California system drops bid for Ashland hospital (SF Gate)

October 30, 2012 – Amid concern in the community over access to abortion and assisted suicide services, a California hospital system once tied to the Roman Catholic Church has dropped plans to take over the Ashland Community Hospital. The Ashland Daily Tidings reports that Dignity Health (A3 / 13033LSJ7) of San Francisco didn’t cite specific reasons in a letter halting negotiations, other than “residual resistance” in the community and uncertainty about being able to conclude the deal. The hospital has been losing money — $2.5 million in the last fiscal year. Its leaders said they would likely turn to two hospital organizations that its board previously considered in a search for a merger partner: Asante Health System (NR / 584283DB8), which runs Rogue Regional Medical Center in Medford, and Providence Health & Services (Aa2 / 93978HFW0) of Seattle, which operates Providence Medford Medical Center. Hospital leaders said they want an alliance by the end of the year. Early this month, Mark Marchetti, the hospital’s chief executive officer, said the hospital could be closed in a year if it remains independent, and the former board chairman, Dr. Doug Diehl, testified in October that it had four to six months of operating cash left unless it trimmed services. The Ashland hospital has said its size puts it at a disadvantage against larger hospitals in Medford, and it’s squeezed by unreimbursed costs of treating Medicare and Medicaid patients.

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