Health Services and Jobs at Risk in Hospital Deal

Tuesday, May 25, 2010 General News J E 4

Report documents significant problems, need for regulatory review

CHICAGO, May 25 /PRNewswire-USNewswire/ -- AFSCME Council 31 released a report today documenting significant problems with a controversial proposal to sell two Chicago-area nonprofit community hospitals to a for-profit corporation.  "Dubious Deal: The Proposed Sale of Westlake Hospital and West Suburban Medical Center" analyzes Vanguard Health Systems' bid to purchase two of Resurrection Health Care's eight hospitals.  AFSCME, community groups and advocacy organizations maintain that the deal jeopardizes the continued operation of the hospitals. They point to significant limits on Vanguard's capacity and commitment to operate the hospitals and Resurrection's failure to negotiate an agreement that protects patients and employees.  

"Vanguard's refusal to commit to keep the hospitals open more than two years is very troubling," said Henry Bayer, Executive Director of AFSCME Council 31.  "The tens of thousands of patients that rely on these hospitals and the thousands of hospital employees deserve more. Vanguard has given a ten year commitment to keep the Detroit Medical Center hospitals open, why not make such a commitment in Chicago?"  

The report documents the terms of the purchase agreement between Resurrection and Vanguard, including the "bargain basement price" – less the half the value of the two hospitals when Resurrection acquired them – and the paltry offer of 60 days job security for current employees.  It also reviews potential antitrust issues.  Vanguard's acquisition of the hospitals will give it a powerful market share in that area, which reduces competition and could drive up prices.  

"Clearly much is at stake in this sale," stated Quentin Young, MD, director of Health and Medicine Policy Research Group.  "We urge the Attorney General and the Federal Trade Commission to take the time needed for a thorough review. There must be a real commitment to keep these hospitals open."  

Over 10,000 people signed a petition to Attorney General Lisa Madigan urging her office to thoroughly review the proposed deal and to set conditions on the sale, topmost that the hospitals be kept open for at least ten years.

Resurrection Health Care is the largest Catholic health care network in Illinois and employees are working to form a union with AFSCME Council 31.  Vanguard is a Tennessee-based for-profit corporation which currently owns and operates 15 acute care hospitals around the country.

Full report available at




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