Healthcare Business News

Regional News/Midwest: University of Wisconsin hospital deal crosses Illinois state line

By Joe Carlson
Posted: May 3, 2014 - 12:01 am ET

The University of Wisconsin plans to establish a presence in a major northern Illinois city that has seen several hospital merger plans flounder in recent years. UW Health system plans to merge with SwedishAmerican Health System in Rockford, Ill.

UW Health, which operates the 530-bed University of Wisconsin Hospital and Clinics in Madison, has been affiliated with SwedishAmerican since 2010, in a partnership that led to the construction of the $40 million SwedishAmerican Regional Cancer Center in Rockford, according to a joint statement from the healthcare providers.

SwedishAmerican also receives telemedicine services from UW Health. The systems are in relative proximity to each other, with less than an hour and a half drive between Madison and Rockford, even though they are in different states.

Both boards of directors have approved a letter of intent, and the deal is expected to close by the end of the year, pending regulatory approval.

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Under the proposed merger, Dr. Bill Gorski would remain CEO of SwedishAmerican, and would report to his board and the board of University Health Care, a not-for-profit that partners with regional hospitals for UW Health.

“As UW Health grows, we are looking for partners who share a commitment to promoting the health of the communities they serve, and SwedishAmerican has made that commitment,” said Dr. Jeffrey Grossman, president and CEO of the UW Medical Foundation and senior associate dean for clinical affairs for the UW School of Medicine.

Rockford's population of 150,000 is served by three health systems, but it has seen merger announcements over the years run into trouble. Most recently, Rockford Health System announced in January the cancellation of a merger with suburban Chicago's Cadence Health, only months after both providers had signed letters of intent to merge their organizations. That news followed a decision in 2012 to cancel the announced merger between Rockford Health and OSF HealthCare in Peoria, which runs one of three acute-care hospitals in Rockford, after the Federal Trade Commission said the deal would raise antitrust concerns.

Follow Joe Carlson on Twitter: @MHJCarlson

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