WYOMING, MI – Metro Health abruptly announced it will not close on the planned affiliation with a national health care giant, Tennessee-based Community Health System.
The hospital worked two years on the proposed deal, which involved the sale of an 80 percent interest in Metro Health to CHS, a for-profit system.
Doyle Hayes, chairman of Metro Health’s board of directors, gave little explanation why the deal fell through, in a brief announcement released Monday, Aug. 3,
“At each step in the process, both organizations committed to finding the right fit for patients, employees, physicians and the local community. While each organization worked hard to make the transaction possible, we have not been able to agree on some important details,” he said.
In a second-quarter earnings report released Monday, CHS mentioned that the planned venture was not going forward but gave no details. It stated only: “The previously assumed acquisition of MetroHealth Hospital in Grand Rapids, Michigan was terminated on August 3, 2015.”
CHS, one of the largest for-profit hospital chains in the country, owns, leases or operates 198 affiliated hospitals in 29 states.
On Monday, it announced plans to create a new publicly traded company by spinning off a group of 38 hospitals and its management and consulting business, Quorum Health Resources. In its second-quarter earnings report, CHS reported a 2.5 percent increase in net operating revenue and net income attributable to common stockholders of 95 cents per share.
Because the venture involved the sale of assets from a nonprofit organization to a for-profit entity, the affiliation was subject to the approval of the attorney general’s office, which was expected to announce a decision soon. A forum was held on the proposal in April. Most of the speakers at the forum spoke in favor of the proposal.
“Metro Health remains committed to serving patients in West Michigan with the high quality care they expect and deserve,” Hayes said. “We want to thank all of the employees, local community members and government officials who helped with this project.”
When plans for the affiliation were announced, Metro Health said CHS planned to invest $100 million to $125 million in facilities, services, medical technology and physician recruitment in the first five years. The hospital would have a local board of directors, and all active employees in good standing at the time of the transaction would be hired.
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