WellStar closing in on major hospital deals

WellStar Health System announced Wednesday that it has received regulatory approval from the state attorney general to add West Georgia Health to its system.

The two organizations plan to sign a definitive agreement next month, with West Georgia expected to join WellStar, based in Marietta, on April 1.

West Georgia’s flagship facility, West Georgia Medical Center in LaGrange, would become the nonprofit WellStar’s sixth hospital when the deal closes.

North Fulton Hospital
North Fulton Hospital

In addition, WellStar appears on the verge of assuming control of the five Tenet Healthcare hospitals in the Atlanta region. That would push its total to 11.

Tenet has agreed to sell the five hospitals — its only facilities in Georgia — to WellStar. And an internal WellStar employee email, obtained by Georgia Health News, indicates the Federal Trade Commission has wrapped up its review of the purchase.

“We are a step closer to finalizing of the purchase of Tenet Healthcare’s five hospitals in metro Atlanta,” the email said.

The email said the FTC granted an “early termination’’ of the agency’s review of the acquisition.

“With the conclusion of the FTC review,” the email said, “WellStar is moving forward with integration planning, with a close date expected in April.’’

A WellStar spokesman Wednesday declined to comment on the Tenet situation.

The five Tenet hospitals being acquired are North Fulton Hospital in Roswell; Spalding Regional Hospital in Griffin; Sylvan Grove Hospital in Jackson; Atlanta Medical Center; and AMC’s South Campus in East Point.

These hospitals would become nonprofit facilities under WellStar’s $575 million acquisition.

(Separately, Modern Healthcare reported this week that Tenet has offered to pay $238 million to resolve a False Claims Act lawsuit involving alleged kickbacks for maternity referrals by four of its hospitals — AMC, North Fulton and Spalding Regional in Georgia and Hilton Head Hospital in South Carolina.)


The two deals in the works for WellStar would make it easily the biggest health system in Georgia.

Economic factors have driven many Georgia hospitals to seek alliances or mergers to help withstand the sweeping changes in health care payments.

Government and private insurers are increasingly emphasizing quality of care in reimbursements, instead of just paying for the quantity of services delivered. Medicare is paying bonuses and imposing penalties under the Affordable Care Act based on quality-of-care measurements.

Getting bigger may help hospital systems cut costs and meet these new demands for improved quality, experts say.

Dave Smith, a consultant with Kearny Street Consulting, said Wednesday that the WellStar additions signal “a new day’’ in the Georgia hospital consolidation trend.

WellStar “has got a lot on their plate’’ with the two deals, Smith said.


“West Georgia is running pretty well’’ and will be easier to absorb than the Tenet hospitals, Smith added. Tenet’s Atlanta Medical Center and South Campus have had financial problems over the years, he said. “WellStar is not used to that.”

“Now they’ve got to manage it.”

Still pending are other major Georgia hospital deals, such as Piedmont Healthcare in Atlanta adding Athens Regional and Northside Hospital in Atlanta partnering with Gwinnett Medical Center in the big suburban Atlanta county.

Leaders of West Georgia and WellStar said Wednesday that they were eager for their partnership to begin.

Jerry Fulks, president & CEO of West Georgia Health, said in a statement that “Troup County and the surrounding West Georgia community will benefit immensely from this partnership. We look forward to tapping into WellStar’s experience and innovative care models to help us achieve even greater success for our patients.”

“As not-for-profits, WellStar and West Georgia Health have similar missions and commitments to our communities,” Candice Saunders, president & CEO of WellStar, said in a statement. “On a recent visit to LaGrange, I met with many civic and business leaders.  I was encouraged by their support and commitment to ensuring the community continues to be a leader in high-quality health care.  Working together, our physicians, nurses and team members will be able to improve the health and well-being of the LaGrange, Troup County and entire West Georgia Health community.”