LYNWOOD, CALIF. — Prime Healthcare, a private healthcare system based in Ontario, Calif., has agreed to acquire St. Francis Medical Center, a 384-bed hospital in the Los Angeles County suburb of Lynwood. The U.S. Bankruptcy Court for the Central District of California in Los Angeles recently approved Prime Healthcare’s purchase agreement with the seller, Verity Health System, a California-based healthcare system that filed for bankruptcy in summer 2018.
As part of the agreement, Prime Healthcare will purchase St. Francis Medical Center for more than $350 million, which includes a $200 million base price and a $15 million in payroll and benefits for staff. The firm will also invest $47 million to make technological and system upgrades, as well as finalize employee agreements with the hospital’s current staff. The remaining balance of the purchase price was not specifically categorized.
Prime Healthcare has agreed to honor the Attorney General and Bankruptcy Court conditions recently issued for this sale to preserve the hospital, trauma care, service lines, charity commitments and community benefit programs.
“Our agreement with Verity reflects our decades-long mission of saving, improving and investing in community hospitals,” said Dr. Sunny Bhatia, Prime Healthcare’s Region 1 CEO and corporate chief medical officer. “We look forward to continuing St. Francis’ legacy of compassionate, critical medical care for the communities it serves, especially during this unprecedented health crisis.”
St. Francis Medical Center remains fully operational during the sale closing process, and Prime Healthcare will be supporting the hospital staff as it continues to provide care during the COVID-19 pandemic. The hospital’s Emergency Department recently opened a tent on the outside of the hospital to triage those suffering from complications from COVID-19 away from the department’s existing patient population.
Prime Healthcare and the not-for-profit Prime Healthcare Foundation employ nearly 40,000 people and own and operate 45 acute care hospitals in Alabama, California, Florida, Georgia, Indiana, Kansas, Michigan, Missouri, Nevada, New Jersey, Ohio, Pennsylvania, Rhode Island and Texas. The private healthcare firm was founded in 2001 and is based in Ontario, Calif.
Verity Health System is a healthcare system based in El Segundo, Calif. The company filed for bankruptcy in summer 2018 and is working to sell off its hospitals, including St. Francis Medical Center. The firm’s other two hospitals are Seton Medical Center and Seton Coastside in Northern California.
Verity Health recently closed St. Vincent Medical Center in Los Angeles following a failed sales agreement with KPC Group, which planned to purchase all four of Verity Health’s hospitals for $610 million. The move affected more than 900 hospital workers and staff, according to local media reports.
— John Nelson