Sisters of Charity Health System to transfer ownership of two entities

September 15, 2015

Cleveland's Sisters of Charity Health System plans to sell its Providence Hospitals of Columbia, S.C., to LifePoint Health of Brentwood, Tenn., and to transfer its ownership share of St. John Medical Center of Westlake, Ohio, to University Hospitals of Cleveland.

Under a nonbinding letter of intent the Sisters of Charity system and LifePoint Health announced in July, the 247-bed Providence Hospital and the 74-bed Providence Orthopedic Hospital, both located in Columbia, would join the for-profit, investor-owned LifePoint.

According to a release, the change in ownership will provide Providence Hospitals with new clinical, financial and operational resources to improve its market position and ensure its growth.

The Providence Hospitals would become for-profit facilities, but they would retain their names and would "operate in a manner consistent with the identity of a Catholic hospital," according to information from Providence Hospitals. This would include continuing to abide by the Ethical and Religious Directives for Catholic Health Care Services. Currently, Providence Hospitals are sponsored by the Sisters of Charity system's public juridic person, CSA Health System Ministries. If the LifePoint transaction is completed as planned, Bishop Robert E. Guglielmone of the Diocese of Charleston, S.C., would provide oversight of Providence Hospitals' Catholic identity. Through an arrangement with LifePoint, the Sisters of Charity Health System would provide "mission and ministry services to support the hospitals' efforts to embody its mission, values and Catholic identity," according to information from Providence Hospitals.

As part of LifePoint, the Providence Hospitals would continue to provide at a minimum the same level of charity care as they do now, according to information from a Providence Hospitals spokesperson. According to a blog entry the Sisters of Charity system posted on the deal, LifePoint would retain current Providence Hospitals employees "subject to industry-standard preemployment screenings."

Additional details, including the financial aspects of the acquisition, were not available as Catholic Health World went to press.

Under the potential Sisters of Charity –University Hospitals deal, the Sisters of Charity system would transfer its ownership share of the 204-bed St. John to University Hospitals. Currently the two nonprofit systems share ownership of St. John equally, with University Hospitals the managing owner.

According to a statement from Sisters of Charity Health System President and Chief Executive Terrence Kessler, the move will enable St. John to grow and expand "as a cornerstone" of the University Hospitals system. University Hospitals plans to bring new programs and services to St. John and to integrate the facility more fully with other local health care facilities.

Under the agreement, which is under regulatory review, CSA Health System Ministries would relinquish its sponsorship role; and the Diocese of Cleveland would provide oversight to ensure St. John continues its Catholic identity. University Hospitals' leadership and the diocese plan to create a mission and values committee to oversee the continuance of the identity. The Sisters of Charity will have representation on that committee.

According to a press release, the Sisters of Charity system and University Hospitals have invested equally in the expansion and growth of St. John. The release said that in connection with the ownership transfer, University Hospitals will provide additional resources to the Sisters of Charity system to be reinvested into that system. As Catholic Health World went to press, the Sisters of Charity system was not able to quantify the amount it will receive from University Hospitals or specify how it will use the money.

The leaders expect the deal to be finalized by early November.

Besides the Columbia and Westlake sites, the Sisters of Charity system owns two Catholic hospitals, three grant-making foundations, two eldercare facilities and six outreach ministries. These ministries remain part of the Sisters of Charity system, and the system plans to reinvest in them going forward, according to information from the system. "

All of the Sisters of Charity system's hospitals, except for the Providence Hospitals, are in Ohio. LifePoint, which has more than 60 community hospitals and a network of other facilities in 20 states, currently has no facilities in South Carolina, but, according to the press release, it has "a growing presence in the Southeast and significant expertise in operating regional hospital systems that serve as referral centers for their surrounding communities." University Hospitals has 16 hospitals and a network of other facilities in Northeast Ohio.


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