A top executive at Boston-based Partners HealthCare said the organization's planned acquisition of Providence, R.I.-based Care New England's hospitals will depend on whether Partners believes it can help CNE become profitable, according to a Boston Business Journal report.
Partners signed a letter of intent to acquire CNE in April. The deal would not include Memorial Hospital of Rhode Island in Pawtucket, which Prime Healthcare Foundation, a public charity and affiliate of Ontario, Calif.-based Prime Healthcare Services, plans to acquire, according to the report.
Partners' planned acquisition of CNE comes as CNE faces financial hardship. The health system's Providence-based Women & Infants Hospital reported a $14 million loss for the first six months of fiscal year 2017, which contributed to CNE's combined $40 million system loss for the same six-month period, Jim Beardsworth, CNE system director of communications, previously said in an emailed statement to Becker's Hospital Review.
In the midst of its financial challenges, the health system last month announced plans to cut an undisclosed number of jobs at Women & Infants and Butler hospitals in Providence, as well as Kent Hospital in Warwick, R.I., and VNA of Care New England, the hospital group's home care and hospice division. That's in addition to 58 employees CNE laid off in March.
As Partners mulls the planned acquisition of CNE, a top executive said potential profitability will play a key role, according to the report.
"If we don't believe we can get them to break even and profitability relatively quickly, we'd have to evaluate the situation," Peter Markell, CFO of Partners, told Boston Business Journal.
He added: "Memorial Hospital was at least half of their losses, and Memorial is being sold to Prime. Now you have to deal with the rest. And they have given us assurances that they have plans to right size the ship. We'll evaluate as part of due diligence, but we won't take on something that will lose money forever."