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JACKSON, Miss. (AP) — The University of Mississippi Medical Center will take over a chain of fitness centers in the Jackson area, partly accepting them as a gift and partly purchasing them.
The College Board approved a plan Monday where UMMC will pay $9.26 million for Courthouse Racquet & Fitness, whose real estate is valued at $10.5 million. Owner John L. Black Jr. of Madison will give $4.8 million in cash immediately to the medical center and give $500,000 a year for 10 years, for a total of another $5 million.
Vice Chancellor for Health Affairs Dr. James Keeton said the six Courthouse locations would become the UMMC Wellness Center on Jan. 1. UMMC would own locations in Brandon, Byram, Flowood and north Jackson, while taking over leases for locations in Madison and downtown Jackson.
"We will be able to take our patients and, in effect, give them a prescription for wellness," Keeton said in an interview last week.
Keeton said UMMC had previously considered building its own wellness center from scratch and had chosen Illinois-based Power Wellness Management to run it after reviewing proposals in 2012. But then Keeton said he started talking to Black, his former fraternity brother at Ole Miss.
"He has been meeting with me for the last few years," Keeton said. "He said 'I want to do something for health care.'"
The idea, Keeton said, is that the wellness centers will be medically integrated with the university's hospitals, physicians, schools and clinics.
"This is part of the delivery of health," Keeton said.
Power Wellness will get a flat fee of $144,000 a year, plus 12 percent of the monthly operating profits from the centers. In documents presented to the College Board, Power will be paid a total of $3.5 million over 10 years. UMMC projects the facilities will run at a loss in 2015, but turn a profit after that.
Power will employ about 100 workers at the six locations, which bring in $5 million to $5.5 million in revenue in a typical year. Current Courthouse employees will become employees of Power. UMMC said the number of employees is expected to increase in the changeover to the wellness model. UMMC expects to spend $1.3 million on upgrades in the first year.
In the Jackson area, Baptist Health Systems has locations in Jackson, Clinton and Madison. St. Dominic Hospital is aligned with a multi-unit operation called The Club.
University officials wrote in documents submitted to the College Board that the deal could help UMMC reach more patients.
"This will give UMMC a presence in our communities in which we have needed to be present for years, especially since the size of our campus is intimidating and sometimes negatively perceived by consumers," board materials state.
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