Healthcare Business News

Regional News/South: Prime Healthcare acquires Dallas Medical Center, and other news

By Modern Healthcare
Posted: September 29, 2012 - 12:01 am ET

FARMERS BRANCH, Texas—Prime Healthcare Services, Ontario, Calif., has continued its acquisition spree, this time further extending its presence in Texas. The for-profit system has acquired 89-bed Dallas Medical Center, an acute-care facility in the suburb of Farmers Branch. It is Prime's third hospital in the state; the chain also has medical centers in Pampa and Harlingen. Dallas Medical Center has more than 200 physicians and 250 full-time employees, according to a news release. Financial terms of the deal were not disclosed. Physician Synergy Group, Irving, Texas, previously managed the hospital; the physician-owned group allows medical professionals to gain equity in healthcare facilities. Already this year, Prime has completed acquisitions of three hospitals, including the Pampa facility, and signed another deal to purchase its second hospital in Pennsylvania.

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TALLAHASSEE, Fla.—Florida's Agency for Health Care Administration is defending itself against U.S. Justice Department allegations that it forced families to send their disabled children to nursing homes when they couldn't afford their care. “Florida cares about kids,” agency Secretary Elizabeth Dudek said in a statement last week. “Medicaid has a comprehensive medical service package that can accommodate any family who chooses to have their child at home and encourages children to be in the least restrictive setting that can best serve their needs.” Dudek was responding to a Sept. 4 letter from Assistant Attorney General Thomas Perez to Florida Attorney General Pam Bondi. The letter states that a Justice Department investigation found “hundreds” of children living “segregated lives,” despite their families' wishes and in violation of the Americans with Disabilities Act. The law requires disabled patients to be treated in community-based settings, whenever possible. The Justice Department also alleged the state cut funds for community-based services—resulting in long waiting lists—while increasing reimbursement for nursing homes that care for children. The state has vigorously denied the allegations, and said it is willing to meet with the Justice Department to “clarify their misunderstanding.” The Florida Medicaid program is also facing two lawsuits filed in March in district court in Fort Lauderdale that claim that 250 children are being illegally confined to nursing homes, while 3,300 disabled children are being cared for at home without the necessary support.

Mercy Hospital
Capella has signed a letter of intent to acquire Mercy Hospital, above, and Mercy Clinic.
HOT SPRINGS, Ark.—Capella Healthcare moved a step closer to acquiring Mercy Hospital and Mercy Clinic, signing an asset purchase agreement with parent system Mercy. The agreement follows several months of negotiations that began in April. The Franklin, Tenn.-based chain is already present in the Hot Springs market with 181-bed National Park Medical Center and is seeking to merge the two facilities. A news release said the asset purchase agreement marks the end of the due-diligence period and the start of the next stage of the transaction. The deal between the for-profit and Roman Catholic systems requires regulatory approval as well as sign-off from the Vatican; the process is expected to take 60 to 90 days. Capella and Mercy have set up a website,, to promote the deal. The 282-bed Mercy Hospital and Mercy Clinic was previously known as St. Joseph's Mercy Health System. Parent company Mercy, Chesterfield, Mo., will own 23 hospitals in four states after the deal closes. Capella operates 13 hospitals in seven states.

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