New London — Lawrence + Memorial Healthcare and the Yale-New Haven Health System have agreed on the main terms of a possible affiliation and expect to submit applications for regulatory approvals by September, L+M President and Chief Executive Office Bruce Cummings said Tuesday.

“There are no meaningful issues or questions that separate the parties now,” Cummings said during a meeting with The Day’s editorial board. “Our board is convinced this is the right time. It seems the stars are in alignment.”

Talks about a possible affiliation began in February at the suggestion of L+M’s board, Cummings said, although Yale-New Haven made overtures previously. Rumored for weeks, the talks were announced to staff and the public on June 19.

Though other hospital networks have approached L+M in recent years about affiliation, Yale-New Haven is the only suitor L+M has seriously considered, he said. The Yale-New Haven Health System includes Yale-New Haven Hospital and its Saint Raphael Campus, and affiliates Greenwich and Bridgeport hospitals.

The Yale-New Haven network also includes Smilow Cancer Center facilities in Fairfield, Old Saybrook, Waterbury, Sharon and Torrington, children's hospital and psychiatric hospital in New Haven, and outpatient clinics offering a variety of services in more than a dozen other communities in Litchfield, Fairfield, New Haven and Middlesex counties.

“Yes, in years past, others have knocked on our door wanting to talk with us,” Cummings said, “but Yale is the obvious choice.”

L+M Healthcare — the parent organization of L+M Hospital, the L+M Medical Group, the Visiting Nurse Association of Southeastern Connecticut and The Westerly Hospital — already has a strong relationship with Yale-New Haven through its clinical partnerships for radiation oncology, telestroke, neonatology, pediatric emergency medicine, invasive cardiology and angioplasty and vascular surgery, he said.

An additional partnership would provide pediatric hospitalist services at L+M by this summer, Cummings said.

Vin Petrini, spokesman for Yale-New Haven, said an agreement with L+M would be the first new affiliation for the larger hospital since Greenwich Hospital joined its network in 1998. Yale-New Haven's Board of Directors has not yet made a final decision, however.

“We’re very optimistic,” Petrini said. “We have a longstanding clinical relationship with L+M, so we know the clinicians out there and we know the administration. We know they share our values.”

The agreement, Cummings said, would not be a merger or an acquisition, but a “sole member substitution” in which L+M Healthcare retains its own board and financial structure, but has Yale-New Haven as its parent organization.

Decisions about expansion or elimination of services at L+M would have to be agreed on jointly by both boards, he said.

“We’ll still be L+M Hospital, and Westerly Hospital will still be Westerly Hospital,” Cummings said. “We will have the same staffs. For all outward appearances, it will be very familiar.”

He expects final approvals could take up to 18 months. After that, a “rebranding” of L+M would take place that would retain the name but acknowledge that it is part of the Yale-New Haven network.

Donations to L+M would remain there, he said. However, due to state laws governing hospital systems, the L+M Medical Group would have to be merged into Yale-New Haven’s Northeast Medical Group.

One of the open questions is how the affiliation would affect the two-year-old L+M Cancer Center in Waterford. The cancer center is under contract as an affiliate of the Dana Farber Cancer Institute until 2018.

Cummings said discussions with Dana-Farber are scheduled for this month to determine whether both parties would prefer to end the affiliation before the contract expiration if the Yale-New Haven affiliation happens. Either way, Cummings said, the cancer center would ultimately become part of Yale-New Haven's Smilow Cancer Center network.

L+M is already the largest source of patient referrals to Yale-New Haven outside its network, both Cummings and Petrini said. The affiliation would enable L+M to add services and receive a “very generous” capital investment from Yale-New Haven to upgrade equipment and facilities, Cummings said. He declined to specify the amount, other than to say it would be “in the millions.”

“We will be able to do things in the future we can’t do now,” he said.

For both hospitals, the affiliation would trim costs for supplies by allowing them to take advantage of bulk purchase discounts.

Cummings said it would also give L+M to access to Yale-New Haven’s electronic medical records system at a much lower cost than it could obtain on its own. L+M’s current system, purchased for $30 million a few years ago, needs to be replaced, he said.

He declined to specify other cost savings that could be achieved through the affiliation, saying these areas must be kept confidential until the deal is final. Yale-New Haven officials have said previously that any staff reductions would be kept to a minimum.

Changes in health care payment models and other economic pressures are the main motivators for affiliation with a larger network, Cummings said. The experience of Yale-New Haven’s other affiliates, Greenwich and Bridgeport hospitals, shows that the arrangement would preserve and enhance local health care, he said.

“Our board chairman talked to the board chairmen of those two organizations, and the Yale-New Haven model gives great deference to local delivery networks,” he said.

Under the Yale-New Haven model, rates for services paid by insurers are not the same system-wide, Cummings said, a policy that would benefit L+M.

“When they negotiate with ratepayers, the rates are different (for different affiliates),” he said. “The new models for health care will incentivize people to go to the lower cost places for services. We are substantially less expensive than Yale-New Haven.”

j.benson@theday.com

Twitter: @BensonJudy