The staid Maryland hospital market is heating up as hospitals there may be sensing the imminent death of the state's 22-year-old rate regulation system and growing insurer clout.
Maryland payers have targeted the system for dismantling or at least a major overhaul because of cost concerns (Nov. 10, 1997, p. 98).
Last week 218-bed Mercy Medical Center in Baltimore and 230-bed North Arundel Hospital in Glen Burnie announced plans to form a mergerlike partnership and then seek other consolidation partners.
Mercy and North Arundel plan to create a new parent corporation with equal board representation. Both hospitals will keep their names, their chief executives, their current services and their characters.
Details of the merger, including the name and leadership structure, will be worked out by the end of March with a July completion goal.
Calvin Pierson, president of the Maryland Hospital Association, said it is not clear whether the Mercy-North Arundel partnership will lead to a larger system.
About three-quarters of Maryland's 50 hospitals are in some kind of affiliation, Pierson said, "But the preponderance are still in two-hospital systems. The jury is still out on whether they will come together to form larger systems."
Meanwhile, 291-bed Anne Arundel Medical Center in Annapolis has received the regulatory go-ahead from the state to build a $71 million acute-care replacement facility.
The project calls for construction of a six-level hospital and a medical office building on a 104-acre campus 21/2 miles from the existing 250-bed downtown building, which dates to the 1950s. The outlying site, called Medical Park, already houses a 40-bed women's hospital, outpatient facilities and another office building.
The new facility will abut the women's hospital and have a common entrance, a spokeswoman said.
As a result of consolidation of services, the medical center's bed complement will be reduced by 80 medical-surgical beds.
Also, Helix Health and Johns Hopkins Medical Institutions, both of Baltimore, reportedly have been discussing a merger or affiliation for several months (Nov. 17, 1997, p. 21).
-with Associated Press