The state Office of Health Strategy on Wednesday approved Hartford HealthCare’s emergency bid to acquire Manchester Memorial Hospital, its Rockville campus and related assets, imposing a series of conditions intended to preserve services, ensure local input and limit cost growth.
The decision comes 40 days after OHS deemed the application complete and marks the first completed transaction under the state’s new emergency Certificate of Need process, created earlier this year in response to Prospect Medical Holdings’ bankruptcy.
Acting OHS Commissioner Amy Porter said the accelerated review was intended to protect care for residents in eastern Connecticut while placing safeguards around access and affordability.
“The expedited decision ensures continuity of care for Eastern Connecticut residents, while imposing specific conditions designed to ensure preservation of healthcare access and quality and control cost growth,” Porter said in a statement.
Under the ruling, the Hartford HealthCare subsidiary purchasing the hospitals must submit a full assessment of facility conditions and an integration plan within nine months, and engage local residents in strategic planning and community health needs assessments within the same time frame.
The system must maintain all services currently offered under the Manchester Memorial Hospital license, including labor and delivery and intensive care, for at least three years after closing or 90 days after publication of a second community health needs assessment, whichever is later. Service reductions require prior OHS approval, and any bed reallocations or outpatient relocations must be reported within 30 days.
The order also requires that a 24/7 emergency department remain in Vernon for at least three years and that inpatient behavioral health services be preserved at or within 30 miles of the Rockville campus.
Gov. Ned Lamont called the outcome “a positive result to an initially challenging situation,” saying the conditions help ensure that “quality services remain both accessible and affordable” for the region.
Several provisions are aimed at containing future cost increases.
Hartford HealthCare must adopt existing reimbursement rates with insurers; negotiate future Manchester Memorial rates separately from those of its other hospitals; and keep commercial rate growth tied to the state’s Cost Growth Benchmark and the Consumer Price Index for medical care in New England. For at least three years, the system must also keep existing ECHN outpatient and physician offices — and any it may acquire — from converting to hospital-based billing status.
The Attorney General’s Office and the Department of Public Health also have regulatory authority over parts of the deal and may impose additional conditions.
Hartford HealthCare stepped in as a buyer of Manchester Memorial earlier this year after Prospect Medical Holdings filed for bankruptcy and a long-planned sale to Yale New Haven Health collapsed.
HHC has agreed to pay $86.1 million for the Manchester and Rockville facilities and committed more than $225 million in capital improvements, positioning the transaction as a way to stabilize services that had been uncertain for years.
Hartford HealthCare said it welcomed the state’s approval and the bankruptcy court’s designation of the system as the buyer, describing the acquisition as a stabilizing step for communities that have faced years of uncertainty.
“We are pleased and proud that Hartford HealthCare has been named the buyer of Manchester Memorial and Rockville General hospitals by the bankruptcy court,” the system said in a statement. “We are actively working to provide resources to stabilize and grow the workforce, enhance quality and safety, and make strategic investments in people, programs, technologies, facilities, and community partnerships.”
The acquisition is part of a broader transition for Prospect’s Connecticut hospitals. UConn Health is pursuing a separate purchase of Waterbury Hospital.
