Methodist, Franciscan probing merger plan - March 27, 2017

Courtesy of • March 27, 2017

By Carole Carlson

Methodist Hospitals and Franciscan Alliance are weighing a possible merger, according to the leaders of both organizations.

On Wednesday, they released statements saying they’ve signed a non-binding letter of intent aimed at combining hospital operations.

Both sides expect to explore the partnership during a 120-day period before an agreement is finalized.

During that time, they will meet with physicians, staff members and community representatives to discuss the impact of a merger.

“We look forward to maximizing the benefits of this partnership that will bring the best of both systems to our communities,” said Ray Grady, president and chief executive officer of Methodist Hospitals.

Grady announced last June that Methodist planned to explore a merger with another hospital.

“We believe that, together, we can provide better access to care, enhance patient services, improve quality, and lower costs through cooperation,” said Kevin Leahy, president/CEO of Franciscan Alliance.

“By leveraging the talent and expertise of our physicians and clinical staffs we can improve the patient experience for those whom we are privileged to serve,” he said.

The merger is fueled by the country’s changing healthcare market that leaves hospitals struggling to reach sustainable profit margins.

The release stated that combining systems would leave the hospitals better-positioned to meet challenges and address “clinical and financial consequences of the shift to population health management and risk-based contracting.”

Franciscan Alliance is one of the largest Catholic health care systems in the Midwest. Locally, it owns hospitals in Crown Point, Munster, Hammond, Dyer and Michigan City.

Founded in 1875 by Sisters of St. Francis of Perpetual Adoration, it employs nearly 20,000 healthcare professionals.

Nearly 100 years old, Methodist Hospitals operates two facilities in Gary and in Merrillville. Its Gary campus was the first Level 3-rated trauma center in Northwest Indiana.

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