Two of Nashville's not-for-profit healthcare giants signed a letter of intent last week to consolidate their operations through a new partnership, creating a network serving central Tennessee and southern Kentucky.
The partners are Baptist Hospital and Saint Thomas Health Services.
Baptist owns three hospitals in Tennessee. Its flagship is 649-bed Baptist Hospital in Nashville. Saint Thomas, which is part of Daughters of Charity National Health System, owns 525-bed Saint Thomas Hospital in Nashville.
Executives of the systems expect the deal to take three to six months to become final. It's subject to federal antitrust approval.
A spokesman for Saint Thomas said the hospital doesn't need Vatican approval to complete the transaction because it's not selling or merging any assets.
David Stringfield, Baptist president and chief executive officer, said talks to create the alliance began about three months ago.
Stringfield and Saint Thomas President and CEO John Tighe said the reason behind the joint venture was twofold: to increase access to patients and to create a more efficient structure between the hospitals and managed-care plans.
Tighe said this wasn't a defensive position for the two hospitals. "This is an offensive measure," he said. "We want to be responsive to what managed care and physicians wanted. This is not a look over your shoulder kind of thing."
Baptist and Saint Thomas will maintain their separate ownership and historic assets, but they'll create a joint board to run the systems as a merged organization.
Stringfield will chair the new board for the first two years, then the position will rotate to a chairman appointed by Saint Thomas for two years. Tighe will be the interim CEO while the new board completes its search for the position. Tighe said he would be applying for the job.
Stringfield and Tighe said they met with executives of 609-bed Vanderbilt University Hospital the day of the announcement to talk about Vanderbilt joining the partnership.
That's two days after Roscoe "Ike" Robinson, 66, retired after 16 years as vice chancellor for health affairs at Vanderbilt. Harry R. Jacobson, deputy vice chancellor for health affairs, will be the interim head of the hospital.
Merger talks between Saint Thomas and Vanderbilt broke down in June 1996 after the two hospitals realized their interests couldn't be aligned at the time, Tighe said.
Vanderbilt is interested in entering the alliance, Stringfield said, but Baptist and Saint Thomas won't consider it until after their deal is final.
"We want to be open for other not-for-profit institutions in any way that we can, and that includes Vanderbilt," Tighe said.
This isn't the first time Baptist and Saint Thomas have joined forces. For the past 11 years, they have jointly owned Middle Tennessee Medical Center in Murfreesboro.