The Sitka (Alaska) Community Hospital board cancelled its letter of intent to combine operations with Juneau-based SouthEast Alaska Regional Health Consortium June 22, according to KCAW Radio.
The organizations signed a letter of intent to combine operations in December 2016 and discussed a variety of potential management options, eventually negotiating a potential merger agreement earlier in February. However, talks regarding the proposed merger began to sour shortly thereafter, according to the report.
SEARHC offered to purchase Sitka Community Hospital in May for $6.5 million upfront. In an emailed statement to KCAW Radio, SEARHC President and CEO Charles Clement said the Sitka Community Hospital board's decision to withdraw the letter of intent does not affect the consortium's interest in purchasing the hospital, according to the report.
However, Sitka officials said they are open to alternative management proposals from other organizations. The potential proposals would also dictate the number and types of services the hospital is able to provide. Without any financial assistance, services like the hospital's obstetrics program and surgical services may be cut or minimized, officials said.
Officials hired healthcare consulting firm Stroudwater Associates to review the hospital's operations and issue recommendations, according to the report.