This is a story that will be familiar to all not-for-profit hospital deal watchers. In April 2016, Eastern Niagara Health and Kaleida Health, two Niagara Frontier healthcare systems, announced their affiliation, with Lockport, New York-based Eastern Niagara tapping into Buffalo-based Kaleida Health’s network.
Eastern Niagara Health operates the 136-bed Eastern New York Hospital in Lockport, an outpatient/urgent care facility in Newfane, and an ambulatory surgery/primary care practice in Lockport.
Kaleida Health is the largest not-for-profit health system in western New York, serving eight counties with four hospitals, two long-term care facilities and more than 80 outpatient clinics. It provides home health care through the Visiting Nurse Associates of WNY, Inc.
The affiliation went so well, apparently, that the two entities announced a new agreement in December 2017, calling it an “active parent” model. Under terms of the proposal, Kaleida Health would be the active parent of Eastern Niagara.
Kalieda’s press release at the time stated, “It is not a merger. ENH will remain a separate entity with a separate board of directors that will develop recommendations to Kaleida Health’s board, which will have ultimate responsibility for Eastern Niagara Hospital.”
The story changed in March 2018, when Buffalo Business First reported that the establishment committee of the Public Health and Health Planning Council issued a contingent approval for “the merger,” which recquires a final approval from the full state council on April 12, 2018.
The agreement would dissolve the Eastern Niagara Health System, the current parent, and make Kaleida Health the sole corporate member of Eastern Niagara Hospital, according to the article.
That sure sounds like a merger between two not-for-profits to us. As we investigate the hospital deals that go into our DealSearchOnline database, we’ve spoken with several lawyers and hospital officials who’ve struggled with calling a merger something other than what it is, lest the local community rise up in rebellion. Any thoughts you’d like to share?