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Baylor, Memorial Hermann to form 68-hospital system

The boards of Dallas-based Baylor Scott & White Health and Houston-based Memorial Hermann Health System signed a letter of intent to merge, the systems announced Oct. 1.

Together, the combined system will include 68 hospital campuses, more than 1,100 care delivery sites, two health plans and almost 14,000 employed, independent and academic physicians.

The combined $14 billion system's 68 hospitals would account for 15 percent of the total hospitals in the state, and cover most of north, central and southeast Texas, according to data from American Hospital Association cited by The Dallas Morning News. Physicians in the hospital network would see nearly 10 million patients per year.

"This is about two mission-driven organizations — both committed to making safe, high-quality healthcare more convenient and affordable — building something transformative together," Jim Hinton, CEO of Baylor Scott & White Health, said in a news release. "We must lead the change in our industry, while insisting we continue to fulfill our unwavering commitments to meeting the needs of all Texans."

Under the letter of intent, the organizations will retain a unified board comprising an equal number of representatives from both organizations, and will maintain an executive and support staff based in Austin, Texas; Dallas; and Houston, among other locations.

Mr. Hinton will serve as CEO of the combined entity and will be joined in the office of the CEO by Chuck Stokes, president and CEO of Memorial Hermann, and Pete McCanna, president of Baylor Scott & White.

Officials said the combined organization will be rebranded before closing the deal, but that Baylor Scott & White and Memorial Hermann will continue to operate under their respective brands in their service areas.

With the letter of intent, Baylor and Memorial Hermann have entered into exclusive negotiations. Officials said they hope to sign a definitive agreement in 2019.

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