California AG conditionally approves sale of 2 hospitals to AHMC Healthcare

California Attorney General Xavier Becerra conditionally approved the sale of two California hospitals to for-profit hospital operator AHMC Healthcare on July 27. 

El Segundo, Calif.-based Verity Health, which entered Chapter 11 bankruptcy in 2018, reached a deal to sell the two hospitals in April. 

Under the deal, Verity would sell Seton Medical Center in Daly City, Calif., and Seton Coastside in Moss Beach, Calif., to AHMC for $40 million. 

Mr. Becerra approved the deal so long as AHMC meets certain conditions, including that it will keep the hospitals open at least five and a half years after the sale. In addition, AHMC would need to offer more than $1 million in charity care for the surrounding community in the next six fiscal years. 

As part of the charity care requirement, Mr. Becerra said AHMC needs to cover in full care for individuals who are uninsured or earn at or below 250 percent of the federal poverty level. 

In addition, AHMC must make safety improvements to the facilities and maintain access to women’s healthcare services for five and a half years. 

“As the COVID-19 public health crisis continues to mount, it’s crucial that California communities have access to lifesaving hospital care,” said Mr. Becerra. “That’s why the conditions we have attached to the proposed sale of Seton focus on improving care and services at the facilities — increasing the amount of charity care, the benefits to the community and investment in improvements for the facilities.”

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For-profit hospital divestitures: 6 latest deals involving CHS, HCA and Quorum
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