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Why did the Presbyterian/UnityPoint merger really break down? Questions remain

When the two CEOs sat down in early March with Becker's to discuss the merits of the proposed $11 billion merger between Presbyterian Healthcare Services and UnityPoint Health, there was a lot of positivity in the air.

Talk of a close professional relationship between Dale Maxwell, CEO of Albuquerque, N.M.-based Presbyterian, and Clay Holderman, then CEO of West Des Moines, Iowa-based UnityPoint, anchored the planned tie-up where the differences between the health systems was discussed as a key element of the merger. Both systems stressed how they were committed to rural low-cost healthcare in their respective markets.

"There were so many fundamental changes we saw in 2022, such a structural change across the entire health sector, and we knew we had to do something different and find a more sustainable path forward," Mr. Maxwell told Becker's at the time. "We can't solve these structural problems with old solutions."

Seven months later, and the merger is no more.

A joint press release simply acknowledged the breakdown of the merger. A separate one from UnityPoint subsequently thanked the departing Mr. Holderman for his work for the health system.

Reports emerged of the breakup not being due to regulatory issues, an issue confirmed to Becker's by a Presbyterian spokesperson who said the system would not comment further on the merger breakdown.

No other specifics have been officially revealed by either system as to why the planned partnership could not continue after the heady days of early March when it was announced to the world.

"After significant planning and consideration, the two organizations will no longer be pursuing the transaction," according to the Oct. 11 press release. While Mr. Maxwell was also quoted as reiterating Presbyterian's commitment to finding a "sustainable path forward," comments from UnityPoint leadership were left to Board Chair Sally Gray, RN, with the concurrent announcement that Mr. Holderman would no longer be serving as CEO of the Iowa organization.

"We believe this decision allows us to better meet the needs of our patients, team members, communities, and key stakeholders," she said in a statement.

An almost 50-hospital system would have been created out of the merger, with Presbyterian operating nine hospitals and UnityPoint responsible for 39 at the time of the March announcement.

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