UPDATED: 10:15 a.m. MetroSouth Medical Center, a hospital in Chicago's south suburbs that was on the verge of closure three years ago, announced plans to be acquired by for-profit Community Health Systems for undisclosed terms.
Community Health to buy Chicago-area hospital
The Blue Island, Ill., hospital was sponsored by the Catholic Franciscan Sisters of Mary for 103 years, until 2008, when the operation was sold to private investors through a holding company called MSMC Investors to prevent its closure. On Monday, Nashville-based Community Health Systems announced that one of its subsidiaries planned to acquire the hospital in the first quarter of 2012, pending regulatory approvals.
According to a news release from MSMC Investors, CHS will pay about $20 million for upgrades to equipment, information systems and infrastructure during the five years after the acquisition. CHS plans to offer "substantially all active employees in good standing" their same positions and salaries at the hospital and will continue the hospital's charity-care policies
For-profit CHS already owns eight facilities in Illinois, including two in the Chicago market, among its 125 hospitals. CHS President, CEO and Chairman Wayne Smith said the company looked forward to supporting MetroSouth with its resources, experience and clinical initiatives.
"The acquisition of MetroSouth Medical Center will offer a compelling opportunity to expand our operations in Illinois, especially in the northeast section of the state around Chicago," Smith said in a news release.
Dr. Enrique Beckmann will remain as CEO of the hospital, according to MSMC. "Partnership with a hospital system the size and caliber of CHS is an exciting development that brings unparalleled advantage to our hospital, medical staff, employees and community," Beckmann said in a statement.
The transaction will require the granting of a certificate of need from the Illinois Health Facilities and Services Review Board. That hearing is expected in late February 2012, MSMC said.
MSMC is composed of Harrison, N.Y.-based Falcon Investors and Chicago's Transition Healthcare Co. Since 2008, they have converted all of the hospital's rooms to single occupancy, implemented a hospitalwide electronic health-record system and recruited more physicians to the hospital.
Transition said in 2008 that it planned to invest $30 million in new equipment and upgrades at the hospital. On Monday, the company cited shifts in the national economy and the healthcare industry for changing its long-term outlook for the hospital's future under its current ownership model.
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