lifespan. “His passion for patients and the community has helped advance the quality of medical care available locally.  His retirement is a great loss to the health care landscape in Rhode Island, but it is well-earned and well-deserved, and we wish him all the best. We look forward to continuing to work with Care New England, under Dr. Wagner’s leadership, to advance patient care and access in Rhode Island and surrounding communities.”

Wagner has a long career as health care executive and leading health systems. Wagner most recently served as chief physician executive for Tufts Medicine, leading the company’s physician enterprise, which includes the Tufts Medicine Integrated Network, Tufts Medicine Professional Group, and Quality and Patient Safety and Service Lines.

In 2019, Wagner was interim CEO for Wellforce—now Tufts Medicine and prior to that he served as president and CEO of Tufts Medical Center, the academic medical center of Tufts Medicine and the principal teaching hospital for Tufts University School of Medicine.

DR. MICHAEL WAGNER, former president and CEO of Tufts Medical Center, will succeed Dr. James E. Fanale as president and CEO of Care New England Health System on Dec. 1. / COURTESY CARE NEW ENGLAND HEALTH SYSTEM

He is a magna cum laude graduate of Connecticut College and a graduate of Georgetown University School of Medicine. Wagner completed his residency and chief residency in Internal Medicine at Dartmouth in Hanover, N.H. He is also currently president and CEO of the Tufts Medicine Professional Group and Tufts Medical Center Physicians Organization.

“Having survived COVID, risked infection, and pulled extra shifts to ensure high-quality care standards in Rhode Island’s hospitals,” Jesse Martin, executive vice president of New England Health Care Employees Union, District 1199. “CNE caregivers are eager for new investment in the frontlines. We look forward to working with Mr. Wagner to solve the ongoing staffing crisis at CNE.”

Care New England is the state’s second-largest hospital system, operating Women & Infants Hospital, Butler Hospital, Kent County Memorial Hospital, and other health care facilities around Rhode Island.

Lifespan, CNE’s main competitor and largest hospital system in the state, also went through some leadership changes in the last year. Its longtime CEO and President Dr. Timothy J. Babineau stepped down on May 31, after 10 years with the company. Arthur J. Sampson is currently serving as interim CEO and president.

Both Lifespan and Care New England recently reported financial losses in their latest quarterly report, with Lifespan suffering a net loss of $49 million for the 2022 third quarter ending on June 30 and CNE a $26.5 million net loss in the same quarter.

Rising costs, labor shortages and the strain brought on by the COVID-19 pandemic were some of the factors that strained the hospital system’s resources.

CNE’s net losses for the nine-month period ending June 30 were $71.2 million, including non-operating losses, such as negative investment returns, which totaled $39.6 million. This was on top of a $31.6 million operating loss over the nine months. By comparison, Lifespan’s net loss for the nine-month period ending on June 30 was $142 million, while its operating loss for the same nine-month period was $69.5 million.

“We will miss Jim’s leadership; particularly during the COVID-19 pandemic and the challenges it presented for Care New England and all of our hospitals.”

The Hospital Association’s President, Teresa Paiva-Weed said she spoke with Fanale Thursday morning on the phone and thanked him “for his support of HARI, of our healthcare system here in Rhode Island, and his unwavering commitment to ensuring Rhode Islanders have access to healthcare in the state.”

“Dr. Wagner brings an incredible wealth of knowledge to this position, and I look forward to the opportunity to work with him,” Paiva-Weed said.

(Update: Adds more of Wagner’s background, CNE financial information)

(Update: Adds comment from Sampson and Paiva-Weed)

(Update: Adds comment from Martin)

PBN staff writer Claudia Chiappa contributed to this report.

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