Not-for-profit Queen of Angels-Hollywood Presbyterian Medical Center, in the heart of Los Angeles, signed a letter of intent late last week to be sold to Tenet Healthcare Corp., a Santa Barbara, Calif.-based for-profit hospital chain. The pair had been rumored to be quietly working out details of a sale for months (July 21, p. 18). Sylvester Graff, president and chief executive officer of private, 416-bed Queen of Angels, confirmed a deal has been struck but declined to disclose its terms. Proceeds from the sale would go to a charitable fund devoted to the healthcare of the Hollywood community. California's attorney general must approve any definitive agreement, following at least one public meeting and other community input. "The realities of healthcare delivery are changing at warp speed and stand-alone medical centers cannot effectively compete for the managed-care contracts" that establish a facility's patient base, Graff said.
Also in Southern California, San Diego-based Sharp HealthCare signed a letter of intent late last week to discuss acquiring 150-bed Mesa Vista Hospital from Vista Hill Foundation. Mesa Vista, a behavioral health and chemical dependency treatment center, sits on Sharp-owned property adjoining Sharp Memorial Hospital in San Diego. Sharp would assume Vista Hill debt of about $7.7 million rather than make a cash payment. The two parties said they hope to reach an agreement within 60 days and close the deal within a month after that.
Late Friday the Environmental Protection Agency issued final rules on hospital incinerators aimed at reducing air pollution from the burning of medical waste. The EPA said the new standards will reduce mercury emissions by 94% and dioxin emissions by 95%. The agency estimated complying with the rules would add less than 35 cents a day to the average cost of a hospital stay. Rural hospitals will be allowed to operate incinerators under less stringent controls than hospitals in urban areas. "These standards are tough, but we are confident many hospitals can meet them," said chief American Hospital Association spokesman Richard Wade.
Cambridge Public Health Commission, parent organization of Cambridge (Mass.) Hospital and Somerville (Mass.) Hospital, reached separate affiliation agreements late last week with the biggest regional healthcare systems in eastern Massachusetts: Partners HealthCare System and CareGroup. The arrangement will allow physicians to delegate managed-care contracting authority to either of the systems.
n*Young Suh, longtime president and chief executive officer of Flint, Mich.-based Genesys Health System, has retired after more than three decades in the system. Suh, 61, had been president since 1980. Chief Operating Officer Michael Deming has been named interim president while the Genesys board searches for a permanent replacement. Genesys is part of Ann Arbor, Mich.-based Sisters of St. Joseph Health System.
Houston-based Paracelsus Healthcare Corp. lost $3 million, or 5 cents per share, in the second quarter ended June 30, compared with a net loss of $5.1 million, or 17 cents per share, in the year-ago period. Revenues rose 40% to $167.3 million. The hospital company said it incurred unusual charges in a corporate reorganization and the closing of a Salt Lake City hospital.
Blue Cross of Northeastern Pennsylvania, Wilkes-Barre, and Capital Blue Cross, based in Harrisburg, Pa., said late Friday that they have terminated their merger discussions. In a joint statement, the companies said the discussions were ended because of their failure to agree on certain terms. They didn't rule out the possibility of renewed discussions in the future, but both companies indicated they had determined separately it was in their best interests to pursue strategic alternatives. They signed a letter of intent to merge in 1996, and the boards of both plans approved the deal in May (May 19, p. 16). Together the plans insure more than 2 million Pennsylvanians.