Mercy buys out Defiance clinic, hospital

Mercy has bought out its joint venture partner in Defiance, strengthening the Toledo hospital chain's presence in northwest Ohio's western region by wholly owning a 23-bed hospital and a multispecialty physician group.

Defiance Clinic and Mercy first formed a partnership in 2000 to offer services of additional specialists to the area, including cardiologists, vascular surgeons, and pediatric specialists. Four years later, they opened Mercy Hospital of Defiance, a joint-venture hospital with an emergency center, two operating rooms, a Life Flight helipad for transport cases to Mercy St. Vincent Medical Center, radiology, chemotherapy, and other services.

"We've had a relationship with Defiance Clinic for the last 11 years, and this is a natural progression in our partnership," Andrea Price, Mercy's president and chief executive, said after the acquisition was announced Wednesday.

The 150-employee hospital was renamed Mercy Defiance Hospital. With 30 doctors and 270 employees, Defiance Clinic's main location was renamed Mercy Defiance Clinic, while its other office was renamed Mercy Napoleon Clinic.

Terms were not disclosed of Mercy's acquisition of the physician group and its 50 percent hospital stake.

Mercy Defiance Hospital competes with Defiance Regional Hospital, which is owned by Mercy's rival ProMedica.

Chad Peter, who was president and chief executive of Defiance Clinic and now is chief executive of Mercy's western division, said the physician group becoming part of Mercy was the next phase of their relationship, especially with health-care reform under way.

Reform, for example, prohibits physician ownership in either new or expanded hospitals.

"We had a hospital with Mercy, and with the new health-care law, we can no longer expand it," said Mr. Peter, adding while there are no expansion plans, the possibility will be examined.

Reform also calls for more coordination of care among health-care providers and hospitals, as well as the use of electronic health records. Pairing a large physician office with a hospital chain as Mercy has done in Defiance is a model for reform, Mercy officials said.

Physician groups typically have limited resources to expand services, recruit doctors and staff, and make other moves, so becoming part of a hospital chain is beneficial, said Dr. Allen Gaspar, Mercy Defiance Clinic's board chairman.

The relationship also will benefit area residents by better meeting patient needs, from a physical exam in Defiance to robotic cardiac surgery in Toledo, he said.

Contact Julie M. McKinnon at: jmckinnon@theblade.com or 419-724-6087.