CHI-Dignity merger cleared by Vatican

The proposed merger between Catholic Health Initiatives and Dignity Health cleared a major hurdle this month when it got the ecclesiastical blessing from the Vatican.

Denver Archbishop Samuel Aquila in a letter dated Oct. 5 informed CHI that as long as his five moral conditions for the deal continue to be met, he had no objections to the merger. This followed a decision last month by the Vatican’s Congregation for the Doctrine of the Faith to let bishops in the local dioceses where the newly formed entities will exist decide the matter. While the archbishops of Denver and San Francisco—where CHI and Dignity, respectively, are based—previously had signed off on the so-called ministry alignment agreement, their approval was dependent on Vatican approval.

The merger proposal received an unfavorable moral analysis from John Haas, president of the National Catholic Bioethics Center, which added to the uncertainty about the Vatican’s decision. CHI and Dignity then sought additional moral analyses from three other ethicists, who gave favorable opinions. Several state regulators must still OK the deal.

North Dakota’s attorney general has reviewed the merger, and the Colorado attorney general’s review process is underway. Arizona regulators will also likely hold a public hearing. California’s review process has been by far the most rigorous. The systems filed their alignment agreement with Attorney General Xavier Becerra’s office in March, and have since held 17 public meetings, CHI Chief Financial Officer Dean Swindle said on an Oct. 11 call with investors.

A coalition of advocacy groups are pressing Becerra to ensure that the deal does not limit reproductive health services, care for LGBTQ patients, or services for low-income and underserved communities.

The merger agreement states that CHI or Dignity may terminate the agreement if it hasn’t closed by Dec. 5, a year after it was signed. Initially announced in 2016, the merger would create a combined system with 139 hospitals in 28 states with total annual revenue of nearly $30 billion, making it the nation’s largest not-forprofit hospital company by revenue.