Care New England and Memorial Hospital expect the partnership to improve the quality of clinical programs and services, increase operational efficiencies and maintain a strong academic and research platform, along with other positive developments for the hospital and health system, according to a news release.
The Rhode Island Department of Health approved the affiliation in June. Under the acquisition agreement, Care New England will not pay for debt financing but will refinance or discharge $11 million of Memorial’s bond debt and cover its estimated $27 million to $36 million operational deficits through Sept. 30, 2016.
Additionally, Care New England’s board will grow by four seats and govern Memorial, which will nominate three at-large directors for Care New England approval. Memorial will freeze its defined benefit pension plan and isn’t expected to receive capital investments from Care New England as part of the transaction, but it will continue all current service lines. Memorial will also keep its teaching affiliation with Brown University’s medical school.
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