The only public offer CNE has received is from StoneBridge Healthcare, a nonprofit based in Pennsylvania, which submitted its second bid for CNE in February 2022 for $550 million. StoneBridge, which was founded in 2020, is led by Josh Nemzoff, who has more than 40 years of experience as a health care industry consultant. Nemzoff made his first attempt to buy Care New England in December 2020 for $250 million.
Some observers and political leaders said Mass General Brigham, formerly known as Partners HealthCare, might be interested in making another deal.
In April 2017, Mass General Brigham had attempted to acquire Care New England, and even went as far as signing a definitive agreement to merge. Lifespan launched an opposition campaign against the deal saying it would “cost” Rhode Island with rising care prices and shift jobs to Massachusetts. But at the time, the FTC had already signed off on the deal.
But former governor Gina M. Raimondo, now US commerce secretary, asked Fanale, the leaders at Lifespan, and Brown University’s medical school to create a locally run academic medical center in Rhode Island. Mass General pulled out of its acquisition, but interim president and CEO Anne Klibanski didn’t rule out the idea of restarting discussions in the future. And the deal between Lifespan, Care New England, and Brown was strongly rejected by state and federal regulators earlier this year.
Jennifer Street, a spokeswoman for Mass General Brigham, declined to comment for this story, but Fanale previously said the system’s relationship and clinical affiliation with Mass General is “outstanding” and “exceedingly important to us now and in the future.”
“So are we likely to discuss options? Certainly, we will. They’re part of us,” he told the Globe in March. “It’s a great relationship, no matter what, and they’ll be part of of the discussion going forward.”
When pressed on Wednesday whether Mass General Brigham was one of Care New England’s potential suitors, Fanale said, “I can’t say because everything is under a NDA.”
The only other possible suitors in Rhode Island would be Prime Healthcare Services, Yale New Haven Health, South County Health, and Prospect Medical Holdings (also known as CharterCARE in Rhode Island).
Earlier this year, prior to state and federal regulators blocking a proposed merger between Care New England and Lifespan, the state’s largest system, executives at two Rhode Island hospitals expressed interest in CNE’s hospitals.
In a letter sent to the attorney general’s office, Michael R. Souza, the CEO of Prime Healthcare Services, which operates Woonsocket’s Landmark Medical Center, made an offer to buy Kent Hospital “in order to minimize the anti-trust issue” in the Lifespan deal, and “infuse much needed capital, along with a cash consideration.”
It’s unclear what any deal between Landmark and CNE would look like, but under Rhode Island state law, the transaction would have to be approved by the attorney general’s office and state health department. When asked if the offer was still on the table, Elizabeth Nikels, a spokeswoman for Prime Healthcare, declined to comment “on specific opportunities that are, or are not, currently under review.”
But union leaders have long been opposed to that idea.
In 2018, Prime was forced to pay the federal government $65 million to settle a lawsuit in which the hospitals allegedly knowingly submitted false claims to Medicare by admitting patients who required less costly, outpatient care and by billing more-expensive patient diagnoses than the patients actually had. Last year, the company had to pay another $37.5 million to settle allegations of kickbacks and other false claims.
“The for-profit alternative, of course, is a non-starter,” wrote Lynn Blais, president of United Nurses and Allied Professions, in a letter to the attorney general on Feb. 1.
Aaron Robinson, the CEO of independently owned South County Health, previously told the Globe when Lifespan’s proposed merger with CNE was still a possibility, that Kent Hospital or Lifespan-owned Newport Hospital didn’t need to be part of the equation. He said he attempted to speak with the leaders of Lifespan and Care New England systems, but that neither were interested because of their exclusivity clause.
At the time, which was the day before the Lifespan-CNE deal was denied by the attorney general’s office, Robinson said he would “be very open” to having those discussions again if the merger is not fully approved.
On Thursday, Robinson said the plan to form a community health care delivery system, which included Kent and South County, was related to the merger of Lifespan and Care New England only.
“It would have allowed for the creation of an academic medical center while preserving competition to promote quality, value and innovation. Now that the merger of Lifespan and Care New England is not moving forward, the community health care delivery system as originally contemplated is no longer applicable,” he said in an email to the Globe. But, he said the hospital will “continue to explore all compliant forms of partnership to enhance high quality, community-based care for all Rhode Islanders.”
Los Angeles-based Prospect Medical Holdings, which owns Roger Williams Medical Center in Providence and Our Lady of Fatima Hospital in North Providence, is looking to unload both of its properties, making it unlikely the company will want to acquire Care New England.
Prospect also has a long history of financial instability and grueling fights with local lawmakers over ownership changes. In 2018, Prospect borrowed about $1 billion, which was used to pay a nearly half a billion dollar dividend. The attorney general’s office told the Globe recently that a company hasn’t expressed interest in Fatima or Roger Williams in months.
Prospect spokesman Otis Brown did not respond to multiple inquiries from the Globe.
Yale New Haven Health, which also owns and operates Westerly Hospital, is set to acquire two health networks, including three Connecticut-based hospitals, from Prospect. But Fiona Phelan, a spokesman for Westerly Hospital, previously said she was unaware of any interest regarding Prospect’s Rhode Island properties.
When asked if Yale New Haven was interested in expanding its footprint farther into Rhode Island by acquiring CNE in any way, Phelan responded in an e-mail, “Not at this time.”
Alexa Gagosz can be reached at [email protected]. Follow her on Twitter @alexagagosz and on Instagram @AlexaGagosz.