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Kutak Rock is a national leader in the representation of for-profit and not-for-profit hospital corporations and healthcare systems, hospital corporations, physician groups, skilled nursing facilities, long-term care companies, pharmacies and other providers in transactions that include mergers, acquisitions and affiliations, ranging from joint venture arrangements to acquisitions of physician-owned clinics to major mergers of healthcare systems.
We provide turnkey legal services to the healthcare industry, focused on smooth transitions of ownership with regard to taxation, licensure, accreditation, regulatory compliance, employment and employee benefits matters. We help clients navigate the full lifecycle of transactions including:
- Initial bidding
- Due diligence
- Negotiation and structuring of the deal
- Preparation of transaction documents
- Issuance of federal and state regulatory notices
- Transfers of necessary accreditation
- Closing and post-closing tasks
Joint Ventures
We have significant experience in structuring joint ventures between healthcare providers, and our work has taken us into more than 40 states. Our experience includes both clinical ventures between hospitals and physicians, such as imaging and surgery center joint ventures, as well as broader service line and/or whole hospital ventures. We also represent providers in the structuring of “provider-based” joint ventures involving either a single, campus-based service line (e.g., cardiac services) or service lines encompassing multiple campuses. In addition, the firm has served as counsel in connection with numerous hospital, health system, long-term care, home health agency, hospice, ambulatory surgery center, imaging center, physician practice and other provider acquisitions, joint ventures and dispositions.
The firm has served as lead transaction counsel in several multi-party affiliations of healthcare systems through the joint operating structure and in connection with various joint venture arrangements between health systems (including several involving major academic medical centers and/or religious-based organizations) with responsibility for tax, antitrust and other regulatory matters necessary to developing the legal structure of the arrangement.
Hospital Affiliations
We represent affiliations of hospital entities in all facets of healthcare law including:
- Corporate governance under a variety of state laws
- Antitrust
- Employment and employee benefits
- Taxation
- Tax-exempt financing considerations
- Intellectual property
- Real estate
Our role in affiliation-related transactions includes:
- Assisting clients in the design and implementation of due diligence investigations
- Negotiation and structuring of the business terms of the transaction
- Negotiation and drafting of transaction documents
- Preparation of disclosure schedules
- Obtaining regulatory approvals and corporate consents (including antitrust approval)
- Organizing and overseeing the closing of the transaction
Nonprofit Hospitals and Health Systems
A significant number of our clients are nonprofit hospitals and health systems. As a result, we are deeply familiar with aspects of transactions particularly applicable to nonprofit organizations, such as the oversight or authority that state attorneys general exert with respect to charitable trust issues and statutory approval processes for transfers of assets owned by a non-profit. In addition, our knowledge includes the requirements and approval processes relevant to religious-affiliated health systems. We have participated in multiple transactions where approval of a religious hierarchy was a critical component of the transaction's structuring and closing process. Our representation includes hospital systems purchasing city, district or county-owned hospitals as well as representing the selling hospital. We are deeply familiar with the issues associated with these transactions, including local approvals, potential bond financing and real estate matters—particularly leases.
- Multiple hospital acquisitions and divestitures, structured as either a transfer of member interest or a sale of assets, involving non-profit health systems
- Representation of a Virginia nonprofit health system in its acquisitions of community hospitals through member substitution transactions in Virginia and North Carolina
- Representation of a New Jersey health system in its acquisition by member substitution of a New Jersey hospital subsidiary hospital system of a national, Catholic system
- Representation of a national inpatient physician company in multiple acquisitions of hospitalist and emergency medicine companies in several states
- Representation of multiple hospital systems in purchase of primary care and multi-specialty physician practices
- Representation of two Colorado community hospitals in separate transactions involving an affiliation through a member substitution transaction with separate, religious-based multi-state systems
- Representation of a regional, nonprofit health system in its acquisition of an academic medical center (including residency slots associated with the academic medical center’s provider number) owned by a joint venture between a publicly traded for-profit hospital company and a Catholic university and related purchase of the assets of multiple physician clinics owned and operated by the university’s medical school; the transaction also involved an academic affiliation agreement and financial sharing agreement between nonprofit acquirer and the university
- Representation of a regional, nonprofit health system in the sale of hospital assets and formation of joint venture with various spine and neurosurgery practices to own and operate a specialty spine hospital
- Multiple engagements with health systems to structure and implement clinical joint ventures with physicians (including, for example, ambulatory surgery, GI, imaging)
- Representation of a regional health system in its acquisition of two district owned hospitals in Georgia
- Representation of a Virginia system in a sale and joint venture of its home health business
- Representation of an academic health system in restructuring transactions to combine assets and operations of the academic medical center, a separate community hospital and a related faculty practice plan entity into a single enterprise
