Practices: Catholic Health Issues

Healthcare provider organizations that are affiliated with religious orders of the Roman Catholic Church face unique concerns involving taxation, mergers, acquisitions, joint ventures, and patient care issues. Such organizations – whether single facilities or larger, comprehensive health systems – receive informed and experienced guidance from Ungaretti & Harris regarding their operations and obligations. If you have administrative responsibility for a Catholic healthcare facility, you’ll appreciate our practical understanding of your challenges: a key member of our team formerly served as in-house counsel at a Catholic healthcare system, and several of our lawyers serve Catholic healthcare organizations as day-to-day operational counsel. Together they can help you with the following major issues.

Mergers and Acquisitions

Asset purchases and sales involving not-for profit healthcare facilities are among the most complicated of all business acquisitions, often involving complex regulatory approval, governance issues and financing concerns. If you have management responsibility for a Catholic-sponsored hospital or healthcare facility, you can turn with confidence to Ungaretti & Harris and know that the deal will be done right and your fiduciary responsibilities will be properly carried out. We have represented the buyers and sellers of numerous not-for-profit healthcare facilities, generally in transactions valued at $50 million to $100 million, and have handled transactions in which Catholic health systems have assumed control of for-profit and secular not-for-profit hospitals.

M&A transactions involving Catholic healthcare organizations involve a number for steps for completion, and hospitals rely on us to execute all the necessary steps. We secure state Attorney General approval and address regulatory concerns of the Health Planning Agencies, licensure boards and similar institutions in other states. Because the boards of directors of not-for-profit Catholic hospitals have special fiduciary responsibilities, especially where the buyer is a for-profit corporation, we help them in resolving liabilities, and setting up a nonprofit foundation to fund community healthcare programs with assets that remain after claims settlement.

Ethics Concerns

Administrators and ethics committees of Catholic healthcare organizations are uniquely bound by the requirements of both civil law and canon law, including certain ethical codes, as embodied in the Ethical and Religious Directives for Catholic Healthcare Services, promulgated by the U.S. Conference of Catholic Bishops (the ERDs). Although we are not canon lawyers, we can give you compliance and interpretive guidance on the interplay between religious and legal requirements. As with all our counsel to Catholic healthcare organizations, the advice you receive is uniquely tailored to address both your mission statement and your business strategy.

Contracts and Joint Ventures

Most contracts and joint ventures within Catholic systems implicate the ERDs. Our lawyers are experienced in incorporating the requisite contractual provisions necessary for ERD compliance, including with respect to certain situations where financial and/or managerial carve-outs are necessary to effectuate business purposes while at the same time achieving ERD compliance. Similarly, we have structured numerous Catholic/non-Catholic joint ventures, working with relevant dioceses for necessary approvals and establishing ethics codes, member expulsion and buy-out protections and other partnership terms and conditions unique to such ventures.