Colorado-based health system taking over Memorial East Texas

LUFKIN, TX (KTRE) - A Colorado-based health system is taking over the ownership of Lufkin-based Memorial Health Systems of East Texas. The health care systems will negotiate the terms of the agreement with the expectation of reaching an agreement by spring 2014.

"CHI is an extremely dynamic and respected organization and they have demonstrated that in all markets. They operate their commitment to quality patient care, operating efficiencies and a very strong faith-based ministry to the population," said Gary Looper, the President and CEO of Memorial Health Systems of East Texas.

The hospital board signed a letter of intent Thursday morning to transfer ownership of Memorial to Catholic Health Initiatives.

"We wanted to stay nonprofit if at all possible. We felt that people in the area look more toward Houston for health care and we're more aware of the hospitals there if they go out of the area. So, we wanted an affiliation with Houston. We wanted someone who would make a capital commitment to this area and I think in addition to that we got a comfort level," said Jack Sweeny, the Chairman of the Board for Memorial Health Systems of East Texas.

The announcement was made at a press conference at the Lufkin hospital Wednesday afternoon.

"This proposed transaction will significantly strengthen and expand the 65-year mission of Memorial through the strong commitment and resources of CHI, a highly respected national health care organization and a very successful faith-based ministry," said Jack Sweeny, chairman of the board for Memorial Health System of East Texas.

According to the group's web site, Catholic Health Initiatives is a national non-profit health system with headquarters in Englewood, Co lo. It boasts as being one of the nation's largest health systems, operating in 18 states and 87 hospitals.

"The additional affiliations with CHI St. Luke's Health, Baylor College of Medicine and the Texas Heart Institute will add a very exciting regional dimension to the services that Memorial can offer the communities it serves in East Texas," said Gary Looper, Memorial's president and CEO. "CHI has a very clear vision for its new mission in Texas, and Memorial will be an integral part of that vision."

CHI President and CEO Kevin Lofton said the move will ultimately add 100 jobs to the system.

"The addition of Memorial to CHI's Texas system, following the affiliation of CHI St. Luke's Health last year, honors our deeply held commitment to build strong relationships of lasting value to better serve the people of Texas," Lofton said. "In becoming part of CHI, Memorial also will benefit from CHI's overall scale and reach as well as the exciting new ventures that CHI St. Luke's Health is undertaking with the Baylor College of Medicine and the Texas Heart Institute in Houston."

Memorial's name will change, but it is not yet known what it will change to, Lofton said.

The only management change on the horizon is a CHI board member will serve on the Memorial Health System board. But, Lofton says the transfer will bring in new jobs.

"Once you start developing and growing the services here you're going to have more patients being taken care of [and] you will need more staff. Clearly what we're saying is that our coming into town doesn't suck jobs back to Denver and that's not the way our motto works because the health care delivery is local," Lofton said.

Lofton says he doesn't know the exact total of capital investments CHI will make during the transfer of the next couple of year, but he estimates around $80 to $100 million.

"This is a big deal for this area and it's just not a big deal for today, it's going to get better as it goes along. We didn't want to be an average hospital that provided average care. We wanted to be the best," Sweeny said.

The transfer will require approvals from the Memorial Health System of East Texas Board of Directors and the CHI Board of Stewardship Trustees as well as federal, state and Church authorities.

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