Tag: Hospital

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-Hackensack Meridian Health to merge with Englewood Health


Hackensack Meridian Health commits $400M to Englewood Health in proposed merger

Hackensack Meridian Health and Englewood Health have signed a definitive agreement to merge, the not-for-profit New Jersey health system and hospital announced Tuesday.
Hackensack pledged a $400 million capital investment in Englewood, which executives hope will further Englewood’s position as a tertiary academic hub in northern New Jersey. Those investments include new operating rooms, additional ambulatory care facilities and expanded cardiac catheterization labs, among others.
State and federal officials will need to sign off on the deal, which is expected to be completed in a year.
“We recognize that more and more healthcare is delivered outside of the four walls of a hospital,” said Robert Garrett, CEO of Hackensack Meridian Health.
An expanded ambulatory network will increase access and lower costs, he added.
Hackensack, which has 17 hospitals and an affiliation with Memorial Sloan Kettering Cancer Center, has had a clinical and academic partnership with Englewood since 2015. Englewood Health includes Englewood Health Physician Network, Englewood Health Foundation and Englewood Hospital and Medical Center, which deliver cardiovascular care, neurosciences, oncology, robotic surgery, women’s health and neonatal intensive care, stroke care, thoracic surgery and ambulatory care. They both operate on the Epic electronic health record.
“Hackensack recently opened its first behavioral health urgent care center—those are areas where on your own you could really just scratch the surface, but together you can make the investments necessary to create access and address affordability at the same time,” said Warren Geller, president and CEO of Englewood Health.
Hackensack and Englewood plan to create a regional cardiac surgery program, but that doesn’t mean those services will cease at Englewood, Geller said. It means they will link the patient to the right care in the most effective setting, he said.
The number of independent hospitals, in New Jersey and across the country, continues to wane. Nearly three-quarters of all hospitals were part of multihospital systems in 2017, up from 70.4% in 2012, according to Modern Healthcare Metrics data.
Lower reimbursement rates, declining inpatient admissions, and higher staffing, pharmaceutical and technology costs are weakening margins. More than half the nation’s stand-alone hospitals (53.2%) have lost money on an operating basis each year spanning 2012 to 2017, which is more than twice the share of system-owned hospitals (25.9%), Metrics data show.
Meanwhile, health systems are looking to acquire hospitals in the same or adjacent markets as they claim that scale is necessary to contain costs, improve access to capital, bolster care and boost their leverage with payers and vendors. Economists maintain that health systems often raise prices following mergers and so-called efficiencies are seldom reached given the complexity of integration.
Fellow New Jersey health system RWJBarnabas Health announced a deal to acquire Trinitas Regional Medical Center last week.
“There is no question that many of the independent hospitals in New Jersey have either merged with a larger health network or affiliated to receive the benefits that a large network can bring,” Garrett said, citing potential supply chain savings, better pricing on drugs and supplies, and clinical alignment. But one size does not fit all, he added.
Hackensack, which formed a clinical partnership with St. Joseph’s Health last month, reported an operating income of $274.4 million on revenue of $5.4 billion in 2018, down from $228.2 million of operating income on $4.4 billion of revenue in 2017, according to Modern Healthcare’s financial database.
Englewood’s operating revenue was cut in half in 2018, dropping to $14.5 million on operating revenue of $665.9 million. It reported $32.5 million in operating revenue on $629.9 million of operating revenue in 2017.
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-Community Health Systems Announces Definitive Agreements to Sell Three Virginia Hospitals | Community Health Systems, Inc.


Community Health Systems Announces Definitive Agreements to Sell Three Virginia Hospitals

