The parent company of Manchester Memorial and Rockville General hospitals announced plans Friday to be acquired by Prospect Medical Holdings, a for-profit, Los Angeles-based company already in the process of acquiring Waterbury Hospital.
In a statement, Eastern Connecticut Health Network CEO Peter Karl described Prospect as “the best partner for our collective future.”
The two hospitals had been part of a previous plan to be acquired, along with three other hospitals, by Tenet Healthcare, a Texas-based for-profit hospital chain. That deal fell through after state regulators indicated they would impose restrictions on Tenet that the company deemed too burdensome.
Karl said in the statement that Prospect “has a strong track record of providing high-quality, cost-effective services to the communities it serves, working in collaboration with physicians, medical groups, community providers, payors and other key stakeholders such as labor unions.”
The terms of the sale will be reviewed by Eastern Connecticut Health Network’s governing body and voted on this summer, according to the statement.
Prospect operates 13 hospitals and 40 clinics and outpatient centers in California, Texas and Rhode Island. Its deal with Waterbury Hospital was announced in May. At the time, Tom Reardon, president of Prospect East Holdings, said the company was in talks with other Connecticut hospitals.
Many of Connecticut’s independent hospitals have been looking to join larger organizations. The parent company of New London’s Lawrence + Memorial Hospital announced last week that it is in discussions about joining the Yale New Haven Health System, although the two have not yet reached an agreement. St. Francis Hospital and Medical Center in Hartford is seeking regulatory approval to join Trinity Health, a national nonprofit Catholic health care system that includes 86 hospitals in 21 states.
All but one of Connecticut’s 29 acute-care hospitals are currently nonprofit, and the prospect of more hospitals becoming for-profit has been controversial. A law passed last year eased the way for for-profit companies to operate hospitals but added new regulatory requirements for the state approval process, and a bill passed this year would add additional requirements on changes in hospital ownership involving for-profits or large systems. The sale-related requirements in this year’s bill don’t take effect until Dec. 1, allowing hospitals to avoid them if they apply for state approval before that date.
Leaders of AFT Connecticut, which represents approximately 700 workers at both hospitals, sent an email to members Friday afternoon saying the union would continue its efforts “to put patients over profits.”
“Our unions have had a collaborative relationship with the administration throughout the network’s previous for-profit conversion efforts,” union President Melodie Peters and Field Representative Neil Alper wrote. “To their credit, ECHN leadership demonstrated a commitment to community dialogue and we look forward to that continuing as they pursue affiliation with Prospect.”