Ontario, Calif.-based Prime Healthcare Services CEO Prem Reddy, MD, has said the for-profit hospital operator plans for an initial public offering in two to three years, according to a Daily Press report.
Dr. Reddy told the Daily Press a number of factors will be considered to determine when Prime goes public, including market demands, growth status and need for equity.
Prime has entered into numerous transactions this year, including six deals since October, and the hospital operator has no intention to slow down. Prime currently operates 29 hospitals, and Dr. Reddy told the Daily Press that number would grow to 42 hospitals by April 2015, which would make Prime the fourth-largest system in the U.S.
Although Prime has experienced significant growth this year, some of the deals have been controversial, with one union, SEIU-United Healthcare Workers West, taking particular issue with Prime.
In October, Daughters of Charity Health System — a six hospital network based in Los Altos Hills, Calif. — agreed to sell its six hospitals to Prime. Immediately after the sale announcement was made, SEIU-UHW proclaimed it would fight to stop the deal. Since then, the union has filed a lawsuit against DCHS alleging the system evaded federal pension law and further alleging the futures of 9,000 employees and retirees were at risk because Prime had not agreed to operate the pension plan as one protected by the Employee Retirement Income Security Act.
SEIU-UHW has also accused Prime of overbilling Medicare by $93 million. However, Prime said the accusations are based on fabricated data, and described the allegations as "part of a tired, self-serving corporate campaign the SEIU-UHW is waging against Prime."
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