Lifespan, Care New England Unveil Merger Plans with Brown University

Two of Rhode Island’s predominant health systems are officially joining forces to create a healthier state with the help of Brown University.

In an announcement released yesterday, Lifespan and Care New England revealed that they have signed a definitive agreement to merge and create, with Brown University, an integrated, academic health system.

The healthcare merger will bring together key teaching hospitals in the state—Lifespan’s Rhode Island, Miriam, Hasbro, Newport and Bradley hospitals, and Care New England’s Women & Infants, Kent, and Butler hospitals—with The Warren Alpert Medical School at Brown.

Brown will also provide at least $125 million over five years to support the creation of the integrated, academic health system.

“Combining health system operations with leading-edge research and renowned medical expertise will improve the quality of medical care for patients across Rhode Island and surrounding regions,” said Charles Reppucci, Care New England Board of Directors Chairman, said in the announcement.

“The uniting of health care with medical education and research serves to advance biomedical discovery, educate future physicians, nurses and health practitioners in medicine and health care, and create a vibrant economic nexus in the region based on the health care industry,” Reppucci stated.

The merger deal will also provide Rhode Islanders with high-quality, affordable care right in their own communities, leaders from the three organizations agreed.

“We don’t want people to have to go to Boston or New York if god forbid they get cancer,” Christina Hull Paxson, president of Brown University, added in a conference call yesterday. “We can develop a world-class cancer center that conducts research, that lets us treat patients better, and that provides Rhode Islanders with an option and an alternative to going elsewhere.”

Care New England previously pursued a merger deal with Boston, Massachusetts-based Partners HealthCare. The merger deal, however, faced staunch pushback from Brown University’s Paxson and Rhode Island Governor Gina Raimondo who both expressed concerns about losing local healthcare if the merger were to go through.

Lifespan and Brown stepped up to offer the struggling health system, which reported $115 million in losses during the two fiscal years preceding the Partners announcement.

This is the fourth attempt to solidify a local merger deal between the three Rhode Island-based organizations. But executives say now is the right time for this deal.

 “If the COVID pandemic taught us one thing it’s that we are better when we work together,” said Timothy J. Babineau, MD, Lifespan president and CEO. “This is a moment in time that we cannot let slip through our grasp. Rhode Island is one of the only states in the country that does not have a single integrated, academic healthcare system. Massachusetts has four or five, Rhode Island has none. If we don’t do it now, if it doesn’t happen this time, the alternatives will not be in the best interest of the community and the patients we serve.”

Leaders from the organizations believe the combined academic health system will alleviate the fragmented care system currently in place in the state by increasing access to high-quality, affordable care while improving outcomes of patients through better population health management and data-driven care delivery.

But research has shown that these benefits are rarely realized post-merger.

Just last year, researchers from Harvard University found that hospital acquisitions had little impact on key quality of care metrics, including hospital readmission and mortality rates. A growing body of literature has also questioned the cost benefits of hospital mergers and acquisitions.

Top Rhode Island lawmakers have already voiced concerns about the merger deal between Lifespan and Care New England, which are the two largest hospital groups in the state.

Particularly, the state’s House speaker, Joseph Shekarchi, and Senate majority leader Michael McCaffrey told The Boston Globe in December 2020 that they are concerned about job cuts at Kent County Hospital, a Care New England facility, following the merger.

“Coming from Warwick, where Kent County Hospital is, I want to make sure that Kent County Hospital is protected if they are going to move forward with the merger,” McCaffrey said. “Obviously, it’s only in its infancy right now, but we want to be sure that if there is any legislation that the attorney general will want, we will look at that, and also the Department of Health, so that all the parties will be protected.”

The proposed merger will face regulatory scrutiny as with other healthcare merger and acquisition deals. The health systems did not provide information on when they expect to finalize the deal.