A news release announced that a letter of intent has been signed to transfer control of Mercy Hot Springs hospital and clinic from the Mercy Health System to Catholic Health Initiatives and the related St. Vincent Health System.

Terms are to be negotiated and the aim is to complete the deal by Dec. 31, 2013.

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An earlier plan to transfer control of Mercy to the owner of crosstown for-profit National Park Medical Center was dropped after objections from Catholic Bishop Anthony Taylor. He feared the new hospital would eventually provide services, such as sterilization, unacceptable under church doctrine. He approves of this merger.

News release follows.

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HOT SPRINGS, ARK. (Oct. 14, 2013) – On Friday, Oct. 11, Mercy Health and Catholic Health Initiatives signed a non-binding letter of intent (LOI) to transfer ownership of Mercy Hot Springs hospital and physician clinic to CHI and its affiliate, St. Vincent Health System (SVHS) in Little Rock. The parties will negotiate the terms of the agreement and, if agreement is reached, are planning completion of the transaction by Dec. 31, 2013.

Mercy and CHI recognize the extremely challenging health care environment in Arkansas and agree that enhancing the Catholic health ministry and strengthening access to health care is a key objective of the proposed transaction. Upon successful completion of the transaction, Mercy Hot Springs would be operated as part of an integrated network with SVHS in Little Rock, which is part of CHI.

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Through the transaction, SVHS has committed to preserve existing physician relationships in the community and build new ones as they work to strengthen the ministry in Hot Springs. Medical staff privileges of the physicians at Mercy Hot Springs are not expected to be affected by the proposed transaction. Furthermore, SVHS is committed to creating a strong and integrated regional physician network to sustain and grow the network throughout the state.

SVHS intends to offer employment to each individual currently employed by and in good standing with Mercy Hot Springs as of the closing, subject to CHI’s routine employment screening and verification process. SVHS also intends to retain the charity care and core health care services currently provided by Mercy in the Hot Springs community, which will be overseen by a local board of community and physician leaders following the transaction.

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The transfer will require approvals from the Mercy Board of Directors, SVHS Board of Directors, the CHI Board of Stewardship Trustees as well as federal, state and Church authorities.

Mercy and CHI are pleased to know that Bishop Anthony Taylor of the Diocese of Little Rock considers their discussions to be welcome news, and that he is hopeful that the outcome will yield a positive result for the residents of Hot Springs and the surrounding communities.

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About Mercy: Mercy is the sixth largest Catholic health care system in the U.S. and serves more than 3 million people annually. Mercy includes 32 hospitals, 300 outpatient facilities, 39,000 co-workers and more than 2,000 integrated physicians in Arkansas, Kansas, Missouri and Oklahoma. Mercy also has outreach ministries in Louisiana, Mississippi and Texas. For more information, visit mercy.net.

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About Mercy Hot Springs: Mercy Hot Springs includes a 282-bed acute care hospital, the only Level II trauma center in Southwest Arkansas and an 80-physician clinic organization.

About Catholic Health Initiatives: Catholic Health Initiatives is a national nonprofit health system with headquarters in Englewood, Colo. The faith-based system operates in 18 states and includes 87 hospitals; 40 long-term care, assisted- and residential-living facilities; two academic medical centers; two community health-services organizations; two accredited nursing colleges; and home health agencies. CHI is the nation’s third-largest faith-based health system, with annual operating revenues of more than $12 billion and approximately 85,500 employees. In fiscal year 2013, CHI provided $762 million in charity care and community benefit, including services for the poor, free clinics, education and research.

About St. Vincent Health System: St. Vincent Health System, founded in 1888, is one of Arkansas’ leading health systems. St. Vincent Infirmary, an acute care facility, licensed for 615 beds, located in Little Rock, serves as the hub of the health system. Other St. Vincent hospitals include St. Vincent North, licensed for 69 beds, in Sherwood; St. Vincent Morrilton, a critical access hospital in Morrilton, licensed for 25 beds; and St. Vincent West; an outpatient campus in west Little Rock. The system also includes a network of primary care and specialty physician clinics, a home health agency, a joint venture inpatient rehabilitation facility, and affiliations with more than 650 physicians. Visit www.stvincenthealth.com.