Most hospitals want their consolidation deals to stay out of the courtroom. A Washington hospital, however, has asked a court to help determine which of its three suitors would make the best partner.
The District of Columbia Superior Court last week was scheduled to appoint a trustee to choose a merger partner for Columbia Hospital for Women Medical Center. Under District law, not-for-profit organizations can ask the courts to appoint a trustee who can make such decisions when the organization's board fails to do so.
The trustee is charged with protecting community assets and avoiding conflicts of interest.
Columbia's board was unable to reach consensus on which merger to pursue, and as a result, had to seek help from the courts, said Susan Hansen, the hospital's president and chief executive officer.
"It was truly one of those instances in which a not-for-profit hospital board failed to function," she said.
Columbia hired Hansen 18 months ago to complete a deal with another hospital or system in a market where consolidation, dealmaking and cost-cutting is accelerating.
The three suitors are Medlantic Healthcare Group, a not-for-profit system that owns two district hospitals; Suburban Hospital, a not-for-profit facility in Bethesda, Md.; and George Washington University Hospital, which is creating a joint venture with investor-owned Tenet Healthcare Corp.
Columbia is just a few blocks from GWU's medical campus and has shared residents with GWU. During the 1980s, however, Columbia was part of Medlantic.
Kenneth Samet, president of Medlantic's Washington Hospital Center, welcomed the potential addition of Columbia as a way to expand its services and market.
Columbia Hospital for Women operates 110 beds and has $60 million in annual revenues. Its specialties are obstetrics-gynecology, cardiology, oncology and urology.