Combining is a choice between surviving and thriving, says Al Stubblefield.
[Photo: Jeffrey Camp]
For 10 years, Al Stubblefield, president and CEO of Baptist Health Care of Pensacola, has been trying to buy West Florida Hospital from Hospital Corporation of America. The move, in his view, would reduce the three-hospital town’s oversupply of hospital beds and provide a better location for Baptist’s main hospital, a 60-year-old facility in a downtown inner-city neighborhood.
The two hospital chains broke off discussions two years ago, but HCA contacted Stubblefield about resuming merger talks in December. In June, HCA agreed to sell West Florida for $245-million. The sale is expected to go through by year-end, hinging only on federal regulatory approval and securing tax-exempt bond financing, neither considered a problem.
West Florida Hospital in Pensacola
HCA isn’t commenting on its
about-face, although West Florida’s financial losses of $15 million in 2007
and $13 million in 2006 could be a
factor. Occupancy at West Florida’s
531-bed hospital was 34% early this year; at 492-bed Baptist Hospital, it was 48%. Post-merger, Baptist plans to offer 600 beds between the two locations, potentially boosting occupancy to around 69%, putting it in line with that of Sacred Heart Hospital, its fellow Pensacola non-profit.
Baptist will spend $80 million for additions at its new main hospital campus. The current campus will focus on outpatient care, physician offices and expanded psychiatric services and also remain as corporate offices.
|Baptist Health Care
» Employees: 5,500
» Net income (2007): $9.5 million
» Holdings: Four regional hospitals, at Pensacola, Jay, Gulf Breeze and Atmore (Ala.); Lake-view Center; majority of Andrews Institute; total of 60-plus facilities
» Acquisition adds: West
Florida Hospital and 11 satellite medical sites