Deaconess Faces Legal Challenge Over Hospital Acquisition

A lawsuit has been filed by a group named Save Jennie Stuart to halt the acquisition of Jennie Stuart Medical Center in Hopkinsville, Kentucky, by Deaconess Health. The plaintiffs argue that the hospital's board of directors breached fiduciary duties by agreeing to a transfer of assets to Deaconess without adequate consideration for the community. They assert the hospital's book value is over $157 million, yet the proposed acquisition is yielding minimal returns. The lawsuit highlights procedural flaws, including inadequate disclosure and conflicts of interest among the governing board members. The Hospital Board of Trustees rebuts these claims, asserting that the acquisition will enhance local healthcare and has undergone thorough evaluation with community engagement. This legal dispute reflects a broader trend within the hospital M&A landscape, shifting toward strategic partnerships rather than larger combinations, as identified by a Kaufman Hall analysis.