Brown’s President Paxson Takes on One of The Most Powerful Healthcare Companies in America

Friday, January 12, 2018


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Christina Paxson, President Brown University

Christina Paxson came to Brown in 2012, and for the most part, has kept a low profile in Rhode Island. She has been a fundraising-focused President, who is the midst of a $3 billion campaign, but now she is fighting to keep Boston-based Partners HealthCare -- and their medical school affiliate, Harvard Medical School -- out of the Rhode Island market.

Reaction to Paxson’s move was swift and varied.

On Thursday, Paxson announced that the proposed purchase of the financial fledgling Care New England by mega healthcare giant Partners was bad for Rhode Island’s economy.

“I feel strongly that letting this acquisition go forward would be wrong for Rhode Island and for Brown. Doing so is likely to lead to specialty healthcare shifting to Massachusetts, impeding access to healthcare for Rhode Islanders and especially for members of the state’s underserved communities,” she wrote in a letter to the Brown community that was released to the public and media.

In a conference call with reporters on Thursday, Paxson said she was concerned that if Partners made the acquisition of Care New England, Rhode Island would see significant jobs losses.

“It also would likely increase the cost of care and reduce the ability of Rhode Islanders — consumers, businesses, healthcare workers and policy-makers — to have a voice in how our healthcare system works. If the focal point of Rhode Island healthcare shifts to Boston, excellent physicians (many of them Brown-trained) could be less likely to choose Rhode Island as a place to practice,” she added.

Partners' workforce is more than twice the size of Rhode Island’s direct healthcare workforce — it employees more than 70,000. The healthcare giant’s budget is roughly a third larger than Rhode Island’s — Partners' annual budget in 2017 was in excess of $13.4 billion.

A New Partner for Brown

As part of Paxson’s announcement of the University’s opposition to the Partners and CNE deal, she also announced that Brown is partnering with Prospect of California — the for-profit hospital group -- in launching an alternative bid. Prospect owns the majority stake in CharterCARE — Roger Williams Hospital and Fatima.

The pronouncements had been rumored for weeks, but the strategy change for Ivy League Brown sparked comments from a range of sources.

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Governor Gina Raimondo

Governor Gina Raimondo embraced the Brown pronouncement. “I’m encouraged that there might be even more options for Care New England’s future. Having a financially sustainable hospital system in Rhode Island is critical to the health and prosperity of our people," said Raimondo.

Behind the scenes, Raimondo has strongly voiced support for the Brown-Prospect option.

Senate President Dominick Ruggerio, who has close political ties to Care New England told GoLocal in an email, “We respect the process that Care New England is currently undertaking. Today’s announcement by Brown demonstrates the tremendous value and expertise invested in health care in Rhode Island and what it represents for patients, academics, research, and jobs.”  

Speaker of the House Nick Mattiello said on Thursday, "At this time, I have not seen an analysis or details of Brown’s proposal.  I look forward to receiving these details.”

United States Senate candidate Bob Flanders said, “I recently stepped down from the CNE board when I became a candidate, so I am hardly disinterested, but no, I don’t think it will have an adverse impact.”

Former U.S. States Attorney and now candidate for Attorney General, Peter Neronha said, “I read today’s reporting on Brown’s proposal with considerable interest.  Whether one agrees or disagrees with the conclusions drawn by Brown, plainly, by making its own proposal, Brown is a now a party in interest.”

Neronha went on to add the following:

“Without access to considerably more information than I have right now, I can’t say whether Brown’s proposal with Prospect would be better for Rhode Island than a purchase of CNE by Partners, either for the state economically, or, more importantly in my view, in terms of Rhode Islanders’ access to effective and affordable health care.  That access to effective and affordable health care, for everyone, is what is of critical importance in today’s complex healthcare environment.  

Ultimately, CNE will or will not reach a deal with Partners.  If they do, the Department of Health (and the Attorney General’s Office) will gather a great deal of information as they evaluate what is best for Rhode Islanders under the relevant criteria of the Hospital Conversions Act.  That evaluation presumably will address many if not all of the concerns Brown raised today,” added Neronha.

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Partners HealthCare employs more than 70,000

Less Than Enthused

The United Nurses and Allied Professional (UNAP) blasted Brown’s partnership with Prospect. The union has been battling with the company for years.

"We find it difficult to understand why Brown University would risk its stellar academic reputation through a partnership with Prospect Medical Holdings -- an out-of-state run, for-profit corporation with a documented history of jeopardizing patient safety and care. Prospect management represents the worst in profit-based medicine and we believe this move would be calamitous for Rhode Island patients and health workers,” said UNAP’s General Counsel Chris Callaci.

"This is a remarkably bad deal for Rhode Island, and we urge state regulators and all elected leaders to look closely at Prospect's extensive record of putting patient safety at risk," Callaci added. 

