FSLH and St. Elizabeth Medical Center Explore Merger Opportunities

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The Boards of Directors for both Faxton St. Luke’s Healthcare and St. Elizabeth Medical Center have each recently passed a resolution to begin discussions on the feasibility and benefits of merging, or undertaking other transactions that would more closely link the two hospitals. 

“The economic and regulatory environments continue to make it difficult for hospitals to survive. During the past several years, hospitals, particularly in New York State, have been struggling with the changes in reimbursement, unfunded mandates and an increasingly challenging regulatory environment. I applaud both boards for having the vision and commitment to explore a merger in order to sustain the healthcare needs of our community,” stated Gregory McLean, chairman of the Board of Directors for Faxton St. Luke’s Healthcare. “Both institutions have strong commitments to the community and both recognize the need to be pro-active in this ever-changing healthcare arena.”

While officials are unsure of the specific timeline, they anticipate the process will take 18 to 24 months.

“As we look around New York State, a number of hospitals have already merged or are in the process of merging,” notes Norman I. Siegel, chairman of St. Elizabeth Medical Center Board of Trustees. “Consolidation and joint partnerships are not new for our area. Faxton Hospital and St. Luke’s Memorial consolidated their services in 2000. Both St. Elizabeth Medical Center and Faxton St. Luke’s Healthcare jointly own the Mohawk Valley Heart Institute and have collaborative agreements for the Regional Cancer Program and the Central New York Diabetes Education Program. As we, the board members, look at the future, we feel it is responsible and prudent to explore the possibility of a combined system.”

The two organizations employ nearly 4,900 employees and have combined operating budgets of more than $535 million dollars.

“As community hospitals, we have done a good job working together to not duplicate services in a number of areas. That alone has saved our community millions of dollars in resources. As we look to the future and see the continued decrease in reimbursement and the additional burden placed on healthcare for regulatory reform, we recognize it is no longer business as usual,” commented Scott H. Perra, FACHE, president/CEO, Faxton St. Luke’s Healthcare. “We will be exploring other models for the delivery of healthcare. While we are going through this process, we are very sensitive to what this announcement means to our healthcare family and our community. We recognize there will be concern among our employees, medical staff and members of our community. They will be anxious to know what this means regarding their jobs, where physicians practice and where patients receive care. Our pledge is to keep an open dialogue throughout this process.” 

“Both the hospitals are busy, with more than 90,000 patient visits in our combined Emergency Departments and Urgent Care and caring for more than 29,000 inpatients annually. As we begin this process, we have no preconceived ideas about the final outcome or what the new system might look like. There are a number of excellent resources throughout New York State, systems who have merged, and we will be talking directly to a number of them in the coming months,” said Richard H. Ketcham, FACHE, president/CEO, St. Elizabeth Medical Center.  “As we begin this journey, we have many avenues we need to explore, including working with the New York State Department of Health and our national, state and local government officials.”

“It is very important that the sponsor of our Medical Center, the Sisters of St. Francis, is fully involved as our discussions develop,” Mr. Ketcham stated.  “I am pleased that they have already pledged their full support for our participation in this process.”