Rhode Island may lift ban on for-profit hospital deals

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Rhode Island is moving forward with legislation that could pave the way for hospital merger deals in the state. The Senate last week approved the Hospital Conversion Act, which would eliminate a ban on for-profit companies acquiring more than one hospital in the state in a three-year period.

The Senate-approved bill is good news for Massachusetts-based powerhouse Steward Health Care System, which backed the bill and has its eye on a purchase deal with Landmark Medical Center in Woonsocket, R.I.

The bill, however, does include some conditions. The purchaser must keep the hospital open for at a certain length of time, commit to a minimum investment to protect the assets, maintain a local governing board and contribute financially to state health planning and to primary care in the state. Hospitals can only enter into contracts that are reasonably necessary, according to a senate statement.

"The goal here is to be flexible, since every hospital's situation is different, but to do what is in the interest of the public, public health and the strength of the community," Sen. Roger A. Picard (D-Dist. 20, Woonsocket, Cumberland) said in a statement. "Ultimately, regardless of whether they are for-profit or nonprofit, we want hospitals ... to provide high-quality healthcare to the public while employing local people."

In other news, Steward Health Care System on Friday announced the abrupt resignation of Bill Walczak, president of its Carney Hospital in Dorchester, according to The Boston Globe. It's unclear why the president left after only 14 months on the job.

Meanwhile, another hospital in Steward's network of 10 Massachusetts hospitals, Saint Anne's Hospital in Fall River, laid off an undisclosed number of employees, reported the Boston Herald.

Steward spokesman Christopher Murphy told the Herald that the layoffs are part of a "minor reduction in staffing levels" due to a decrease in patient volume and that none of the other hospitals are affected.

For more information:
- check out legislation (2012-S 2180Aaa) and the related bill (2012-H 7283)
- see the senate statement
- read the Boston Globe article
- see the Boston Herald article

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