Prices for acute-care hospital services were unchanged in April for the second consecutive month, according to the U.S. Labor Department's Producer Price Index released late last week. The hospital PPI measures changes in net revenues per episode of care. For the 12-month period ended in April, wholesale hospital prices were up 2.7%.
*Primary Health Systems, a privately held, investor-owned chain, announced a letter of intent to purchase Philadelphia's Roxborough Memorial Hospital for an undisclosed amount. It would become the first acute-care community hospital in Pennsylvania to convert to for-profit status. Meanwhile, PHS' management team is talking to other Delaware Valley hospitals and has more than $100 million in credit and equity available for such purchases. Although Philadelphia generally is considered overbedded, it's exactly the kind of market PHS is targeting, said Joseph Gaynor, executive vice president and chief financial officer. The Wayne, Pa.-based company has acquired or is under contract to purchase five hospitals in the Cleveland market.
*Memorial Healthcare System, Houston's largest not-for-profit system, agreed to acquire Southmore Medical Center, a for-profit hospital in Pasadena, Texas. Terms weren't disclosed, but Memorial officials said the hospital generated $42.5 million in annual revenues in 1995 and has assets of $23.6 million. The 208-bed hospital is owned by Brentwood, Tenn.-based Touchstone Healthcare Management. Southmore is the fifth for-profit hospital Memorial has acquired in the Houston area. The deal, expected to close in mid-June, also includes three professional office buildings.
*Memorial Hospital of Southern Oklahoma in Ardmore has agreed to be acquired by Mercy Health System Oklahoma, which is part of the Sisters of Mercy Health System-St. Louis. Memorial, the largest not-for-profit in southern Oklahoma, selected Mercy from three finalists, officials said. Mercy operates 18 acute-care hospitals, including Mercy Health Center in Oklahoma City and St. Mary's Mercy Hospital in Enid, Okla. Terms of the transaction weren't disclosed>