Trinity Health and CommonSpirit Health, which have jointly owned and operated MercyOne for the past 24 years, announced today they have signed an agreement for Trinity Health to acquire all of the facilities and assets of MercyOne. Based in West Des Moines, MercyOne is a regional health system that serves more than 3.3 million patients annually.

Since 1998, MercyOne has operated under a joint operating agreement between the two not-for-profit Catholic health care organizations. CommonSpirit, formerly known as Catholic Health Initiatives, and Trinity each hold a 50% ownership stake in MercyOne.  

Bob Ritz, president and CEO of MercyOne, said a transition to one owner has been something that has been discussed for years. No leadership or organizational shifts are anticipated within MercyOne as a result of the transition, he said. MercyOne includes 16 medical centers, 27 affiliate organizations and more than 420 care sites that employ more than 20,000 health care workers, including some 2,000 physicians.

“We strongly believe this transition to become a full member of the Trinity Health family will result in a stronger, more cohesive health system better able to offer a convenient and personalized circle of care for all we serve,” Ritz said in a press release. “We are delighted to have the agreement in place as we plan for the future of our mission. We are grateful to CommonSpirit for more than 20 years of partnership.”

The announcement follows months of analysis and due diligence by Trinity Health and CommonSpirit, which determined a sole parent is the best path forward for MercyOne and for the communities it serves.

Under the joint operating agreement, Trinity and CommonSpirit have equally shared adjusted operating cash flow from MercyOne’s operations. According to the most recent quarterly earnings report filed by Trinity, CommonSpirit agreed to suspend the cash flow sharing arrangement for fiscal year 2021 and for the six months ended Dec. 31. As of Dec. 31, Trinity Health’s investment in MercyOne totaled $122.1 million.  

Based in Livonia, Mich., Trinity Health is a national health system spanning 25 states. Operating under one owner will bring unified strategies and operations to MercyOne’s care sites, including one set of system services, the health systems said.  

“True to our shared Catholic mission, our goal is to provide high-quality, compassionate care with the best patient/member experience possible,” said Mike Slubowski, president and CEO of Trinity Health. “We will accomplish that goal through a holistic approach, with a range of health services and technologies that are fully connected and coordinated. This agreement creates a fully integrated MercyOne to care for more people in a unified way.”

Ritz said while the ownership transition should create new efficiencies, it’s not being done as a cost-saving or cost-cutting move. “I don’t think this will lower costs, but I do think it will put us on a more efficient path,” he said.

Examples of greater efficiencies include a transition to Trinity Health’s information technology platforms, including a single electronic health record, allowing patients to more easily manage their care across all MercyOne services and locations.  

Trinity Health and CommonSpirit will now plan for integration, complete regulatory filings, and take other steps necessary to finalize the transaction, which is expected to be completed summer 2022.