This page answers frequently asked questions regarding the Attorney General's review of the proposed sale of St. Joseph Mercy – Port Huron to Prime Healthcare Services. Trinity Health and Prime signed a definitive agreement in November 2014 and, subject to the Attorney General’s review, expect to close the transaction in the next 4 to 6 months.
To promote transparency and inform the public, documents are available on the Attorney General website.
Trinity Health has represented to the Attorney General that it is selling due to the challenges of operating St. Joseph Mercy – Port Huron, which is geographically remote from its other hospitals in the St. Joseph Mercy Health System. As part of the review, the Attorney General will review the reasons for the sale.
The Attorney General will review these questions to ensure a fair process and to verify that St. Joseph Mercy Port Huron receives fair market value for its charitable assets.
Prime Healthcare Services is a privately-owned company from California. It operates 29 hospitals in 9 different states; this would be its second hospital in Michigan. In June 2014, the Attorney General approved Prime’s purchase of Garden City Hospital. More information on Prime is available on their website.
Michigan law requires that charitable assets be used for charitable purposes. The Attorney General will review to ensure that the hospital receives fair market value for its assets and that any proceeds are used appropriately for charitable purposes.
St. Joseph Mercy – Port Huron will continue to serve the medical needs of the local community, albeit with a new owner—Prime Healthcare Services. Under the definitive agreement, Prime has agreed to various post-closing covenants, which the Attorney General will consider during the course of his review.
In general, the Attorney General protects charitable assets in Michigan under broad common law and statutory authority. This authority extends over the merger or sale of charitable nonprofit corporations, which includes most of Michigan’s hospitals. Primarily, the Attorney General reviews these transactions to protect the charitable assets and to ensure that they are not diverted for private benefit. The Attorney General also protects restricted charitable assets, i.e., those assets that were donated for a specific purpose, to prevent these assets from being misused. For a guideline of the Attorney General’s review process, see here.
More specifically, the Attorney General is reviewing this transaction because the parties have conditioned the sale on receiving the Attorney General’s consent or lack of objection. In other words, the parties recognize the Attorney General’s authority in this area, are cooperating with the Attorney General’s review process, and recognize that his objection would stop the sale.
The Attorney General’s Review Process provides guidelines for the issues the Attorney General considers, but here are some of the main areas:
Yes. When the Attorney General’s review is complete, he will publish a report on this website.
Yes. The Attorney General is hosting a public forum on Thursday, April 16, so that the public can comment and submit questions regarding the sale.
Date & Time: April 16, 2015, 5:00 - 7:00 p.m.
Location:Double Tree by Hilton (Ballroom 1)
The public can also comment on the proposed sale by email or by mail to:Michigan Department of Attorney General
Last updated: March 5, 2015