A consortium of not-for-profit hospitals associated with the VHA hospital alliance tried last year to buy some Columbia/HCA Healthcare Corp. hospitals and return them to not-for-profit status, MODERN HEALTHCARE has learned.
The attempted purchase was previously undisclosed.
The consortium, Community Health Corp., came up empty-handed when Columbia didn't show any interest in selling some of its 36-hospital spinoff, the Pacific Group. The hospitals will stay together under a new corporate umbrella, Triad Hospitals.
It's unclear whether VHA's long opposition to converting not-for-profits and its harsh rhetoric against Columbia in particular contributed to the rebuff.
A separate consortium of not-for-profits successfully bought 21 Southeastern hospitals in Columbia's Atlantic Group last fall for $1.2 billion.
Community Health Corp. was founded in 1997 by leaders of not-for-profit hospitals in Dallas, Houston and Fort Worth, Texas, to carry the banner of community ownership (Dec. 8, 1997, p. 40).
Community Health is independent of but closely allied with VHA Southwest and VHA itself. Leaders of major VHA hospitals in Texas sit on its board.
Once it became known in November 1997 that Columbia wanted to spin off a large number of hospitals, Community Health tried early last year to acquire Columbia hospitals in the Southwest and convert them to not-for-profit status.
"We thought it might be helpful to have offers for all the hospitals in the Pacific Group," said Michael Williams, Community Health's president.
It's not clear how many hospitals were targeted for purchase or how much the consortium offered to pay.
In early 1998 the consortium retained investment banker Salomon Smith Barney to approach Columbia. Salomon also represented the consortium of not-for-profits that bought hospitals in the Atlantic Group from Columbia. But on the Pacific Group, the investment bank was met with a blank stare from Columbia.
Jeff Prescott, a Columbia spokesman, was not able to confirm the details of the VHA hospitals' proposal.
"We had people approach us to buy just about everything. With so many on so many different fronts, unless we got agreements on them, we're not able to tell you who offered what," he said.