It took longer than expected, but Parkview is joining the Colorado system next month. UCHealth is going to invest nearly $200 million in Parkview.
More than a year after announcing plans to come together, UCHealth in Colorado says it will complete the acquisition of Parkview Health System next month.
UCHealth and Parkview announced Thursday that the transaction will be finished by Dec. 1. On that date, Parkview and its employees will be part of UCHealth.
UCHealth operates 12 acute-care hospitals, and more than 150 clinic locations across Colorado and parts of Wyoming and Nebraska.
Parkview, based in Pueblo, Colo., operates two hospitals: Parkview Medical Center and Parkview Pueblo West Hospital. Parkview has been struggling financially. Darrin Smith, Parkview’s president and CEO, cited those difficulties and indicated that joining UCHealth offers the organization a lifeline.
“I am excited to be moving forward on this important partnership to stabilize Parkview and protect jobs in Pueblo,” Smith said in a statement.
“As our community knows, we serve a very large number of patients who are either uninsured or who are covered by Colorado Medicaid,” Smith said. “This has strained our finances and risked the sustainability of some of our services. Joining UCHealth will help ensure that our patients in Pueblo and southern Colorado continue to have access to excellent health care.”
Parkview says 80% of its patient population relies on Medicare or Medicaid.
UCHealth and Parkview first disclosed plans of the move in October 2022. The two organizations said they planned to complete the deal in 2023, and though it’s coming toward the tail end of the year, they are indeed coming together.
Initially, the organizations hoped to come together in the middle of the year, but the deal took some more time. Citing the ongoing regulatory review, Parkview filed a notice of delay in July, The Pueblo Chieftain reported.
In a news release, UCHealth and Parkview said Thursday that they had completed the “extensive regulatory, legal and contractual work” necessary to come together.
In announcing the plans last year, UCHealth said that it would invest nearly $200 million into Parkview and the Pueblo area in the coming years. The money would be used to recruit staff, support nursing and clinical education programs and bolster Parkview’s shaky finances.
UCHealth also said at the time it would donate $5 million to the Parkview Foundation to help create a fund to support the hospital, its patients and the surrounding community.
Founded in 1923, Parkview is celebrating its centennial. The system is licensed for 350 beds, has a Level III trauma center and employs 3,000 people. Parkview serves a 15-county area with a population of about 370,000.
The transaction comes as more hospitals and health systems have announced mergers or explored partnerships. More than 50 hospital mergers and acquisitions were announced in the first three quarters of the year, already matching the total of all last year.
Industry analysts have said they expect to see more hospital mergers and acquisitions in the coming months. As in UCHealth’s acquisition of Parkview, many of those deals are likely to involve a larger system looking to acquire a smaller hospital or system that is struggling financially, experts say.
Looking at deals announced in the third quarter, 39% of the transactions involved an organization in financial distress, according to an analysis by Kaufman Hall, a healthcare consulting firm. The firm said the percentage of deals involving a hospital in financial trouble is above historical norms.