(Story updated at 5:15 p.m. ET.)
The potential merger of NYU Langone Medical Center with Continuum Health Partners moved closer to a deal as the New York hospital operators signed a memorandum of understanding.
Negotiations are expected to continue for another six months as the prospective partners compare strategic and operating plans, the not-for-profits said in a joint statement (PDF)
NYU Langone, one of New York City’s largest hospitals with 786 beds, finished fiscal 2011 with operating income of $138.6 million on revenue of $2.84 billion. Financial statements were unavailable for Continuum, which includes 810-bed Beth Israel Medical Center, 692-bed St. Luke’s-Roosevelt Hospital Center and the 32-bed New York Eye & Ear Infirmary. St. Luke’s-Roosevelt reported operating income of $17.4 million on revenue of $1.26 billion for fiscal 2011.
The organizations touted the potential benefits from consolidation in the joint statement. “Both entities expect that a successful partnership would achieve economies of scale that reduce healthcare costs while enhancing the quality of care and allowing for investment in new facilities.”