Ascension, Tenet and Dignity Health sign agreement to create joint venture in Arizona

Ascension, one of the largest not-for-profit Catholic healthcare system operators, plans to give up a large share of its ownership stake in Southern Arizona’s Carondelet Health Network to the for-profit publically-traded Tenet Healthcare and the not-for-profit Dignity Health under a joint venture operating agreement that will create a larger regional network of care, the companies announced.

All three organizations already have a presence in the state, and the joint venture agreement currently going through the due diligence process would facilitate connecting Carondelet’s strong regional network in the Tucson area with the Phoenix-area networks of Dignity Health and Tenet, which already collaborate on the Arizona Care Network accountable care organization.

Dignity Health, based in San Francisco, operates four Arizona hospitals — Chandler Regional Medical Center, Mercy Gilbert Medical Center, St. Joseph’s Hospital and Medical Center, which includes Barrow Neurological Institute, and St. Joseph's Westgate Hospital — as well as the 250-physician  Dignity Health Medical Group, imaging centers, outpatient clinics, specialty hospitals, urgent cares, an insurance provider, an accountable care organization and other clinical partnerships. Tenet Healthcare, based in Dallas, has six hospitals — Arizona Heart Hospital, Arrowhead Hospital, Maryvale Hospital, Paradise Valley Hospital, Phoenix Baptist Hospital, and West Valley Hospital — and four outpatient centers in Arizona. Finally, Ascension’s Carondelet is comprised of three hospitals — St. Joseph’s and St. Mary’s Hospitals in Tucson, Arizona, and Holy Cross Hospital in Nogales, Arizona —as well as the Carondelet Medical Group with 15 primary care offices, the Carondelet Specialist Group with three specialty care offices, the Carondelet Heart and Vascular Institute, and the Carondelet Neurological Institute.

For-profit Tenet, the largest organziation of the three, would be the majority partner in the joint venture with management responsibility for all of Carondelet’s assets, the companies said in a press release. Ascension would retain a minority interest in Carondelet.

“We are excited to pursue this relationship with Tenet and Dignity Health,” stated James K. Beckmann, president and CEO of Carondelet in the press release. “Like Carondelet, Tenet and Dignity Health are committed to providing high quality, low cost, person-centered care. This relationship is an opportunity to strengthen those efforts, enhance healthcare across Arizona, and continue Catholic sponsorship of Carondelet.”