SCL Health, the Colorado-based operator of eight not-for-profit hospitals with 16,000 employees, will merge into much larger and secular Intermountain Healthcare of Utah, officials announced Thursday, creating a chain of 33 hospitals with 58,000 employees across six Western states.
SCL Health, a Catholic system begun by nuns in Kansas and now based in Broomfield, will give up its corporate name and overall leadership to Intermountain, but the individual Colorado hospitals such as St. Joseph and Good Samaritan will retain their names and their religious identity.
Intermountain Healthcare, also not-for-profit, has been secular since the original hospitals in the system were donated by the Church of Jesus Christ of Latter-day Saints. Current Intermountain CEO and president Dr. Marc Harrison will have those titles with the merged company, which expects combined annual revenue of about $14 billion. The Intermountain hospitals will remain secular.
The hospital systems differ on how they handle the COVID-19 vaccines for employees. SCL Health requires the vaccine, as do other Colorado hospital systems. Harrison said Intermountain Healthcare has not mandated the vaccine, but has “north of 80%” compliance and “climbing every day.” He said the crisis in the pandemic is among those in the community who are not vaccinated, but added that Intermountain will do “whatever we need to do to take care of people.”
Intermountain runs a managed health insurance plan for 1 million residents in its current area, but SCL Health CEO Lydia Jumonville said there had been no discussions about expanding the insurance program into Colorado or other states. Harrison said there may be “market by market” applications for health insurance expansion, “or there may not be.”
Jumonville said Intermountain Healthcare wants SCL Health to continue to embrace its Catholic heritage, and that “we will follow all of the Catholic” ethical and religious directives, “and all of the values of the Catholic hospitals will be there.”
Both Harrison and Jumonville said the merger would help the hospitals continue promoting “affordable” care, but did not answer specific questions from reporters about whether they would commit to freezing or lowering prices. Colorado hospitals have been called out in recent reports for collecting some of the highest profits in the nation, and in other markets, major hospital mergers have not delivered cost savings to the consumer.
“If you can find two systems more committed to keeping costs down, please show them to us,” Harrison said, frequently emphasizing that neither hospital system was under financial pressure to merge. Instead, Harrison and Jumonville said, the combination is meant to promote better health care and expanded patient access.
Jumonville said the pandemic and its influences on health delivery did not impact the merger talks. Both CEOs said because their territories do not overlap, no staff cuts are planned as a result of merging the systems, and only a “handful” of employees would need to move. SCL’s system will continue to be run by Jumonville from Broomfield, they said.
SCL Health said the merger would not impact its close relationship with Kaiser Permanente. The managed health provider uses facilities at St. Joseph and other SCL hospitals for its inpatient and other hospital needs.
Whether or not Intermountain expands its insurance plan to new states, both CEOs said they have fielded eager contacts from “payers” — insurance companies or self-insured large employers — who seek innovation in plans for their employees. That innovation can include risk-based arrangements for the providers, who can be rewarded if they hit quality of care marks while also keeping costs down.
On costs, Harrison said, “Please watch us and hold us to be accountable.”
SCL Health, despite a large Colorado network, has remained smaller than the dominant hospital groups run by UCHealth, Centura, and for-profit HealthONE. The SCL Health group had previously announced it will build a new, $650 million Lutheran Medical Center campus a few miles west of their current Wheat Ridge site.