By Richard Asinof
By Richard Asinof
PROVIDENCE – R.I. Attorney General Peter F. Kilmartin approved the affiliation of Pawtucket-based Memorial Hospital of Rhode Island to become part of the Care New England hospital network, the attorney general’s office announced late Tuesday afternoon.
The approval followed an expedited 90-review under the state’s Hospital Conversions Act. Last week, Dr. Michael Fine of the R.I. Department of Health also issued an approval of the new affiliation.
“Memorial Hospital and Care New England share strong ties to Rhode Island and a reputation for providing quality health care services,” Kilmartin said. The approval, he continued, will “provide greater certainty that access to quality health care services to Pawtucket area residents will continue.”
In advance of partnering with Care New England, Memorial Hospital, a 294-bed acute care community hospital, had experienced serious financial stress – losing a total of more than $12 million in funding years 2010 and 2011, more than $13 million in funding year 2012, and a projected $13 million in funding year 2013, according to details in the R.I. Department of Health’s report.
The transaction did not involve any debt financing. Care New England agreed to refinance or discharge $11 million in bond debt, and finance any operation shortfalls, estimated to be between $27-36 million, through Sept. 30, 2016.
Care New England will serve as the corporate parent for Memorial Hospital; Care New England’s board of directors will be expanded to include four new members nominated by Memorial Hospital.
No elimination of any clinical services is envisioned, but some specialty services, such as the cardiac catheterization laboratory and specialized imaging services, will be eliminated over time.
Care New England described the new partnership with Memorial as creating “a truly integrated delivery system with strong primary care as a central and unifying force.”
No date has yet been set for the actual closing of the deal.
Kilmartin praised the professionalism and diligence of the state regulators. “With the rapidly-changing landscape of the health care marketplace, we are mindful of the important role we as regulators play in balancing the need to protect the interests of the patients, the community, the employees and the state with the economic realities faced by our community hospitals,” he said.