The following comes from a March 10 story in the L.A. Times.
Prime Healthcare Services Inc.’s proposed deal to buy six financially struggling Catholic hospitals has collapsed, raising questions about how the nonprofit chain will keep its doors open.
On Tuesday, Ontario-based Prime Healthcare blamed California Atty. Gen. Kamala Harris for imposing “impossible” conditions on its planned purchase — which included St. Vincent Medical Center and St. Francis Medical Center in L.A. County.
In turn, Harris lashed out at Prime, saying it had signaled that it was OK with the terms of the deal she had outlined.
And Robert Issai, chief executive of the Roman Catholic hospital chain known as Daughters of Charity Health System, said he disagreed that the conditions announced last month by Harris were too onerous.
“I was disappointed and surprised,” Issai said of Prime’s decision. “The conditions were very much workable.”
Issai said he is now consulting with financial advisors and the hospital system’s board of directors about how to keep the six hospitals operating.
“Every option is on the table, including bankruptcy,” he said.
Issai has said the hospital chain, which specializes in providing care to the poor, has been losing $10 million a month. In 2013, its board decided that selling the hospitals was the best way to avoid filing for bankruptcy.
On Feb. 20, Harris approved the proposed $843-million sale to Prime, but said she would require the company to keep all of the hospitals open for 10 years. She also said the hospitals would have to provide the same level of charity care to poor patients as Daughters of Charity had.
The deal has been closely watched because the hospitals employ 7,600 workers and provide needed medical services to a number of lower-income communities.
In a statement, Harris berated Prime for backing out of the deal.
“Prime is choosing to walk away from this transaction after publicly stating that it had no issue with the 10-year conditions and intended not to close any of the hospitals or end essential services,” Harris said. “By walking away, Prime is confirming many of the concerns heard at multiple community meetings that the continuity of vital healthcare services in these communities is not its priority.”
Prime Healthcare, which is privately held, now owns 34 hospitals across the country. It specializes in acquiring distressed hospitals and making them profitable, often through cost-cutting and aggressive negotiations with insurers.
Prime’s founder, Prem Reddy, said Tuesday that the company had been committed to buying the six Catholic hospitals, but that the 78 pages of conditions made the deal “untenable.”
“Unfortunately, the conditions placed on the sale by the California attorney general are so burdensome and restrictive that it would be impossible for Prime Healthcare — or any buyer — to make the changes needed to operate and save these hospitals,” Reddy said in a statement.
He noted that Prime had agreed to keep the hospitals open at least five years, maintain or increase charity care and fully fund pensions of 17,000 current and former workers.
The proposed sale to Prime had divided the hospitals’ labor unions.
The California Nurses Assn. had supported the proposed deal, saying Prime was the best option to keep the hospitals open and protect jobs and employees’ pensions.
But the SEIU-United Healthcare Workers West union warned that in the past Prime has shown it puts profit above patient care.
Scott Byington, president of the St. Francis Registered Nurses Assn., said Tuesday he was relieved Prime backed out of the deal.
“The attorney general did California many favors by making the conditions so strong,” he said. “We dodged a big bullet here….”
She wishes to be the next US Senator from CA (and maybe, Governor, one day).
Kamala Harris is all about, Kamala Harris, so there is no surprise here.
And, she is no friend of the Catholic Church, except to the sycophantic lap-dog bishops that are really chaplains to the Democratic Party.
Guess where she stands on abortion rights, homosexual sexual rights (and marriage), all of that?
Maybe there is just too much sun out there. Certainly not much in the way of religious conviction.
Other than licensing to make certain a health care facility is safe,
the State and other governmental bodies need to keep their noses out of privately owned hospitals.
It is absolutely STUPID to think that if the ‘Daughters of Charity Health System’ can not afford to keep the doors open under the current mode of operation – that anyone else would be able to.
But that is what Harris is ordering prospective buyers to do.
Close the hospitals down.
In a year or so, sell the buildings for whatever use.
Teach California Atty. Gen. Kamala Harris and her buddies at the SEIU a lesson – no jobs and no pensions.
Let the State worry about the rest, for interfering.
So the SEIU and Harris want someone else to buy the hospitals and also LOSE $10 MILLION a MONTH –
by forcing buyers to keep the same business model.
Only in California – the land of fruits and nuts !
Let the hospitals close – and the sooner the better.
The dictatorial marxist and communist mentality of the Democrats and the Unions in CA has got to stop somewhere.
Sounds to me like Prime called their bluff.
Maybe the Daughters of Charity could find options other than simply walking away from serving the poor and selling out to some large conglomerate. Isn’t this a traditional order devoted to the Miraculous Medal?
The Catholic Church needs to stop being a punching bag. Catholics will be punished for all their good works because the Catholic Faith is contrary to popular mores. It’s time for the Church to take cae of its own, just as it was forced to do so regarding adoptions. The Church needs to get out of the health care system, the educational system, and any other endeavor which is teathered to the government.
The Church is called to serve, but with SEIU and Harris running things, they are the wrench in those wheels of service to the poor and marginalized. Every dime coming from the CA govt. & Feds comes with very sticker strings attached. The Church should serve from a place of poverty, without any government money. That way they would be free to render to God service clear and clean of the strings that come with serving Ceasar. Cannot serve two masters.
