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South Side Hospital Merger Set To Be Finalized In June, Combining 4 Struggling Facilities

Coronavirus has "really shown us how much of a benefit we can provide to the South Side of Chicago if we were organized in a different manner," South Shore Hospital president Tim Caveney said.

Mercy Hospital is one of four hospitals that would have combined under a $1.1 billion merger proposal that failed in May.
Mauricio Peña/ Block Club Chicago
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SOUTH SHORE — Four struggling South Side hospitals are expected to reach a final agreement on a $1.1 billion merger by June, officials said at a virtual town hall Monday evening.

The hospitals that reached a tentative agreement in January to merge into a single health care system are:

  • Advocate Trinity Hospital, 2320 E. 93rd St.
  • Mercy Hospital & Medical Center, 2525 S. Michigan Ave.
  • South Shore Hospital, 8012 S. Crandon Ave.
  • St. Bernard Hospital, 326 W. 64th St.

At Monday’s meeting, hospital officials gave updates on the merger and answered questions from attendees. Another virtual town hall is scheduled for 6 p.m. Wednesday.

One or two new “destination hospitals” and three to six large community health centers would be built, replacing the existing facilities.

The new hospitals would provide 24-hour emergency services while reducing the 50 percent vacancy rate at existing facilities, South Shore Hospital president Tim Caveney said.

“We can be much more efficient as a single system, which would help reduce the cost of discharge,” he said.

The four existing hospitals — at least two of which have nearly shut down in recent years — combine to lose an estimated $76 million annually.

A new trauma center would not be built, as they’re “very expensive to maintain” and the University of Chicago already operates “a very good facility,” Caveney said.

The community health centers would offer urgent, preventative, primary and specialty care services. Outpatient mental health services would also be provided.

“No hospital … will close before one of the new [community health] centers is built, open and serving patients,” St. Bernard Hospital president Charles Holland said. “This is not a plan for closure; this is a plan for building something new.”

As the coronavirus has disproportionately killed Black Chicagoans, it has highlighted the South Side’s need for a merger, officials said.

The virus has put some regular services, like elective surgeries and labor and delivery, on pause at the hospitals. The “disjointed organization” of the existing hospitals has affected their response to COVID-19, Caveney said.

Coronavirus has “really shown us how much of a benefit we can provide to the South Side of Chicago if we were organized in a different manner, where we were prepared for this type of pandemic,” he said.

Planned improvements include a network-wide transition to electronic medical records, according to Mercy Hospital president Carol Schneider.

The hospitals plan to spend $1.1 billion on the merger over eight to ten years. They’ll provide $100 million in cash up front and estimate bringing in $800 million from operating revenue and debt financing.

They’re asking for $520 million over five years from the state government, and are hoping to raise $200 million from philanthropists.

The site selection process will begin after the hospitals reach a formal agreement in June and will include community input sessions. The partners will prioritize public transportation, existing parking and convenient access for South Siders.

There are 3,500 current employees at the four hospitals. Once the merger is completed, the new hospital system will employ 3,500, but a different mix of health care professionals will be needed.

Leaders are committed to retraining employees impacted by the shift, officials said.

“The door is still open” for Jackson Park and Roseland Hospitals to join in the merger, but to date, they have chosen not to, Caveney said.

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