Ascension exited the Northwest in 2018 as it pivoted from hospitals to outpatient care
The largest Catholic health system sold Lourdes Health for a reported $21M, completing its exit from Washington and Idaho to chase outpatient population health.
What was changed
Healthcare Dive reports that Ascension finalized the sale of Lourdes Health Network of Pasco, Washington to RCCH HealthCare Partners, a for-profit firm, in a deal reported at $21 million. Lourdes was the only health system Ascension operated in Washington; together with an earlier Idaho sale to the same buyer, it left the largest Catholic health system in the US with no presence in the Northwest.
The sale fit Ascension's drive to move away from a hospital-centric focus toward population health delivered in outpatient settings, part of an industry divestiture wave — Community Health Systems and Tenet Healthcare sold dozens of hospitals in about a year. Ascension also laid off hundreds of workers as it struggled financially.
For the first nine months of FY2018, Ascension's operating income fell to $282 million from $749 million and revenue slipped to $17.09 billion from $17.15 billion as it restructured. The system divested hospitals, cut leadership, dropped ancillary businesses and saved $400 million in administrative costs, hoping to cut $61 million more the next fiscal year.
The transition was not smooth: a week before the sale closed, Ascension's Providence health system in Washington, D.C. fired most of its 12-member board by email after they voted to rescind a transition plan they felt they hadn't fully understood. CEO Anthony Tersigni told employees the board had endorsed the plan and expected $57 million a year in savings from aligning pay practices. Ascension also still invested $50 million in three Michigan health systems it had originally planned to sell.
Why it worked
Inpatient admissions were flattening industry-wide, and the hospital-centric model no longer paid.
The outpatient population-health strategy needed capital that legacy regional hospitals were absorbing.
Peer systems such as Tenet and Community Health Systems were shedding hospitals for the same reason.
What can be applied
Shrinking a regional footprint is strategy, not retreat, when admissions flatten — but transitions that outrun local boards breed revolt, so carry the locals along.
Aftermath
Ascension kept divesting hospitals and reshaping toward outpatient care through the 2020s; the article notes it still selectively invested, including $50 million in three Michigan systems once slated for sale.