Ascension to Sell 9 Illinois Hospitals to Prime Healthcare

The transaction, set to close in the first quarter of 2025, will see Prime Healthcare invest $250 million into upgrading the facilities' systems, technology, and other capital improvements.

Ascension Illinois has agreed to sell nine hospitals and four additional care sites to Prime Healthcare.

The transaction, set to close in the first quarter of 2025, will see Prime Healthcare invest $250 million into upgrading the facilities' systems, technology, and other capital improvements.

Reportedly, the hospitals will incur no debt as part of this deal.

Prime Healthcare, the fifth-largest for-profit health system in the United States, aims to hire nearly all current staff and continue expanding services based on community needs.

The acquisition is reported to be the largest in Prime’s history and involves its charity arm, Prime Healthcare Foundation. Prime will keep eight hospitals as for-profit entities, while St Francis in Evanston will remain a nonprofit institution under Prime’s charity.

Operational & Financial Context

Ascension Illinois, part of the larger nonprofit Catholic health system Ascension, has faced financial difficulties in recent years. The health system reported a net loss of $2.66 billion for the 2023 fiscal year.

However, financial performance showed improvement in the first half of 2024, with a reduced operating loss compared to the same period in 2023.

The system experienced a 6.2% growth in operating revenue for the quarter and 5.3% for the nine-month period.

Ascension's President and CEO Polly Davenport stated, “Prime Healthcare’s Mission and commitment to clinical excellence and health equity will carry on this legacy, ensuring that the greater Chicago area has sustainable, quality healthcare access long into the future.”

Impact on Catholic Status & Community Services

Under the new agreement, eight hospitals will transition to for-profit status, while St Francis will retain its nonprofit designation.

These hospitals will cease to be considered Catholic institutions, and discussions with the archdiocese are ongoing to determine if any Catholic traditions will be preserved.

The facilities will also retain their current names, minus the Ascension branding.

“Our agreement with Ascension reflects our decades-long mission of saving, improving, and investing in community hospitals,” Prime president and chief medical officer, Sunny Bhatia, MD, commented.

Prime Healthcare’s recent moves include purchasing the real estate of five hospitals from Medical Properties Trust and transitioning two Pennsylvania hospitals from for-profit to nonprofit.