Spencer Fane attorney Blane Markley recently explained the Olathe Health and the University of Kansas Health System combination through the often-misconstrued membership substitution transaction with Kansas City Business Journal reporter James Dornbrook.
In the article, It’s Not a Merger: Explaining the Legal Process Olathe Health Used to Join KU Health, Blane outlined potential motivations for nonprofit hospitals to combine, including more extensive market coverage and more brand awareness, as well as pandemic-induced staff shortages and ever-increasing labor costs.
Blane said, “It’s the worst economic environment for hospitals in many decades. We’ve seen large systems like Ascension and others reporting multibillion-dollar losses, and that type of thing is happening all the way down to the smallest hospitals. But Olathe Health is not in a fire sale position where it’s, ‘Take this deal or file for bankruptcy.’ They’re likely being proactive. It’s just a decision of when is the right time, and they wanted to do it from a position of strength.”
At Spencer Fane, Blane helps clients navigate the complex and evolving legal framework of health care, so they can more efficiently and effectively deliver care and meet operational goals. His experience in this area includes representing hospitals, physician groups, physicians, other health care providers, Accountable Care Organizations (ACOs), and other enterprises operating in the health care industry.
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