PROVIDENCE — After a five-month search, Care New England announced on Thursday that Dr. Michael Wagner will take over as the health care system’s new president and CEO.
Wagner most recently served as the chief physician executive for Tufts Medicine, a $2.2 billion integrated health system based in the greater Boston area. In 2014, he was appointed the president and CEO of Tufts Medical Center, the academic medical center of Tufts Medicine and the principal teaching hospital for Tufts University School of Medicine.
When Wagner takes over Care New England on Dec. 1, he’ll be leading a system plagued with financial pressures that predate the pandemic, and a system that faces a critical labor shortage impacting hospitals across the country. Care New England posted a $31.6 million operations loss and a $71.2 million deficiency of revenues over expenses for its third quarter.
Over the last several months, executives asked the state to share a portion of its $1.13 billion American Rescue Plan Act funds to help fill staffing gaps and construct new medical units to increase supply. Instead, Care New England received $11 million in ARPA funds, which is on top of the millions it has received in other federal grant money throughout the pandemic.
Raina Smith, a spokeswoman for Care New England, told the Globe Thursday that Wagner would not be available to the media at this time.
This news comes five months after Dr. James E. Fanale, Care New England’s current president and CEO, announced he was retiring. Fanale has led Rhode Island’s second largest health care system, which owns Women & Infants, Butler, and Kent Hospitals, since 2018. His announcement came just weeks after Dr. Timothy Babineau, the president and CEO of Lifespan Corp., announced he was stepping down. Babineau will stay on as a consultant at the request of the company’s board. Lifespan is expected to announce their new CEO in December or January, and owns The Miriam, Hasbro Children’s, Newport, Bradley, and Rhode Island Hospitals.
Fanale’s last day at Care New England will be Dec. 1.
In early July, Care New England’s board voted unanimously to remain independent and not merge with another entity. But for years, executives have warned of financial challenges that would give them “no choice” but to merge with another health care system. Fanale previously told the Globe that he thought a merger or acquisition of some type would be “necessary” for the system’s financial future.
Some state leaders, such as Speaker K. Joseph Shekarchi, a Warwick Democrat, have long said they would protect Care New England’s Kent Hospital, which is the area’s general medical and surgical hospital. It’s considered a “community hospital,” and is the second-largest hospital in the state. But according to the system’s financial reports, it is Women & Infants Hospital that would be at the greatest risk.
Women & Infants Hospital has 247 licensed beds, which includes 80 neonatal intensive care unit beds. It delivers more than 80 percent of the babies born in the state, has Rhode Island’s only NICU, and has a high predominance of Medicaid, Fanale told the Globe recently.
“It’s just a fact that we take care of everybody,” Fanale said in a July 2021 interview.
It’s just one issue among those Wagner will have to face head on.
Care New England’s board tried to smooth their finances over with a proposed merger that included Lifespan Corp. and Brown University. It would have been Rhode Island’s largest employer. But in February, Attorney General Peter Neronha and the Federal Trade Commission, denied the merger, saying it would hurt consumers by creating a health care giant with a stranglehold on the local market.
Lifespan and Care New England had attempted to combine before. In 2018, after one of those deals fell apart, Massachusetts-based Partners HealthCare (now Mass General Brigham) swooped in and tried to acquire Care New England. They went as far as submitting an application to the state to request to merge, but former Governor Gina Raimondo, who is now the US commerce secretary under President Biden, stepped in and asked for an in-state solution. Her solution faced backlash, and critics said having a system with 80 percent market power would be a prescription for disaster. Mass General Brigham pulled out of the deal so Lifespan and Care New England could go back to the drawing board.
Some observers and political leaders said Mass General Brigham, formerly known as Partners HealthCare, might be interested in making another deal. Executives at Mass General Brigham and Care New England have previously declined to comment on any such talks. It’s unclear if Wagner will explore another deal.
As the CEO of Tufts Medical, however, Wagner led a system that treated many low-income families and children that did not have the same kind of brand recognition and high payment rates as its competitors like Mass General Brigham.
In 2014, Wagner said he was concerned that Mass General Brigham was looking to take over South Shore Hospital and Hallmark Health System. He and other competitors voiced how those kinds of deals would make Mass General Brigham, the most dominant health care network in the state, even more powerful. He brought other executives from various local systems together and launched a coalition that waged a public campaign to derail Mass General Brigham’s expansion plans. At the time, following widespread concern over increased health care costs and lower competition, Mass General Brigham pulled out of their plans.
Three years later, in 2017, he faced a showdown with the Massachusetts Nurses Association, which staged a strike at Tufts. It was the first such strike in Boston in more than three decades. The union planned a one-day strike, but the hospital planned on keeping nurses out for several days while using temporary replacement workers. As union nurses picketed outside his office, he told a Globe reporter at the time, “Somebody has to step up and say the intimidation, harassment, and bullying of the MNA has to be stood up against.”
The Service Employees International Union District 1199 New England (SEIU 1199) represents over 2,300 registered nurses, clerical staff, nurses aides and assistants, service workers, maintenance workers, mental health workers, therapists, therapy assistants, and other professionals within Care New England. Fanale and SEIU’s now retired executive vice president, Patrick Quinn, had a respectful relationship.
But the union is undergoing changes, too: Jesse Martin, who previously led Connecticut’s SEIU branch, was recently appointed to fill Quinn’s shoes.
Wagner is currently the president and CEO of the Tufts Medicine Professional Group and Tufts Medical Center Physicians Organization. In 2019, Wagner was the interim CEO of Wellforce, which is now known as Tufts Medicine, where he drove strategic growth initiatives. During Wagner’s tenure, Tufts Medical Center achieved “a strong financial performance” and was recognized twice with a five star rating on the Vizient (the University Health System Consortium) annual quality and effectiveness evaluation, according to a news release by Care New England. It was the only academic medical center in New England to achieve this recognition. He attended Georgetown University School of Medicine and completed his residency in internal medicine at Dartmouth in New Hampshire.
Outgoing CEO Fanale said Thursday that retiring when there is so much work to be done is bittersweet.
“The time has come for me to pass the torch to someone well-equipped to handle the challenges of operating a healthcare system of this magnitude,” said Fanale in a statement on Thursday. “I will forever be grateful to those who hold the same vision I do, and that’s to always put patients first, no matter the circumstances.”