Sep 17, 2021 - Health

Intermountain to acquire SCL Health

A beige Intermountain hospital with a sunset sky in the background.
Intermountain Healthcare has found a new merger partner. Photo: Intermountain

Intermountain Healthcare will acquire SCL Health roughly six months after Intermountain and Sanford Health ended their merger attempt.

Why it matters: The combined Intermountain-SCL system will own 33 hospitals, will generate more than $13 billion of annual revenue and will dominate several areas throughout Utah and Colorado — consequently gaining leverage over health insurers and employers as a must-have network if the deal is finalized.

What they're saying: The combined hospital system is committed to "transparency and affordability," but could not guarantee prices or employer premiums would stay flat or decrease, Intermountain and SCL leaders said during a press conference.

  • However, Intermountain CEO Marc Harrison said: "Hold us accountable."

By the numbers: Both tax-exempt systems posted high-end profit margins in 2020, which were buoyed in part by taxpayer bailout cash used to stem the initial impact of the coronavirus pandemic.

  • Intermountain, which also operates its own health plan, ended 2020 with a net profit of $1.7 billion on $10.1 billion of revenue.
  • SCL, which is a Catholic system, ended 2020 with net profit of $349 million on $2.9 billion of revenue.
  • This year is on pace to be even more profitable for the systems as patient volumes returned during the COVID-19 vaccine rollout.
  • The combined health system will be headquartered in Salt Lake City and Harrison will remain CEO. SCL will take on the Intermountain name.

The big picture: The pandemic didn't stop hospitals from merging with each other, and the pandemic likely sped up hospital buyouts of physician practices.

  • This trend has raised scrutiny. The Federal Trade Commission put out a statement in August saying: "Too many hospital mergers lead to jacked up prices and diminished care for patients most in need ... hospital executives hatching merger plans should take note."

Go deeper: A reality check on hospital mergers

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