(IRON MOUNTAIN, MI.)–UP Health System will not acquire Dickinson County Healthcare System, the second time this year a deal has fallen through.
UPHS and DCHS announced Tuesday afternoon that the organizations have terminated their non-binding letter of intent that was signed in July. They weren’t able to reach an agreement on the terms of an acquisition.
With the termination of the letter of intent, DCHS is no longer in exclusive discussions with UPHS.
DCHS says it will explore all options for the hospital’s future, including potential alternative arrangements with UPHS.
“We have been transparent with the community and our stakeholders about the financial distress our hospital has faced, similar to many other rural hospitals across the country,” said Bill Edberg, chairman of the Dickinson County Healthcare System Board of Trustees, in a press release. “The management team and Board will continue to work diligently to identify the right path forward for the health system. I am hopeful that there will continue to be even stronger support from all stakeholders in helping our community continue to have access to quality healthcare close to home.”
But the door was left open to some type of collaboration between the two organizations.
UP Health System is still firmly committed to serving the UP and believes that Iron Mountain and Dickinson County deserve access to quality local care, “While we are no longer discussing this acquisition arrangement, we will continue to explore collaborative efforts with Dickinson County Healthcare System to provide healthcare in Iron Mountain and Dickinson County.”
Bellin Health, based in Green Bay, signed a letter of intent to purchase DCHS in December 2017, but Bellin backed out of the deal in May 2018. Bellin says that deal fell through because of sustained financial losses at DCHS.
What happens in the next couple of months is critical for the future of DCHS.
The locally-run hospital had taken steps to reduce expenses and implemented cost saving measures, but it is still millions of dollars in debt and operating in the red.
In August, the hospital reported that its outpatient volumes for 2018 were down 4 percent compared to last year and inpatient volumes were down 19.4 percent for the same period.