Mercy officials: Parent group’s merger talks won’t change plans to sell Portland hospital to for-profit chain

Mercy Health System of Maine said its board of directors have agreed to negotiate its sale to Steward Health Care System LLC, a for-profit health care company based in Boston.
Mercy Health System of Maine said its board of directors have agreed to negotiate its sale to Steward Health Care System LLC, a for-profit health care company based in Boston. Buy Photo
Posted Oct. 18, 2012, at 1:07 p.m.

PORTLAND, Maine — Officials with the Portland-based Mercy Health Systems of Maine said Thursday talks of a merger between their parent group, Catholic Health East, and the Michigan-based Trinity Health will have no direct effect on the local hospital or its associated facilities.

The higher-level discussions also will not derail concurrent, but separate, negotiations between Mercy and the Massachusetts-based Steward Health Care, which could result in Mercy leaving Catholic Health East and joining the Boston for-profit hospital group.

Scott Share, spokesman for Pennsylvania-based Catholic Health East, said talks between his organization and Trinity Health to pin down the details of an official partnership may take as long as seven months. By that time, Mercy may no longer even be a part of the Catholic Health East, he admitted.

If it is, the southern Maine network of health care facilities would benefit from the best practices and lessons gleaned from what would become a new 82-hospital family ranging across 21 states.

Catholic Health East currently includes 35 hospitals.

Mercy’s southern Maine portfolio includes two flagship hospitals in Portland, as well as several smaller associated health care facilities in the area. Mercy has been a part of CHE for approximately 15 years.

“We’re really looking at the importance of scale, the size of your organization and what you can do with that size,” said Share. “Whether it’s best practices, the ability to work with third-party payers across the country, or combining voices to advocate for Catholic health care and our commitment to serving the poor.”

Share said Catholic Health East officials are excited about the prospect of bringing thousands of additional doctors, administrators and caregivers from Trinity into ongoing CHE discussions about best efficiency, charity work and patient care. A combined Trinity-CHE group would include 4,100 physicians and 87,000 total employees from which to draw best practices, he said.

But he acknowledged many details still need to be worked out. The boards of the two organizations announced on Tuesday that they had signed a nonbinding letter of intent to merge into a single unified health system. Where economic efficiencies might be found — through bulk purchasing, shared data systems or eliminating administrative redundancies — remains to be determined, Share said.

“That’s what this due diligence period is about,” he said. “Specifically, what are some of those tactical and operational opportunities to come together.”

Mercy CEO Eileen Skinner said in a statement the consolidation talks between CHE and Trinity “reflect the necessity for health care systems to respond to answer the call for health care reform while ensuring access to quality care for all.”

“It is a bold and strategic move on CHE’s part to enhance its mission of service to people and communities across the nation,” she said.

In August, Skinner announced that Mercy had begun negotiating a sale to Steward Health Care Systems, which if consummated would make the Portland hospital Maine’s first to be wholly owned by a for-profit organization.

Steward would be expected to make significant investments in the Mercy system if the deal is finalized, according to a hospital release at the time. Steward has reportedly made nearly $600 million in capital investments in their hospitals in Massachusetts.

Mercy has expanded its operations over the past decade, including the completion of Phase I of its new health care campus on the Fore River in Portland. Phase II is expected to be completed by 2018, according to the hospital.

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