Harris Okays Daughters Hospital Deal

California Attorney General Kamala Harris has approved a bid by Ontario-based Prime Healthcare Services' to acquire the six-hospital Daughters of Charity healthcare system for $843 million, but it remains unclear if the for-profit operator will go through with the deal.

Harris proposed stricter conditions than originally proposed by the parties to ensure that levels of care would be preserved and pension obligations to Daughters' 7,800 employees are maintained. 

Among the conditions: Prime must keep the six Los Angeles and San Jose-area hospital open for at least the next 10 years, more than the five years originally proposed and recommended in an independent review authorized by Harris’ office. 

Prime must maintain the levels of specialty servies and charity care that had been provided, with various adjustments for inflation. It must also keep Medi-Cal managed care and other government payer contracts in place. And it must also keep outpatient clinics operated by St. Francis Medical Center in Lynwood open for at least five years, among other conditions.

Prime officials said they expect to reach a decision whether to go forward in the next several days. 

The Service Employees International Union-United Healthcare Workers West, which had objected to Prime acquiring the hospitals, suggested it supported the deal under the conditions Harris issued.

“If Prime lives up to both the letter and spirit of the conditions placed on this sale, community healthcare and services for low-income families will be protected, but given our history with Prime, that’s a big if,” said union President Dave Regan.

The California Nurses Association had previously supported Prime purchasing the hospitals.

Daughters of Charity officials say the system has been losing $10 million a month and would likely file for bankruptcy and cut services if it can't reach a deal.