Dive Transient:
- Summa Well being CEO and President Dr. Cliff Deveny plans to step down from his publish on the finish of the 12 months, in accordance with a Wednesday electronic mail to employees reviewed by Healthcare Dive.
- Deveny’s departure comes lower than a month after enterprise capital agency Normal Catalyst’s spinoff, the Well being Assurance Transformation Firm, accomplished its $515 million acquisition of the Ohio-based well being system. The deal will transition nonprofit Summa right into a for-profit firm.
- Starting Jan. 1, Deveny will transfer right into a CEO emeritus and strategic advising function. Daryl Tol, president of HATCo, will function interim CEO. Summa expects its government search will take a number of months, in accordance with a spokesperson.
Dive Perception:
Normal Catalyst’s acquisition of Summa Well being marks the primary time a enterprise capital agency has absolutely owned a well being system. Normal Catalyst payments the deal as a chance for it to check methods to enhance hospital operations, with out the danger of money shortfalls.
Deveny’s word addresses that workers may be stunned by his departure, given its shut proximity to the acquisition.
“I do know that change can really feel unsettling. However I would like you to know this resolution has been made thoughtfully, collaboratively, and with Summa’s long-term success in thoughts. It’s the precise resolution on the proper time,” the CEO wrote.
Summa Well being serves roughly 1 million sufferers yearly by operations at two acute care hospitals, one rehab hospital, a community of neighborhood medical facilities and doctor places of work. Summa Well being additionally operates a medical health insurance arm referred to as SummaCare.
Summa Well being struggled financially previous to the HATCo acquisition, reporting poor working returns and carrying excessive ranges of long-term debt.
Normal Catalyst promised Summa Well being hundreds of thousands of {dollars} above the acquisition worth, together with $15 million to fund neighborhood well being, $350 million towards expertise investments and $200 million for strategic transformation tasks. Summa Well being executives have mentioned the investments ought to collectively enhance the well being system’s viability.
Nonetheless, the acquisition took about two years to shut, partially as a result of there may be extra scrutiny of offers that transition nonprofit well being methods like Summa to for-profit entities. Research have proven high quality of care declines and costs rise after such offers are accomplished.
Normal Catalyst needed to conform to quite a few circumstances to safe approval for the deal from Ohio regulators. These included elevating the acquisition worth, pledging to publish area people members to Summa Well being’s board and promising to keep up earlier ranges of medical companies and charity care.
Ohio Legal professional Normal David Yost finally greenlit the deal in June earlier than it was finalized on Oct. 1.
