General Catalyst’s Health Assurance Transformation Company (HATCo) has wrapped its acquisition of Summa Health, shifting the Akron, Ohio-based healthcare system from a nonprofit to a taxed subsidiary.
The deal was first announced in early 2024 and underwent a lengthy regulatory review amid pushback from local residents. Ohio Attorney General Dave Yost gave the transaction a green light during the summer with certain conditions, including an increase in the sale price from $485 million to $515 million.
“Today is the culmination of months of collaboration between our organizations and marks the start of a new chapter for Summa Health and those we serve,” Cliff Deveny, M.D., Summa Health President and CEO, said in Wednesday morning’s announcement. “With HATCo, we can preserve our community roots, invest in our team and take bold steps to modernize and expand access to ensure Summa remains strong for decades to come.”
Summa Health is among Ohio’s larger health systems. It employs more than 8,500 people across two acute care hospital campuses, 15 community medical centers, a rehab hospital, a health insurance arm, a multispecialty group practice and a research and medical education program. It reported about $2 billion in total revenue, but a narrow operating loss of $8 million in fiscal year 2024.
HATCo’s purchasing funds, plus Summa Health’s existing cash on hand, allows the system to scratch $850 million in existing debt, the organizations have said. They have also committed to maintaining existing charity care commitments and creating a nonprofit community health foundation—the Trailhead Community Health Foundation of Greater Akron—that, under the attorney general’s terms, will be governed separately, with most board members holding no affiliation with the health system.
From the start, General Catalyst has described its plans to acquire a health system via HATCo as “not a quick flip but a long-term commitment to transformation that benefits the community.” The venture capital firm has outlined a strategy of near-term technology investments and other innovations that may pave the way for value-based care and new revenue streams over a longer horizon—and has promised $350 million in five-year capital funding and another $200 million in seven-year strategic investment funding to make it happen.
The partners reaffirmed the thesis with Wednesday’s announcement, saying that HATCo’s “significant investment will ensure the sustainability of the system while also enabling strategic, transformative initiatives and innovation.”
“For our teams, that means new technology, resources and support to drive transformation enablement while addressing system fragmentation to make daily work easier,” HATCo President Daryl Tol said. “For patients, it means consistent, reliable care today and a more connected, seamless experience tomorrow as we transform together.”
The partners’ immediate focus is on stabilizing the organization during the transition to a for-profit entity. So far, work has begun on “a transformation plan to connect, support and empower patients, providers and staff,” the partners said.
“We are making a generational investment in community health infrastructure. Our partnership with Summa in Akron will serve as a blueprint for the healthcare industry,” Hemant Taneja, CEO of General Catalyst and founder and executive chairman of HATCo, said in the announcement. “Outcome-driven, and focused on sustainable transformation, we are reimagining and building a more resilient, affordable and proactive healthcare system that empowers people to live their healthiest lives.”