Catholic hospital system severs ties with Church, changes name

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Catholic Healthcare West, one of the nation’s largest hospital systems, is ending its governing board’s affiliation with the Catholic Church and changing its name, two steps intended to help the system expand throughout the states in which it operates _ California, Arizona and Nevada — and beyond.

The changes, which executives plan to announce Monday, underscore the unique challenges facing Catholic hospitals in the marketplace, where there are tremendous financial pressures for hospitals to merge or form formal alliances with other health care providers in order to survive and thrive.

The change will have no effect on any patients or the medical care provided at the 25 Catholic and 15 secular hospitals in the system. But executives hope it will make it easier to merge or affiliate with other hospitals, doctors’ practices and other health care providers.

In the past few years, proposed mergers between Catholic and secular hospitals in Louisville, Ky., and Sierra Vista, Ariz., have collapsed in part because of concerns about the church’s bans on abortions, in-vitro fertilizations and sterilizations. Other mergers have succeeded only with the help of unusual contortions, such as in Troy, N.Y., where a separately licensed maternity ward free from Catholic doctrine was created on the second floor of a secular hospital taken over by a Catholic system. In Seattle, Swedish Medical Center last fall agreed to fund a Planned Parenthood office next door to quell objections about its planned affiliation with a Catholic system.

Lloyd Dean, the president and CEO of Catholic Healthcare West, said the concerns about his system’s Catholic affiliation have hampered some potential deals.

“I have been contacted over the last couple of years by many, many different constituencies who have an interest in Catholic Healthcare West and what we have accomplished,” Dean said. “But one of the things when we get down to what I’ll call the real discussions as they confer with their boards is, ‘What does the future mean if we’re a non-Catholic entity? Will we have to become Catholic? What will be the Catholic influence?’ ”

The San Francisco-based system, which has $11 billion in revenues, making it the fifth-largest in the country, is seeking to triple in size and build a national footprint. It treated 6.2 million patients last year.

As of Monday, the system’s new name will be Dignity Health. Dean said the system’s change to a non-denominational board will create “a tremendous opportunity that will help accelerate our growth.”

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