North Shore-Long Island Jewish Health System has entered exclusive talks to acquire Maimonides Medical Center, a deal which would significantly expand North Shore's market in Brooklyn.
A deal for Maimonides Medical Center would continue the Great Neck, N.Y.-based system's recent aggressive growth strategy, which includes its expansion into health insurance and hospital acquisitions.
“We've been looking for opportunity to expand,” said Terry Lynam, spokesman for North Shore-LIJ, which operates two pediatric clinics in the New York City borough. Its primary market is Long Island, Staten Island and Queens. The system acquired a Manhattan hospital in 2010. The 679-bed Maimonides would become the Brooklyn hub for North Shore-LIJ, he said. “We recognize the borough as a major opportunity, Lynam said.
Negotiations are expected to last two or three months, he said.
The prospective partners have worked together previously. Maimonides Medical Center is a provider within North Shore-LIJ's insurance network. The pair also jointly bid unsuccessfully to take control of Brooklyn's Long Island College Hospital.
Maimonides Medical Center did not seek a partner because of any financial distress but because it lacked sufficient borrowing capacity to make capital investments, said Maimonides spokeswoman Eileen Tynion. “We determined that we wanted and needed to expand some of our services,” she said. The system's emergency and obstetrics departments see continued high demand. “There is a limit to how much we can expand because the margins are slim,” she said.
North Shore-LIJ ended the first nine months of last year with net income of $109.7 million on revenue of $5.4 billion, according to the system's financial statements. Maimonides Medical Center reported net income of $1.1 million on $740 million in revenue for the same period, Tynion said. Net income includes income from operations and income from other sources, such as investments.
The deal comes as Brooklyn's health system grapples with consolidation and upheaval, reports Crain's New York Business.
Follow Melanie Evans on Twitter: @MHmevans
