Tenet walks away
By Jonathan M. Stankiewicz Journal Inquirer | Posted: Friday, December 12, 2014 11:32 am
With Thursday’s announcement that Tenet Healthcare Corp. is abandoning its plans to acquire five
hospitals in Connecticut, local and state officials say they are concerned for the future of local
hospitals.
The deal — more than two years in the making— would have seen the Texas­based group acquire
Waterbury Hospital, St. Mary’s Hospital in Waterbury, Bristol Hospital, and Eastern Connecticut
Health Network — which owns Rockville General Hospital in Vernon and Manchester Memorial
Hospital.
Tenet said its decision is largely based on a proposed list of conditions imposed by the state Office of
Health Care Access and Attorney General George Jepsen’s office for its plan to acquire the Greater
Waterbury Health Network, Waterbury Hospital’s corporate parent.
The strict conditions included maintaining current clinical staff levels for five years and certain
medical services for seven years, as well as not reducing or relocating any inpatient or outpatient
services for five years.
“The extensive list of proposed conditions to be imposed on the Waterbury Hospital transaction,
which is only the first of four transactions for which we’ve made applications, has led us to conclude
that the approach to regulatory oversight in Connecticut would not enable Tenet to operate the
hospitals successfully for the benefit of all stakeholders,” Texas­based Tenet said in a statement late
Thursday.
“We greatly appreciate the dedication and hard work of so many individuals and organizations to
create a strong future for the hospitals serving these communities,” the statement also said.
The for­profit company added that it both appreciates and admires “the leadership of these hospitals
and Yale New Haven Health System.”
A Tenet spokesman today declined to comment beyond the contents of Thursday’s statement.
Jepsen, in a statement released later Thursday, called Tenet’s decision to withdraw “unfortunate.”
The attorney general also said he doesn’t believe “that the conditions proposed by my office — which
focused on preserving and safeguarding the assets of the sale for health care purposes and not the day­
to­day operation of the for­profit hospital going forward — were a contributing factor in Tenet’s
decision.”
“This decision raises substantial and immediate questions about the future of health care delivery in
some of our communities,” Jepsen said. “Those questions deserve the closest attention of
policymakers at the local and state levels.”
ECHN’s CEO and president, Peter Karl, said in a statement today that “these are challenging times
for hospitals.”
“After three years of hard work by many at ECHN and with strong support from our community and
business leaders, we were excited about the transaction with Tenet and Yale New Haven, knowing
that it would preserve and strengthen the health care network for residents east of the river,” Karl
said.
“The ECHN Board of Trustees will assess alternative measures with the goal of preserve high­quality,
community­based healthcare for the communities we serve,” he added.
Local officials all expressed concern over what Manchester Memorial and Rockville General would
do to move forward from Tenet’s sudden decision.
M. Saud Anwar, a pulmonology specialist who’s also mayor of South Windsor, said everyone needs
to “look at the bigger picture of what’s going on.
“There are unfortunate reality changes in the health care law, and the current reimbursement pattern
has become very difficult for health care services to survive on their own,” Anwar said.
Anwar, whose practice is affiliated with ECHN, said he believes part of the reason Tenet pulled out
was due to OHCA’s recently proposed conditions.
“This is a time that the governor and the Office of Health Care Access need to completely focus on
saving thousands of jobs and not negatively impacting thousands of lives,” Anwar said.
Anwar said the proposed conditions also make the state look as though it’s not open for business.
Vernon Mayor Daniel A. Champagne said he’s concerned for the future of Rockville General, now
that Tenet has decided to withdraw from acquiring it. Karl said at a Vernon community meeting this
year that Tenet would keep Rockville General open for at least three more years.
“I just hope it doesn’t lead to the hospital closing,” Champagne said, adding Rockville General has
said that it has “five years” before it gets into even greater financial trouble.
“I hope that we can find a solution to keep the hospital open,” the Vernon mayor said. “We are going
to do everything we can.”
Champagne added that he had been worried about Tenet pulling out after the conditions were released
last week.
But former Vernon Mayor Marie A. Herbst said today that she’s “happy the deal” won’t go through
with Tenet.
“It’s about time,” Herbst, who still serves on the Town Council, said. “The deal was never solidified
properly to begin with. It was done quickly and without any research.”
Herbst said the deal would have “very, very seriously” affected Rockville General. She said she
believes the “pressure of the community about Rockville General in particular had a lot to do with
this behind the scenes.”
Manchester Mayor Jay Moran said today that he continues to be concerned about the future of
Manchester Memorial and “how it affects the employees.”
“I’m sure the hospital is going to wake up today and wonder what Plan B is, and hopefully they can
think of a way to keep this great hospital in our community because it’s our largest employer,” Moran
said. He added that his major concerns are about keeping the hospital open and avoiding staff layoffs.
Legislators were surprised by Tenet’s decision Thursday, saying all signs had been pointing to the
hospital chain following through with the application. They also had a mixed reaction on how the
decision will impact the five hospitals involved.
Newly elected state Rep. Mark Tweedie, R­Manchester, said he had concerns about Tenet, most
notably the company’s high level of debt.
“I was concerned with it, as we a lot of people in Manchester,” Tweedie said of Tenet’s bid for
Manchester Memorial.
State Rep. Claire Janowski, D­Vernon, said Jepsen had proposed some “very responsible” measures
in Tenet’s bid for Waterbury Hospital that would have acted as “safeguards.”
She also said she would have wanted similar protections had Tenet acquired Rockville General and
Manchester Memorial.
Janowski also said the legislature will need to take steps to help smaller hospitals, most notably in
regards to financial help for “uncompensated care” of indigent and uninsured patients.
“All the hospitals are struggling, but it’s a particularly acute problem for the smaller community
hospitals,” she also said.
State Rep. David Alexander, D­Enfield, said the state needs to look at both short­term help and long­
term solutions for smaller hospitals.
Alexander, who has served on the legislature’s Public Health Committee and wants to again, said the
General Assembly needs to play more of a role when private companies seek to acquire nonprofit,
community hospitals.
Staff writers Mike Savino and Eli Freund contributed to this story.