CHS withdraws BRHS offer

Published 1:14 am Wednesday, October 27, 2010

Staff Writer

Community Health Systems, one of four health-care providers seeking to merge or associate with Beaufort Regional Health System, has withdrawn its offer, the chairwoman of the BRHS Board of Commissioners told the Washington Daily News on Wednesday.
Board Chairwoman Alice Mills Sadler said CHS “wished us well with our plans” and that she had “no other information from them” regarding the health system’s withdrawal of its proffer.
Sadler said this latest development changes the options before the BRHS board, but she said its members will continue with the process of evaluating the proposals that are now before it.
“We haven’t lost any ground,” she said. “We are proceeding as if we had received only three proposals.”
In recent days, a number of people — most within the local, regional and national medical community — had begun to express concerns about the CHS offer and its operations, particularly in regard to its employees.
The news of the CHS withdrawal came just hours before a hearing scheduled for the BRHS board to hear from the public about the merger or affiliation proposals that could determine the fate of health care in Beaufort County.
After receiving comments from the public, the BRHS board will meet Thursday to establish a schedule for negotiations with the remaining three prospective suitors whose four offers remain.
Greenville-based University Health Systems of Eastern Carolina and LHP Hospital Group of Plano, Texas, presented lease offers. LHP Hospital Group and Brim Healthcare of Brentwood, Tenn., presented alternative proposals that would either create some type of joint venture with BRHS or establish a management-services arrangement.
University Health Systems, a private, nonprofit organization with a listed $607 million in assets, presented an offer for a 20-year lease. It offered a prepaid lease payment of $18.1 million and promised a minimum of $21 million in capital expenditures over the first five years of the lease. Its proposal also states that at the end of the lease, UHS is entitled to full and complete ownership of all leased assets, according to an executive summary of the UHS proposal.
Brim Healthcare, a private, for-profit organization, chose not to disclose its assets. It presented a proposal for a management-services arrangement for three years plus one two-year renewal. The chief operating and chief financial officers of the local health system would be Brim employees, and the health system would be directed by the local governing board as currently seated. The offer proposed a starting point for discussions of its management fee at 1 to 3 percent of net patient revenue, according to a summary of the offer.
LHP Hospital Group, a private, for-profit organization, disclosed its assets confidentially to the BRHS board. It presented two options — a proposed 30-year lease plus two 10-year renewals at fair-market value and a proposed joint venture with LHP investing $24 million in cash and having an 80 percent interest in a new joint venture with BRHS.
Copies of the offers are available for review by the public at the George H. and Laura E. Brown Library and the Beaufort-Hyde-Martin Regional Library, both in Washington.