The Definitive Blog

2013-01-30 – SCL Health System Sells 2 Kansas Hospitals to Prime Healthcare

Sisters Of Charity Of Leavenworth Health System (SCL), a faith-based, nonprofit organization, and Prime Healthcare Services, recognized as one of the Top 15 Health Systems in the Nation in 2012, announced today they have reached an agreement for Prime Healthcare Services to purchase both Providence Medical Center in Kansas City, Kan., and Saint John Hospital in Leavenworth, Kan.

Terms were not disclosed.

Prime Healthcare will make significant investments to financially stabilize the facilities and ensure that both hospitals continue to provide compassionate and quality care to Wyandotte and Leavenworth counties and surrounding communities. Prime Healthcare has committed to the following:

• Maintain current acute care and emergency department services at both campuses for at least five years.
• Offer employment to substantially all employees.
• Continue the hospitals’ commitment to the community by maintaining current levels of charity care.
• Provide at least $10 million toward capital and other investment projects over the next five years.

“We are confident we have found the best organization to ensure a successful future for both Providence Medical Center and Saint John Hospital,” said Michael Slubowski, FACHE, FACMPE, President and CEO of SCL Health System. “The clinicians and associates at these facilities are dedicated professionals who are committed to providing the highest level of person-centered care. With this transaction, they are best positioned to ensure continuation of that care, including to those who are poor and vulnerable.”

“Prime Healthcare intends to reaffirm these hospitals as top providers of quality health care in the state and country,” said Prem Reddy, MD, FACC, FCCP, Chairman, President and CEO of Prime Healthcare Services. “We understand how important these acute care facilities are to the people in Wyandotte and Leavenworth counties and intend to ensure they remain in vital service to these communities for years to come.”

During the past 10 years, SCL Health System has invested significant resources to sustain the mission of these care sites, including capital investments of more than $96 million. In addition to facility and technology upgrades, SCL Health System has contributed $212 million for charity care and an additional $215 million in bad debt expenses during that same period.

Given the challenging economics of today’s health care environment, the ongoing operating model was deemed unsustainable by both SCL Health System’s Board of Directors and Leaven Ministries, the sponsoring organization of both care sites.

“We are appreciative of the wonderful legacy the Sisters of Charity of Leavenworth leave these hospitals and our communities,” said Michael Parra, M.D, board member for Providence Medical Center and Saint John Hospital. “Yet, now is the time to embrace a new direction and Prime Healthcare Services has a strong reputation for quality, excellence and growth.”

Saint John Hospital and Providence Medical Center, as well as medical office buildings and certain joint ventures, will transition to Prime Healthcare Services. The Duchesne Clinic and Saint Vincent Clinic as well as the Providence Saint John Foundation, will remain with SCL Health System and continue to serve the community. SCL Health System and Prime Healthcare are negotiating a contract for the continuation of certain services such as information systems. Both Providence Medical Center and Saint John Hospital will continue to provide comprehensive medical care during the transition. There will be no impact on patient care.

February 12, 2013