Ascension to set aside $20 million from KC-area hospital sales for indigent care

Kansas City, Mo. — The owner of St. Joseph Medical Center and St. Mary's Medical Center has agreed to set aside $20 million from its pending sale of those hospitals for charitable care.

In a news release Wednesday, Missouri Attorney General Chris Koster said nonprofit Ascension Health agreed to the set-aside after concerns raised by his office that the money be made available for acute indigent care.

In July, Prime Healthcare Services of Ontario, Calif., signed a letter of intent to buy St. Joseph Medical Center in south Kansas City and St. Mary's Medical Center in Blue Springs, Mo. Terms of the deal were not disclosed.

The hospitals have roughly 450 beds and 900 physicians on staff combined. Both operate through Kansas City-based Carondelet Health, which Ascension acquired in 2002.

Ascension is the nation's largest Catholic health care system. Prime Healthcare, an active buyer of troubled hospitals, last year bought Providence Medical Center in Kansas City, Kan., and Saint John Hospital in Leavenworth, Kan., from Sisters of Charity of Leavenworth Health System, another Catholic health system.

Under Missouri law, nonprofit corporations must use the proceeds of any sale for purposes consistent with their charitable intent. The attorney general has the power to enforce the law.

The news release said Koster was concerned that Ascension planned to take the proceeds out of the Kansas City area. It said Koster told Ascension that he would not approve the sale unless Ascension agreed to put the funds in escrow. Ascension agreed to do so, the release said.

"For more than a century, the people of the Kansas City region have invested in St. Joseph and St. Mary's Medical Centers, both through their charitable contributions and their tax dollars," Koster said in the release. "The Kansas City community has a right to expect that the company managing the assets it has nurtured for decades won't sell those assets for a profit and then take the money out of town."

[Dan Margolies, editor of the Heartland Health Monitor team, is based at KCUR, Kansas City's NPR station.]