Trinity Health completes acquisition of MercyOne Health System
Trinity said the combined organization will be stronger in the face of challenges brought on by the COVID-19 pandemic.
Photo: Martin Barraud/Getty Images
Nonprofit Catholic health system Trinity Health has completed its acquisition of Iowa-based MercyOne, closing out a process that began in April when Trinity signed an agreement with CommonSpirit Health to acquire all of MercyOne's facilities and assets, including home care, hospice and infusion locations.
Trinity Health president and CEO Mike Slubowski said via statement that the move creates "a stronger and more unified system," and hinted at economy of scale when he said the combined organization will be stronger in the face of challenges brought on by the COVID-19 pandemic.
Operating as a part of Trinity Health, MercyOne will retain its name and brand, the companies said. The agreement was announced on April 19, and plans have been underway to complete the integration, including regulatory filings and other steps necessary to finalize the agreement.
WHAT'S THE IMPACT
The Trinity Health/MercyOne deal was one of the second-quarter "megadeals" identified by Kaufman Hall's Quarterly Mergers and Acquisitions Report released in July. In megadeals, or mega transactions, the smaller party has annual revenues in excess of $1 billion.
MercyOne, the smaller party in this case, posted $3 billion in annual revenues, Kaufman Hall found.
It was a banner quarter overall, with a record high of $19.2 billion in total transacted revenue. That about doubles the transacted revenue logged during the first quarter, and the Trinity Health/MercyOne deal was one of the main transactions contributing to Q2's high dollar amount.
Overall, 13 deals were announced in Q2. That's low compared to some of the numbers seen prior to 2020 when the pandemic hit, but the mega transactions have more than made up for any potential lag in total transacted revenue.
THE LARGER TREND
Trinity Health's network of care includes 88 hospitals, 131 continuing care locations, the second largest PACE program in the country, and 125 urgent care locations. Based in Livonia, Michigan, its annual operating revenue is $20.2 billion with $1.2 billion returned to its communities in the form of charity care and other community benefit programs.
Headquartered in central Iowa, MercyOne was founded in 1998 through a collaboration between Catholic Health Initiatives, now CommonSpirit Health, and Trinity Health.
ON THE RECORD
"Today's closing further advances MercyOne's vision to provide personalized and radically convenient care experience for Iowans and neighboring communities. We are delighted to become a full member of the Trinity Health family which will further our goal to be a more strongly connected system of health services," said MercyOne President and CEO Bob Ritz. "We are grateful to CommonSpirit for their support in the transition and for more than 25 years of successful partnership in Iowa. We look forward to further strengthening the mission of MercyOne."
Twitter: @JELagasse
Email the writer: jeff.lagasse@himssmedia.com
