Memorial Hospital, Care New England talk merger

Posted 6/28/12

PAWTUCKET – The Memorial Hospital of Rhode Island has entered into partnership discussions with Care New England, according to a joint statement released Thursday by Memorial’s acting president and CEO Arthur DeBlois and Dennis D. Keefe, president and CEO of Care New England.

The proposed consolidation is the latest change in the hospital landscape in Rhode Island.

With Landmark Medical Center on the verge of being purchased by Steward Health Care, Westerly Hospital in receivership with a stalking horse bid of $69 million by Lawrence Memorial Hospital in New London, Conn. and CharterCARE Health System seeking a financial partner, the only remaining community hospital currently unaligned is South County Hospital.

Memorial said that it began the process of exploring partnership opportunities more than a year ago, as a way to strengthen its financial future.

In April, at a R.I. Senate hearing on legislative changes to the Hospital Conversions Act, Christopher Callaci, general counsel for United Nurses & Allied Professionals, testified that Memorial was experiencing financial difficulty and in May, Martin E. Tursky abruptly resigned his position as president and CEO at Memorial to take a job in Ohio.

“Memorial Hospital of Rhode Island began exploring partnership opportunities that would allow us to continue providing quality health care services to our community, and also present opportunities for us to grow in the changing health care climate,” DeBlois said.

“When we looked at our vision of the future and Care New England’s vision of the future, we saw that the two cultures of the institutions fit very strongly,” added DeBlois. “We took that into consideration when coming to a decision about accepting Care New England’s proposal to enter partnership discussions.”

Calling it was a new world for health care, Keefe said it was necessary to offer a broad array of services of patients of all ages.

“We believe the complementary services of Memorial Hospital of Rhode Island and the geographic span of their service area will enable us to create a high quality, high value continuum of care for the people of Rhode Island and our region,” Keefe said. “We look forward to studying partnership potentials and hopefully seeing our vision for the future of health care come to fruition together with Memorial.”

Memorial Hospital, a 294-bed facility in Pawtucket, is a teaching affiliate of The Warren Alpert Medical School of Brown University.

It operates the medical school’s Center for Primary Care and Prevention and includes strong disciplines in family and internal medicine. Memorial has been an independent health care facility since its founding in 1894.

Today’s announcement paves the way for the two organizations to conduct due diligence and explore possible partnership models. The hope is that, following this exploration phase, the organizations will move forward and seek regulatory approval.

Under the new Hospital Conversions Act, two nonprofit hospitals involved in an acquisition where one is financially distressed can request an expedited review.

Yet, Memorial has not really looked into the expedited review possibility, according to Memorial spokeswoman Dyana Koelsch. The next step in the process will be to reach a definitive agreement with Care New England, she said.

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