Merger creates largest N.Y. network of federally funded health centers

Brightpoint Health and HRHCare have received all the needed regulatory approvals to merge, creating what they say is the largest network of federally qualified health centers in the state of New York.

The combined network of clinics, which serve mostly Medicaid and uninsured patients, now has 43 locations in the Hudson Valley, New York City and Long Island, serving about 225,000 patients annually.

The merger concludes what executives said was a 20-month process to establish one not-for-profit.

The leaders said each organization fill gaps in the other's offerings in terms of geography and services.

"We complement each other in so many ways that it really worked," said Paul Vitale, CEO of Brightpoint Health, who will serve as president of the combined organization.

Brightpoint Health, created in 1990 as a skilled-nursing facility for people living with AIDS, has evolved into a network of 13 health centers that offer primary care, behavioral health and social services. It continues to specialize in serving vulnerable populations, such as those living with HIV/AIDS as well as those with serious mental illnesses, substance-use disorders and the homeless.

HRHCare, founded in Peekskill in 1975, has 30 clinics in the Hudson Valley and Suffolk County, where it took over the operation of several previously county-run clinics. The network also has gained expertise in providing care to agricultural workers.

"It's now an opportunity to look at vulnerable populations throughout our entire geography and to bring an expansion of services where necessary," said Anne Kauffman Nolon, CEO of HRHCare, who will serve in that same role in the combined nonprofit.

The organizations will retain their names for a transition year, with Brightpoint operating as a member of HRHCare. The new nonprofit will have 2,000 employees. James Sinkoff, who will serve as deputy executive officer, said that management will use the transition to examine the combined services and look for potential savings, but there is "no intention whatsoever to reduce headcount."

Sinkoff said the combined organization would have a small debt burden and would look to leverage its size in negotiations with managed-care plans and vendors.

HRHCare's initial commitment that it would provide up to $7 million to Brightpoint on an as-needed basis was not part of the final agreement. Vitale said Brightpoint no longer saw as great of a need to receive the money as part of the deal.

Six Brightpoint board members will join 11 HRHCare directors in a combined board.

This story originally appeared in Crain's New York Business.