July 8, 2014

St. Mary’s to join for-profit Tenet

St. Mary's Hospital in Waterbury said it hopes to be acquired by Tenet Healthcare Corp., adding a fifth institution to the for-profit operator's list of hospitals it's courting in Connecticut.

St. Mary's is just down the street from Waterbury Hospital, which first announced its intent to be acquired by Vanguard in 2012. Vanguard was later acquired by Tenet.

Tenet is also working in partnership with Yale New Haven Health System towards acquiring Eastern Connecticut Health Network – which includes Manchester Memorial and Rockville General hospitals — and Bristol Hospital.

"As health care continues to evolve, it is essential to be part of a larger regional network," Dr. Robert Gumbardo, St. Mary's chief of staff, said in a video posted online this week. "The Tenet transaction is a strategic decision that positions St. Mary's for the future."

Financial terms of the deal were not disclosed. St. Mary's said it plans to use the proceeds to fully fund its pension plan and eliminate debt.

St. Mary's said it would maintain its Catholic identity, and that a local advisory board would be established to oversee hospital operations.

The hospital described the deal as "separate and distinct" from Tenet's other pending Connecticut deals.

St. Mary's and Waterbury Hospital nearly merged in 2012 with for-profit operator LHP Hospital Group, but the deal was called off.

The Tenet acquisition, which will require state approvals, is made possible by a law passed at the eleventh hour of the state legislative session in May.

Gov. Dannel P. Malloy, who vetoed similar legislation in 2013 but signed the bill this year, released a statement Tuesday saying it will be a top priority to ensure Greater Waterbury residents have access to the healthcare services they need.

"The delivery of health care across our nation has been an extraordinarily complex and multifaceted issue, which only added to the need for everyone involved to be thorough and mindful of the long-term effects of a major transaction such as this," Malloy said. "I am glad to have signed legislation last month that helped today's announcement come to fruition and I look forward to working with Tenet and Saint Mary's to ensure a smooth process that continues to serve the Waterbury community."

St. Mary's teaming up with Tenet reduces the remaining number of independent hospitals in the state, which are eyeing their own collaboration. St. Mary's CEO Chad Wable said in May that a partnership could work, but expressed doubt over having enough collective capital to gain leverage with insurers and suppliers.

Read more

Regulators grant initial OK to Waterbury Hospital acquisition

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