EVANSVILLE, Ind.-Three-hospital Mission Health System, a subsidiary of St. Louis-based Ascension Health, restructured its board governance and management in the wake of a $10 million system loss, Mission Health officials said last week. Chief Executive Officer Frank Tiedemann said the system, which earned a profit of $3.5 million on net revenue of $330 million for the year ended June 30, 2001, will report a $10 million loss on net revenue of $345 million for the fiscal year ended June 30. Teidemann attributed the loss to the closure of the system's wholly owned primary-care physician practice division. The restructuring includes changes in titles and a move of Mission Health's administrative staff to separate headquarters. Tiedemann, who had served in top positions both at Mission Health and its flagship, 563-bed St. Mary's Medical Center, will now lead only Mission Health. He said dropping the money-losing physician practices, retooling its managed-care strategy and having a new CEO, Kathleen Korbelak, focusing exclusively on St. Mary's should stanch the losses and return the system to profitability.
FRANKFORT, Ill.-Seven-hospital Provena Health saw its underlying long-term bond rating drop last month to Baa1 from A3 in a downgrade by Moody's Investors Service affecting $444 million in debt. Moody's also assigned a negative outlook to the bonds; however, the debt continues to carry a primary long-term rating of Aaa because of bond insurance. Moody's said it expects Provena's financial performance to remain depressed in 2002, reflecting "a nearly complete turnover of senior management in the past few months," among other factors. The credit-ratings agency said Provena's financial projections for 2002 are "overly optimistic" and cited an operating loss of $28 million in 2001 and a decline in cash on hand to 126 days from 201 days. The system has ended up $20 million to $30 million short of budget annually in each of the past four years, Moody's said. It also noted that Provena has had four different CEOs and chief financial officers since its 1997 formation.
MILWAUKEE-Thirteen-hospital Ministry Health Care plans to build a 104-bed acute-care hospital with cardiac-care capabilities in Weston, Wis., that will open in 2004. The Catholic system has 12 hospitals throughout Wisconsin. Paul Spaude, president of 219-bed Wausau (Wis.) Hospital, which lies just a half-hour northwest of Ministry's proposed site for its new facility, said the new hospital is not needed and would duplicate services. Ministry countered that its full-service capabilities, including heart care, are needed. Weston, with 18,000 to 20,000 residents, has no acute-care facilities. The greater Wausau community has a population of 75,000 residents.