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More Trouble for CNE as Sen. Whitehouse Raises Concerns Over Partners Deal

“Whitehouse is raising alarms about a proposed sale of Care New England — Rhode Island’s second-largest hospital group to a large out-of-state hospital chain.”

Rhode Island Senator Sheldon Whitehouse has voiced concern about the merger between Care New England and Partners. According to Rhode Island Public Radio:

U.S. Sen. Sheldon Whitehouse is raising alarms about a proposed sale of Care New England — Rhode Island’s second-largest hospital group to a large out-of-state hospital chain. Care New England has been losing money — and it’s trying to negotiate a sale to Boston-based Partners Healthcare. …

“Whatever the merits are of the Care New England merger with Partners,’’ Whitehouse said, “I think we have to think about it in the larger context of what this means for having local leadership of hospitals in Rhode Island.”

Since the proposed deal was announced, Care New England has faced a number of challenges.

Last month, Care New England announced its sale of Memorial Hospital to Prime Healthcare Foundation would be further delayed, possibly “well into” 2018. WPRI reports:

Alyssa Boss, Care New England’s general counsel, told bondholders in a conference call Thursday that company executives had originally expected the Memorial transaction would be complete by late this year or early 2018, but they now think it will take until “well into 2018.”

The sale of the struggling Memorial Hospital to Prime is key to CNE’s larger deal to be acquired by Partners Healthcare.

This isn’t the first setback in the Memorial Hospital sale. Earlier this year, Prime’s credit was downgraded amid a Department of Justice investigation.

In addition to the issues with Prime and Memorial, CNE itself is in dire financial straights. Its CEO recently announced his resignation after the company reported a $61 million loss for this fiscal year.