Hospital owner considers sale
| Thursday, Mar 11 2010 05:31 AM
Last Updated Thursday, Mar 11 2010 05:30 PM
Majority ownership of Bakersfield Heart Hospital could change under a set of options being explored by the medical center's North Carolina-based co-owner, MedCath Corp.
Last week MedCath announced that its board of directors has formed a "strategic options committee" and hired a financial advisor to consider whether the company should sell itself, its interest in individual hospitals or other assets.
In any of these possible scenarios, "the hospital continues as it is," MedCath President and CEO Ed French said Thursday. He emphasized that the hospital itself is not for sale, and added that local physicians will continue to make medical-related decisions for the hospital regardless of what happens at MedCath.
MedCath owns more than 51 percent of Bakersfield Heart, said hospital President and CEO Randy Rolfe, a MedCath employee. He said more than 40 percent ownership of the hospital is shared among more than 40 local doctors.
The hospital's board of directors consists of three local physicians and four MedCath employees, Rolfe said.
MedCath also has ownership stakes in nine other heart hospitals across the country, as well as diagnostic and other medical facilities.
French said that although patients and the general community wouldn't notice the effects of a change in ownership, such a move could impact certain administrative functions at Bakersfield Heart, such as accounting, human resources management and legal support. He said those services are delivered under contract, and they could be provided by an entity that bought MedCath's interest in the hospital.
But even that is undecided.
"If we sell our shares (in hospitals including Bakersfield Heart), that doesn't necessarily mean MedCath and the team go away, either," French said. "We just don't know."
Rolfe acknowledged longstanding rumors that Bakersfield Heart is for sale, but said that inside the hospital, "it's business as usual."
"At this point in time, everything is going on as it always has been," he said, "and it may be the case going forward as well."
In the fiscal year ended Sept. 30, MedCath reported a net loss of $50.3 million on revenues of $602 million.
Yahoo Finance reported that the company's share price closed Thursday at $9.61, near the middle of its 52-week range.
