Brooksville Regional acquired by massive hospital chain in merger
Stockholders at Health Management Associates, Inc., the hospital company that owns Brooksville Regional and Bayfront Health, decided this week to merge with Community Health Systems, Inc.
A recent study places Brooksville Regional Hospital as the seventh most expensive hospital in the country, and Oak Hill Hospital as the 10th most expensive. FILE
Community Health Systems will acquire Health Management Associates, making it the fourth largest hospital chain in the country, according to a release.
“We are pleased that HMA stockholders have seen the significant strategic value in combining with CHS,” said Community Health Systems CEO, Wayne Smith. “We are working now to finalize regulatory approvals, and we expect to complete this transaction quickly.”
The transaction is expected to be completed by the end of January, the company said.
Steve Shulman, chairman of the board of Health Management Associates, said he was “gratified” with the merger.
Last April, Health Management finalized its joint venture partnership with the 480-bed Bayfront Health System, located in St. Petersburg.
Through the joint venture, Health Management owns an 80 percent interest in Bayfront Medical Center and its related operations, including Brooksville Regional Hospital, which will acquire the Bayfront logo and name in coming weeks, according to the hospital.
Health Management stockholders approved the merger with Community Health by a nearly 99 percent majority during a special meeting Wednesday at the Ritz Carlton golf resort in Naples.
Nurses across the country, some of whom work in hospitals owned by the companies, protested the merger, alleging equipment shortages and price gouging of patients.
The merger follows a study conducted by National Nurses United, which found six of the nine most expensive hospitals in the U.S. are part of Community Health and Health Management. Brooksville Regional Hospital was the 7th most expensive hospital in the country, according to the study.
Brooksville Regional’s local competitor, Oak Hill Hospital, was also on the organization’s list as the 10th most expensive hospital in the U.S.
The study was based on the most current data submitted to the federal government by more than 4,300 private and public hospitals, according to National Nurses United spokesman Charles Idelson.
The study concluded that for every $100 in costs at Brooksville Regional Hospital, the hospital charged $1,083, and for every $100 in costs at Oak Hill Hospital, the hospital charged $1,052.
“The implications are very serious; it will create the single largest hospital chain in the United States,” Idelson said. “Both of those systems have a deliberate corporate strategy of seeking to target hospitals in small towns and rural communities where they’re the only game in town, which means they’re setting real high costs, and patients and families don’t have other alternatives.
“If you’re the only hospital in town, it’s hard to go to another hospital.”
Following a year-long “60 Minutes” investigation into allegations of admission and billing malpractice by Health Management Associates, the federal government filed multiple lawsuits against the hospital company alleging Medicare fraud.
Former Health Management Associates Division 5 President, Joshua S. Putter, of Needham, Mass., is scheduled to go on trial this month after being charged with destroying or falsifying records during a federal investigation related to the billing malpractice matter, according to the FBI.
The alleged crime occurred around October 2008, according to the FBI, and if convicted, Putter faces a maximum penalty of 20 years in federal prison.
Nashville-based Community Health Systems is one of the largest publicly-traded hospital companies in the U.S., and a leading operator of acute care hospitals in non-urban, mid-size markets throughout the country.
Through its subsidiaries, Community Health owns, leases or operates 135 hospitals in 29 states with about 20,000 licensed beds.
Health Management Associates, owns and manages 71 hospitals, also in small cities and select urban markets across 15 states, according to a release.
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