R.I. Foundation unveils recommendations on proposed Lifespan-CNE merger

Updated at 10:42 a.m. on Nov. 17, 2021.

NEIL D. STEINBERG, CEO and president of the Rhode Island Foundation, and Jayne Hayward, CEO and president of the Rhode Island Health Center Association, discuss the 40 recommendations the foundation has put forth regarding the proposed merger of Lifespan Corp. and Care New England Health System. / PBN PHOTO/JAMES BESSETTE
NEIL D. STEINBERG, CEO and president of the Rhode Island Foundation, and Jayne Hayward, CEO and president of the Rhode Island Health Center Association, discuss the 40 recommendations the foundation has put forth regarding the proposed merger of Lifespan Corp. and Care New England Health System. / PBN PHOTO/JAMES BESSETTE

PROVIDENCE – When Lifespan Corp. and Care New England Health System in April submitted plans to merge as a single integrated academic health system with Brown University, they asked the Rhode Island Foundation to seek community input on the proposed merger, according to RIF President and CEO Neil D. Steinberg.

Now, with the merger application deemed complete by the R.I. Office of Attorney General and the R.I. Department of Health, the 120-day review process is underway. Steinberg hopes that process will include review of 40 recommendations proposed on Wednesday by a 25-member group organized by the foundation.

The group co-chaired by Steinberg and Jane Hayward, CEO and president of the Rhode Island Health Center Association, met over five months and formulated a 70-page report that includes recommendations they say are intended to create a health system for all Rhode Islanders.

The report outlines four guiding principles – equity, independence, impact and sustainability. The committee also identified eight priorities – equity, oversight, access, cost, quality, workforce, community responsibility and governance – that all the recommendations revolve around.

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Among the recommendations is that the merged system commit to achieve benchmarks for nationally accepted measures that addresses health disparities within five years, focusing specifically on historically marginalized communities. The group also recommends the merged system to alleviate distrust of academic health systems among the state’s communities of color, as well as improving cultural competence for system employees.

Regarding governance, one recommendation the group noted is that the merged system “will promptly” commence a national search to hire a new CEO to oversee its system. Hayward clarified that the idea that either Babineau or Fanale – who have been instrumental thus far in pushing the merger plan forward – would leave their posts was not part of the discussion.

Hayward said the discussion noted that there should be a new CEO for the merged system. “Whether that CEO ends up being Dr. Fanale or Dr. Babineau or someone that comes from some place else, there needs to be a search and a conscious decision that this is a new CEO for this new entity,” she said.

The group also recommends for the merged system to address workforce impacts related to the merger, and how job losses will be minimized and mitigated. Hayward said there was a “sense” in the community that the merger would result in job loss and a routine in mergers of this size. She also said economy of scale should be looked at “across the board.”

The recommendations also include the merged system and Brown University directly investing $50 million over five years into the community addressing social determinants of health, such as housing and food insecurity. The merged system, per the report, initially offered to invest $10 million over three years, but the group felt more investment was needed.

The report also recommends transparency around Brown University’s involvement with the merger. Hayward said there was concern shared among group members about Brown’s investment in the community both currently and in the future.

Steinberg told Providence Business News said that while the foundation has supported the idea of a locally controlled, integrated, academic health system for years, the recommendations are designed to ensure “a broader community benefit” if the merger happens.

“We want to make sure the priorities and the voices of the community were heard,” he said.

Steinberg and Hayward delivered the report on Nov. 15 to Lifespan CEO and President Dr. Timothy J. Babineau, Care New England CEO and President Dr. James E. Fanale, Brown University President Christina H. Paxson, Attorney General Peter F. Neronha and R.I. Health Director Dr. Nicole Alexander-Scott.

Neronha on Tuesday told PBN the foundation’s recommendations are “credible, important public input.” He also clarified that approval of the merger with conditions that might include recommendations not already part of the merger application is “one of three doors” the regulators can walk through.

“Regulators can walk through with no approval at all,” Neronha said. “Approval with conditions or approval with no conditions. That’s what we will be determining over the next several months. But the work by the Rhode Island Foundation is well done and the points they made are certainly salient points, and we will be taking that into account along with additional public input in the months ahead.”

Steinberg said that the foundation does not typically get involved in discussions with mergers, outside of having conversations with some nonprofits who are willing to merge with one another. When asked why this situation is a unique case, Steinberg said, “it’s the health care component.”

Hayward further elaborated that the foundation spent a few years putting together a long-term health care plan for the state. The recommendations for the proposed merger are a “reasonable extension” of that work, she said.

In a statement Wednesday regarding the proposed merger and the foundation’s report, Sen. Sheldon Whitehouse, D-R.I., said that oversight will be key and the merged system’s new governance structure should include unions, consumers and payers. “A merger has great potential to be good for Rhode Islanders if the result is a new locally controlled system that provides affordable, high-quality health care,” Whitehouse said.

Update: Adds comments from Sen. Sheldon Whitehouse in paragraph 18.

James Bessette is the PBN special projects editor, and also covers the nonprofit and education sectors. You may reach him at Bessette@PBN.com. You may also follow him on Twitter at @James_Bessette.

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