El Segundo, Calif.-based Verity Health System may get a bid for two of its six nonprofit hospitals from Santa Clara County, Calif., according to The Mercury News.
The county is interested in acquiring the pair of financially struggling California hospitals — San Jose-based O'Connor Hospital and Gilroy-based St. Louise Regional Hospital — as public institutions. County Executive Jeff Smith said the county views a potential acquisition as a way to relieve overcrowding at its San Jose-based Santa Clara Valley Medical Center.
The county's interest comes after Verity Health said July 9 it is exploring strategic options, including a potential sale, to minimize financial and operational pressures at its six hospitals. Verity posted an operating loss of $55.8 million in the nine months ended March 31, according to The Mercury News.
In 2015, Verity was sold to a New York City-based hedge fund for $260 million, a historic price tag for nonprofit hospital transactions in the state. In July 2017, billionaire entrepreneur Patrick Soon-Shiong's, MD, company NantWorks acquired a majority stake in the hedge fund's Integrity Healthcare, which manages Verity Health. Dr. Soon-Shiong also served as CEO of the health system from July 2017 until earlier this year.
Alyssa Rege contributed to this article.
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