USMD’s subsidiary, USMD Hospital Division, acquired the almost 18 percent ownership interest in the 34-bed USMD Hospital at Arlington from individual physicians and physician-owned entities. USMD now owns 46.4 percent of the hospital. Texas Health Resources in Arlington, Texas, still has majority interest at 51 percent.
According to a filing with the Securities and Exchange Commission, USMD paid the physicians more than $24.3 million, in notes, for their ownership stake.
The physicians who sold their ownership stake had medical staff privileges at the hospital. USMD wanted to buy out the physicians to expand the hospital. Under the Patient Protection and Affordable Care Act, physician-owned hospitals cannot add new operating rooms, procedure rooms, inpatient beds or services, but USMD’s transaction frees the hospital from those regulations as there are no more referring physicians who hold ownership.
John House, MD, chairman and CEO of USMD, said in a news release that the transition of ownership at USMD Hospital at Arlington “has been in development for years,” and it will allow the hospital “to increase its service offerings even further to better meet the needs of the Arlington community.”
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