Three years after its fateful entry into the Cleveland market and the world of Roman Catholic healthcare, Columbia/HCA Healthcare Corp. may be looking to get out.
The company quietly has been seeking buyers for four northeastern Ohio hospitals that are part of its 50-50 joint venture with Sisters of Charity of St. Augustine Health System, said sources in the market.
Columbia and the partnership, called Columbia-CSA Health System, wouldn't confirm that the hospitals are on the block, but wouldn't rule it out, either.
Said Columbia spokesman Jeffrey Prescott: "It wouldn't surprise me that there are discussions going on. We have discussions with other players in healthcare frequently. It's not unusual."
The hospitals are part of Columbia's 120-hospital East Group, which were to be retained under its restructuring plan (Nov. 24, 1997, p. 2). Last December, the joint venture adopted a new name for the three Cleveland-area facilities in the joint venture, marketing them as the Caritas Healthcare Partnership.
The system declined to release recent financial information last week.
Its innovative joint venture with the CSA system in November 1995, which transformed the hospitals from not-for-profit to for-profit status, met with opposition from the Catholic Health Association and residents of Canton, Ohio.
Twelve board members of CSA's Timken Mercy Medical Center in Canton were dismissed for refusing to approve the deal, and Canton's Timken family, which supported the hospital, insisted that its name be removed.
A year later, Columbia's attempt to take over Ohio's largest insurer, Blue Cross and Blue Shield of Ohio, created a furor when it was revealed that the deal included golden parachutes and other sweeteners for top Blues officials. The deal was finally withdrawn under state regulatory pressure.
Columbia paid more than $200 million for its stake in the profitable, four-hospital CSA system, which listed assets of $438 million in 1994. The venture included 426-bed Timken Mercy Medical Center in Canton, 183-bed St. John West Shore Hospital in Westlake, Ohio, 266-bed St. Vincent Charity Hospital in Cleveland and 235-bed Providence Hospital in Columbia, S.C.
A fifth hospital, 424-bed Saint Luke's Medical Center in Cleveland, joined the venture in 1996.
John Clough, M.D., director of health affairs at the Cleveland Clinic, said a third party asked if the clinic would be interested in buying the hospitals.
"What was said wasn't no. But it's not something we are aggressively pursuing," Clough said. The clinic is busy integrating acquisitions and has no plans for expansion, he said. "Our interest (in buying) might be in terms of who else might get them," he said. The city's other major system, University Hospitals Health System, declined to comment.
The Canton Repository reported that officials at Aultman Hospital in Canton held a meeting this month to discuss the possibility of a change in ownership at its cross-town rival, now called Mercy Medical Center.
Attempts to reach officials with the Cleveland-based CSA, Columbia's partner, were unsuccessful last week.