To date, growing California hospital chain Prime Healthcare has picked up nine facilities, all of which were in financial trouble when it arrived on the scene. These days, it's trying to pick up a tenth facility, one that also is in dire financial straits and still on the ropes after filing for bankruptcy last fall. However, despite its plight, Brotman Medical Center doesn't want to join the Prime empire.
Executives there say that they don't like Prime's business practices, which include canceling all private insurance contracts and often, cutting back on low-profit (but arguably necessary) service lines. That being said, they may not have a choice. Prime already has bought $18 million in Brotman's loans from the hospital's primary lender, and if the hospital can't pay up, that puts it in an excellent position to make a hostile takeover. However, the hospital's leaders say they have another suitor, and hope to close with that buyer within the next few weeks, which would get them off the hook.
To learn more about the struggle for control:
- read this Los Angeles Times piece
California hospital operator boots HMOs
Upstart CA hospital chain buys another facility
State stops acquisition by growing CA hospital chain