Lifespan lays off executives in $6 million cost-cutting move

The Emergency Department at Newport Hospital is shown. The hospital's president is among the Lifespan executives whose positions were cut in a restructuring announced Sept. 20, 2024. (Janine L. Weisman/Rhode Island Current)

Rhode Island’s largest employer and health care provider has cut 20% of its executive suite in a maneuver the not-for-profit hopes will save millions in its upcoming fiscal year.

Crista Durand, who led Newport Hospital since August 2014, appears to be one of the executives let go. Her LinkedIn lists her as no longer working as president of the hospital.

“Lifespan implemented a strategic restructure focused on creating a one-system, one-team approach, designed to reduce executive overhead and streamline operations,” Lifespan Corporation CEO John Fernandez said in a Sept. 20 statement. “Starting from the top like this, allows us to allocate more resources directly to patient care and support areas.”

Fernandez stated the elimination of 20% of executive positions would result in an estimated $6 million in savings. Jessica Wharton, a Lifespan spokesperson, did not confirm the number of layoffs or provide further detail on affected personnel.

“We have no further comment on the restructuring at this time,” Wharton said in an email Monday.

A spokesperson for Newport Hospital did not return a request for comment Monday, but Becker’s Hospital Review reported Friday morning that Lifespan had confirmed Durand was let go.

Durand’s total compensation for the fiscal year ending Sept. 30, 2022, was $678,894, according to the hospital’s Form 990 submitted to the Internal Revenue Service.

Thirteen executives , including Fernandez, comprise Lifespan’s leadership, according to its website. But the corporation’s hospitals and outpatient providers have their own c-suites — some of which overlap with Lifespan’s corporate leadership, but not all.

A total of 35 executive positions across Lifespan’s major properties include:

• Eight executives at Rhode Island Hospital , the biggest hospital in the system. That includes Fernandez.
• Six executives , including Fernandez, at Hasbro Children’s Hospital in Providence, which is adjacent to Rhode Island Hospital.
• Four executives at Bradley Hospital , the youth psychiatric hospital in East Providence.
• Six executives at Newport Hospital , which serves Aquidneck Island and parts of the East Bay.
• Six executives at The Miriam Hospital in Providence and another six at Gateway Health Care .
• Five executives at Lifespan Physician Group and three at Coastal Medical.

The layoffs arrive amid a season of changes for the health care provider: In August, Lifespan announced it would buy two struggling hospitals in Massachusetts owned by the Dallas-based Steward Health Care. On Sept. 5, a federal bankruptcy judge in Houston approved the $175 million deal , bringing the two hospitals —  St. Anne’s in Fall River and Morton Hospital in Taunton — closer to Lifespan’s control. Federal and state regulators still need to finalize the transfer.

In June, Fernandez and Brown University President Christina Paxson made a joint announcement that sometime in 2024, Lifespan will change its name, logo and branding to Brown University Health. The rebrand comes with a $150 million investment from Brown, paid over multiple years, after which Lifespan will invest in Brown’s Warren Alpert Medical School. (The school and corporation will continue to have their own distinct governing bodies, however.)

The health corporation also added an executive as recently as June 3, when Sarah Frost joined the Lifespan c-suite as chief of hospital operations.

At a health care summit in May , Fernandez lamented the lack of public funding for his hospital and suggested that Medicaid and charity care were taking too big a bite from Lifespan’s profits.

“Our Medicaid operating margin is negative $139 million,” Fernandez told a room full of lawmakers, doctors and other health care notables. “You throw in some charity care at $32 million, that adds up to $170 million, just in those two populations. We shouldn’t have to lose money taking care of people.”

According to Lifespan’s 2023 annual report , the company employs over 17,000 people, and counts 1,165 beds among its properties. Lifespan providers accounted for 1.4 million outpatient visits, 229,950 emergency department visits and over 24,000 outpatient surgeries that year.

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