Officials from Ascension Health announced a letter of intent Tuesday to transfer its ownership of Carondelet Health Network in Arizona to a three-way joint venture that includes Dignity Health and Tenet Healthcare.
The move follows Tenet's 2013 acquisition of five Phoenix-area hospitals as part of its appropriation of Vanguard Health Systems. Dignity also has three hospitals in the Phoenix region.
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Under the agreement, the systems will form a Tucson-based joint venture with Tenet holding a majority stake, Ascension a minority stake, and Dignity holding undisclosed interest.
In addition, Carondelet's three hospitals—449-bed St. Joseph's, 429-bed St. Mary's, 56-bed Holy Cross Hospital—would be allowed to participate in accountable care organizations with Tenet and Dignity's hospitals in Arizona.
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Carondelet, which also includes the Carondelet Medical Group and the Carondelet Specialist Group, will also retain its Catholic identity under the partnership.
For now, the three groups are conducting due diligence over an undisclosed timeline, officials say.
Ascension in February dropped plans to sell its two Kansas City hospitals, also known as Carondelet Health, to Nashville-based HCA after a prolonged Federal Trade Commission review (Kutscher, Modern Healthcare, 7/22 [subscription required]; Liss, St. Louis Post-Dispatch, 7/22).
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