Transcript Document

HOSPITAL MERGERS AND
ACQUISITIONS AND THE GEORGIA
ACQUISITION ACT
Michelle Williams, JD
Partner, Alston & Bird LLP
Michael J. Finnerty
Senior Vice President, Kaufman, Hall & Associates, Inc.
W. Wright Banks, Jr., JD
Deputy Attorney General, Office of the Attorney General
SEPTEMBER 28, 2012
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MOODY’S Factors Behind Current
Consolidation Strategies
Current Factors
All payers creating reimbursement pressures
Increased need for capital for outpatient facilities, information technology
Pressure to justify tax-exempt status
Costly access to capital for smaller hospitals
Need for fundamental changes in healthcare delivery
Need to increase covered lives
Need for size and scale to gain greater efficiencies
Costly regulatory and compliance changes
Riskier debt structures with costly interest rate swaps, onerous bank covenants
Need for greater alignment with physicians, payers to create ACO or ACO-like structures
Spiraling healthcare costs and insurmountable federal deficit
Large unfunded pension liabilities
Prolonged economic downturn
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2012 Georgia Transactions
Client
Partner
AG
Emory Healthcare
(Buyer)
St Joseph’s Healthcare
Yes
McDuffie Regional Health System
(Seller)
University Hospitals of Augusta
Yes
Satilla Regional Health System
(Seller)
Mayo Clinic Jacksonville
Yes
Medical Center of Central Georgia
(Buyer)
Peach Regional Medical Center
Yes
Tift Regional Medical Center
(Buyer)
Adel Memorial
No
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Kaufman Hall and Associates
Changes to the Georgia Provider Landscape Since 2008
Erlanger Health acquires Hutcheson
Medical Center
Emory Healthcare acquires HCA’s interest in
Emory John’s Creek Hospital
Restoration Healthcare
acquires Banks-Jackson
Commerce Hospital
(March 2010)
(October 2009)
(April 2011)
Elbert Memorial Hospital enters into letter of
intent to initiate management agreement with
AnMed Health
Emory Healthcare and St. Joseph
Hospital announce partnership
(October 2012)
(March 2011)
HCA acquires Emory Healthcare’s interest in
Eastside Medical Center
Piedmont Healthcare acquires Henry
Medical Center
(March 2010)
(January 2012)
University Hospital announces acquisition of
McDuffie Regional Medical Center
Partnership announced between
Medical Center of Central Georgia and
Peach Regional Medical Center results
in the construction of replacement
hospital
(October 2011)
St. Mary’s Healthcare acquires St. Joseph’s East
Georgia from St. Joseph’s Health System
(June 2011)
(January 2012)
Medical Center Hospital Authority
acquires Columbus Doctors Hospital
LifePoint Hospitals acquires Rockdale Medical
Center
(February 2008)
(February 2009)
Medical Center Hospital Authority
acquires Hughston Hospital
Southern Regional Health System announces
affiliation with Emory
(April 2008)
(May 2012)
Phoebe Putney acquires Sumter
Regional Hospital
Mayo Clinic Jacksonville acquires Satilla
Regional Medical Center
(October 2008)
Phoebe Putney acquires Palmyra
Medical Center from HCA
(December 2011)
(March 2012)
Tift Regional acquires Memorial Hospital
of Adel from SunLink
(March 2012)
Copyright 2012 Kaufman, Hall & Associates, Inc. All rights reserved.
South Georgia Medical Center acquires Smith
Northview Hospital from Ameris Health System
(May 2011)
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Kaufman Hall and Associates
Michael J. Finnerty, Senior Vice President
Kaufman, Hall & Associates, Inc.
Mike Finnerty is a Senior Vice President of Kaufman Hall and a member of the firm’s mergers
and acquisitions group. Mr. Finnerty advises on all facets of the merger and acquisition (M&A)
process, valuations, and joint venture execution, working with a variety of clients, including notfor-profit hospitals and health systems, managed care plans, and other for-profit and not-forprofit entities. He also has significant experience working with academic medical centers.
Prior to joining Kaufman Hall, Mr. Finnerty was an investment banker with Shattuck Hammond
Partners, where his responsibilities focused on M&A advisory and capital raising services related
to or for hospitals, imaging, managed care, and healthcare information technology. Prior to this,
Mr. Finnerty worked at APM/CSC Healthcare as an Operations Consultant to hospitals and
academic medical centers nationwide.
