The University of Maryland Medical System has completed its acquisition of Towson, Md.'s St. Joseph Medical Center from Catholic Health Initiatives, according to a news release.
As of Saturday, the hospital is a subsidiary of the University of Maryland Medical System, becoming the organization's eighth affiliated hospital. The system will not assume any of the hospital's debts from Englewood, Colo.-based CHI. Other terms of the deal weren't disclosed. According to CHI's annual report
for fiscal 2012, the hospital had about $120 million of existing debt and posted operating revenue of $327.8 million for the fiscal year ended June 30.
Two years ago, the hospital paid $22 million
to the federal government over litigation from allegations that it profited from unneeded cardiac procedures performed by Dr. Mark Midei. CHI's report also mentioned the 2010 settlement—in which the hospital made no admission of guilt—and other related litigation.
"CHI management believes that adequate reserves have been established and that the outcome of any current investigations and collateral consequences will not have a material effect on the financial position or results of operations of the CHI Credit Group," the report stated.
The deal marks CHI's exit
from the Maryland market. St. Joseph will also retain its Catholic identity under the agreement. The hospital's board made a March recommendation to CHI officials to sell the hospital's assets to UMMS after soliciting bids from Catholic and non-Catholic not-for-profit companies.
"As healthcare reform continues to evolve, the SJMC board and CHI recognized their obligation to find innovative approaches to meet the changing needs of the communities they serve while remaining true to SJMC's Catholic identity," CHI senior vice president and group executive officer Beth O'Brien said in the release. "The transfer of SJMC's assets to UMMS will position University of Maryland St. Joseph Medical Center to thrive in the future and serve the health needs of the people of Maryland."