The hospital will be sold to a California company pending state approval as the company continues to face major financial challenges.
TOLEDO, Ohio — ProMedica is selling its Coldwater Regional Hospital in Michigan, several years after first purchasing the facility.
The hospital announced Wednesday that it has entered into a purchase agreement with California-based American Healthcare Systems. ProMedica cites “financial problems” as the main reason for the sale.
“The pandemic and its consequences, including staff shortages and rapidly rising costs, have further strained the finances of hospitals across the country — and Coldwater Regional Hospital is no exception,” said Alan Sattler, president of ProMedica Coldwater Regional Hospital. “Due to the financial strain ProMedica is experiencing, especially in the wake of the pandemic, it has become necessary for us to review our options for Coldwater Regional Hospital.”
Terms of sale were not disclosed. The sale requires approval — which is expected to take up to six months — from the state of Michigan because American Healthcare Systems is a for-profit entity.
ProMedica will continue to fully support the hospital during that time.
Coldwater, Michigan is about 100 miles northwest of Toledo. ProMedica marketed the hospital before the COVID-19 pandemic and liquidated it in 2020.
ProMedica spokeswoman Tausha Moore said there are no plans to sell other hospitals.
“While we are focused on the sale of this particular hospital, it is important to note that we believe all of our other emergency departments and ancillary locations are strategic to our mission,” she said in a statement. “As such, we have no plans to impact our other hospital and outpatient operations.”
ProMedica has been facing major financial problems for more than a year. On Friday, the company announced a new chief financial officer who will oversee many of the changes being made.
Terry Metzger will take over as CFO on Sunday. He will report directly to President and CEO Arturo Polizza.
Metzger takes over from Steve Kavanaugh, who was let go last May in a corporate shakeup. Louis Robichaud IV has served in an interim capacity for the past year.
Metzger has worked in the healthcare and insurance industry for 12 years and has experience in strategic and financial planning. He was most recently the Chief Operating Officer of Ascension St. Vincent in Indianapolis.
He also served as CFO and Chief Administrative Officer for three different health insurance organizations in Wisconsin and Indiana.
Metzger earned a Bachelor of Science in Business Administration (BSBA) and a Master of Business Administration (MBA) from Regis University in Denver.
“We are pleased to welcome Terry to our team as Chief Financial Officer,” said Polizzi. – Given his extensive experience in healthcare, insurance and technology, we are very confident that he will play a key role in the development of our financial strategy and positioning. our organization for greater stability and success.”
Earlier this week Fitch Ratings downgraded ProMedica’s credit rating for the second time in nine months. This comes just weeks after the company reported a loss of about $350 million for the fourth quarter of 2022, adding to an already disastrous financial year.
ProMedica is in the midst of a significant restructuring and reorientation as it continues to deal with serious financial challenges. The consequences of these problems were felt this year in the region.
In recent weeks, the company has asked Lucas County for a friendlier naming rights deal for Glass City Center, suspended a $10 million donation to Metroparks and $60,000 for Jeep Fest and also canceled the 10-year sponsorship contract with the USGA for the US Open just a year after the deal.
In March, ProMedica asked the city of Toledo and the county for more money to put on fewer plays for this year’s summer concert series.
Almost 300 people were fired after the company divested itself of skilled nursing facilities earlier this year. 262 were announced in the first wave before another 26 in the second.