RegionalCare Hospital Partners acquires Iowa health center

The Ottumwa Regional Health Center in Ottumwa, Iowa, has entered into a Letter of Intent to be acquired by RegionalCare Hospital Partners, a for-profit company focused on the operation of community hospitals.

According to Tom Siemers, president and CEO of ORHC, the acquisition is expected to be completed in the spring of 2010.

"This is a wonderful opportunity for Ottumwa Regional," said Siemers. "RegionalCare is a good match with ORHC. We'll enhance the great care we provide our patients while expanding medical services to our community."

Under the agreement, the hospital's name will remain the same, the board of directors will continue to serve on the hospital's new board and the staff of Ottumwa Regional Health Center and its affiliated facilities will retain their positions.

RegionalCare Hospital Partners is based in Brentwood, Tenn. The company forms partnerships with community hospitals that are seeking to expand their services and regional influence.

Siemers said that as a result of the partnership between ORHC and RegionalCare, new capital will allow ORHC to pay off its long-term debt and invest in many new projects over the next five years, including:

• Accelerating plans for building a permanent building for a cardiac cath lab;
• Expansion and renovation of clinical service areas;
• Continued investment in training and programs based on the Studer principles for service excellence to patients;
• New equipment including a complete upgrade to the hospital's information system; and
• Plant maintenance and infrastructure projects.

Additionally, RegionalCare plans to establish a new multi-million dollar nonprofit foundation which will be managed by an independent board of directors. Funded by net proceeds of the sale with cash and savings of the hospital, the new foundation, among the largest in Iowa, will be dedicated to improving the health and wellness for residents of southeast Iowa.

"Ottumwa Regional's board of directors reached the decision unanimously," said Ted Haas, MD, chairman of ORHC's board of directors. "The board's guiding principles in making our decision were to assure the continuation of outstanding care to patients, their families and the communities we serve and do what is best for our associates and physicians."

The Ottumwa hospital has 900 employees, including 62 active staff physicians. Payroll and benefits exceed $44 million per year.

"The scope of commitments RegionalCare has made to ORHC's future is extensive and will allow our hospital to continue to provide exceptional care and service to our patients," Siemers said.

Marty Rash, chairman and CEO of RegionalCare Hospital Partners, said RegionalCare's investment would help ORHC accelerate its plans and implementation of the organization's strategic vision and mission.