Three member hospitals of the Unity Health Network in St. Louis announced they will bind themselves more tightly through a system merger.
St. Anthony's Medical Center, St. John's Mercy Health System and St. Luke's Health Corp. said on May 12 they will form a regional holding company that will be part of Sisters of Mercy Health System-St. Louis.
In a written statement, the three hospitals pledged to maintain their separate identities, management teams, boards of trustees and support staff, while exploring the benefits of joint managed-care contracting, shared services and better delivery. The three expect to sign a letter of intent soon and to complete the merger by midsummer.
The combined organization will include a behavioral health system, two skilled-nursing centers, several urgent-care centers and four general medical-surgical hospitals. St. John's Mercy has a second campus in Washington, Mo., about 50 miles southwest of St. Louis. The three main hospitals are all situated in demographically attractive parts of St. Louis County, west of the city.
Sisters of Mercy Health System is sponsored by the Religious Sisters of Mercy, St. Louis Regional Community, a Roman Catholic order. The holding company, however, will not be considered Catholic. St. Anthony's and St. John's Mercy are Catholic, but St. Luke's will retain its Episcopalian-Presbyterian heritage.
"St. Anthony's, St. John's Mercy and St. Luke's have a long history of collaboration and share many common traditions and values," said David C. Pratt, chairman of the board of directors of St. Luke's Health Corp. "Coming together as members of a regional holding company is a natural evolution of the cooperative relationship."
The chief executive officer of the new holding company will be James W. Swift, now president and CEO of St.Consolidations
John's Health System in Springfield, Mo., also a Sisters of Mercy hospital. Richard Grisham, CEO of St. Anthony's, will be president.
St. Anthony's, St. John's Mercy and St. Luke's were at one time known as AJL Network. In 1993 the three hospitals had 26% of the St. Louis market, as measured by average daily census. BJC Health System had 34% and the integrated delivery network around SSM Health Care System had 23%.
The hospitals will still be part of Unity Health Network, which includes 1,300 physicians and another three hospitals in Illinois: Saint Anthony's Health Center in Alton, Saint Elizabeth Medical Center in Granite City and St. Elizabeth's Hospital in Belleville.
Donald Kalicak, executive director of Unity, said the merger of the Missouri-side hospitals should strengthen the network's market position, particularly with regard to giant BJC. "Principally, it allows the hospitals to look at cost-containment strategies on a common basis. Secondly, it allows the hospitals and physicians who have affiliated through their PHOs to plan more closely together, inasmuch as they're part of a common holding company."
St. Louis hospitals form holding company
Total revenues Licensed beds Employees Physicians
St. Anthony's $341 million 934 3,800 750
St. John's Mercy 330 million 1,164 5,400 1,100
St. Luke's 155 million 633 2,800 800
Total 826 million 2,731 12,000 2,650
Note: Dollar figures are for fiscal 1994. Bed counts include skilled nursing and residential care.
Source: Sisters of Mercy Health System-St. Louis