AKRON, Ohio--(BUSINESS WIRE)--Akron, Ohio-based Summa Health and General Catalyst’s Health Assurance Transformation LLC (HATCo) announced today that the two organizations have signed a Definitive Agreement outlining a proposed transaction focused on stabilizing the health system and creating a more proactive, affordable and equitable system of community-based, lifelong healthcare. The transaction is subject to regulatory review and approval.
“As part of HATCo, Summa Health will be better positioned to build upon our existing strengths and capabilities while also benefiting from new opportunities and technology. Our goals are to expand access to care and improve the experience for our patients, providers and staff,” said Cliff Deveny, M.D., Summa Health President and CEO. “This is only the beginning of our long-term journey together.”
The Definitive Agreement outlines the proposed terms and conditions of HATCo’s acquisition of Summa Health and reflects a significant investment in the health system. The purchase price of $485 million, when added to Summa Health’s current cash, will enable the health system to eliminate $850 million in existing debt. The remaining cash, after closing adjustments, will fund a new, separately governed community foundation that will support focused investment to benefit community health in the Greater Akron region.
HATCo has also committed to $350 million in capital funding within the first five years to ensure necessary resources are available for routine purposes, and investment in technologies that support growth. Additionally, HATCo has committed $200 million intended for strategic and transformative investments and to drive innovation over the first seven years.
“Our focus is on creating new and expanded opportunities for Summa Health, the communities it serves, and its talented workforce,” said Marc Harrison, M.D., co-founder and CEO of HATCo. “I am proud of the strong collaboration our teams have demonstrated over the past several months, and we look forward to continuing to work together to develop a plan that optimizes operational stability, while positioning Summa Health to drive meaningful transformation in the years ahead."
We remain deeply committed to investing in the communities we serve. Summa Health will maintain its charity care policy, community benefit, and essential services it currently offers while focusing on sustainable growth and enhanced access to care for people across the region.
Summa Health’s staff is at the forefront of all discussions relevant to the transaction. Its employees, providers and leadership team will transition to the new entity. Maintaining and growing Summa Health’s workforce is critical to pursuing this transformative work.
“Our respective leaders and teams worked together through a thoughtful, thorough due diligence process to define the terms of this agreement, which further cemented our trust and confidence in HATCo’s commitment to Summa Health, our culture, and the Greater Akron region,” said George Strickler, Chair of Summa Health’s Board of Directors. “This opportunity with HATCo puts us in a stronger position to navigate headwinds, transform the health system and create a sustainable path forward to better serve our people, our patients and our communities.”
Summa Health and HATCo have been working closely together to shape a comprehensive plan focused on stabilization and transformation. In the stabilization period, Summa Health will take the needed steps to transition into a for-profit, taxable structure and establish and optimize processes and best practices to maximize resources, improve workflow and, most importantly, enhance the experiences of patients, providers and staff.
While true transformation will take time, the organizations have begun to collaborate on a transformation plan, which includes the creation of working groups with representation across Summa Health to identify and map out the many opportunities ahead.
“We view this long-term investment as a critical milestone – not only to build on Summa Health’s existing strengths, but also to create a blueprint for the future of healthcare delivery,” said Hemant Taneja, CEO of General Catalyst, and founder and executive chairman of HATCo. “We couldn’t be more excited for the opportunity to execute on that transformative vision together with Summa Health and our innovation ecosystem to make healthcare a more proactive, affordable, and equitable system of care.”
Summa Health and HATCo are submitting applications related to the proposed transaction to all required regulatory bodies, including the Ohio Attorney General, the Ohio Department of Insurance, the Federal Trade Commission and other applicable authorities in compliance with regulatory review processes.
About Summa Health
Summa Health is one of the largest integrated healthcare delivery systems in Ohio. Encompassing a network of hospitals, community medical centers, a health plan, an accountable care organization, a multi-specialty physician organization, research and the Summa Health Foundation, we are nationally renowned for excellence in patient care and for exceptional approaches to healthcare delivery. Summa’s clinical services are consistently recognized by the American Nurses Credentialing Center (Magnet status), U.S. News and World Report, Healthgrades, Thomson Reuters and The Leapfrog Group. For more information, visit summahealth.org or find us on Facebook at facebook.com/summahealth, Pinterest, pinterest.com/SummaHealth, YouTube at youtube.com/summahealthsystem, Instagram at instagram.com/summahealth and LinkedIn linkedin.com/company/summahealth.
About HATCo
Health Assurance Transformation LLC (HATCo) was founded by General Catalyst to operationalize the promise of Health Assurance, and to demonstrate the economic and human benefits that result from collaboration and responsible innovation. The HATCo platform is designed to combine the best leadership and capabilities in healthcare and tech to inform, support and drive transformation enablement while addressing system fragmentation, and improving access to – and quality of – care. In collaboration with health system and technology leaders through partnerships, investments, and acquisitions, HATCo seeks to drive efficiency, affordability, and transparency to transform the healthcare industry to be more proactive, resilient, and equitable for communities and society.
