WAUKEGAN, Ill.-Vista Health owes $34 million to its former partner Provena Health, Mokena, Ill., under the terms of their failed merger, an arbitrator ruled late last month. Vista Health said the ruling doesn't require a lump-sum payment as Provena requested but allows payment according to a previously agreed-upon schedule. Vista Health merged its Victory Memorial Hospital with Provena St. Therese Medical Center, both in Waukegan, in 2000. Two years later, six-hospital Provena announced it would withdraw from the partnership because it was unwilling to finance Vista Health's long-range plan to build a new hospital. Sources said the merger agreement required Provena to leave St. Therese to the joint venture but called for Vista Health to pay the outstanding bond debt. In his decision, the arbitrator, Jerald Esrick of Wildman, Harrold, Allen & Dixon in Chicago, said that although Vista Health now lacks the resources to pay Provena in full, the system "has a continuing, contingent responsibility to work to satisfy that debt." Vista Health said the payment schedule would allow it to proceed with its long-term consolidation strategy. Provena said it was pleased to end the matter.
HAMMOND, Ind.-The Indiana Board of Tax Review has denied a property tax exemption sought by two-hospital St. Margaret Mercy Healthcare Centers for its fitness club. In a decision released last month, the board ordered the Roman Catholic system, owned by Mishawaka, Ind.-based Sisters of St. Francis Health Services, to pay taxes on its Omni 41 Health and Fitness Connection health club in Schererville, Ind. St. Margaret purchased the health club in 1998. It received a property tax exemption for that year from the Lake County Property Tax Assessment Board of Appeals, but the board revoked the exemption in 1999. In 2000, St. Margaret filed an appeal with the state review board. The state board said the "use of property by a nonprofit entity does not establish any inherent right to exemptions." Omni had paid taxes before St. Margaret purchased it. Hospital attorney Timothy Galvin Jr. of Krieg, Devault & Galvin said St. Margaret believes the club serves the hospitals' healthcare mission and that the system would appeal to a state tax court. The annual tax bill on the facility will be approximately $450,000 for 2004, said Hank Adams, the St. John Township assessor who pushed for the tax revocation. St. Margaret's has been paying taxes on the facility while awaiting the decision.
MARION, Ind.-Marion General Hospital and three-hospital Cardinal Health System, Muncie, Ind., said last month that they would build a $6 million, for-profit cancer center here in partnership with about 40 physicians. The facility is slated to open by the end of the year. Marion General will own 50%, the physicians 40% and Cardinal 10% of the new facility. Marion General will relocate its existing cancer center to the new site, which will offer the latest medical technology, said David Callecod, the hospital's president and chief executive officer.
O'FALLON, Mo.-BJC HealthCare, St. Louis, recently applied for regulatory permission to build a 72-bed acute-care hospital here. The $75 million project would include a full-service emergency room, inpatient care, outpatient surgery and obstetrics. Pending state and local approvals, construction could begin this summer, with the hospital opening in early 2006. BJC's Barnes-Jewish St. Peters (Mo.) Hospital recently completed a three-year, $21.6 million expansion. BJC operates 13 hospitals in the St. Louis area, southern Illinois and central Missouri.
MILWAUKEE-The Heart Hospital of Milwaukee, owned by MedCath Corp., Charlotte, N.C., and 150 physicians, is accepting noncardiac-related emergency patients after receiving state approval last month. The 32-bed specialty hospital, opened in October 2003, now has four emergency room beds for patients transported by county paramedics with injuries such as sprains and fractures, Hospital President and Chief Executive Officer John Antes said. Antes said the move shows specialty hospitals aren't in business to skim the most profitable cases and leave ER care to general acute-care hospitals, a common criticism of the specialty-hospital industry. "We treat anybody who comes to the emergency room," he said.