Intermountain to acquire SCL Health
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