Interesting post gravey –
And it is in complete conformance with:
1 Cor 10:20-21 “Do not partner with demons” (pagan);
2 Cor 6:14-17 “and be separate from them”
Eph 5:3-7 “Do not associate with them.” :
2 Thess 2:6 “keep away from any brother who…..”
1 Tim 5:20 “As for those who persist in sin, rebuke them”
1 Tim 3:5 “Avoid such people”
1 Titus 3:10 “..have nothing more to do with him”; etc.
JESUS never taught us to partner with any Government,
but merely do the best we can with what God has provided to us.
And we are obligated to pay our just bills. (CCC 2411)
In his book, “Faith and the Future” pg 116 by Cardinal Ratzinger/Pope Benedict XVI – regarding the Church “She will become small and will have to start afresh more or less from the beginning. She will no longer be able to inhabit many of the edifices she built in prosperity. As the number of here adherents diminishes, so will she lose many of her social privileges. ………”
” she will enjoy a fresh blossoming and be seen as man’s home, where he will find life and hope beyond death”. written in 1971.
I have a question. If as the system has been losing $10 million a month, and they require them to keep doing exactly the same things, how is a new owner going to do anything other than losing $10 million a month?
Obviously doing things the same way is going to result in the same outcome. Do these people not understand basic math?
Harris and the SEIU do not care about basic common sense math.
They merely want to control everyone and everything – and this is called communism.
Paul, it is called Politics. She is running for U.S. Senator and cannot have any unions, especially SEIU against her. They are the ones who have the money and the people to hang the doorknob flyers and lawn signs, drive people to the polls, and bring hundreds to rallies. This was a political decision.
It is too bad when/if politicians court UNION officials rather than the electorate.
UNIONS in the USA have become corrupt over the past 30 years.
Now they even support immoral activities such as Abortion and Same sex marriage – using the dues paid by the working person.
The SEIU lead her down the stupid path. Perhaps she will learn her lesson, but I doubt it.
Birds of a feather flock together.
I agree with those who ask why Harris was at all involved. To my mind, she had no business sticking her nose into the deal.
Because she is a Democratic Communist who wants to control everyone and everything.
Now dump the hospitals as soon as possible, teach her and her SEIU cronies a lesson. – Goodbye. You made the mess, now you clean up the mess with your own resources.
Larry, by law the Attorney General of the State of California must approve a for-profit company buying a not-for-profit corporation, especially it seems in the health care industry. But, in her effort to ensure adequate care for the poor, she went too far in her 76 pages or regulations, to the point that the buyer said no to the deal.
By going too far and WAY OVER-regulating (essentially writing the law herself), Harris has showed that she is a mini-Obama. A communist dictator.
And therefore Harris should never be elected for anything again – not even dog catcher.
I agree with Kamala Davis and keeping in essence the Daughters of Charity hospitals going in the Santa Clara County area. A large corporation would only close all the hospitals then charge whatever the market will bear. One of the hospitals in South County is an emergency facility where persons severely injured in traffic or other accidents receive expert care. Keep the Catholic hospitals open. Do we really want our Catholic hospitals to start an abortion trade, deal in other morally corrupt practices? That is what would occur if the Catholic hospitals were sold. That is why people in Santa Clara County want to keep Catholic hospitals open.
John Patrick, you did not read the article.
Dictator Harris was dictating to the potential buyer that they must continue the same practices as the hospitals currently do.
Currently the hospitals are losing $10,000,000.00 per MONTH.
* * * * * Who do you expect to pay for the continued losses ? ? ? ? ?
Catholic social teaching requires that we pay just bills (CCC 2411).
Taking government money means – playing by government rules which includes but is not limited to:
ABORTION, CONTRACEPTION, VOLUNTARY STERILIZATION;
and if the CA Democratic Party has their way it will also include EUTHANASIA (death with dignity), and SEX CHANGE operations per their 2014 CA Party Platform.
And this includes any money from OBAMACARE that may come in.
Close the hospitals. It is the only way to stop the hemorrhaging debt load, and not bow to government required immorality.
Make Harris and her SEIU come up with something for the community.
Kamela Harris is a one woman Left Wing Hate Group! There are many more like her in Sacramento. I’ll bet that “Catholics in name only” voted for her.
Pope Francis has taught us that He does not want the Church to became another NGO. So let the Sisters “hacer lío” and transfer the Hospitals to the SEIU and the NAACP for a Dollar.
The Church will have to separate itself from modernity. The Democrat Party shows no signs of gratitude for five decades of aggiornamento. They will not be satisfied until they abort most babies and marry most homosexuals. But Californians are all the same and happily elect and re-elect Democrats again and again.
Not only Pope Francis, but also Pope Benedict has stated that Catholic charities of any kind must not become merely a social services organization, or another NGO.
In fact Pope Benedict taught so strongly on the matter that he put out a Motu Proprio that must be adhered to.
“ON the SERVICE of CHARITY”
One part of the article says Prime Health Care had no ultimate problem with either the ten year requirement or the level of charitable care requirement. But then the article refers to 78 pages of other conditions. Nowhere does the article specify what the real deal breakers in the 78 pages were.
I wonder if Prime just was looking for an excuse to say no and nix the deal.