10/28/19
FRANKLIN, Tenn.–(BUSINESS WIRE)–Oct. 28, 2019– Community Health Systems, Inc. (NYSE: CYH) announced today that affiliates of the Company have signed a definitive agreement to sell three Virginia hospitals – 300-bed Southside Regional Medical Center in Petersburg, 105-bed Southampton Memorial Hospital in Franklin and 80-bed Southern Virginia Regional Medical Center in Emporia, and their associated assets to subsidiaries of Bon Secours Mercy Health, Inc. The transaction is expected to close by the end of 2019, subject to customary regulatory approvals and closing conditions.
About Community Health Systems, Inc.
Community Health Systems, Inc. is one of the largest publicly traded hospital companies in the United States and a leading operator of general acute care hospitals in communities across the country. The Company, through its subsidiaries, owns, leases or operates 102 affiliated hospitals in 18 states with an aggregate of approximately 17,000 licensed beds. The Company’s headquarters are located in Franklin, Tennessee, a suburb south of Nashville. Shares in Community Health Systems, Inc. are traded on the New York Stock Exchange under the symbol “CYH.” More information about the Company can be found on its website at www.chs.net.
Forward-Looking Statements
Statements contained in this news release regarding potential transactions, operating results, and other events are forward-looking statements that involve risk and uncertainties. Actual future events or results may differ materially from these statements. Readers are referred to the documents filed by Community Health Systems, Inc. with the Securities and Exchange Commission, including the Company’s annual report on Form 10-K, current reports on Form 8-K and quarterly reports on Form 10-Q. These filings identify important risk factors and other uncertainties that could cause actual results to differ from those contained in the forward-looking statements. The Company undertakes no obligation to revise or update any forward-looking statements, or to make any other forward-looking statements, whether as a result of new information, future events or otherwise.
View source version on businesswire.com: https://www.businesswire.com/news/home/20191028005620/en/
Source: Community Health Systems, Inc.
Investor Contacts:
Thomas J. Aaron, 615-465-7000
Executive Vice President and Chief Financial Officer
or
Ross W. Comeaux, 615-465-7012
Vice President – Investor Relations
Media Contact:
Tomi Galin, 615-628-6607
Senior Vice President, Corporate
Communications, Marketing and Public Affairs
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-California AG rejects Adventist-St. Joseph merger


California AG rejects Adventist-St. Joseph merger

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California Attorney General Xavier Becerra
California regulators have rejected a proposed merger between Adventist Health System/West and St. Joseph Health System that would have created a joint operating company to manage nine hospitals in six largely rural counties in Northern California.
The California Justice Department issued a denial letter Thursday citing concerns that the transaction is not in the public interest, has the potential to increase healthcare costs, and could limit access and availability of healthcare services.
The health systems said the merger would boost access to quality care throughout Northern California, with a focus on vulnerable and underserved populations. They also said the merger would enable their facilities to compete more effectively against Kaiser Permanente, which has a large market share in those six counties even though it has no hospital there.
But the state Justice Department did not agree.
“After careful review, we found this proposal falls short of protecting consumers,” said Sean McCluskie, chief deputy to Attorney General Xavier Becerra.
The health systems indicated they were blindsided by the decision.
“Both Adventist Health and St. Joseph Health are very disappointed in the outcome of this decision,” the systems said in a joint written statement. “Our intent has always been to better serve our communities, increase access to services, and create a stronger safety net for families in northern California. At this time, our organizations will need to take a step back and determine implications of this decision. The well-being of our communities remains our top priority.”
Consumer advocacy groups had objected to the merger, warning that it would raise prices and could limit access to certain services that are prohibited by the Ethical and Religious Directives for Catholic Health Care Services, such as tubal ligations, contraception, gender transition care and physician aid-in-dying.
A transgender patient has a lawsuit pending against St. Joseph, claiming he was discharged from the St. Joseph Hospital in Eureka minutes before a scheduled hysterectomy in 2017, after hospital officials learned he was transgender.
In its response to the suit, St. Joseph said it has a constitutional right to refuse to perform procedures barred by Catholic religious doctrine.
The American Civil Liberties Union of Northern California applauded the state’s decision to bar the merger.
“This is a strong statement by the attorney general that healthcare should be available and accessible to patients,” said Phyllida Burlingame, the group’s reproductive justice and gender equity director. “More than one in six hospital beds in California are already in hospitals like those in the St. Joseph network that deny patients needed reproductive healthcare and gender-affirming care based on doctrine established by Catholic bishops. Californians, particularly those in the rural areas where these hospitals are primarily located, need more access to these essential healthcare services, not less. This decision helps move our state in a positive direction.”
The merger denial contrasts with the same agency’s decision last November to approve the much larger merger of CHI and Dignity Health, two Catholic-affiliated systems which formed CommonSpirit Health earlier this year. That deal also was opposed by the ACLU and a number of other advocacy groups on the grounds that it would raise costs and limit access to certain types of care.
Adventist and St. Joseph had sought to reassure regulators and their religious sponsors that the merger would not change either organization’s mission or religious operating rules. Under the deal, each partner would retain management and control over its own facilities. Neither would be allowed to cause the other to violate its religious rules.
Unlike Catholic-sponsored St. Joseph, Adventist permits contraception, sterilization, in vitro fertilization, and calls itself LGBTQ-friendly. But Adventist, like St. Joseph, does not offer gender transition surgery or participate in physician aid-in-dying.
Anthony Wright, executive director of Health Access California said the proposed merger raised other concerns as well, including potentially higher costs in the already highly concentrated California market.
“Bigger is not often better with hospital chains and health care in general, as consolidation is closely correlated with much higher costs for consumers,” he said.
Correction: The proposed merger involved only nine hospitals. The attorney general’s statement listed one hospital under two names.
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-Sanford Health, UnityPoint Health call off merger


