Summit County’s biggest hospital system and largest employer officially has a minority owner.
Summa Health System completed a deal on Monday giving HealthSpan Partners — an auxiliary of Cincinnati-based Catholic Health Partners — a minority ownership stake for $250 million.
Catholic Health Partners restructured the deal for 30 percent ownership of Summa after the local Catholic Diocese leader recently refused to approve the partnership.
Under the modified agreement, HealthSpan Partners, a secular, nonprofit auxiliary organization of Catholic Health Partners (CHP), made the investment in Summa.
“The money will be used to strengthen Summa financially and better equip the system to tackle the challenge of health-care reform,” Summa spokesman Mike Bernstein said in an email.
All other terms of the previously announced agreement remain the same, according to a news release.
The deal appeared to hit a snag when Bishop Richard Lennon of the Catholic Diocese of Cleveland recently declined to approve the agreement, citing Summa’s publicly stated plans to continue providing sterilizations, contraceptives and abortions on a limited basis when medically necessary among his reasons for rejecting the deal.
Catholic health-care systems seeking a partnership with a non-Catholic hospital must ask the local bishop to determine whether the deal opposes Catholic faith and morals.
Under the agreement approved by the board of Summa and Catholic Health Partners in June, Summa can’t be banned from providing tubal ligations, vasectomies and prescriptions for contraceptive drugs and devices — all services in conflict with the Catholic church.
According to the agreement, a new entity called Community Health System was created through which Catholic Health Partners was to acquire its minority stake in Summa.
Community Health System registered “HealthSpan Partners” as a trade name with the Ohio Secretary of State’s office on July 31, according to state records.
“HealthSpan Partners is a separate corporation from CHP, with its own board and fiduciary responsibilities,” spokeswoman Liz Vogel said in an email. “The HealthSpan board — not CHP — will appoint members to the Summa board. The officers of HealthSpan Partners will not be employees of CHP.”
HealthSpan Inc., a CHP company that has been offering services for self-insured employers for more than 20 years, is expected to become a subsidiary of HealthSpan Partners on Jan. 1, Vogel said.
Kaiser Permanente Ohio, which is being acquired by Catholic Health Partners, also will be taking on the Health Span name.
“We are delighted to be partnering with HealthSpan Partners and look forward to working together for the benefit of Northeast Ohioans,” Thomas J. Strauss, Summa’s president and chief executive, said in a prepared statement.
A Catholic Health Partners spokeswoman said last week the restructured deal didn’t require the bishop’s approval because the Catholic health system is no longer directly involved in the Summa investment.
As of Monday afternoon, the Catholic Diocese of Cleveland hadn’t received any notification about the restructured deal, said Robert Tayek, director of media and public relations for the diocese. The bishop also hadn’t indicated whether he would take any further action.
CHP is the state’s largest hospital system, with 24 hospitals in Ohio and Kentucky and $5.6 billion in assets.
Summa includes Akron City, St. Thomas, Barberton and Wadsworth-Rittman hospitals, SummaCare insurance, a physician practice and other ventures. The health system has roughly 11,000 employees if partially owned and affiliated businesses are included.
The deal ends Summa’s two-year search for a larger partner to strengthen its financial position and prepare for looming changes from health-care reform.
CHP and Summa have an existing relationship, with several of CHP’s facilities joining SummaCare’s Medicare managed- care plans’ hospital network at the beginning of the year.
Both also have “accountable- care organizations,” the industry trend that brings together doctors, hospitals and other providers to coordinate patient care and then share any savings achieved.
The organizations already have started working together to improve Summa’s performance in the areas of billing, supply costs, labor productivity and average length of stay for hospitalizations.
A high-level executive from Catholic Health Partners joined the Summa staff in July to begin integrating the health systems.
Cheryl Powell can be reached at 330-996-3902 or firstname.lastname@example.org. Follow Powell on Twitter at twitter.com/abjcherylpowell.