Steward Health Care System, LLC (Steward) and Tenet Healthcare Corporation (NYSE: THC) announced that they have signed a definitive agreement regarding the acquisition by Steward of Tenet’s five hospitals and related hospital operations in the Miami-Dade and Southern Broward counties. Under the terms of the agreement, Steward will purchase five hospitals and their associated physician practices from Tenet for approximately $1.1 billion. The hospitals included in the sale are Coral Gables Hospital, Florida Medical Center, Hialeah Hospital, North Shore Medical Center and Palmetto General Hospital.
The Boards of Directors of both Monongahela Valley Hospital and Penn Highlands Healthcare have signed a Definitive Agreement between the two entities that would integrate Monongahela Valley Hospital into the Penn Highlands Healthcare system. Monongahela Valley Hospital is a 200-bed health facility with a 225-member medical staff representing more than 40 specialties. Penn Highlands Healthcare was officially formed on September 30, 2011, and is comprised of six hospitals.
Sentara Healthcare and Cone Health represent the latest in a series of scuttled merger proposals, but it isn’t expected to slow M&A activity, industry observers said. Sentara and Cone abandoned their plans Wednesday to build a more than $11 billion system spanning North Carolina to Virginia amidst internal opposition as well as criticism from community members and state regulators. Around a dozen proposed mergers between relatively healthy not-for-profit systems haven’t closed over the past three years as doctors have protested and regulators have become increasingly wary of consolidation.
Heights Hospital in Houston filed for Chapter 11 bankruptcy protection June 1, according to court documents. The hospital listed assets of $100 million to $500 million and liabilities ranging from $10 million to $50 million.
This time last year, healthcare providers were in panic mode about lost patients due to the end of elective procedures throughout the spring because of the COVID-19 pandemic. One year later, things have mostly returned to normal (with increased masking and PPE, most likely), but challenges still exist for the healthcare industry. Opportunity awaits as well. Dallas-based consulting firm RSM provided insights into the future of dealmaking in the industry and how current legislation impacts hospital finance.
Sentara Healthcare and Cone Health on Wednesday became the latest health systems to walk away from plans to form a sizable, multistate system. The not-for-profit systems didn’t share much detail on what killed the proposed deal to create a 17-hospital system with more than $11 billion in combined revenue, but there had been hints of discord since it was announced in August 2020. Not only did two of Cone’s top executives announce plans to leave, public comments suggested some Cone patients viewed the deal as an out-of-state takeover.
Rhode Island state regulators have approved the sale of two privately held hospitals in the state, ending an impasse between the regulators and the hospitals’ owners that threatened to close them. But to secure regulatory approval the hospitals’ owner, Prospect Medical Holdings Inc., and its private-equity backer, Leonard Green & Partners, had to agree to certain stipulations, including setting aside $80 million to help secure the two hospitals’ futures. The agreement ends a more than one year review by Rhode Island regulators into Prospect’s operations and finances.
Cerberus Capital Management, demonstrating the rewards of Wall Street’s rush into health care, made a roughly $800 million profit on its investment in struggling Catholic hospitals, records show. The New York private equity firm quadrupled its money over a decade, according to internal documents and a federal filing this month. Co-founded by billionaire Stephen Feinberg, Cerberus executed an unusual exit. It offloaded its remaining interest to doctors who work in its hospital company, rather than pursue an initial public offering or sale to a rival.
Hospital systems are increasingly investing in hospital-at-home programs, a previously niche offering that’s become a significant trend amid the pandemic. But while the trend may be here to stay, hospital systems still must navigate a host of significant challenges to bring their investments to scale.
Hospital margins, volumes, and revenues in April increased year-over-year as the financial recovery from the COVID-19 pandemic continues for provider organizations, according to a new Kaufman Hall report released Monday morning. Hospital operating margin rose 8.6 percentage points compared to January-April 2020, not including CARES Act funding. However, hospital margins remained thin at 2.4% during the month, not including CARES Act funding.
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