Last week’s announcement that Yale New Haven Health System was ousting and immediately replacing chief executive officer Chris O’Connor came as a shock to many in the state’s healthcare sector.

O’Connor — born and raised in New Haven, and a longtime employee of the health system — was, by all accounts, a skilled leader who was well liked and widely respected.

“It was a surprise to me, for sure,” said state Comptroller Sean Scanlon, who works closely with hospitals across the state as one of Gov. Ned Lamont’s key advisors on healthcare issues. “Chris is a tremendous guy and a tremendous leader.”

But, a closer look — and conversations with people across the industry — suggests there were warning signs that O’Connor’s job could be in jeopardy.

The health system’s financial recovery from COVID has been sluggish, and a failed bid to buy the hospitals formerly owned by Prospect Medical Holdings had plagued O’Connor’s tenure. Multiple industry sources said the debacle led to the dismissal of two YNHHS executives last fall.

But it appears that purging wasn’t enough to save O’Connor’s job in the end.

The shakeup in the executive suite at Yale New Haven Health, one of the largest private employers in Connecticut with an internationally renowned medical school, also comes at a time of heightened stressors for hospitals in general. Increased costs, a strained workforce and the looming specter of cuts to Medicaid have all created challenges for healthcare organizations already operating with tight profit margins.

The Connecticut Mirror reached out to O’Connor, the former Yale New Haven Health executives, and current board members for comment. None responded.

State Sen. Saud Anwar, a physician who serves as co-chair of the legislature’s Public Health Committee, acknowledged the challenges today’s industry leaders are grappling with when asked to comment on O’Connor.

“Leading a healthcare system is never easy, particularly through the unprecedented challenges of the COVID-19 pandemic and a rapidly changing healthcare environment,” Anwar stated in a text message. “Chris helped guide the organization through a period of significant growth, strengthened collaborations across the state and remained committed to expanding access to high-quality care.”

A son of New Haven

New Haven healthcare has shaped O’Connor’s life. He was born at Yale New Haven Hospital and his mother spent most of her career as a nurse at the city’s Hospital of St. Raphael, which O’Connor said inspired his own career in healthcare. 

After working in hospital leadership in New Orleans and Boston, O’Connor returned to New Haven in 2009 as chief executive officer of St. Raphael’s. He determined the hospital, which was independent at the time, needed to join a larger institution, and led its acquisition by Yale New Haven Health System. 

After the deal closed in 2012, O’Connor joined YNHHS and served as the system’s executive vice president and chief operating officer.

O’Connor was named CEO in 2022, following the retirement of Marna Borgstrom, who worked at Yale New Haven Health for 43 years and served as its head for 17 years. Not only did O’Connor have big shoes to fill, he ascended to the role at a time when the industry was still reeling from the effects of the COVID-19 pandemic, record-high inflation and workforce burnout.

Financial pressure

Last week’s announcement provided no details about the reason for O’Connor’s dismissal. John Brady, vice president of the AFT Connecticut union, said he found the lack of explanation concerning and called for greater transparency from the industry. 

AFT CT represents nurses and other workers at Lawrence + Memorial Hospital in New London, one of the system’s five hospitals. The other four are Yale New Haven Hospital, Bridgeport Hospital, Greenwich Hospital and Westerly Hospital in Rhode Island. The system also includes the Northeast Medical Group.

“We cannot be sure what drove this change in leadership, and this might be the most disturbing part,” Brady said. “Although Yale, Hartford HealthCare and others are vital to the healthcare of Connecticut’s residents, the public has little insight or oversight into their decisions.”

With O’Connor’s departure, Yale New Haven Health’s current president, Pamela Sutton-Wallace, has been appointed acting CEO. The board of trustees will conduct a national search for a permanent replacement over the next several months.

Robert Hutchison, a spokesperson for the system, declined to provide additional comment on the reason for O’Connor’s exit beyond the organization’s initial announcement.

Several healthcare leaders who declined to speak on the record said that while the announcement was unexpected, the Yale system had been dealing with several challenges, including operating losses in the years since the pandemic and a failed deal to acquire three Connecticut hospitals that cost the system upwards of $45 million.

Yale New Haven Health’s performance over the last several years has mostly outpaced the average health system in the state, but its financial performance has lagged behind its biggest competitor, Hartford HealthCare. Jeff Flaks, O’Connor’s counterpart at Hartford HealthCare, did not respond to a request for comment.

The two health systems had similar operating margins prior to COVID-19 and both suffered financially in the wake of the pandemic. While neither had recovered entirely by 2025, HHC’s operating margin mostly trended upwards, while Yale New Haven Health’s performance has been rockier.

In fiscal year 2025, YNHHS reported an operating loss of -2.5%, compared to HHC’s operating margin of 2.8%, according to the most recent hospital financial data filed with the state. Scanlon, however, said he heard Yale’s financial performance had recently improved.

A doomed deal

The failed deal to acquire three Connecticut hospitals from the bankrupt Prospect Medical Holdings also plagued O’Connor’s tenure as CEO. 

Yale New Haven Health signed an agreement to acquire Manchester, Rockville and Waterbury Hospitals from Prospect for $435 million in February 2022 — just a month before O’Connor took over the top post. The deal quickly became mired in controversy, however.

In August 2023, a cyberattack crippled operations at Prospect’s facilities around the country. Afterward, Yale New Haven Health tried and failed to get $80 million from the state to support the acquisition. 

Then the legal disputes began. In 2024, Yale New Haven Health and Prospect Medical sued and countersued each other over the true value of the hospitals. In January 2025, Prospect filed for bankruptcy and, by the following month, YNHHS officials said a deal appeared “impossible.”

In September, Yale New Haven Health paid $45 million, roughly 10% of the proposed purchase price, to end the legal disputes.

The following month, the system removed its chief financial officer Gail Kosyla and general counsel Bill Aseltyne. Kosyla had been with the organization for three years and Aseltyne had been at Yale New Haven Health for just shy of two decades. 

Ultimately, UConn Health and Hartford HealthCare acquired the hospitals at a fraction of what Yale New Haven Health had negotiated. 

HHC bought Manchester Memorial and Rockville General Hospitals for $86.1 million. UConn Health, the state’s flagship medical center, purchased Waterbury Hospital for $13 million and assumed a limited set of the hospital’s liabilities, bringing the deal’s total value up to $35 million, according to the terms laid out in court documents. 

Prospect has yet to pay $127 million in hospital provider taxes it owes the state going back more than three years.

Anwar rejected the notion that the failed deal was O’Connor’s fault.

“The debacle was because of Prospect and not Yale,” he said.

Scanlon said the key challenge that O’Connor faced — that the next CEO will have to address — is balancing the interests of Yale New Haven Health System as a healthcare organization with the other priorities of Yale University as a medical school, research institution and a centuries-old Ivy League university. 

“The next leadership of Yale needs to figure out who they want to be and how this is going to work. I think Chris certainly had a vision for that, but they’ve decided to go different ways,” Scanlon said, adding that the state has a “very big interest” in seeing how Yale New Haven Health decides to manage its identity as one of Connecticut’s leading healthcare providers.

“Their success is our success in terms of treating the patients and making sure people have access to health care in the state,” he said.