Partners HealthCare, Care New England Seek Fast-Track Review

Aug 9, 2018

PROVIDENCE – Massachusetts-based Partners HealthCare and Care New England are asking Rhode Island health officials to conduct a fast-track regulatory review of their proposed merger, citing Care New England's ongoing financial distress.

If the request is approved, the Rhode Island Department of Health would have to review the application to take over Rhode Island’s second-largest hospital system within 90 days, as opposed to the usual 120 days.

The curtailed review also reduces the amount of documentation the two hospital systems are required to submit as they seek state approval for the deal. And an “expedited” review does not require a public hearing on the application, though state law does provide for a period of public comment, generally in writing.

The takeover deal must be reviewed by Rhode Island health regulators with a final decision by the state’s health director, Dr. Nicole Alexander-Scott.

Care New England reported first- and second-quarter losses in fiscal 2018 of $33.6 million and $40.7 million, respectively. To qualify for the curtailed review, state law requires the company to show it meets certain criteria of a distressed hospital system.

Last year, at the request of Care New England, state lawmakers approved legislation to change the state Hospital Conversion Act to allow for the curtailed review for the sale of the distressed Memorial Hospital.  Supporters said at the time that the changes would cut red tape that could delay the sale of Memorial  and the hospital system’s turn around.  Union officials said at the time they feared the changes would undermine regulatory oversight of the state’s biggest ever hospital deal, since the information and disclosures are far less than what’s required under a full review. Memorial’s sale fell through, however, and the hospital was later closed, save for some out-patient services.

There is no deadline for health officials to decide whether to grant the fast-track review for the Partners-Care New England deal. However, health officials generally respond to such requests within roughly two weeks, said Joseph Wendelken, a state health department spokesman.  To go forward, the deal also needs approval from Massachusetts regulators and federal regulators.

Differences between an “expedited” review and a full regulatory review:  

— Applicants submit 13 documents instead of the usual 32 documents

— Health department reviews 27 questions instead of 55 questions

— Review completed in 90 days instead of 120 days