California-based Prime Healthcare has agreed to buy nine Ascension hospitals in Illinois, as well as associated physician practices, post-acute and senior living facilities.
The hospitals and senior living facilities will join Prime Healthcare’s for-profit health system that currently includes 44 hospitals, more than 300 outpatient locations, 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 ending March 31—a $1.3 billion turnaround from the same period last year.
Terms of the deal were not disclosed, but as part of the acquisition, Prime Healthcare committed to investing $250 million in facility upgrades, capital improvements, technology investments and system upgrades. Prime Healthcare stressed that it has all available funding and no debt will be put on the hospitals to complete this transaction. Additionally, Prime has 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 post-acute and senior living 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 persons, with special attention to those who are most vulnerable. Prime Healthcare’s mission and commitment to clinical excellence and health equity will carry on this legacy, ensuring that the greater Chicago area has sustainable, quality healthcare access long into the future,” said Polly Davenport, president and CEO of Ascension Illinois, in a statement. “We are confident that Prime will continue its record of excellence and look forward to working in partnership through the sale close process.”
Ascension has been busy making other deals. In June the University of Alabama at Birmingham Health System Authority 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 a joint venture that would merge eight Ascension southeast Michigan hospitals and Genesys healthcare facilities and assets with Henry Ford’s.
In a recent blog post on the organization’s website, Eduardo Conrado, Ascension’s president, described 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 labor shortages. These challenges have provided Ascension the opportunity to reimagine our ministry and affirm our mission in a changing healthcare environment, especially as more communities seek care in non-traditional settings.”
Conrado said that Ascension’s vision is to become a more consolidated and integrated health ministry, “focusing on meeting the shifting needs of our communities with special attention to those who are poor and vulnerable. To achieve this, we have transitioned some hospitals through divestitures and invested in acute and non-acute care services, including ambulatory surgery centers, physician practices, physical and occupational therapy, at-home and virtual care, imaging, and pharmacy. We believe these changes have strengthened Ascension and better positioned us to meet community needs 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.
