Saline Memorial Hospital to partner with Capella Healthcare


Saline Memorial Hospital to partner with Capella Healthcare

Board votes to form Public-Private Partnership

Benton, AR.  March 29, 2016. The Board of Directors of Saline Memorial Hospital has voted to create a public-private partnership with Capella Healthcare that will help to ensure the continuation of high quality healthcare for the community for years to come, according to Bob Trautman, CEO of Saline Memorial Hospital.

 The joint venture partnership preserves the tax-exempt, not-for-profit charitable status and purpose of Saline County Medical Center (SCMC). Simultaneously, it creates a tax-paying (for-profit entity) that will contribute a new source of revenues to the city and county through the paying of property and sales taxes. Charity care policies and practices will be preserved.

Meetings are being held today with co-workers, physicians and volunteers at the hospital.  Joining CEO Bob Trautman and board members for the “town hall” meetings are several senior leaders of Capella Healthcare, including Michael Wiechart, President and CEO of Capella Healthcare; Mark Medley, EVP, President of Hospital Operations; Andy Slusser, EVP, Chief Development Officer; and Carolyn Schneider, SVP-Human Resources.

Capella Healthcare is a private company with ten acute care and specialty hospitals in five states, including two in Arkansas – National Park Medical Center in Hot Springs and Saint Mary’s Regional Medical Center in Russellville – and more than 150 outpatient centers, including physician practices.  Based in Franklin, Tennessee, Capella has access to significant leadership and financial resources, investing 100% of net cash flow in its family of hospitals to strengthen and expand services and facilities.

“This innovative partnership provides additional resources for our community that will help us expand services, recruit specialists, and continue to enhance our already strong quality,” said Meredith Wineland, Chair of the Board of Directors. “The affiliation with a larger entity and regional providers also provides for our long-term sustainability.  Additionally, our agreement ensures continued local governance since it’s a 50/50 public-private partnership. We are excited about this collaboration because we believe it’s the best possible outcome for healthcare in our region.”

Saline County Medical Center (SMC) will remain a not-for-profit entity, continuing its focus on assessing community needs.  The county will continue to own the real estate while the joint venture resulting from the public-private partnership will become a tax-paying organization. Distributions (excess cash flow) from the joint venture partnership to SCMC will be received on a tax-free basis.

“Along with our Board, I believe this is a great opportunity for Saline Memorial Hospital, our staff and our community,” said Bob Trautman, SMH CEO. “Partnering with Capella will make us a stronger organization, giving us new opportunities for growth. We’ll have access to more resources to continue our quality initiatives as well as new capital dollars to fuel growth strategies, including recruiting new physicians and adding new technology. Most importantly, Capella Healthcare’s leaders are deeply committed to community-based healthcare and high quality services, like we are. Our mission, vision and values are highly compatible.”

There are no plans to change the hospital’s current partnership with Arkansas Heart Hospital, he added. 

“We are honored to be partnering with Saline Memorial Hospital to help ensure the continued high quality of care they’ve provided for this community,” said Michael Wiechart, President and CEO of Capella Healthcare. “With more than 60 years of service and national recognition for their high quality, we look forward to learning from Saline’s associates as well as sharing with them and investing in resources for growth. Our guiding principle is that ‘all health care is local’ and that’s why partnering with strong, progressive organizations like Saline Memorial Hospital makes sense.”

The SMH Foundation would continue as a separate 501(c)3 entity, with funds raised going to many of the same initiatives, including community programs such as providing CPR equipment for students and funding scholarships as well as patient and family support, including assisting underprivileged patients and continued support at the Hospice House in Bryant.

The health care industry is facing many challenges, Trautman said. “Health care reform, continued reductions to reimbursement and increasing competition from health systems outside of Saline County have come together to create a particularly challenging environment for providers. To succeed in the future, every hospital must continue to improve quality while lowering costs and expanding access for patients. Closer collaborations and increased scale are essential for success in this new era since every hospital is being challenged to do more with less.”

The recently announced merger of Capella Healthcare with similar-sized RegionalCare Hospital Partners will not impact the partnership currently being formed between Saline Memorial Hospital and Capella Healthcare, Wiechart said. It will simply result in a stronger partner for all affiliated hospitals since the new company will have 18 hospitals in 12 states and greater access to capital dollars to invest. 

About Saline Memorial Hospital

Located in Benton, AR, Saline Memorial Hospital has served the community for more than 60 years earning national recognition for its quality of care. For the past three years, SMH has earned HealthGrades® Patient Safety Excellence Award™.  At SMH, patients can expect quality healthcare with a personal touch. As a 177-bed, community hospital and one of the largest employers in Saline County, SMH continually works toward expanding services to better meet the needs of patients and local residents. SMH has a strong tradition of providing charitable support to the residents of the community. Over the past three years, SMH has provided over $40 million in charity and uncompensated care.  Saline County is one of the five fastest-growing counties in Arkansas.

About Capella Healthcare
Capella Healthcare partners with communities to build strong local healthcare systems that are known for quality patient care. Based in Franklin, Tennessee, Capella operates 10 acute care and specialty hospital facilities in five states. With the philosophy that all healthcare is local, Capella collaborates with each hospital’s medical staff, board and community leadership to take care to the next level.  A private company, Capella has access to significant leadership and financial resources, investing 100% of its net cash flow in its family of hospitals to strengthen and expand services and facilities. For more information, visit the website

In Arkansas, Capella operates
National Park Medical Center in Hot Springs and Saint Mary’s Regional Medical Center in Russellville.  During 2014, the most recent year for which complete data is available, these two hospitals provided more than $54 million in charity and other uncompensated care.




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