Jul 8, 2014
11:42 AMHealth & Science
Saint Mary's in Waterbury Latest Connecticut Hospital Tenet to Acquire
A New Haven Register story in the spring said Tenet is working toward purchasing Waterbury Hospital, Bristol Hospital and the Eastern Connecticut Health Network, which includes Manchester Memorial and Rockville hospitals. That story also said Yale New Haven Health System and Tenet Healthcare Corp. have formalized a partnership through which Yale would expand its services to the four hospitals that Tenet wants to acquire, if the legislature approves a path to allow the huge system to convert the four to for-profit status (The legislation was passed and Gov. Dannel Malloy signed it in early June.)
Bristol Hospital has a FAQ sheet posted online about the Tenet Acquisiton, which opens with:
At Waterbury Hospital, according to a July 7 Republican-American story, "A union representing more than 500 nurses and technical employees at Waterbury Hospital has asked state regulators to restart from scratch their review of the proposed for-profit joint venture between the hospital and Tenet Healthcare Corp."
In a news release posted on its website May 8, Eastern Connecticut Health Network (ECHN) said it "is pleased with the Connecticut General Assembly’s passage of a bill that allows the health system to move forward with its proposed transaction with Tenet Healthcare Corporation and Yale New Haven Health System."
“We’d like to thank the Governor’s office and the Legislature for working to craft a bill that recognizes the rapidly changing environment for hospitals with health care reform and the importance for some Connecticut hospitals to convert to for-profit institutions,”Dennis McConville, Senior Vice President and Chief Strategy Officer at ECHN, said in the news release.
Gov. Dannel Malloy issued a statement Monday morning in response to the Saint Mary's announcment:
“Saint Mary’s Hospital provides a great benefit to the Greater Waterbury region and it is a top priority to make sure that residents in this area continue to have access to the health care services they need. The delivery of health care across our nation has been an extraordinarily complex and multifaceted issue, which only added to the need for everyone involved to be thorough and mindful of the long-term effects of a major transaction such as this. I am glad to have signed legislation last month that helped today’s announcement come to fruition and I look forward to working with Tenet and Saint Mary’s to ensure a smooth process that continues to serve the Waterbury community.”
In its announcement (full text below), Saint Mary's said the hospital and Tenet "today announced plans for Saint Mary’s to be acquired by a subsidiary of Tenet, a leading healthcare services company which operates 79 acute care hospitals and 193 outpatient centers in 16 states. The transaction, which is subject to the execution of a definitive transaction agreement, state and federal regulatory approvals and other conditions, represents an opportunity to provide continued access to comprehensive healthcare to the Waterbury community by an organization that has been serving the community for over one hundred years."
Connecticut's first conversion of a nonprofit hospital to for-profit status involved Sharon Hospital in rural northwestern Connecticut, which was sold in April of 2002 and became an Essent Healthcare facility. Essent merged in 2012 with RegionalCare Hospital Partners of Brentwood, Tenn. "The sale of Sharon Hospital created a $20 million foundation for the Sharon-area community called the Sharon Area Community Health Foundation. That group is dedicated to improving the healthcare of the greater Sharon Community," says a post in the history section on the Sharon Hospital website.
The Saint Mary's Hospital news release:
WATERBURY, CT and DALLAS, TX (July 8, 2014) -- Saint Mary’s Hospital (Saint Mary’s) and Tenet Healthcare Corporation (Tenet) today announced plans for Saint Mary’s to be acquired by a subsidiary of Tenet, a leading healthcare services company which operates 79 acute care hospitals and 193 outpatient centers in 16 states. The transaction, which is subject to the execution of a definitive transaction agreement, state and federal regulatory approvals and other conditions, represents an opportunity to provide continued access to comprehensive healthcare to the Waterbury community by an organization that has been serving the community for over one hundred years.
Following approval and completion of the transaction, Saint Mary’s Catholic heritage and the Ethical and Religious Directives under which the hospital currently operates will be honored and maintained. In addition, Saint Mary’s will continue to abide by the same charity care and uncompensated care policies as in the past and will fulfill the community benefit standards required of tax-exempt hospitals, which include improving access to care and the health status of the elderly, the poor, immigrants and other at-risk populations.
