Forum’s new owner warrants close scrutiny by AG Cordray

Although the $120 million offer from Community Health Systems to purchase Forum Health is more than anyone in the Mahoning Valley expected, Ohio’s top lawyer has a responsibility to closely scrutinize the proposal.

Attorney General Richard Cordray has already shown that he is committed to protecting the interests of the people of this region by his review of the bid submitted by Ardent Health Services. For months, Ardent was the only suitor, and its offer of $69.8 million seemed like a winner. But then Community Health threw its hat in the ring and the contest was on. Both companies are headquartered in Tennessee.

On Thursday, Forum selected CHS to be its new owner.

But because Community Health submitted its offer just before last week’s bid deadline set by U.S. Bankruptcy Court Judge Kay Woods, the attorney general has not completed his review. He had previously approved Ardent’s proposal.

Forum Health, which has been in bankruptcy for 16 months, is a nonprofit health-care entity and as such its sale must be examined by the state. In addition, federal bankruptcy laws require that the sale of assets conform to Ohio law.

Cordray has said his office is fully engaged in this transaction, and his involvement in the Ardent proposal shows he is serious about fulfilling his statutory responsibilities.

That’s encouraging, because Community Health Systems’ proposal prompts questions that need unambiguous answers. For instance, the nation’s largest publicly traded hospital company says it is committed to maintaining all three Forum Health hospitals: Northside Medical Center in Youngstown, Trumbull Memorial in Warren and Hillside Rehabilitation in Howland. What does that mean?

Is the company saying it will operate the three entities as they now exist, or does it have other plans for them?

CHS has also said it will invest at least $80 million over five years to fund facility improvements, technology upgrades, physician recruitment and service enhancements. How can the Valley be sure that the investment will be made?

Charity care

Finally, it says it will continue participating in the Medicare and Medicaid programs and provide a charity-care policy. To what extent will free services be available? Given the large number of people in this area who do not have health-insurance coverage and are too poor to have their own doctors, emergency rooms are used for basic health care. Will CHS continue this practice?

Our uncertainty about Community Health’s plans stems from the fact that the company had not been forthcoming with a lot of details before Thursday’s bid deadline. Indeed, the unions representing Forum’s employees publicly complained about the lack of information, compared with what Ardent had provided.

In addition to offering $69.8 million, Ardent had pledged to preserve the three hospitals and said it would invest $50 million. The fact that it had reached agreement with the unions representing thousands of employees in Youngstown and Warren was reassuring.

Forum briefed the union leadership Friday on the CHS proposal, and the unions are hoping to soon meet with company officials.

With the future of such an important community asset hanging in the balance, the employees and the public have a right to every bit of information pertaining to the sale of Forum.

Bankruptcy Judge Woods, who will review the CHS proposal Tuesday, and Attorney General Cordray should consider the ramifications of the sale.