State stops acquisition by growing CA hospital chain

Earlier this week, we told you about the growing California hospital empire [1]controlled by cardiologist Dr. Prem Reddy. Victorville, Calif.-based Prime Healthcare Services, which has made its mark with its insurance-free business model, has picked up eight California hospitals in recent times, drawing much attention and some opposition. Now, questions about the chain have stopped its next planned acquisition. State officials have nixed its attempt to buy non-profit Anaheim Memorial Medical, one of the largest medical centers in its region.

Anaheim's parent company, Memorial Health Services, had accepted a roughly $55 million bid for the 217-bed hospital in February. But in a nearly unheard of move, the state attorney intervened to cancel the deal, saying the proposed buy wasn't good for the region and didn't come with a high enough pricetag. The AG's office also said it was uncomfortable with the bidding process for acquiring the facility, which went up for sale about a year ago. Prime has said it intends to keep pursuing the deal, and is willing to participate in a new, alternative bidding process.

To learn more about the proposed deal:
- read this Los Angeles Times article [2]

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