Lifespan, Care New England won't say no to a possible merger as new leadership beds in

Providence, R.I.-based Care New England and Lifespan were forced to abandon plans to merge in February 2022 when the Federal Trade Commission filed suit to block the proposed deal.

But now it might be a sense of never say never. New leadership at both health systems may be encouraging fresh thinking as to a possible merged entity.

"We have to accept the decision they made," Lifespan CFO Peter Markell told an investor call March 16. "There is still room for dialog and discussion, and you can always try again."

The focus for now will be on improving Lifespan's operating numbers with a particular concentration on workforce management. Lifespan has had to close a number of operating rooms as well as bed capacity because of a shortage of staff.

While staff recruitment was a relatively easy part, it was retaining that staff that continued to be the most challenging, with CEO John Fernandez describing it as "a real problem."

"We are pulling out every trick we can," he said, including working with other organizations such as local nursing colleges to incentivize nurses to stay and work in Rhode Island.

Lifespan is also seeking to strengthen its research partnership with Brown University, where Care New England is also involved. As well as planning physical space better to improve efficiencies, there could be real advantages to enhanced collaboration.

"We are looking to find some efficiencies to make research easier for our scientists so they can find more time to do that," Mr. Fernandez said. "If we are working together on a particular disease, we could be working better than we already have."

The main focus for now would be on improving operating margins to between 3 and 5 percent over the longer term and to get back to days of cash on hand "in the big 100s." Current days of cash on hand oscillate around 100, Mr. Markell said.

"We are focused on Lifespan," he said. "We have to get our own house in order and then we will see where life takes us after that."

In comments made March 15 by Michael Wagner, MD, CEO of Care New England, a similar focus was raised.

"There is new leadership (at Lifespan) and it is better to see how we can collaborate," he said. "Our job at Care New England is to create a platform of profitability and then we can work out strategic steps from there."

Copyright © 2023 Becker's Healthcare. All Rights Reserved. Privacy Policy. Cookie Policy. Linking and Reprinting Policy.


Featured Whitepapers

Featured Webinars