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4 Chicago hospitals to unite, form single healthcare system

Four hospitals on Chicago's South Side have signed a nonbinding agreement to form a single integrated healthcare system.

The four hospitals are Advocate Trinity Hospital, Mercy Hospital & Medical Center, South Shore Hospital and St. Bernard Hospital.

"Working individually, our hospitals will not be able to provide sustained, quality care on the South Side," said Charles Holland, president and CEO of St. Bernard Hospital. 

Under the agreement, each provider will contribute or transfer existing hospital assets to help the combined system. The new system would have a new leadership team and an independent board of directors. Each of the four hospitals would be able to appoint someone to the board.

The leadership team will be named when the four providers sign a definitive agreement, according to a news release. They expect to sign a final agreement by the middle of this year.

The group of providers said it is committed to ensuring new facilities open before any existing ones close. They also plan to retrain and rehire current staff when the changes are made.

The four hospitals are seeking community input to help shape decisions about new facilities and services. Currently, they plan to invest $1.1 billion to expand access to primary and preventive care and build a hospital to replace aging facilities.

Consolidating may also help improve the financial picture of the hospitals, all of which posted net losses in 2018. The losses ranged from $1.3 million at South Shore to $68.3 million at Mercy. 

Combining could also help the institutions bolster bargaining power with insurers and suppliers, cut duplicative services and eliminate other expenses, such as equipment.

More articles on healthcare industry transactions:
Hospital mergers will be closely scrutinized in 2020, FTC says
Hospital M&A activity dipped 27% in 2019
McCready Hospital to join Peninsula Regional Health

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