Under a definitive agreement reached this week, Mission Health will continue to manage its seven hospitals in western North Carolina, while HCA runs operations, capital access, predictive modeling and analytics.
HCA Healthcare announced Friday that it will pay $1.5 billion to acquire Mission Health, a seven-hospital, nonprofit health system based in Asheville, North Carolina.
"Mission Health is the premier healthcare system in western North Carolina, with a 130-year tradition of high quality patient care," Milton Johnson, HCA chairman and CEO, said in a media release.
"We look forward to continuing Mission Health’s focus on excellence, and investing in western North Carolina to improve the health of the region," he said.
Under the deal, "nearly all" Mission facilities will become part of HCA while continuing to operate under the Mission brand. Mission will continue to be managed locally while HCA runs operations, capital access, clinical trials, research, predictive modeling, and analytics, the media release said.
Mission Health's tax status would change to for-profit with the acquisition.
The HCA-acquired hospitals are: 763-bed Mission Hospital in Asheville; 80-bed CarePartners Rehabilitation Hospital in Asheville; 49-bed Mission Hospital McDowell in Marion; 25-bed Angel Medical Center in Franklin; 25-bed Transylvania Regional Hospital in Brevard; 25-bed Blue Ridge Regional Hospital in Spruce Pine; and 24-bed Highlands-Cashiers Hospital in Highlands.
Nashville-based HCA said it will spend $430 million over five years for the completion of the Mission Hospital for Advanced Medicine, building a replacement hospital for Angel Medical Center and building a new Behavioral Health hospital.
The proceeds from the sale will be combined with Mission Health's remaining cash and investments and will be used to fund the newly formed Dogwood Health Trust, a population health initiative serving western North Carolina.
"From the very beginning, Mission Health's Board worked diligently and continually to ensure that the very best path was selected for the people of western North Carolina and to make certain that our community has access to high quality, effective and compassionate care for generations to come," Mission Health Board Chair John R. Ball, MD, JD, said in prepared remarks.
"After completing due diligence and finalizing definitive agreements that have significant protections for our rural communities, we are convinced that HCA Healthcare is the right and best choice for western North Carolina and Mission's team members, providers and patients. It is heartening to share that every single Mission Health member entity Board voted unanimously to approve this transaction," Ball said.
HCA said it will maintain clinical services for at least five years and keep open all rehabilitation and acute-care hospitals for at least 10 years, other than St. Joseph’s Hospital which was already planned for transition.
HCA has agreed not to sell any rehabilitation or acute-care hospital for a minimum of 10 years. None of these protections exist for Mission Health programs or facilities today.
In addition, HCA and Mission will each contribute $25 million to create a $50 million innovation fund to encourage healthcare investment in the region.
The deal is subject to the approval of North Carolina state regulators, including an evaluation by the state's attorney general, to ensure that it will benefit people in the service area, and that HCA is paying a fair price, Mission said.
John Commins is a content specialist and online news editor for HealthLeaders, a Simplify Compliance brand.
KEY TAKEAWAYS
HCA to spend $430 million over five years on capital improvements.
Proceeds from the sale will be used to create a public health trust for the region.
The deal must clear a state review to determine if HCA is paying a fair price.