Discussions between the University of California at San Francisco and Stanford University have led the institutions to consider a merger of their medical centers and clinics.
Combining forces holds more promise than going it alone in the managed-care-driven health environment, UCSF said in a written statement.
Consolidation talks have been going on for 10 months (Jan. 8, p. 6). Last month the institutions-which are within 40 miles of each other-informed their employees that a merger proposal is being considered.
The institutions combined have $1 billion in assets and nearly 1,200 beds.
Under the proposal, a new, independent organization would be created to administer the merged medical enterprises. Both institutions would transfer their medical centers and other clinics to a new not-for-profit public benefit corporation.
The two medical schools and their faculties, along with their research and educational programs, would remain independent.
"The primary goals of such an agreement would be to ensure strong medical education programs, provide cost-effective health services and improve community access to the latest advances in medical science," UCSF officials said in a written statement.
"Combining the individual strengths of the medical centers could improve the clinical and financial performance of patient-care services as well as strengthen the teaching and research programs of the respective medical schools," UCSF added.
Over the next few months, results of the discussions will be shared with UCSF regents and Stanford trustees. If both groups approve an agreement in principle, the new organization would make decisions about program, departmental and personnel policies, UCSF said.
The arrangement is not expected to be operational before next year.