Rhode Island’s two biggest health systems head into the new year with major questions to answer about their finances and the prospect of a long-discussed merger still looming.
For Lifespan Corp., the immediate focus is on achieving a profit, following a $23 million operating loss. The state’s largest private employer is targeting a $1 million profit in fiscal 2020 but declined to outline details. The company says layoffs will be a last resort.
But reducing costs tied to employee pay and benefits is one of the best ways for health systems to generate savings, says David DeJesus, director of the graduate program in health care administration at Salve Regina University.
The conundrum for Lifespan is that cutting jobs or leaving them unfilled could boost overtime pay, one of the causes cited for Rhode Island Hospital’s $31.9 million operating loss for fiscal 2019.
For Care New England Health System, which turned a small operating profit last fiscal year following two years of losses, the focus remains on finding a partner. Discussions on merging with Lifespan have repeatedly failed, most recently earlier this year. Dr. James E. Fanale, CNE’s CEO and president, told WPRI-TV CBS 12 he’d like to see a renewal of talks with Lifespan, but only with the involvement of Massachusetts-based Partners HealthCare [which recently changed its name to Mass General Brigham]. Such three-way talks have already been tried and failed.
Can the two sides finally find common ground? Let’s hope 2020 is the year both are invested enough in finding out.
