Northwell Health has cleared the final regulatory hurdle to merge with cash-strapped health system Nuvance, stretching its vast hospital network into Connecticut and the Hudson Valley.
Connecticut’s top health regulator reached a settlement agreement with Northwell and Nuvance that allows the integration to move forward, state officials said Tuesday. The approval, which allows four Connecticut hospitals to move under Northwell Health’s umbrella, comes after two months of negotiations between the health systems and Connecticut’s Office of Health Strategy about Northwell’s investments into its new hospitals and how the integration could affect health care prices.
The deal cements Northwell as the region’s largest health care system, with 28 hospitals, more than 1,000 care sites and more than 100,000 employees across New York and Connecticut, including 14,500 health care providers. It’s the latest example of hospital consolidation in New York, which health systems say improves quality of care and financial sustainability for hospitals but can also result in higher prices, research shows.
“This opens a new and exciting chapter for Northwell and Nuvance Health,” Northwell CEO Michael Dowling said in a statement, adding that the agreement provides an opportunity to enhance both health systems and improve patient services.
The agreement requires Northwell, which earned $17 billion in revenue in 2023, to invest at least $1 billion into Nuvance’s hospitals over the next five years, health officials said. Northwell agreed to limit growth in medical prices for commercially insured patients as not to exceed state cost benchmarks, as well as implement its most robust financial assistance policies at Nuvance hospitals, according to Connecticut’s Office of Health Strategy.
Northwell first announced plans to acquire Nuvance last February, citing the need to combine resources and improve quality of care for patients in Connecticut and the Hudson Valley. Northwell and Nuvance Health submitted applications to New York and Connecticut health officials last year asking them to sanction the deal, and the state’s Public Health and Health Planning Council greenlit the takeover of Nuvance’s three New York hospitals in September.
Nuvance will officially become a part of Northwell Health on May 1, according to a letter sent to Northwell employees on Tuesday that was reviewed by Crain’s.