Mr. Finnerty has an M.B.A. in Finance and Healthcare Management from the Wharton School of
the University of Pennsylvania and a B.A. from Middlebury College.
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Copyright 2012 Kaufman, Hall & Associates, Inc. All rights reserved.
Michelle A. Williams, JD
Partner
Michelle A. Williams
Alston & Bird LLP
One Atlantic Center
1201 West Peachtree St.
Atlanta, GA 30309-3424
404-881-7594
[email protected]
Practice Areas
Compliance
Health Care - Regulatory
Internet & E-Business
Life Sciences
Privacy & Data
Management
Products Liability
Education
Case Western Reserve
University
(J.D., 1986)
Butterworth Hospital
(M.T., 1981)
Michigan State University
(B.S., B.S., 1978)
Admitted to Practice
1992, Georgia
1991, Colorado
1987, Ohio
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Michelle Williams practices health care law and is a member of the Firm’s Regulatory Health Care
Group and the Products Liability Group. Ms. Williams concentrates her practice on the regulatory
aspects of health law and handles Medicare/Medicaid termination actions, EMTALA defense and peer
review organization hearings, professional agency actions and administrative agency proceedings
including those involved in food poisonings and infectious disease look backs. She also works with the
Corporate Health Care Practice Group advising on the fraud and abuse and Stark aspects of health care
transactions, and the Government Investigations Practice Group advising on qui tam actions.
Prior to law school, Ms. Williams completed her Medical Technologist internship at Butterworth
Hospital, an affiliate of Michigan State University, where she received a B.S. in microbiology and public
health and a B.S. in animal husbandry.
Ms. Williams was a registered medical technologist at University Hospitals of Cleveland, Lansing
General Hospital and Baystate Medical Center and a laboratory assistant at Michigan State University
where she worked on vaccine projects for Brucellosis and Marek’s Disease Herpes Virus. While an
undergraduate, she worked at the Michigan State University abattoir in all phases of meat production.
She received her J.D. in 1986 from Case Western University School of Law where she was the
Executive Editor of Health Matrix: Quarterly Journal of Health Services Management.
Following law school, she served as assistant counsel of University Hospitals of Cleveland, Ohio, a
teaching hospital of Case Western Reserve University School of Medicine, and then as associate
general counsel of The Mt. Sinai Medical Center, Cleveland, Ohio.
She is a member of the American Health Lawyers Association (AHLA), Vice Chair of the ALAH Hospitals
and Health Systems Practice Group, Chair of the American Red Cross Blood Services Southern Region
Life Board, past Chair of the Board of Directors of the American Red Cross Southern Region Blood
Services, and past Chair of the Board of Directors of the American Red Cross Fulton County Advisory
Board. She is a member of the National Advocacy Council for the CDC Foundation, Inc. and was
selected to Best Lawyers in America 2006.
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W. Wright Banks, Jr.
Georgia Office of Attorney General
W. Wright Banks, Jr. is a Deputy Attorney General with the Office of the Georgia Attorney General. He
serves as the Director of the Commercial Transactions and Litigation Division which includes three
sections: Business and Finance; Real Property, Construction, Transportation and Authorities; and Tax.
From 2007 to 2012, he served as the Section Leader of the Business and Finance Section. Prior to the time
that he served as Section Leader, he worked in the Business and Finance Section practicing in a number of
areas of law, including alcoholic beverage regulation, bankruptcy, insurance, and procurements handling
both transactions and litigation matters. He has provided general representation to a number of entities of
the State, including the Department of Administrative Services, the Alcohol and Tobacco Division of the
Department of Revenue, the Georgia Lottery Corporation, the Financing and Investment Division of the
Georgia State Financing and Investment Commission and the Georgia Superior Court Clerks’ Cooperative
Authority.
He graduated from the University of Georgia with an A.B. degree in Political Science in 1990. He received
his law degree from Mercer University cum laude in 1993 where he was a member of the Mercer Law
Review and Phi Kappa Phi and received three American Jurisprudence Awards.
Among other responsibilities, the Commercial Transactions and Litigation Division is charged with
administering the responsibilities of the Attorney General under the Hospital Acquisition Act, O.C.G.A. §§
31-7-400 through 31-7-412. Wright has served in a variety of roles related to a number of hospital
transactions including serving as hearing officer in four recent transactions involving hospitals ranging
from twenty-five to in excess of three hundred beds.
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