Franciscan Hospital for Children, Inc.

The parent company of Boston Children’s Hospital has finalized its acquisition of Franciscan Children’s, the Brighton-based Catholic hospital known for its rehabilitation and mental health programs. Children’s also unveiled new details of its multimillion-dollar plan to expand the Brighton campus. Initially announced in 2021, the deal was envisioned to tie the two organizations closer together, bolstering mental health services for young patients while bringing Franciscan under the corporate umbrella of Children’s parent company, Children’s Medical Center Corp. Together, the health systems disclosed Thursday that they will now embark on a more than $500 million campus expansion and renovation at Franciscan. “The context is always to do more for kids and families,” said Dr. Joseph Mitchell, president and CEO of Franciscan Children’s. “We’re living through a kids’ mental health emergency, a by-product of the pandemic that started before the pandemic…and we realize that together we can make a difference and have an impact on this crisis. We won’t solve it alone, but this will allow us to expand access to services, rethink and reimagine the care model for kids with mental health challenges, but also medical complexity. The envisioned expansion includes construction of a new clinical tower that will increase the number of operational inpatient beds from 91 to 127. The growth includes additional inpatient behavioral health beds, which will grow from 32 to 56, including a dedicated unit for patients with intellectual disability disorders. The health system will also establish a partial hospitalization program, which allows children to remain at home overnight while receiving treatment during the day, treating approximately 20 children daily who otherwise would require an overnight hospital stay. The expansion is expected to add another 150 to 200 new full-time employees at Franciscan, including three to four new clinician-scientists dedicated to research in children’s mental health. Both groups say they will commit yet undisclosed capital financing to the project, supplemented by philanthropy and hoped-for state support. “We’re viewing this as a great opportunity,” said Dr. Kevin Churchwell, president and CEO of Boston Children’s Hospital. “We don’t see it as the one solution for kids in the region. It needs to be part of a solution.” Franciscan Children’s is the only rehab facility in the region that accepts babies on ventilators. The two hospitals have also operated closely in the past, with approximately 70 percent of the patients in the medical surgical beds at Franciscan coming from Boston Children’s, and Boston Children’s doctors seeing patients at Franciscan. Despite the acquisition, Franciscan will retain its own administrative structure, board, and its name. Its nearly 800 employees will remain employees of Franciscan. The organization said while there is not an immediate plan to jointly contract with insurers given the separate licenses, they will likely move to a joint contracting arrangement similar to other health systems. While the acquisition has received approval, plans to expand the campus will require additional sign offs by state and city officials. For now, the acquisition will further consolidate pediatric services in the state. Already, Children’s has clinical affiliations with six Massachusetts hospitals at which Children’s completely or substantially staffs the pediatric services, according to a September analysis by the state’s Health Policy Commission. In 2019, 36 percent of all pediatric discharges came from Boston Children’s Hospital, a share that has likely climbed since Tufts Medical Center closed its 41 pediatric beds in summer of 2022. Franciscan will also come under the umbrella of one of the most expensive health care systems in the state. Even after adjusting for the severity of patients’ illnesses, Children’s had the highest commercial hospital prices per pediatric discharge in the state, according to the analysis. Children’s Hospital also has the highest commercial prices for outpatient hospital care for many services the Commission analyzed. In its review, the Health Policy Commission, the state’s health care watchdog, noted that the transaction could increase commercial health care spending if prices at Franciscan increase as a result of the acquisition. However, the Commission also noted the transaction could expand access to key pediatric services, including behavioral health and didn’t find evidence that the transaction would negatively impact clinical quality. The agency declined to undertake a deeper review of the deal. The acquisition also received sign offs from the Department of Public Health; Franciscan’s founding organization, The Franciscan Missionaries of Mary; and the Catholic Church. While Franciscan will transition from a Catholic institution to a secular non-profit, Mitchell said that the organization will maintain its Catholic identity and mission.