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Tuesday, Sep 26, 2023


JESSICA TOLEDANO Staff Reporter Health care-industry officials say Catholic Healthcare West is close to completing a deal to acquire Burbank-based UniHealth, a move that would make CHW the second-largest hospital operator in Los Angeles County. The non-profit UniHealth owns six hospitals in the county, including Northridge Hospital Medical Center, California Hospital Medical Center and Glendale Memorial Hospital, as well as the Pasadena-based Huntington Provider Group, a large physicians’ group that contracts with managed care companies. CHW, a non-profit based in San Francisco, owns four hospitals in the county, including St. Vincent Medical Center near MacArthur Park and St. Mary Medical Center in Long Beach. Officials with both CHW and UniHealth confirmed the talks but would not comment on their status. But local industry officials and consultants said the deal could go through as early as this month. “It is imminent,” said Andrew Leeka, president and chief executive of Good Samaritan Hospital in Los Angeles. “It puts Catholic Healthcare West in a much better position.” John Edelston, president of the health care consulting firm HealthPro Associates Inc. in Woodland Hills, also said a deal should be announced in a matter of weeks. Elaine Murphy, a public relations specialist for UniHealth, would not discuss the reasons behind the merger, though the chain’s financial troubles have been well documented. Five of UniHealth’s six local hospitals posted a collective loss of $11.2 million last year, according to the Office of Statewide Healthcare Planning and Development. The sixth, California Hospital, posted a profit of just $28,717. By acquiring UniHealth, CHW hopes to improve the bottom line, said spokeswoman Debbie Cantu. As a large hospital chain 37 facilities in California, Arizona and Nevada CHW is in a better position to cut deals with everyone from medical supply companies to managed care groups, she said. “Catholic Healthcare West has done this a number of times with a number of hospitals,” she said. “Every situation has its risks. I believe the leadership at Catholic Healthcare West has an extraordinary ability to assess those risks.” But analysts say some of the obstacles will be hard to overcome, especially the need for large amounts of capital to turn around ailing hospitals. “Catholic Healthcare West may have the financial wherewithal and the technical capabilities to put the UniHealth network back into shape, but it will be a significant challenge,” said Albert Lowey-Ball, president of Albert Lowey-Ball Associates Inc., a health care consulting company and former advisor to UniHealth. “The question is, are they willing to invest? A lot of money needs to go into it.” Santa Barbara-based Tenet Healthcare Corp. is the largest hospital chain in L.A. County, with 18 hospitals, including Brotman Medical Center in Culver City and Queen of Angels-Hollywood Presbyterian. Over the last two years, UniHealth has sold about one-third of its hospitals, and last year sold its CareAmerica health maintenance organization to Blue Shield of California for $195 million. It also sold its majority interest in PacifiCare Health Systems in Orange County.

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