Moses Cone Health System and Wesley Long Community Hospital, both of Greensboro, N.C., unveiled a proposed merger last week.
A consolidation of the two not-for-profits would give them an acute-care monopoly in Greensboro and control of nearly 70% of the staffed beds in Guilford County, N.C.
Moses Cone operates 547-bed Moses H. Cone Memorial Hospital and a 115-bed women's hospital in Greensboro. Wesley Long is a 199-bed general acute-care facility. The county's third acute-care hospital is 329-bed High Point (N.C.) Regional Hospital.
Executives of Moses Cone and Wesley Long said the organizations' merger would generate significant savings through the elimination of duplicative services and increased purchasing power, and those savings would be passed along to consumers. They also said Wesley Long, the smaller facility, needed to affiliate with a larger system to survive financially.
But according to the latest data from HCIA, a Baltimore-based healthcare information company, Wesley Long's profit margin last year was almost as high as that of Moses Cone.
Wesley Long earned $6.8 million on total revenues of $77.8 million in 1995, posting a total profit margin of 8.7%. Moses Cone's margin was 8.9% that year, reflecting a $21.9 million profit on total revenues of $243.8 million.
The organizations have begun a study to estimate the savings that would result from the merger. And, recognizing the potential antitrust problems posed by the deal, they anticipated that federal clearance may take a year or more.