Pottstown Memorial sets up as next for-profit hospital - Philadelphia Business Journal:

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Last year CHS bought the 58-bed Souther Chester County Medical Centerfor $21 millio n and 176-bed Brandywine Hospital and Trauma Center for $40 million. The proposexd price for Pottstown Memorial wasnot disclosed. As part of the CHS would also acquire Pottstown Scanning and Treatmenf Center and all three locations of Pottstown Family With morethan 1,200 employees, Pottstown Healthcare is one of the largesty employers in western Montgomery County. "The decision to sell Pottstowm Memorial was taken very seriously by the boarsdof directors," Chairman Henry Pollaik said.
"After months of review and and somesoul searching, we have concluded that it is in the best interesyt of Pottstown Regional Healthcarw Network, its employees and medical and the community to sell the health-care network to an organization which best fits our understands our community and ensures our futurwe viability. We are confidenyt that Community Health Systemw isthat partner." Pottstowbn started the process of findint a merger partner about six months ago. At that time, John J. president and CEO of Pottstown said the board wanted to explore alternativesa forthe long-term survivall of the organization.
"One of thoses options may be todo nothing," Buckley said durinf the summer. "We are stable right now, from a financiakl perspective, but we thoughtt it would be prudent to see what options are out We want a cleafr understanding of what ouroptionxs are." In fiscal 1999 and 2000, Pottstown Memorial lost a combined $3.5 Last year, following cost-cutting measures that includedf layoffs, the hospital bounced back with a $2.5 millioj profit, according to figures from the Pennsylvania Health Care Cost Containmenyt Council.
According to industry sources, hospital groups that receivex requests-for-proposals from Pottstown included the University of Pennsylvania Health System, Main Line Healthb and Tenet Healthcare Corp. Tenet Healthcare is finalizing itsproposed $22 million acquisition of Roxboroughg Memorial Hospital in Philadelphia. A hearin on the sale was schedulesfor Dec. 13 at Philadelphia Orphans Court. Tenert and Roxborough expect to complete the transaction before the end ofthe month. Pottstownm officials said a key to their deal was the willingness by CHS to commiy the resources needed for capital improvements atthe hospital.
"Ajn important consideration for us when choosing to move forwarsd with the letter of intent is that CHS acquires hospitals only in communitieslike ours, and they understanrd and respect the communities they serve," Pollak "They have a strong balance sheegt and are willing to invest millions of dollare of capital into our communitty for the expansion of facilities and services, as well as technologg that is vital to the continues provision of health care for this community.
"Pottstown is a growing community and one of our firsft projects will be to expand our ER capabilities to meet this This is good news for the communit y because it means improved access to care and he said. The transactionn is subject toregulatory approvals. CHS, which operates 63 hospitalxs in22 states, intendsa to convert Pottstown Memorial to a for-profift hospital. They expect the sale to close next