Catholic health network gets 22 percent stake in Premier

The vote by Premier Health’s board to close Good Samaritan Hospital was made possible in part by a Jan. 1 business deal that changed the Dayton hospital’s ownership structure.

Up until Jan. 1, Good Samaritan’s assets were owned by a one of the largest U.S. hospital networks, Catholic Health Initiatives. CHI and Premier Health had a deal in place since 1995 that allowed Premier to run the hospital, but which left the hospital building, land and other assets in the hands of CHI.

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Then on Jan 1. CHI transferred the Good Samaritan hospital assets to Premier. In return, the Dayton Daily News has found in quarterly financial records that CHI received “a 22 percent interest in the restructured Premier joint venture.”

That was followed about two weeks later by Premier’s board of trustees voting to permanently close Good Samaritan’s main campus, at the corner of Philadelphia Drive and Salem Avenue.

The hospital closed July 23 and Premier is moving ahead with plans to tear down the campus buildings with the exception of the parking garage and Five Rivers Health Centers.

Premier, with $1.7 billion in revenue in 2017, is the largest private employer in the region and operates Miami Valley Hospital, Atrium Medical Center and Upper Valley Medical Center as well as a network of physicians and outpatient centers. The other ownership entities in Premier are Atrium, UVMC and MedAmerica, which operates Miami Valley. 

CHI said in its quarterly statement that it had no financial gains or losses to report because of the transaction. 

“Our health system is not structured like a for-profit company that delivers quarterly or annual dividends to its shareholders,” Premier said in a statement regarding CHI’s 22 percent interest in the nonprofit network.

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“We don’t have shareholders; we have members that are invested in Premier Health. This reorganization created a streamlined governance model to allow more efficient decision-making for the benefit of the community,” Premier stated.

Premier said CHI continues to have representatives on its board of trustees.

“The change in the legal structure of Premier was for the purpose of making both the legal structure and the decision making of Premier more efficient,” Premier said in a statement.

Premier said it planned to move forward with restructuring its business relationship with CHI whether or not Good Samaritan Hospital closed.

A CHI spokesperson declined further comment.

“Premier’s statement accurately reflects our position and we will not be commenting separately,” a CHI spokeswoman said.

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CHI formed an agreement in 1995 to jointly operate Good Samaritan Hospital as part of the newly formed Premier Health Partners, which at the time was Miami Valley Hospital and Good Samaritan.

Dayton’s Good Samaritan Hospital was opened by the Sisters of Charity in 1932 with the help of a community fundraising effort.

Denver-based CHI was created in 1995, when the Sisters of Charity Health Care Systems and two other large Catholic health networks formed Catholic Health Initiatives. It was the largest Catholic health system in the U.S. at the time.

CHI had $15.5 billion in operating revenues for fiscal year 2017 and had $22.7 billion in assets.

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As of December 2017, CHI’s network included dozens of hospitals, medical facilities, programs and residential centers in 17 states, including Good Samaritan Hospital in Cincinnati and the St. Leonard Living Community, 8100 Clyo Road, in Centerville.

At the Jan. 18 announcement that Good Samaritan would be closing, Premier Health leaders said Good Samaritan’s affiliation with the Denver-based Catholic health network was restructured in recent years so that CHI still sponsored the Catholic mission of the hospital, but Premier had the sole authority to make the decision to close the hospital.

The hospital had employed about 1,600 people on the main campus at the time of the closing announcement.

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