Three South Carolina hospital systems last week inked an agreement that would place control of the systems under a single not-for-profit company.
The plan would consolidate the major hospital systems in the three largest cities in northwest South Carolina under one parent corporation.
The deal is part of the wave of regional hospital consolidation that's sweeping across South Carolina.
In late December, for example, three hospitals in and around Columbia, S.C., unveiled a proposed merger-like partnership that would give them control of more than 80% of the acute-care market (Jan. 1, p. 22). Also, last week Columbia/HCA Healthcare Corp. completed an affiliation agreement with the university hospital in Charleston, S.C., which will become the for-profit chain's tertiary hub in that market (See story, p. 18).
All the deals have been proposed following the 1994 passage of the state's hospital antitrust exemption law. The law immunizes hospitals from antitrust scrutiny if they can prove that the benefits of their deal, such as lowering costs or improving quality, outweigh any anti-competitive risks.
The latest systems to pursue a regional consolidation strategy are the seven-hospital, 1,174-bed Greenville (S.C.) Hospital System, 459-bed Anderson (S.C.) Area Medical Center and 444-bed Spartanburg (S.C.) Regional Medical Center.
Greenville and Anderson had been working on a deal for some time; Spartanburg joined the negotiations last fall after its proposed merger with the other hospital in Spartanburg, Mary Black Memorial Hospital, fell through (Oct. 23, 1995, p. 32). Mary Black subsequently signed a joint-venture agreement with Quorum Health Group.
Under their proposal, the three systems would be governed by an 11-member board. Each system would appoint three members, and those nine members would then select two "at-large" members from the community.
The systems named Frank Pinckney, Greenville's president, to be the new organization's chief executive officer. Kirk Oglesby Jr., who heads Anderson, and Joseph Oddis, who heads Spartanburg Regional, will become executive vice presidents in the new company.
The new organization, tentatively called AGS System, hopes to become operational by early 1997.