Avera Health adds Pierre hospital to networkSIOUX FALLS (AP) — Avera Health is buying St. Mary's Healthcare Center in Pierre in a merger that will give the Sioux Falls-based health network a stronger foothold in central South Dakota, the companies said.
SIOUX FALLS (AP) — Avera Health is buying St. Mary's Healthcare Center in Pierre in a merger that will give the Sioux Falls-based health network a stronger foothold in central South Dakota, the companies said.
When the deal takes effect in the new year, Avera will have 31 hospitals in five states. The deal includes: St. Mary's 60-bed hospital in Pierre; a 10-bed affiliate hospital in nearby Gettysburg; a nursing home and senior apartments in Pierre; and facilities in Gettysburg for long-term care and Alzheimer's patients.
Terms of the sale were not disclosed. St. Mary's has $51 million annually in revenue, according to spokeswoman Amanda Bacon. Avera vice president Daryl Thuringer says his company has annual revenue of $2.6 billion.
St. Mary's and Avera are affiliated with the Catholic church. Thuringer told the Argus Leader newspaper that the acquisition is technically a transfer of sponsorship within the church.
"We wanted to see if there was a way we could strengthen our ministry in Pierre and Gettysburg and the communities we serve," said Joe Messmer, interim chief executive officer at St. Mary's. "We're seeing a rapidly changing health care environment calling for a more integrated approach to the way services are delivered."
Discussions between Avera, a health ministry of the Benedictine and Presentation Sisters, and Catholic Health Initiatives, the national nonprofit that owned St. Mary's, have been ongoing since last spring, Bacon told the Capital Journal newspaper.
"Looking down the road, what our leaders are seeing at CHI and Avera is that things are going to require a more integrated approach between physicians, hospitals and health care systems," she said. "That's why we entered into these discussions. This was done with the intent of really looking at the rapidly changing health care environment and finding a way to provide the best approach to that."
St. Mary's has 425 employees in Pierre and 100 in Gettysburg. They will become part of the Avera network that includes 14,000 employees in about 100 communities.
Sanford Health, Avera's chief competitor, has acquired hospitals and clinics in the Dakotas and Minnesota since 2008, including MeritCare of Fargo, N.D., in 2008 and Medcenter One in Bismarck, N.D., this year.
Sanford vice president Cindy Morrison declined comment to the Argus Leader on St. Mary's joining Avera, but said the industry has had more than 80 mergers in the past year in part because of health reform.
"The unique thing about South Dakota is that integration among smaller hospitals and physicians has been occurring over the last 15 to 20 years, which put us ahead of the country as it relates to the pace of consolidation," Morrison said.