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Mercy Hospital closer to remaining open with sale’s approval

Insight Chicago received approval from a state review board to acquire Mercy Hospital for $1 on Monday.

Mercy Hospital & Medical Center, 2525 S. Michigan Ave.
Insight Chicago received approval from a state review board to acquire Mercy Hospital for $1 on Monday.
Ashlee Rezin Garcia/Sun-Times

Mercy Hospital and Medical Center in Bronzeville moved closer to remaining open after a state review board reluctantly approved the sale of the facility to a new Illinois not-for-profit called Insight Chicago.

The Illinois Health Facilities and Services Review Board approved the change in ownership Monday afternoon with a vote of five in favor. One member abstained from voting and another was absent.

Insight Chicago, which is affiliated with a Michigan health system, promised the board it will keep Mercy as a full-service community acute care hospital that will offer an Emergency Department, rehabilitation center, stroke programs, behavioral health assistance, an obstetrics unit, intensive care unit and inpatient medical surgical beds.

The approval means the acquisition has the blessing from the state, but Insight and Mercy still need to finalize the deal. Insight looks to purchase the hospital from Trinity Health for $1. Without a deal between the two, Mercy Hospital is still at risk of closing by May 31.

Several board members said they were only approving the sale because of regulatory rules.

Board member Dr. Stacy Grundy “implored” Insight to listen to the Bronzeville community and include it in the rebuilding process. Board member Antoinette Hardy-Waller took issue with the representatives acquiring Mercy having few people of color and said that should change quickly.

Mercy and three other South Side hospitals had considered merging, but the plan fell through because it lacked state funding.

Last July, Mercy Hospital announced plans to shut its doors for good by May 31, which sparked backlash from South Side residents for attempting to close in the middle of a pandemic.

Mercy, which is owned by Trinity Health, sought approval from the state board to close the hospital, but its application was unanimously rejected in December. The hospital’s operators then filed for Chapter 11 bankruptcy in February citing the loss of staff and “mounting financial losses.”

The hospital reported it lost more than $30.2 million in the first six months of the fiscal year, averaging about $5 million per month. Facility operators also said it was in debt of more than $303.2 million over the last seven fiscal years and would need more than $100 million in capital investment to safely continue services.

Community organizers applauded Insight’s track record for working in underserved communities like it has in Flint, Michigan, but were concerned with the news it would only operate for two years.

Jitu Brown, director of Journey 4 Justice, said it was important that people in the community have a say in the future of Mercy.

But Insight’s CEO Dr. Jawad Shah promised it had no intention to close after two years and is planning to be in Bronzeville for decades.

Shah did say one change is coming — the hospital’s name, since Trinity Health is taking the name and Catholic affiliation with them.

Manny Ramos is a corps member in Report for America, a not-for-profit journalism program that aims to bolster Sun-Times coverage of issues affecting Chicago’s South and West sides.