The Joplin Globe, Joplin, MO

Joplin Metro

Discussion

July 2, 2009

Negotiations toward new parent company for St. John’s continue

By Wally Kennedy

wkennedy@joplinglobe.com

Two months after a letter of intent was signed, talks aimed at finding a new parent company for St. John’s Regional Medical Center are still under way.

The proposed transfer of ownership, revealed on May 1, would put St. John’s under the umbrella of the Sisters of Mercy Health System, of St. Louis. The transfer could happen as early as September or October.

St. John’s has been under the control of Catholic Health Initiatives, of Denver, Colo., since 1996.

George Caralis, interim president of St. John’s, on Thursday said: “We are going through what the lawyers call due diligence. People with the Sisters of Mercy have visited us several times now.

“They have examined our operation from top to bottom. We are now in the process of negotiating a definitive agreement. That is under way.”

Caralis said the procedure is being controlled by a number of lawyers. “They are working through the issues as they come up,” he said. “It has been moving relatively smoothly, with only a few little glitches.”

When a fully negotiated agreement is reached, the deal then must be approved by the board of directors at St. John’s, the board of the Sisters of Mercy in St. Louis, the board of Catholic Health Initiatives in Denver, and finally officials with the Roman Catholic Church in Rome.

When asked what might happen if an agreement is not reached, Caralis said, “l would rather not do Plan B now.” He characterized the talks as “favorable and doable.”

Officials at St. John’s hope the new owner could strengthen St. John’s strategic position in the Joplin market.

Last November, St. John’s announced its “Mission Forward” steps in a move aimed at gaining the upper hand on a market struggle that had lasted possibly more than three years. The medical center eliminated about 160 full-time positions and cut programs, with the overall aim of saving $30 million in expenses. The possibility of finding a new parent company was explored at that time.

St. John’s was founded under the Sisters of Mercy Omaha Congregation and was part of that group until 1996. The potential new parent company, also Sisters of Mercy, is under the St. Louis Congregation. Both groups have common ancestry in Catherine McAuley, the founder of Sisters of Mercy.

St. John’s is the only CHI operation in Missouri. Sisters of Mercy of St. Louis has several regional operations in the area, including Springfield and Fort Scott, Kan.

St. John’s, one of Joplin’s oldest continuously operated businesses, is a 367-bed hospital serving 19 counties in Missouri, Oklahoma, Kansas and Arkansas. With 2,300 employees, it is one of Joplin’s largest employers.





Mercy particulars



The Sisters of Mercy Health System operates hospitals, physician practices, outpatient clinics and health plans in a seven-state area: Arkansas, Kansas, Louisiana, Mississippi, Missouri, Oklahoma and Texas.

Its members include 19 acute-care hospitals providing more than 4,000 licensed beds, two heart hospitals and a managed-care subsidiary, Mercy Health Plans.

Services are provided by about 31,000 co-workers and 4,600 physicians who are employed or practice at Mercy operations. Mercy is the ninth-largest Catholic health-care system in the United States, based on net patient-service revenue.

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