California-based Prime Healthcare has agreed to buy nine Ascension hospitals in Illinois, as well as associated medical practices and post-acute and senior care facilities.
The hospitals and nursing homes will join Prime Healthcare’s for-profit health system, which currently includes 44 hospitals, more than 300 outpatient centers and nearly 45,000 employees and affiliated physicians.
Headquartered in St. Louis, the Catholic nonprofit Ascension has 140 hospitals in 19 states and Washington, D.C. In May, Ascension reported net income of $581 million for the fiscal third quarter ended March 31, a change of $1.3 billion from the same period last year.
Terms of the deal were not disclosed, but as part of the acquisition, Prime Healthcare committed to invest $250 million in facility improvements, capital improvements, technology investments and system upgrades. Prime Healthcare noted that it has all funds available and that no debt will be imposed on the hospitals to complete this transaction. Additionally, Prime agreed to make employment offers to substantially all employees.
The purchase agreement includes the following Ascension Illinois hospitals: Ascension Holy Family (Des Plaines), Ascension Mercy (Aurora), Ascension Resurrection (Chicago), Ascension Saint Francis (Evanston), Ascension Saint Joseph (Joliet), Ascension Saint Joseph ( Elgin), Ascension Saint Mary (Kankakee) and Ascension Saint Mary and Saint Elizabeth (Chicago).
The transaction also includes the following senior and post-acute housing facilities currently operated by Ascension Living: Fox Knoll Village (Aurora), Villa Franciscan Place (Joliet), Heritage Village and Heritage Lodge (Kankakee) and Resurrection Place (Park Ridge).
“Ascension Illinois has been committed to our mission of serving all people, with special attention to the most vulnerable. Prime Healthcare’s mission and commitment to clinical excellence and health equity will continue this legacy, ensuring that the Chicago metropolitan area has access to sustainable, quality healthcare well into the future,” Polly Davenport, president and CEO of Ascension Illinois, said in a statement. “We are confident that Prime will continue its track record of excellence and look forward to working in partnership during the closing process of the sale.”
Ascension has been busy closing other deals. In June, the University of Alabama Health System Authority at Birmingham agreed to buy Ascension St. Vincent’s Health System in central Alabama for $450 million. Last year, Detroit-based Henry Ford Health and Ascension Michigan signed an agreement to enter into a joint venture that would merge eight Ascension hospitals in southeast Michigan and Genesys’ healthcare facilities and assets with those of Henry Ford.
In a recent blog entry On the organization’s website, Eduardo Conrado, president of Ascension, outlined a strategic shift. He noted that like most health systems across the country, “we have faced significant challenges, including lower patient volumes, cost increases and workforce shortages. These challenges have provided Ascension with the opportunity to reimagine our ministry and affirm our mission in a changing health care environment, especially as more communities seek care in nontraditional settings.”
Conrado said Ascension’s vision is to become a more consolidated and integrated health ministry, “focusing on meeting the changing needs of our communities with special attention to those who are poor and vulnerable. To accomplish this, we have transitioned some hospitals through divestitures and invested in acute and non-acute care services, including ambulatory surgery centers, physician offices, physical and occupational therapy, home and virtual care, imaging and pharmacy. We believe these changes have strengthened Ascension and better positioned us to meet the needs of the community while optimizing financial performance and strategic capital spending.”
The Illinois transaction is expected to close within the first quarter of 2025, subject to regulatory approvals.
