NorthShore, Edward-Elmhurst announce merger
NorthShore University Health System and Edward-Elmhurst Health are planning to merge and create a nine-hospital health care operation with the second-largest physician group in the state.
"We're incredibly excited what this means to our patients and people," said J.P. Gallagher, NorthShore's CEO. "This is a doubling down on making community based care stronger and more vibrant for many, many years to come."
NorthShore operates six hospitals: Northwest Community Hospital in Arlington Heights, Glenbrook Hospital in Glenview, Evanston Hospital, Highland Park Hospital, Skokie Hospital and Swedish Hospital in Chicago. Edward-Elmhurst runs Edward Hospital and Linden Oaks Behavorial Health in Naperville as well as Elmhurst Hospital. The nine hospitals account for nearly 2,400 hospital beds in the suburbs and the north side of Chicago.
Combined, the two systems would employee more than 25,000 workers, have a network of roughly 6,000 physician partners and offer more than 300 sites of care throughout the Chicago area.
Under the current plan, Gallagher would take the reins as CEO of the new medical group and Edward-Elmhurst CEO Mary Lou Mastro would stay on in his administration overseeing operations of the three-hospital campus currently under her watch. The single board of directors would be made up of representatives from NorthShore, Edward-Elmhurst, Northwest Community and Swedish Hospital in Chicago.
"We share values and a shared vision for the future," Mastro said. "We're also taking a step that no other health system has done by investing $100 million each in a community investment fund in an effort to make significant impact in our communities on health equity and on well-being."
The two health system leaders said about $6 million to $10 million would be used each year for health equity programs in the areas the health system covers.
"We'll take a look at investing in partners who are addressing important factors of health such as unemployment, poverty, education, discrimination, food insecurity and housing, for example," Mastro said. "The impact to the community will be significant and allows to continue to work with community partners who are making a big difference in these communities."
Gallagher said he expects federal and state approval of the merger between the two nonprofit hospital systems by the end of the year.
If approved, the new medical group would be the third-highest patient revenue generating health care operation in Illinois behind Advocate Aurora Health and Northwestern Medicine.
The two sides have been discussing a merger for three years, but the onset of the COVID-19 pandemic slowed those talks.
"COVID really required us to step back and focus on meeting the needs of our patients and keeping our people safe," Gallagher said. "One of the take-aways from the past year was just how important strong, vibrant community based health care is when unexpected crises come."
Mastro said both entities were looking for a partnership, not to be rescued.
"Both are financially strong," she said. "This isn't a merger of necessity, but really a merger of possibility and opportunity."
Mastro said one of the lessons learned from the pandemic was how important resources were.
"By coming together, we'll be able to expand our resources available not only to our community and patients, but also our physicians," she said. "And this will allow us to more rapidly adopt and deploy state-of-the-art solutions and technology that will benefit not just our providers, but also our patients."
The two systems currently handle more than 1 million patients each year combined and account for almost 120,000 hospital admissions annually.