| September 10, 2009 |
| |
ESSENT HEALTHCARE SELECTED TO ACQUIRE BROWN COUNTY GENERAL HOSPITAL IN GEORGETOWN, OHIO |
Essent to invest in facility improvements; hire current staff; preserve health care access for community |
| |
The Brown County Regional HealthCARE Board of Trustees has selected Essent Healthcare, Inc. as the best strategic partner to acquire 115-bed Brown County General Hospital and its related operations, officials announced today.
Following a thorough and deliberate seven-month evaluation to find the right partner, the Board recommended that the Brown County Commissioners approve Essent from among a group of bidders to purchase the community hospital. The Commissioners voted to accept that recommendation and made a motion to enter into an agreement with Essent Healthcare, which passed unanimously.
The Trustee’s decision initiates negotiations with Essent Healthcare for the purchase of the hospital. The transaction is expected to take at least 60 days to complete, pending due diligence and customary regulatory approvals.
“We are very impressed with Essent, their vision for our hospital and how they have helped other hospitals like ours turn around and prosper to provide quality health care to patients in their market and communities,” said Eric Sontag, Chairman of the Brown County Regional HealthCARE Board of Trustees.
“We believe Essent Healthcare will be a strong partner. We are confident this important decision is the best way to preserve our hospital and the delivery of healthcare for the future. As we saw at their Pennsylvania hospital, Essent has been successful in stabilizing other community hospitals that have faced challenges very similar to ours.”
Essent’s Proposal
Among a variety of issues in its proposal to acquire the hospital, Essent Healthcare has said it would:
- Offer employment to all employees at the time of closing, with full credit for years of service and rates of pay, and with a competitive benefits package.
- Provide much needed capital for facility and equipment enhancements. Essent Healthcare proposes to invest significant amounts of capital over the next three years to include the construction of two new floors with approximately 50 private inpatient rooms.
- Essent also plans to maintain the hospital’s core general acute care services and to expand the services at Brown County General with a special emphasis on cardiology, orthopedics, primary care and behavioral health, as well as other services most needed in the community.
Many of the specifics of the sale will be determined during the due diligence process, during which Essent will more thoroughly review the hospital and its operations.
Background
As part of its evaluation, a group of Board members and County Commissioners visited one of Essent’s hospitals located in western Pennsylvania last week, which provided an excellent case study. Before its purchase by Essent in 2005, Southwest Regional Medical Center had been experiencing annual operating losses of approximately $1.5 million. After capital investments of nearly $9 million, the addition of 20 inpatient beds and the expansion of services including behavioral health, cardiology, intensive care, orthopedics and cancer care, the hospital is now operating in the black.
Like many stand-alone community hospitals in Ohio and across the country, Brown County General Hospital has been facing a cash shortage and lost $2.5 million on operations in 2008. In its proposal, Essent agreed to assume the hospital’s debt, contract obligations and capital leases, pending completion of the due diligence process.
“Essent is honored to have been selected by Brown County Regional HealthCARE Board of Trustees,” said Michael Browder, President and Chief Executive Officer of Essent Healthcare, Inc. “We see tremendous opportunity in Brown County and we look forward to becoming a permanent member of this growing community.”
|
|
