Summa Health CEO Dr. Cliff Deveny to Step Down
Transition and New Roles
Summa Health’s CEO and President, Dr. Cliff Deveny, will resign from his position at the end of this year, as communicated in a Wednesday email to staff obtained by Healthcare Dive. His departure follows the recent $515 million acquisition of the Ohio-based health system by the Health Assurance Transformation Company, a spinoff of venture capital firm General Catalyst. This acquisition will transition the nonprofit Summa into a for-profit entity. Starting January 1, Deveny will assume the role of CEO emeritus and will focus on strategic advising. Daryl Tol, currently the president of HATCo, has been appointed as the interim CEO. According to a spokesperson, Summa anticipates that the executive search for a new CEO will take several months.
Insights on the Acquisition
General Catalyst’s acquisition of Summa Health is notable as it marks the first instance of a venture capital firm fully owning a health system. The firm views this deal as a chance to explore methods to enhance hospital operations while minimizing the risks associated with financial shortfalls. In his message to employees, Deveny acknowledged that his resignation might come as a surprise given its timing relative to the acquisition. He reassured staff, stating, “I know that change can feel unsettling. But I want you to know this decision has been made thoughtfully, collaboratively, and with Summa’s long-term success in mind. It’s the right decision at the right time.”
Summa Health’s Operations and Financial Challenges
Summa Health serves around 1 million patients annually through its two acute care hospitals, one rehabilitation hospital, a network of community medical centers, and various physician offices. Additionally, Summa Health operates a health insurance division known as SummaCare. Prior to the acquisition, the health system faced financial difficulties, reporting unfavorable operating returns and high levels of long-term debt. In support of the acquisition, General Catalyst committed to providing significant additional funding beyond the purchase price, including $15 million for community health initiatives, $350 million for technology investments, and $200 million for strategic transformation projects.
Regulatory Scrutiny and Conditions
The acquisition process took approximately two years to complete, partly due to the heightened scrutiny of transactions involving the conversion of nonprofit health systems like Summa to for-profit status. Research indicates that such transitions often lead to declines in care quality and increases in prices. To gain approval from Ohio regulators, General Catalyst agreed to several conditions, including increasing the purchase price, ensuring local community members are included on Summa Health’s board, and committing to uphold previous levels of medical services and charity care. Ultimately, Ohio Attorney General David Yost approved the deal in June, and it was finalized on October 1.