A Local Advisory Board will be established, and will provide input and oversight of hospital operations. The Advisory Board will have reserve powers regarding proposed subsequent transactions involving Saint Mary’s. In addition, the proposed terms of this transaction provide that all employees will be offered employment at the closing.
Proceeds from the transaction will be used to fully fund the Saint Mary’s pension and eliminate debt. When the transaction is completed the Saint Mary’s Foundation will receive a significant cash infusion to support local health needs. Tenet has also agreed to invest additional capital in Greater Waterbury to support strategic advancement in technology, clinical care, physician alignment and facilities.
According to Saint Mary’s CEO Chad Wable (left), “We are pleased to choose Tenet as our preferred partner after a lengthy selection process. This is a dynamic time in healthcare, and we believe that Tenet is the best choice to help Saint Mary’s achieve our goal to be one of the region’s leading healthcare providers. Our community and our caregivers will benefit immensely from the capital and expertise that Tenet will bring to Saint Mary’s.”
A Saint Mary’s Task Force has been engaged in a thorough and deliberative selection process for more than four years. During that time the Task Force analyzed a variety of capital raising options to find the best solution for Saint Mary’s. Saint Mary’s representatives considered numerous potential suitors, both regionally and nationally, before naming Tenet as their preferred choice.
“Saint Mary’s strong operating performance in recent years was an important aspect of the process, since we were able to approach our negotiations from a position of financial strength and with a track record of clinical quality, safety excellence, and high patient satisfaction,” said Bob Mazaika, Saint Mary’s Board Chairman and Chairman of the Task Force. “Tenet’s proposal offers the best solution for Saint Mary’s today and in the future.”
“We are very pleased that Saint Mary’s has selected Tenet,” said Trip Pilgrim, Senior Vice President at Tenet.“This proposal offers Saint Mary’s financial stability and sustainability, and offers the community the kind of high quality, comprehensive healthcare it deserves, all while retaining the heritage and legacy Saint Mary’s has established over the last century.”
Tenet has significant experience operating faith-based organizations, including Catholic facilities. Among its Catholic facilities is St. Vincent’s Medical Center in Worcester, MA, which is operated with guidance from the local archdiocese. In addition, Tenet operates facilities with Catholic heritage in Tennessee, Missouri and Florida. The proposed Saint Mary’s transaction is not subject to the completion of other potential transactions by Tenet in Connecticut.
“Saint Mary’s strategy and related capital needs have evolved as the transformation of the healthcare industry has accelerated,” said CEO Wable. “Tenet’s view of the future is in synch with ours, and will enable Saint Mary’s to capitalize on our clinical and financial strengths as we move forward.”
“We are grateful for the leadership and cooperation of both Governor Malloy and Mayor O’Leary, and ask for the community’s support throughout the approval process to ensure a timely and smooth transition to a bright and exciting future for Saint Mary’s Hospital and for the greater Waterbury community” said Wable. “Throughout this process, our patients, staff, and this community have been our top priority and we will remain focused on providing exceptional care to every patient, every day.”
More information about the transaction can be found at www.stmh.org.
About Saint Mary’s Health System
Saint Mary’s Health System is a leading regional healthcare provider anchored by Saint Mary’s Hospital, an acute care community teaching hospital that has served Greater Waterbury for more than 100 years. Licensed for 347 beds, Saint Mary’s is designated as a Level II Trauma Center and Primary Stroke Center, offers award-winning cardiac care and houses the region’s only pediatric emergency care unit. As the leading provider of surgical services in Greater Waterbury, Saint Mary’s was the first to introduce the daVinci® Robotic Surgery System. The health system’s satellites and affiliates extend from Waterbury to Wolcott, Naugatuck, Southbury, Prospect and Watertown. For more information, please go to www.stmh.org.
About Tenet Healthcare Corporation.
Tenet Healthcare Corporation, a leading healthcare services company, through its subsidiaries operates 79 hospitals, 193 outpatient centers and Conifer Health Solutions, a leader in business process solutions for healthcare providers serving more than 700 hospital and other clients nationwide. Tenet’s hospitals and related healthcare facilities are committed to providing high quality care to patients in the communities they serve. For more information, please visit www.tenethealth.com.
Saint Mary's in Waterbury Latest Connecticut Hospital Tenet to Acquire