- Representation of an academic health system in the formation of a joint venture with a community hospital to own and operate an ACO
- Representation of an academic medical center in formation of joint venture with various orthopedic practices to own and operate a specialty orthopedic hospital
- Representation of a community health system in structuring joint ventures with an academic system to operate cancer and pediatric services
- Transaction counsel for a combination of pediatric services between a state university academic medical center and a nonprofit health system
- Representation of a multi-state health system in its acquisition of a physician-owned specialty hospital
- Representation of a multi-state health system in its acquisitions through operational lease and control agreements of hospitals in Missouri, Arkansas and Oklahoma, structured in this manner because many of the hospitals were county-owned and the structure allowed integration of the hospitals into the system without violating certain bond-financing or other restrictions on county-owned hospitals
- Representation of a multi-state health system in the disposition (member substitution and asset sale) of two hospitals and ancillary providers (including home health agency and hospice agency providers) to nonprofit acquirers
- Representation of a multi-state health system in the asset sale of two long-term acute care hospitals
- Representation of a not-for-profit long-term acute care hospital company in an asset sale of long-term acute care hospitals in Louisiana, Arkansas and Texas to a for-profit company
- Representation of a large multi-specialty physician practice in formation of joint venture with a nonprofit health system in the asset acquisition of a hospital from a for-profit hospital company
- Representation of a for-profit health system in the acquisition of two Chicago nonprofit hospitals
- Representation of a physician-owned specialty hospital in connection with the contribution of its assets to a joint venture with a subsidiary of a publicly owned hospital company
- Representation of a nonprofit health system in the disposition of five long-term acute care hospitals in Arkansas, Louisiana and Texas, with three of the LTACHs being sole to nonprofit acquirers and with the remaining two being sold to for-profit acquirers
- Representation of a publicly traded healthcare company in the acquisition of 74 home health agencies and seven hospice agencies from a State Department of Health, including handling of due diligence of all agencies and handling of state procurement law aspects of the transaction
- Multiple long-term care facility acquisitions, leasing and divestitures, including (i) five multiple-facility acquisition and leasing transactions involving over 80 long-term care facilities in multiple states, with most having an aggregate value of over $40 million per engagement, (ii) 34 individual facility acquisitions, some of which involved an ownership model including minority physician ownership and some of which included lease-purchase arrangements, and (iii) separate sale of 15 nursing facilities
- Representation of a publicly traded nursing home company in the sale of multiple skilled nursing facilities in eight states to multiple buyers via concurrent private auctions
- Representation of a publicly traded company in the sale of 141 outpatient rehabilitation therapy clinics in nine states
- Counsel to a religious-affiliated health system in connection with a joint operating agreement affiliation with another religious-affiliated health system for their respective hospitals and affiliated providers in Colorado
- Counsel to a health system in connection with the purchase through an asset sale transaction of multiple hospitals in Minnesota and Wisconsin
- Counsel to a health system in connection with the disposition of multiple hospitals in Oregon and Idaho to another health system
- Transaction counsel in connection with a joint operating agreement between two rural hospitals, resulting in the formation of an operating company that leases the health care assets of the two hospital systems
- Representation of an insurance company in disposition of separate HMO companies in Colorado, Missouri, Tennessee, Texas, Nevada and Ohio (separate transactions with multiple purchasers)
- Representation of a Colorado nonprofit health system in the sale of stock of a Colorado-based managed care company
- Representation of various health systems in the purchase of imaging center businesses in Connecticut, Virginia, Maryland and New York
- Representation of a Colorado nonprofit health system in the sale of a DME business to a national pharmacy chain and formation of a joint venture with the pharmacy chain for the future operation of the DME business
- Sale of two nonprofit hospitals’ interests in an occupational medicine joint venture
- Representation of various hospitals in the purchase of majority member interests in physician-owned limited liability companies operating ASCs; also, have represented physician sellers in such transactions
- Representation of a Kentucky nonprofit health system in the formation of joint venture with a publicly traded hospital company to purchase hospitals in Kentucky and Indiana and several community hospital purchases by the joint venture entity
- Representation of a Colorado nonprofit health system in the sale of clinical laboratories to a national, publicly traded lab provider
- Representation of a Virginia nonprofit health system in the sale of its DME operations to a national DME company
- Representation of a surgery center company in its sale to a publicly traded company
- Representation of a Colorado pediatric hospital in the formation of provider based joint venture with an academic medical center for maternal fetal services
- Representation of a specialty pediatric hospital in the formation of a joint venture with an academic medical center to jointly provide pediatric neuroscience services
- Representation of a Kentucky health system in its disposition of a home health business
- Representation as transaction counsel to 20 Georgia hospitals in connection with formation of a joint venture to pursue a clinically integrated network and other services for the joint venture members
- Representation of several Kentucky health systems, including the State’s largest academic medical center, in the formation of a collaborative joint venture entity