PROVIDENCE, R.I. (WPRI) — Rhode Island’s largest hospital group announced Thursday it will change its name to Brown University Health, part of a wide-ranging plan to deepen its relationship with the Ivy League school in exchange for a large initial cash injection.
The new set of agreements does not constitute a merger, so Brown will not take direct control of Lifespan’s hospitals. But the school agreed to invest $150 million in the future Brown Health System over the next seven years, allowing its cash-strapped hospitals to improve their operations.
“We are excited to move forward with robust plans to expand our facilities and improve our systems and technologies so that we can compete with new entrants to the healthcare delivery market, such as national chains” , Lifespan Chairman and CEO John Fernandez said in a statement. .
“Brown’s investments are critical and will help Lifespan address its immediate challenges,” added Fernandez, who was recruited from Mass Eye and Ear in Boston to replace Timothy Babineau as Lifespan’s chief executive in 2022.
Lifespan is a nonprofit corporation and Rhode Island’s largest employer, with approximately 16,000 workers. It owns Rhode Island, Miriam, Newport and Bradley hospitals, as well as various other medical businesses. But it struggled for years to post a meaningful profit margin, which executives blamed in part on low insurance reimbursement rates in Rhode Island.
Lifespan said that while official adoption of the Brown Health name is expected to occur later this year, it will take several years to fully complete the rebranding. Hospital leaders unveiled the new logo during a morning news conference at Hasbro Children’s Hospital.
In an interview, Fernandez emphasized that the changes should not cause any disruption to Lifespan employees or patients.
“For our employees, nothing changes – the benefits are the same, the work is the same – it doesn’t change. It’s really just a name change,” Fernandez said. “And for patients, your doctors are your doctors – Rhode Island Hospital and Hasbro will be there; Miriam, Newport and Bradley will all be there to take care of you.
He added: “Most patients won’t even notice, except that hopefully we will have more doctors, more nurses and more scientists working on the problems they face. »
For Brown, the biggest benefit of the deal appears to be stabilizing a crucial partner for its Warren Alpert Medical School and, university leaders hope, helping the health system compete more effectively with other academic medical centers at regional and national levels. Brown’s investments will help Lifespan fund the expansion of electronic health records and the recruitment of leading clinicians, executives said.
“The new agreements move the relationship between Brown and Lifespan to a more contemporary model, consistent with other affiliation agreements we see across the country, where the academic-medical affiliation is reflected through a common name between the hospital system and the university establishment. said Brown President Christina Paxson.
Target 12 first revealed the discussions between Brown and Lifespan last October. The discussions follow years of turmoil over the future of Rhode Island’s largest hospital systems, including several failed deals, most recently the proposed Lifespan-Care New England merger that Attorney General Peter Neronha vetoed in 2022.
Lifespan and Brown said they consulted with Neronha’s office and the RI Department of Health to confirm that their new agreements do not require regulatory approval, since ownership of the hospitals does not change.
The decision by Lifespan’s board to move to a more prestigious brand echoes a similar decision made in 2019 by Massachusetts’ largest hospital group, Partners HealthCare, which chose to rename itself after its two flagship hospitals , thus becoming Mass General Brigham.
Other universities also lend their names to affiliated academic medical centers that they do not own, including Yale New Haven Health in Connecticut, the University of Vermont Health Network and UCLA Health in California. In Rhode Island, independent provider group Brown Physicians Inc. has a similar relationship with Brown.
(In a letter to Brown and Lifespan executives confirming that they did not need regulatory approval for the new deals, Neronha flagged Brown Physicians as a potential source of future concern, asking the organizations to proactively inform them if they were considering changing their relationship with the physician group or sharing competitive information with it.)
Paxson said Brown and Lifespan agree on “the goal of improving the health of Rhode Island families, both through medical advances in care and cutting-edge medical training for the next generation of physicians “.
Money is at the center of the new agreements between the two institutions.
Funding will initially shift from Brown to Lifespan, with the school pledging to invest between $15 million and $25 million annually in the hospital system over the next seven years, starting next month. After that, the flow of funds will reverse, with Lifespan promising to allocate $15 million a year to Brown’s medical school.
“A strong financial foundation is now needed to meet facility and other infrastructure needs across the Lifespan system,” Fernandez said, “and our long-term support will in turn help recruit and retain more talented academic and clinical leaders as Warren department chairs. Alpert School of Medicine.
Lifespan also hopes that investments made with Brown’s money will help attract more patients from out of state, strengthening the system’s bottom line.
Separately, the Brown Investment Office — which manages the university’s $6.6 billion endowment — will take over management of $600 million to $800 million of Lifespan’s investments over the next four years. Officials said they hope Brown’s finance team can earn better returns on Lifespan’s portfolio that can be reinvested in the health system.
Brown’s medical school is relatively young in the context of higher education, founded only half a century ago, in 1972. (A former Brown medical school had closed in 1827.) Leaders Academics have invested significant sums in the medical school in recent years. generation, opening a flagship building in the Jewelry district in 2011.
Yet Paxson has long argued that the medical school cannot thrive without strong affiliated facilities, and has spent years trying to figure out the best way for the university to support its partner hospitals while protecting its own interests.
At one point in 2018, Paxson made a failed attempt to buy Care New England, owner of Women & Infants, in partnership with Prospect Medical Holdings. She later offered to contribute $125 million to make the Lifespan-CNE merger a success.
But Lifespan Hospital in Rhode Island was the primary teaching hospital for Brown’s medical school before it even began accepting students, and the deal announced Thursday solidifies that status. Paxson and School of Medicine Dean Dr. Mukesh Jain will join the Lifespan Board of Directors as ex-officio members, and Jain will also be named Lifespan’s Chief Academic Officer.
The changes “will strengthen the work we have been doing for several years to integrate research and remove barriers for doctors and scientists who translate laboratory discoveries into treatments that benefit patients,” Paxson said.
Brown said he still plans to maintain his existing teaching affiliations with other local institutions, including Care New England. In a statement, CNE CEO Dr. Michael Wagner argued that Brown Health’s move “increases Lifespan’s focus on high-end subspecialty services.”
“The new agreement does not change the mission and vision of Care New England, our strong academic credentials and our relationship with Brown’s School of Medicine,” he said, noting that the departments of OB/GYN, Brown Psychiatry and Family Medicine are all CNE. -affiliated.
“Care New England will continue to partner with Lifespan on some initiatives and will refer patients to some of their high-end subspecialties,” Wagner said. “We will also continue to focus on our academic partnership and our unique role in providing basic health care to all Rhode Islanders. »
Brown, Lifespan and CNE are also creating the new Brown Innovation and Research Collaborative for Health, intended to streamline and align their research programs. Brown agreed to invest up to $25 million in the effort.
Rhode Island U.S. Sen. Sheldon Whitehouse, who has played an influential role in discussions about the future of health care in Rhode Island, warmly welcomed Thursday’s announcement.
“I have great hope for what the Brown Health partnership means for health care in Rhode Island,” Whitehouse said in a statement. “This new beginning opens opportunities to improve the quality of care, control costs and expand medical education and research here in the Ocean State.”
Watch the full press conference below:
Ted Nesi (tnesi@wpri.com) is an investigative reporter for Target 12 and politics/business editor for 12 News. He co-hosts Newsmakers and writes Nesi’s Notes on Saturdays. Connect with him on Twitter, Topics and Facebook.