Concluding years of controversy over whether a Catholic health care group should take control of Denver-area non-Catholic hospitals, the Sisters of Charity of Leavenworth Health System (SCLHS) and the Community First Foundation (CFF) have signed a Memorandum of Transfer that gives CFF’s control of health care company Exempla, Inc. to the Sisters of Charity.
SCLHS will become the sole member of Exempla, taking over both Exempla Lutheran hospital in the Denver suburb of Wheat Ridge and Good Samaritan Medical Center in Lafayette, Colo. SCLHS already runs St. Joseph Hospital in Denver.
The Wednesday announcement said the transfer aimed to meet three goals originally requested by Exempla: to simplify Exempla’s governance and structure, increase access to capital, and to keep Exempla together as a viable health care system.
Single ownership of all three hospitals will allow additional leverage to borrow for expansion projects, the Denver Post reports. Possible projects include a new wing at Lutheran, modernization of St. Joseph’s, and investment in a children’s medical campus.
For four years the sale of the hospitals has been controversial because under their new owners the hospitals will adopt Catholic standards of medical ethics. The two hospitals will no longer provide tubal ligations, vasectomies or abortions.
The group Coloradoans for Patients’ Rights has sued to block the policy change. It charges that adherence to Catholic ethical directives at the hospitals will cause financial hardship and inconvenience those in Jefferson County, the Denver Post reports.
In a February 22, 2008 letter Archbishop of Denver Charles J. Chaput defended the Sisters of Charity from their critics.
“They can't compromise their Catholic beliefs without undermining their whole mission,” he wrote.
None of the Denver-area Catholic hospitals are owned by the archdiocese.
In 2008 the two hospitals performed two abortions and 362 tubal ligations and vasectomies, compared with one abortion and 419 sterilizations in 2006, according to the Denver Post.
Sisters of Charity officials said that patients who would have visited Lutheran and Good Samaritan for sterilization procedures and other procedures affected by Catholic ethical directives can get that care nearby.
William Murray, president and CEO of SCLHS, said in an announcement that the move continued a long tradition of “responding to need and working with members of the communities we serve.”
“We value our relationship with CFF, and appreciate its continued involvement on behalf of the local community. Together, we look forward to working with hospital leadership, clinicians and staff to continuously improve the quality and safety of patient care.”
CFF was once the fundraising arm of Lutheran Medical Center but became co-sponsor of the Exempla system in 1997 as a cost-saving measure.
Under the agreement, Exempla, Inc. would lose ownership of both hospitals but remain the operating company. It fought the transfer, saying it was trying to protect the original mission of the nonsectarian Lutheran and Good Samaritan hospitals.
An arbitrator rejected the argument but agreed with Exempla that CFF could not sell its stake in the hospitals to SCLHS for the $311 million.
Instead, the transfer of control includes no monetary compensation. The Exempla system will remain intact and will be governed by a newly constituted board of directors, equal numbers of whom will be appointed by CFF and SCLHS.
Exempla’s board will meet on Monday to consider whether to continue its opposition.
"There are probably a million and six different alternatives that the board could take," Jeff Selberg, president of Exempla, told the Denver Post. "In light of our concerns, do we want to take a step that would express concern to the sponsors, or is it better for these hospitals and the community not to take that step?”