Deal that could save Mercy Hospital in Bronzeville is approved by state board

Mercy Hospital moved one step closer to remaining open after a state board on Monday approved a nonprofit organization’s application to buy the Bronzeville institution.

Though the approval could save the hospital, it came over objections from some community leaders and members who wanted to give potential local buyers more time to make offers.

The Illinois Health Facilities and Services Review Board approved an application by Insight Chicago, which plans to pay $1 for Mercy. Mercy and Insight still must finalize the deal. Mercy, part of Trinity Health, had planned to close May 31, without the Insight deal.

Insight Chicago, created for the purpose of buying Mercy, is affiliated with Michigan-based Insight, which provides medical services at a biomedical technology campus in Flint and the Insight Surgical Hospital in Warren, Michigan.

Insight Chicago has pledged to keep Mercy open and run it as a full-service hospital. Dr. Jawad Shah, president and CEO of Insight, said Insight hopes to operate Mercy “for decades to come.”

When Mercy leaders announced plans last year to close the storied hospital, their announcement was met with outcry from community leaders and members who worried the area would be left without adequate health care. The hospital had said it was sustaining monthly operating losses of $4 million, and needed another $100 million to maintain its aging facility.

The closure announcement followed a decision in May by Mercy, Advocate Trinity Hospital in Calumet Heights, South Shore Hospital in South Chicago and St. Bernard Hospital in Englewood to call off a planned merger, after state lawmakers failed to set aside funding for the deal.

In mid-February, Mercy filed for bankruptcy, but Mercy will seek to have those proceedings dismissed as the deal is finalized.

In announcing Mercy’s closure, Trinity had also proposed opening a 13,000-square-foot outpatient care center on the South Side. Trinity has said it still hopes to open that center this year, even if Insight acquires Mercy.

Some community leaders and members, however, urged the state board not to approve the deal Monday. They said other local groups had expressed interest in buying the hospital and just needed more time. They also expressed concern that Insight did not have experience running a full-service hospital in Chicago.

Several speakers said a group of local doctors and Humboldt Park Health, formerly called Norwegian Hospital, had expressed interest in buying Mercy.

“We need a group that understand the needs of the community,” said Rep. Lamont Robinson Jr., D-Chicago.

Humboldt Park Health’s CEO has met with physicians to discuss a strategy for keeping Mercy open, spokeswoman Nancy Herman said in an email on Monday. But Humboldt Park Health’s board of trustees has not discussed or approved a deal and “we certainly don’t have the funding,” she said.

Alderman Sophia King, 4th Ward, said more research is needed on Insight before a deal should be allowed to move forward.

Approving the deal too quickly would be tantamount to “saying anyone can come in a black community and take over without due diligence,” she said.

Mercy leaders, however, said that Insight was the only viable buyer that came forward to take over the hospital, and Insight has shown that it has the financial ability and experience to run Mercy.

Since last summer, when Mercy’s closure was announced, 14 interested parties emerged, said Carol Schneider, Mercy CEO. Seven of those parties moved forward, but one only wanted to take over Mercy if it could partner with another hospital to do so, two others would have needed state funding to run Mercy, and the others didn’t want to operate Mercy as a full-service hospital, she said.

“Insight’s plans are the best chance to save the hospital,” Schneider said. She cautioned that if the board delayed a decision, it would “be catastrophic to operations.”

Mercy physician Dr. Yousef Sayeed said Mercy is now “on life support” and though a local buyer would have been nice, the hospital is out of time. He urged the board to approve the sale to Insight.

Five state board members voted to approve the application, with several saying they had concerns but the law required them to approve it because it was a complete application. One board member abstained from the vote because she missed part of the meeting.

Board member Dr. Linda Rae Murray said she wished the application included more details about how Insight planned to run the hospital.

The board had previously voted in December against Trinity Health’s application to close Mercy Hospital, citing concerns over continuity of care and the community’s access to health care and was slated to again discuss the issue at a future meeting.

Mercy was the first chartered hospital in the city — starting in an old rooming house near present-day Rush Street and the Chicago River in 1852 before moving to the South Side during the Civil War, according to the hospital.