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North Shore-LIJ targets second hospital purchase


By Melanie Evans
Posted: June 6, 2014 - 6:15 pm ET
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North Shore-LIJ Health System, Great Neck, N.Y., has entered talks to acquire a second hospital as part of its continuing efforts to transform into a regional healthcare player.

Directors of the 189-bed Northern Westchester Hospital in Mount Kisco, N.Y., approved a letter of intent this week to join North Shore-LIJ, which operates a dozen hospitals in New York City and Long Island, N.Y. Last month, directors of the 238-bed Phelps Memorial Hospital, Sleepy Hollow, N.Y., also signed a letter of intent to join North Shore-LIJ.

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The two pending deals would give North Shore-LIJ a foothold in New York’s upscale Westchester County. The deals follow the system’s launch of its own health insurance company, which began marketing Medicaid managed care and commercial insurance roughly eight months ago.

“We’ve been interested in expanding our footprint,” said North Shore-LIJ spokesman Terry Lynam. Acquisitions would diversify the system’s market and add to its size, he said. The system ended its last fiscal year in December with operating income of $84 million on revenue of $7 billion. “Our longer-term goal would be to really emerge as more of a regional healthcare provider,” he said.

A Northern Westchester Hospital spokesman did not respond to a request for comment.

Judge Robert Spolzino, Northern Westchester’s board chairman, said in a news release that the hospital sought a larger partner for the “scale and resources to capitalize on the monumental changes currently underway in the healthcare industry.”

Northern Westchester Hospital officials identified North Shore-LIJ as a system with the potential to invest in technology and improve the hospital’s efficiency, said hospital President and CEO Joel Seligman, in the release.

North Shore-LIJ joins a flurry of regional systems that have announced deals following a wave of consolidation among some hospital giants.

The University of Wisconsin Health system, Madison, announced merger plans with SwedishAmerican Health System, Rockford, Ill., last month. Two Illinois systems—St. Anthony’s Health System in Alton and OSF Healthcare System in Peoria—entered merger talks in March. Also in March, three Michigan systems said they would seek to merge: Beaumont Health in Royal Oak, Botsford Health Care in Farmington, and Oakwood Healthcare in Dearborn.

Follow Melanie Evans on Twitter: @MHmevans


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