Orlando Health completes purchase of Bayfront Health St. Petersburg

ST. PETERSBURG — Orlando Health officially completed its purchase of Bayfront Health St. Petersburg on Thursday, marking a turning point that many said would put the hospital on better footing.

The deal is a first step into the Tampa Bay region for the nonprofit, a Florida health care giant with more than $6 billion in assets at about 450 locations. Though Orlando Health executives aren’t sharing specifics, they say they expect to further expand their presence in the area.

Finances and patient care at Bayfront have suffered in recent years under Community Health Systems, a Tennessee-based company that had owned 80 percent of the 480-bed hospital since 2014. The other 20 percent, owned by the nonprofit Foundation for a Healthy St. Petersburg, was also sold to Orlando Health, giving the company complete control of the hospital.

Still, Orlando Health must continue to run Bayfront as a “safety net” hospital, according to a lease agreement with the city, which owns the land underneath the facility. That means Bayfront must continue to provide charity care to all regardless of a patient’s insurance status or ability to pay for services.

Orlando Health must be “committed to engaging and supporting the community through programs and strategic partnerships that address social determinants of health," the lease states. And Bayfront must continue to “support needy and underserved persons in a manner that prevents and minimizes the need for charity care by establishing a flourishing and healthy community for all citizens."

In an interview Thursday, Orlando Health CEO David Strong said Bayfront fits the culture of the nonprofit, which has its own history of charity care in Central Florida. He declined to share details about either part of the hospital sale, but said Orlando Health is committed to bringing Bayfront back to its heyday.

“We want quality and safety to be in our DNA,” he said. “It will be in everything that we do, because that’s what is important.”

Orlando Health is no stranger to charity care, according to its most recent community benefit report. In 2019, the nonprofit provided more than $76 million in services that patients were unable to pay for.

John Moore, the newly appointed CEO of Bayfront, said he intends to hold a listening tour with the hospital’s staff and community members in the coming weeks. He said he’ll ask two questions: What are you most proud of at Bayfront? And where do you think it needs to focus on improving?

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Already, he’s held 12 orientation sessions with team members, and he and other Orlando Health executives were at Bayfront during shift change Thursday morning. “They really are hungry to have Bayfront be that premier facility in St. Petersburg again,” Moore said, adding that Orlando Health is committed to rebuilding trust with both hospital staff and the city residents.

Bayfront saw significant troubles under management by Community Health Systems, which eventually led to friction with city leaders. During a council meeting last year, hospital executives were unable to explain discrepancies in Bayfront’s finances, and it was clear the hospital’s charity care numbers were inflated.

Meanwhile, nurses raised alarms about layoffs and deteriorating quality of care. Local members of National Nurses United said the hospital was plagued by understaffing and equipment shortages, and that those problems led to high infection rates, unnecessary deaths and other serious issues for patients.

“When I moved here 23 years ago, Bayfront was a good hospital," Pinellas County nurse Terrie Weeks told the Tampa Bay Times last year. "It’s definitely gone downhill. ... The people who work there are by and large not happy.”

In an interview Thursday, City Council member Darden Rice said many Bayfront staff have told her they were eager to see Orlando Health take over. “Employees all up and down the org chart at the hospital said ... it was important for the sustainability and the stability of the hospital."

Council member Robert Blackmon agreed and said he’s thrilled the deal is final. He said he’s done a lot of research on Orlando Health and is confident the nonprofit can turn Bayfront around.

“It’s a win for St. Pete at a time when community health care has never been more crucial,” he said, adding that Orlando Health also has a reputation for high-level teaching and training, as well as for promoting from within.

Both Blackmon and Rice said they don’t know how much Orlando Health paid the Foundation for a Healthy St. Petersburg for its share of the hospital. Rice said the foundation needed more independence, and the sale will provide that.

Foundation president and CEO Randy Russell also said he doesn’t know how much his nonprofit made from the sale. “We were not involved in those conversations,” he said. “We will receive 20 percent of the net of the sale. ... I don’t know what that math or formula is."

The foundation formed in 2013, when Bayfront, which was then a locally owned nonprofit hospital, was sold to for-profit hospital chain Health Management Associates. Money from the sale was used to pay off Bayfront’s debt and create the Bayfront Health Education and Research Foundation, which used some of its funding to buy a 20 percent stake in the hospital.

In 2015, after the hospital was sold to Community Health Systems, the nonprofit became the Foundation for a Healthy St. Petersburg while holding on to its partial ownership of Bayfront. Russell was hired to lead the private health foundation, which has more than $180 million to fund its mission, which is focused on race equity in health care.

The foundation provides grant funding for two Times reporting positions that focus on race and equity.

Strong, the Orlando Health CEO, said Bayfront and the foundation will still have some sort of partnership to decide how to invest the money into the community, but shared few details. He said there are plans for assembling a committee made up of representatives from both entities.

Entering the Tampa Bay market is a good business decision for Orlando Health, Strong said. The nonprofit has been growing throughout Central Florida, and there’s a lot of growth happening along Interstate 4 between here and there.

“That growth is going to need services, whether it’s gas stations, restaurants or health care,” Strong said. “If there are more opportunities that make sense for us, we will absolutely look at that.”

But for now, he said, Orlando Health is focused on diving deep into what’s going on at and around Bayfront. He wants to bring the nonprofit’s spirit of community-focused care to St. Petersburg.

“If there’s a community issue or a community success, we want people to think of Bayfront being involved ... helping to achieve it, helping to fix it,” Strong said. “Our organization’s mission is to care for the communities that we serve, and we now serve this community."