Publicly traded B.C. health-care company expected to buy, operate insolvent Manitoba Clinic

Hey there, time traveller!
This article was published 25/09/2023 (714 days ago), so information in it may no longer be current.

A Vancouver-based health-care giant is poised to take over operations at Manitoba’s largest private clinic, prompting some physicians to consider moving their practices, the Free Press has learned.

Doctors at the Manitoba Clinic, which entered bankruptcy protection last year, were told Sept. 22 a court-appointed monitor had reached an asset purchase agreement with WELL Health Clinic Network Inc.

A source said a separate bid by physicians at the clinic was not chosen.

“It came as a complete surprise that the clinic was purchased by a large multi-clinic, publicly traded corporation listed on the (Toronto Stock Exchange) and operating mostly out of B.C.,” the source said. “Several physicians have already discussed leaving the clinic, and many had already left previously for other reasons.”

Doctors were told the sale will be finalized Dec. 1, pending court approval, which is expected to be sought Nov 24.

The sale price was not disclosed.

“This process is such that the parties are very cautious about confidentiality until it’s ready to go before court,” said lawyer Douglas Finkbeiner, who represents the clinic’s parent company. “The intention of everybody involved is that the clinic will continue.”

It is hoped the existing group of doctors will stay at the central Winnipeg clinic, he said.

Sale does not include the building

The proposed sale to WELL does not include the 10-storey Manitoba Clinic building, located next to the HSC campus.

Subject to court approval, the building is being purchased by the Health Sciences Centre Foundation, which would lease space.

WELL is expected to make a pitch to convince physicians to keep their practices at the clinic.

At a meeting scheduled Wednesday, doctors hope to learn more about how the clinic would operate under new ownership and what a sale could mean for their practices and patients.

A source was optimistic the clinic would be less prone to future collapse under WELL’s ownership, if physicians decided to leave for whatever reason.

“I’d hope WELL clinics is planning on making it a viable place to keep working, and didn’t just buy it to gut the equipment and perhaps the support staff, etc., for telehealth or other projects.”–Source

“I’d hope WELL clinics is planning on making it a viable place to keep working, and didn’t just buy it to gut the equipment and perhaps the support staff, etc., for telehealth or other projects,” the source said.

“Ideally, they are just a new management team running an efficient clinic in a space leased from the HSC Foundation. I think everyone wants to keep a clinic running in the area.”

Another source said some physicians have indicated they would leave if payments owing are not respected by new owners, “as it would be more strategic to either join another clinic or start a new physician-owned clinic elsewhere.”

130 WELL locations in Canada

Some are concerned about the implications of a local physician-owned clinic being purchased by a large corporation that has shareholders, the source said.

According to its website, WELL owns and operates the largest network of outpatient medical clinics in Canada, with more than 130 locations in B.C., Ontario and Quebec.

Physicians submitted their own bid to take over and maintain doctor ownership of the clinic’s operations during the sale and investment solicitation process, a source said.

The source said the monitor, consulting firm Alvarez & Marsal, met with the doctors in August to assure them their bid was being considered.

Alvarez & Marsal is in charge of monitoring the business and finances of the Manitoba Clinic’s parent company while it undergoes restructuring. Parent company WELL Health Technologies Corp. and Alvarez & Marsal did not respond to requests for comment.

Manitoba Clinic chief executive officer Keith McConnell was out of the office Monday, according to an automatic email reply.

The HSC Foundation and Manitoba Health are not involved in the proposed asset purchase to WELL, according to spokespersons.

The proposed sale is mentioned in the latest monitor’s report, which was filed in the Court of King’s Bench on Sept. 22.

On Tuesday, a judge will be asked to extend the deadline for the clinic’s debt restructuring, which would give the parties more time to complete the proposed transactions.

Struggled to recruit physicians

Doctors Manitoba, which represents some 4,000 physicians and students, was waiting to learn more about the proposal and hear from doctors who will be affected before commenting further.

“However, it would be worthwhile pointing out that one of the original problems that contributed to this situation is the significant doctor shortage in Manitoba, something that is impacting numerous clinics across the province,” spokesman Keir Johnson wrote in an email.

Ahead of the Oct. 3 provincial election, Doctors Manitoba made a series of recommendations to party leaders to help ease the shortage and improve health care.

The Manitoba Clinic has lost money since it moved into a new building in 2018. The clinic struggled to recruit enough physicians and lease vacant space to make ends meet. A majority of its revenue comes from physicians’ billings to the province’s Health Department.

In April, a judge approved a plan to give retention payments to the remaining 36 physicians in a bid to prevent them from leaving the insolvent clinic.

Half of the clinic’s 70 physicians had moved to other clinics, retired or left Winnipeg since the Manitoba Clinic entered creditor protection.

In addition to owning clinics, WELL Health Technologies is known for its range of telehealth and virtual-care services, including an online doctor’s appointment booking platform and remote consultations with family physicians or mental-health counsellors.

The company also has operations in the U.S.

chris.kitching@freepress.mb.ca

Twitter: @chriskitching