Sanford Health, UnityPoint Health call off $11 billion merger

Watertown SD Nurse photos
Sanford Health and UnityPoint Health nixed their proposed merger that would have formed an $11 billion, 76-hospital system, the organizations said late Tuesday.
The not-for-profit health systems announced their letter of intent to merge in June. The combined entity would have ranked among the top 15 not-for-profit health systems by revenue, with operations across 26 states and more than 83,000 employees.
Kelby Krabbenhoft, the president and CEO of Sanford, said in a statement that the UnityPoint board failed to embrace the vision of a new health system of national prominence.
“We were excited at the opportunity our combination would have provided to create a new health system of national prominence,” he said. “The executive management teams and physicians worked diligently for 18 months to provide a merger recommendation to the boards. We are disappointed that the UnityPoint Health board failed to embrace the vision. Our focus now is on the patients and communities we serve and the 50,000 people working tirelessly to support them.”
Vision represents a long-term view of how the business will operate and how the culture will manifest both within the organization and as it faces patients and stakeholders, said Joe Lupica, chairman of Newpoint Healthcare Advisors.
“When one party says visions don’t align, this means it is not a failure that happened in the trenches,” said Lupica, explaining that it’s something more fundamental than disparate IT systems or fragmented supply chains.
Executives hoped that the merger would have allowed the combined organization to become a world leader in personalized primary care.
“Our organization concluded we can most effectively fulfill our mission by maintaining our existing corporate structure,” Kevin Vermeer, president and CEO of UnityPoint Health, said in a statement.” As a leader in the delivery of value-based care, UnityPoint Health remains strong and competitively positioned for the future.”
It is hard to imagine spending a year and a half on a transaction and having it fall apart, said Robert Creighton, managing partner at Farrell Fritz.
“It makes me think that the preliminary work maybe was not as thorough,” said Creighton, adding that they may have never come to an understanding of what the vision was.
The deal may have been related to a culture clash, mismatched or unmet expectations when it comes to estimated savings benchmarks, their relationships with physicians or other labor-related issues, he said.
“These are incredibly complex (and costly) transactions,” Creighton said. “You have to get all the pieces to fit, and it is not surprising that some deals will fail.”
Sioux Falls, S.D.-based Sanford reported an operating income of $117.1 million on $4.59 billion of operating revenue through the first nine months of fiscal year 2019, up from $92.3 million of operating income on operating revenue of $3.53 billion over the same period last year, according to Modern Healthcare’s financial database.
Last month, Sanford agreed to pay the federal government $20.25 million to settle allegations that one of its neurosurgeons received kickbacks for using implantable devices distributed by his physician-owned distributorship. The settlement also involved hiring a compliance officer and setting up a compliance committee, implementing a risk-assessment program and hiring an independent review organization to oversee Medicare and Medicaid claims at Sanford Medical Center. Sanford denied any wrongdoing.
Des Moines, Iowa-based UnityPoint reported an operating income of $49.4 million on revenue of $2.26 billion through six months of fiscal year 2019—the most recent financial statement available. That was up from $32.8 million of operating income on $2.19 billion of revenue over the same period the year prior. UnityPoint recorded a $21.5 million operating loss in 2017.
While this dismantled deal may throw up a caution flag to other providers exploring mergers, Creighton still expects significant consolidation in the hospital sector given the potential cost and quality benefits of a smaller organization joining a bigger system, he said.
As health systems continue to pursue massive regional and national networks in search of the highly touted benefits of scale, economists and policy experts have cautioned about consolidation’s tendency to raise prices.
Hospital mergers and acquisitions have seemingly cooled in 2019 after several years of significant activity, possibly in part because the projected synergies of scale have not met expectations, hospital M&A experts said. In some cases, health systems rushed into a letter of intent, they said.
Baylor Scott & White Health and Memorial Hermann Health System called off their merger in February, about five months after the Texas-based health systems signed a letter of intent.
M&A experts expected there had been some concern regarding the alignment of their academic missions as well as a mismatch of their physician-management models.
Atrium Health (formerly Carolinas HealthCare System) and UNC Health Care scuttled their deal last year, about six months after the letter of intent was signed.
Cone Health and Randolph Health, also based in North Carolina, called off their deal in May 2018 after more than a year of talks as Cone Health was unwilling to “scale back projects or put them on hold,” Cone Health executives said.
“The savings executives thought they were getting from eliminating redundancies haven’t panned out,” Lupica said.
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