Franciscan Alliance Seeks to Divest 2 Illinois Hospitals

Mishawaka, Ind.-based Franciscan Alliance announced it is accepting prospective partners to acquire or form a joint venture with Franciscan St. James Health, a health system with hospitals based in Chicago Heights, Ill., and Olympia Fields, Ill., and hopes to enter exclusive negotiations this year.

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Partnering with or selling to another hospital or health system would “ensure the long-term viability of essential services at Franciscan St. James Health,” said Franciscan Alliance CEO Kevin Leahy in a statement. “We are looking for an organization that can provide the capital investment and more extensive local network Franciscan St. James needs to prosper.”

The release notes Franciscan has incurred continued and significant operating losses despite $300 million in investment in St. James’ hospitals since 1994.

The hospitals are Franciscan’s only two located in Illinois, rather than Indiana where its other 11 hospitals are. As a result, the release implied, the Illinois hospitals benefit less from scalability of the Indiana-based system.

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