Inspira completes deal for Salem Medical, plans to add behavioral health staff
The first order of business for Inspira will be stabilizing the Salem County hospital's finances.
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Inspira Health completed its acquisition of the financially struggling Salem Medical Center, in Salem County, with the help of a $25 million state grant, Inspira officials said Friday.
“Our first objective will be to stabilize the organization and to ensure that they will be able to staff appropriately for core hospital services,” said Warren E. Moore, Inspira’s chief operating officer. The Inspira deal was initially announced about a year ago.
Inspira expects the 87-bed Salem Medical Center to lose $25 million this year on revenue of $60 million, Moore said. The hospital industry has seen widespread losses this year, but those losses have been particularly severe at small facilities like Salem.
Among the areas of focus for Inspira will be a 26-bed behavioral health unit that opened last year at Salem but has averaged only six patients a day because of staffing shortages, Moore said.
“We envision the utilization for that unit being much higher than it’s been,” he said. “There’s a great demand.”
This is the second time Salem Medical Center, which had long been owned by a for-profit company, Community Health Systems Inc., has been sold in the last three years or so.
A North Jersey real estate investment firm bought the property from Community Health Systems for $25.6 million in 2019. Around the same time, a newly formed nonprofit, Salem County Hospital Corp., acquired the hospital operations from Community Health for $1 million.
Under the latest sale, Inspira is using $20 million of the state grant to acquire the real estate, Moore said. The remaining $5 million will go toward capital expenditures at the hospital, which is on Route 45 near Salem.
“It will require more than that, but that is very helpful,” Moore said. “We have a three-year plan that calls for $15 million to $18 million invested in the facility.”
Inspira’s three other hospitals are in Vineland, Mullica Hill, and Elmer. Inspira had just over $1 billion in revenue and $53 million in operating income last year.