[cougarnurse]

Saw this on the news tonight:
SSM to Close St. Francis Hospital & Health Center

April 2, 2008 – For immediate release
BLUE ISLAND, Ill. – Facing mounting financial losses and having exhausted all other options – including giving the hospital away for free – SSM Health Care announced today that it will reluctantly close St. Francis Hospital & Health Center.
The hospital will remain open until SSM receives necessary approvals for its plans from the Illinois Health Facilities Planning Board and the Illinois Department of Health.
Sister Mary Jean Ryan, FSM, president and chief executive officer of SSM Health Care, called the decision “heartbreaking – for our employees who have tried so hard to keep it operating; for our talented physicians, who have invested so much of their careers here; and for the community, which depends on St. Francis for care. We deeply regret having to take this step.”
Since 2000, SSM has invested more than $75 million in St. Francis to make it a competitive, state-of-the-art facility. In spite of these investments, however, St. Francis continued to lose millions of dollars each year. Since 2002, St. Francis has lost $40 million. The hospital is projected to lose $20 million this year alone, with losses projected into the future.
In 2003, SSM sought approval to offset St. Francis’s losses by building a sister hospital in Orland Park. That effort failed when the certificate of need (CON) application was turned down in 2005.
SSM subsequently filed an appeal, and at the same time pursued a number of options to establish an outpatient presence in Orland Park. A joint venture partner could not be found given the uncertainty around the hospital’s CON process.
Following that effort, SSM explored other options, including transferring the hospital to other faith-based systems. Not a single one was willing to buy it or even take it for free. SSM then hired an investment banking firm to identify potential buyers nationally.
In all, SSM discussed the sale of St. Francis with 28 potential buyers – Catholic hospitals and other not-for-profit health systems in Chicago, as well as for-profit organizations in all parts of the country. Out of all of these, one final proposal was received – from Transition Healthcare Company, whose financial partner was Lincolnshire Equity Fund III, LP. Lincolnshire withdrew from the transaction last month.
“All potential buyers said the same thing,” said Sister Mary Jean. “No one could do a better job of operating this hospital than it is currently being operated. It is a testimony to our extraordinary employees, physicians and administrative team.
“Unfortunately, in spite of St. Francis’ outstanding clinical reputation, reimbursement from commercial insurers could not cover the cost of providing care to the growing number of Medicaid and uninsured patients,” she said. “Currently, 1 out of every 2 people who come to the Emergency Department and 1 of out 4 people who are admitted to the hospital either have no health insurance or are covered by Medicaid. Most of the people without insurance cannot afford to pay us anything, and Medicaid pays us less than what it costs us to provide care. No hospital can survive over the long term without being able to cover its costs.”
After seven years of continued losses, with large losses projected for the future, and with no hospital or health care system willing to take over St. Francis, SSM has exhausted all viable alternatives.
“As a system, we can and do carry hospitals that experience challenging times,” she said. “However, we cannot sustain these kinds of losses over an indefinite period of time.
“Ultimately, until and unless society accepts the fact that hospitals – or health systems – cannot bear the financial burden alone, we will see other hospitals fail and more people hurt.”
“We have spent years trying to make St. Francis financially stable, but the conditions have only grown worse,” said Dixie Platt, SSM senior vice president-mission and external affairs. “The sad truth is we have exhausted all viable alternatives.”
SSM also plans to close its SSM Home Care and Hospice operations at St. Francis if no buyer can be found.
SSM is committed to helping the more than 1,400 St. Francis employees and 50 SSM Home Care and Hospice employees through this very difficult time. Crisis counselors are on site and a career center at the hospital will help employees find jobs in the area or within the SSM Health Care system.
SSM will work with the community to determine the future use of the hospital.
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