Update on 3/11/2019: We heard from Jennifer Harrod in the AG’s office that the official closing date of the HCA/Mission transaction was January 31, 2019, so the Effective Time was 12:00:01 a.m. on February 1, 2019. This has been corrected in the last paragraph below.
Also, there’s a new page on Mission’s website that gives a lot of detail about the student loan program at this link.
There was a great deal of interest in the topic of student loan forgiveness during the review of the acquisition of Mission Health System by HCA. Students must work for an agreed to number of years at a non-profit institution in order to qualify for this tax-free program. An extensive article explaining this program was published by The Student Loan Planner financial coaching company here. What will happen to these people who have not finished their work requirement now that the Mission system is owned by a for-profit company?
The good news is that, with much concern and comments from many individuals and organizations, the amended Asset Purchase Agreement makes provision for that. The three references to it in those materials are listed below, with bold and red highlights for the most pertinent elements.
In the documet “Overview of DOJ Review of Mission/HCA Transaction”, issued by the AG’s office, there is this reference:
- HCA has committed to make its pilot student loan payment program available to all former Mission employees as quickly as possible. This program provides an unlimited number of years of loan assistance up to $150 per month.
In the “Nonobjection letter – final – executed” document, in “Section D Other Forward-Looking Commitments”, paragraph 4 provides this information:
- Buyer agreed to make its pilot student loan payment program available to all
transferred employees as quickly as is reasonably possible. See Amended APA §
Lastly, in the “Amended and Restated APA – Main Text(public) document, paragraph 7.1(b)(iv):
- Buyer shall provide any Transferred Employees who, pursuant to the Transition Plan, were terminated without cause during the twelve (12) calendar months immediately following the Effective Date with the following information: a link to the websites where Buyer and its Affiliates post advertisements for job vacancies; (x) information about how such Transferred Employees can search for, and access applications for, job vacancies within Buyer and its Affiliates; (y)
general information about how Buyer and its Affiliates manage the typical job application process; and (z) to the extent reasonably practicable, answers to any additional questions such Transferred Employees may have regarding the application and employment processes with Buyer and its Affiliates. If any such
terminated Transferred Employee is hired by Buyer or any of its Affiliates for a new job position during the period of twelve (12) calendar months immediately following such Transferred Employee’s termination, such Transferred Employee shall retain his or her seniority level he or she previously held immediately prior to termination. Buyer shall make HCA’s pilot Student Loan Assistance Program available to all Transferred Employees as quickly as is reasonably possible. Buyer shall provide Transferred Employees with information on that program within thirty (30) days of the Effective Time.
Paragraph 3.1 of the “Amended and Restated APA – Main Text(public) document defines the Effective Time this way:
- Unless otherwise agreed in writing by the Parties, the Contemplated Transactions shall be effective for financial, tax, and accounting purposes as of 12:00.01 a.m. on the first day of the calendar month immediately following the calendar month in which the Closing Date occurs (the “Effective Time”).
The Closing Date for the transaction was Janucary 31, 2019, making the Effective Time 12:00:01 a.m. on February 1, 2019. As we learn more about how this pilot student loan forgiveness program is being implemented we will post more information.