In addition, Care New England stiff-armed the Brown and Prospect announcement.

“Today’s [Thursday’s] announcement by Prospect Medical Holdings and Brown University represents their intention to acquire and split up the Care New England Health System – a process undertaken of their own independent action and interests. While we appreciate their interest in the future of health care in Rhode Island, we will move forward with the important process we have set upon in the best interest of both CNE and those we care for. To that end, CNE will proceed in our exclusive discussion with Partners as set forth in our letter of intent and we look forward to the next steps in that process."

Presently, CNE is under an agreement to exclusively negotiate with Partners — that agreement is set to expire at the end of the month.


Related Slideshow: 7 Implications and Unintended Consequences of a Care New England and Partners Merger

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Providence does not usually do well in mergers

Remember Providence Gas, Fleet Bank, and Narragansett Electric?

Big employers, deep community involvement, and significant charitable donors — all were consumed and in each case, the number of employees left in Rhode Island by the succeeding company is a fraction of the once independent venture.

To the victor goes the spoils.

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As if the Boston economy isn't good enough, and the Providence economy couldn't be more stagnant

The cityscape of Boston is littered with cranes. Boston Business Journal maps the construction projects utilizing cranes in Boston (see image) and the number of projects is staggering. 

In Providence, there few construction projects and not a crane to be seen. The last thing Providence needs is for another one of its largest employers to be merged into a Boston mega-organization. The likelihood is that jobs will be lost or consolidated to Boston - basic functions like purchasing, accounting, etc. will be lost. 

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Harvard beats Brown in Ivy League match-up

Harvard Medical School is ranked as the #1 research-based institution in America by U.S. News and World Report.

Partners Healthcare’s academic partner is Harvard.

In contrast, Care New England’s academic affiliation is with the Warren Alpert Medical School of Brown University. Brown’s best ranking is 21st for primary care - and is ranked for research way back at #31.

One of the biggest losers in the merger could be Brown's medical school.

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Care New England is RI’s 2nd largest employer, so what will It be in 2 Years?

According to the RI Department of Labor and Training, Care New England is Rhode Island’s second largest employer.

Lifespan is the largest: 12,050

Care New England: 8,500

CVS: 7,800

Cities like "Meds and Eds" (the medical and educational business segments), but Providence and all of Rhode Island is likely to lose high paid, highly educated jobs as a result of this deal.

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Care New England Continues to Struggle

Despite hopes that closing Memorial Hospital would solve the financially beleaguered Care New England's economic woes, new financial documents unveil that CNE continues to struggle.

Additionally, the pursuer - Partners HealthCare - is also making cuts. The Boston Globe unveiled the Partners is cutting about 100 of the company’s tech workers that their jobs were being outsourced to India to cut costs.

“Many of the employees have worked for Partners for several years, or even decades, and are struggling with the company’s decision. Almost all are coders — people who scour patients’ medical records to pinpoint billable services — and earn upward of $40 an hour. Coders in India earn a fraction of that amount, making overseas coding an attractive way for hospitals to cut costs,” wrote the Boston Globe.

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Can the unions battle?

Within hours of GoLocal breaking the news of the merger, the United Nurses and Allied Professionals (UNAP) President Linda McDonald, RN, released the following statement today:

"This proposed merger has the ability to impact thousands of jobs and the quality of care in Rhode Island and should be thoroughly scrutinized. Like most Rhode Islanders, we only recently learned of this proposal but expect Care New England and Partners HealthCare to be transparent in their process and begin a conversation with our union about the effect any deal would have on our members and our patients.  

Memorial Hospital provides critical care to scores of Blackstone Valley residents every year and preserving its status as a fully-functioning community hospital will be among our top priorities as this process continues to unfold. 
The onus is now on Care New England, Partners HealthCare and Prime Healthcare Services to make the details of this proposal public and to do it quickly so that workers, patients and state regulators may begin asking the appropriate questions."

The nurses represents nearly 1,400 registered nurses, CNAs, ER techs, surgical techs, orderlies, endo techs, environmental employees and ancillary staff at Kent and Memorial hospitals.  But, will they have any impact on the decisions?

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Speaking of Lifespan - will they be forced to merge with a Boston partner?

Lifespan is having its financial challenges too. While Care New England lost $53 million last year, Lifespan's losses were $40 million. The Lifespan losses were smaller proportionately to the healthcare group's overall budget and it does not have the cash crunch that Care New England was battling.

In February, Lifespan announced it had has entered into another Boston Hospital agreement. This agreement with Dana-Farber Cancer Institute is a long term agreement with the goal of advancing cancer treatment and research. Lifespan previously entered into an agreement with New England Medical Center and that deal led to years of protracted litigation to unwind. Lifespan also ran into a legal battle with Tufts Medical Center.

Will Partners' potential arrival in the market force Lifespan to affiliate?


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