Hospital and Health System Transactions (March 2010)

Tucson, Ariz.-based Carondelet Health Network signed an "integrative network agreement" with 88-bed Sierra Vista (Ariz.) Regional Health Center to share resources and improve healthcare among area residents. The deal will go into effect on April 17.

The Children's Hospital-Denver became an operational component of a recently formed academic medical center, Anschutz Medical Campus in Aurora, Colo., which operates the University of Colorado Hospital and University of Colorado Denver School of Medicine.

EMH Regional Healthcare System in Elyria, Ohio, sold 50 percent ownership in Amherst (Ohio) Hospital to members of five-surgeon Center for Orthopedics in Westlake, Ohio, just prior to the enactment of federal healthcare reform law that severely restrict similar transactions.

Davenport, Iowa-based Genesis Health Systems extended its contract with Mercer County Hospital in Aledo, Ill., and will manage the hospital for one more year. The contract will extend the relationship while the two organizations draft up a formal affiliation agreement.

New Albany, Ind.-based Floyd Memorial Hospital and Health Services acquired The Cancer Center of Indiana, also located in New Albany. Floyd Memorial will control the Cancer Center's physicians and equipment, but the actual building will remain owned by the center's physician founder.

Healthcare Management Associates announced it is meeting with hospital administrator to decide how to invest $20 million in Sparks Regional Medical Center in Fort Smith, Ark. The investment could go toward completing a planned surgery center.

The Louisiana legislature approved a plan to move medical education and inpatient care for Louisiana State University from 157-bed Earl K. Long Medical Center to 740-bed Our Lady of the Lake Regional Medical Center in Baton Rouge.

Marion (S.C.) Regional Health System entered into a non-binding agreement with Community Health Systems in which CHS would acquire all of Marion Regional's assets. Under the agreement, CHS will provide capital and assist in physician recruitment efforts, and Marion will maintain the same governance.

Meadowview Regional Medical Center in Maysville, Ky., part of LifePoint Hospitals, acquired Ohio Valley Heart, a two-cardiologist practice. As part of the agreement, Meadowview purchased OVH's equipment, and the practice's two cardiologists will become employees of the hospital.

MedCath said Bakersfield (Calif.) Heart Hospital is not for sale, but the company may change majority ownership in the hospital due to a net loss in fiscal year 2009.

Mercy Regional Medical Center in Durango, Colo., formerly with Catholic Health Initiatives, joined Centura Health in order to expand and to better coordinate care for its patients.

New Milford (Conn.) Hospital and Danbury (Conn.) Hospital approved plans for a formal affiliation and are moving forward with due diligence. A formal agreement is expected to be announced by Oct. 1.

Ohio State University's private physician practice, OSU Physicians, has joined OSU Medical Center, bringing the practice's 617 physicians to the hospital. The merger is intended to streamline integrated care and electronic health record adoption and to increase the hospital's negotiating power with payors as all of the physicians' revenues will come to the hospital.  

Rockford, Ill.-based SwedishAmerican Health System, which includes two hospitals, a multi-specialty physician group and home healthcare, and Madison, Wis.-based UW Health, which includes University of Wisconsin Hospital and Clinics and related entities, announced an affiliation agreement. The affiliation is intended to improve access to highly sophisticated sub-specialty healthcare services to patients in the Rockford area.

University Medical Center Corp., which operates University Medical Center in Tucson, announced it will merge with University Physicians Healthcare, which operates the physician practice of the University of Arizona College of Medicine faculty and Physicians Hospital at Kino in Tucson, forming tentatively named University of Arizona Medicine.

Valley Health Systems, based in Winchester, Va., received approval to purchase Morgan County War Memorial Hospital in Berkeley Springs, W.Va., for $2.75 million from Morgan County's board of commissioners. Valley Health will build a $30 million replacement hospital as part of the agreement.

Vanguard Health Systems in Nashville, Tenn., began negotiations to buy the assets of critical access hospital Athol (Mass.) Memorial Hospital, in a deal that would involve converting the small community hospital to a for-profit.

Vanguard Health Systems also plans to buy eight-hospital Detroit Medical Center, Michigan's largest healthcare system, for $417 million and spend $850 million more in improvements over 15 years. Under the agreement, all of DMC's hospitals would stay open and maintain their charity care obligations for at least 10 years.

Richmond, Va.-based VCU Health System will operate Children's Hospital of Richmond, effective July 1, pending final approval of the deal. Under the agreement, VCU will continue to operate the facility as a children's hospital and all employees of Children's will become employees of VCU.