Sutter Health, Sacramento, Calif., announced plans to pull out of the Sonoma County, Calif., hospital market and transfer its operations to former rival Santa Rosa (Calif.) Memorial Hospital by early 2008. Under a letter of intent, Sutter agreed to close its 181-bed Sutter Medical Center of Santa Rosa and sell its Warrack campus to 325-bed Santa Rosa Memorial, owned by St. Joseph Health System, Orange, Calif. Santa Rosa Memorial would assume all of Sutters charitable obligations to the county. Under a 10-year, non-competition agreement, Sutter also would shelve its plans to build a new $253 million hospital in the area. Santa Rosa Memorial said it would spend $70 million this year to add 80 beds to the Warrack campus, double the size of its emergency department and expand parking. Officials said they hope to finalize the deal in 60 days to 90 days and seek approval from the county board of supervisors before the end of March. The deal also would require approval from the state attorney general and other regulators. Sutters Santa Rosa hospital lost $6.8 million in 2006, while Santa Rosa Memorial earned $16.2 million, according to state data. -- by Laura B. Benko
Calif. hospitals plan consolidation
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