Deaconess Health System adds rural hospital, but it wasn’t easy

It took some time and a legal battle, but Deaconess Health System has completed the acquisition of Jennie Stuart Health.

After overcoming some community opposition, Deaconess Health System has completed the acquisition of Jennie Stuart Health.

Deaconess announced the completion of the transaction earlier this month. Based in Hopkinsville, Kentucky, about 72 miles from Nashville, Jennie Stuart operates a 194-bed hospital in Hopkinsville, along with an ambulatory surgery center, an imaging center and a sports and rehabilitation center.

When Jennie Stuart first announced the plans to join Deaconess in September 2024, some local residents objected to their local hospital joining the Indiana health system. An opposition group, Save Jennie Stuart, sued the hospital’s board of directors.

But the suit was later settled, clearing the way for Jennie Stuart to join Deaconess. The organizations announced a definitive agreement in March, with Deaconess pledging to invest millions of dollars in upgrades for Jennie Stuart.

Eric Lee, CEO of Jennie Stuart, had previously pointed to the financial pressure on rural hospitals and said that becoming a part of Deaconess would help ensure the hospital’s ability to serve its communities.

“By joining Deaconess, we are building on our legacy of excellent care, while opening the door to new opportunities for growth and expanded services,” Lee said in a statement. “Our patients, employees and community can be confident that the compassionate, high-quality care they’ve always known will continue—stronger than ever.”

Deaconess CEO Shawn McCoy said that the system would bolster Jennie Stuart’s healthcare services.

“Our goal is to support the Hopkinsville region with even greater access to advanced services, additional providers and the same commitment to outstanding patient care that has long been the hallmark of Jennie Stuart,” McCoy said in a statement.

Deaconess said in the spring that the system would invest at least $95 million in Jennie Stuart. In addition, Deaconess said it would pay for Jennie Stuart’s transitioning to the health system’s electronic health records system, which was projected to cost tens of millions of dollars.

Also addressing some concerns of local residents, Deaconess pledged to ensure Jennie Stuart would have local control over the hospital. Jennie Stuart’s management team would remain in place, Deaconess said.

Based in Evansville, Indiana, Deaconess operates 20 hospitals and more than 150 healthcare locations serving patients in Indiana, Illinois, Kentucky, and Tennessee. Some of the hospitals are wholly owned by Deaconess, and some facilities are joint ventures or affiliated hospital locations.

Deaconess has been expanding its footprint in recent years. Last year, Deaconess completed the acquisition of Memorial Hospital and Health Care Center, a 128-bed facility in Jasper, Indiana.

The system also struck a deal with Quorum Health to acquire four hospitals in Illinois in 2022: Crossroads Community Hospital in Mt. Vernon; Heartland Regional Medical Center in Marion; Red Bud Regional Hospital in Red Bud; and Union County Hospital in Anna.

Deaconess has earned an “AA” bond rating and stable outlook from Fitch Ratings. In a September 2025 report, Fitch noted Deaconess’ “strong financial profile” and its “regional hub strategy.”

“The strategy is aimed at making care available in the regional markets and use the flagship hospitals mainly as tertiary referral centers,” Fitch said.

Deaconess also enjoys a service area with a strong economy and areas of population growth, Fitch says.