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Elmhurst Memorial Healthcare in Talks to Merge with Northwestern Memorial Healthcare

Merger would provide a financial boost to EMHC, patients would have more access to clinical trials, according to sources.

 

Northwestern Memorial Healthcare and Elmhurst Memorial Healthcare announced Thursday they are exploring a merger.

Discussions, which could take several months, are in the early stages. But the move would help Northwestern expand its presence in the western suburbs, and it would strengthen the financial position of EMHC, which is facing hundreds of millions of dollars in debt, according to a Thursday article in Crain's Chicago Business.

Northwestern is financially strong, with net revenue for 2010 at $1.6 billion, up from $1.4 billon in fiscal 2009, according to audited financial reports.

EMHC's debt is due to construction of its new 866,000-square-foot hospital on Brush Hill Road, which opened in June. A release issued by EMHC does not mention debt as a reason to partner with Northwestern, however.

"This affiliation would offer us a unique opportunity to become a destination provider in the western suburbs of Chicago with regionally significant and distinctive clinical program," EMHC President and CEO W. Peter Daniels said in the release.

Fitch Ratings gave EMHC an A- "Stable Outlook" rating in February.

While there are certain financial risks associated with construction of the new facility, long-term benefits are expected, according to Fitch.

The A- rating reflects EMHC's "continued good operating cash flow, strong liquidity relative to expenses, and a solid market position."

Its credit outlook is dependent on "Elmhurst's ability to execute on its strategy for top-line revenue growth (and) improved volumes and profitability," according to Fitch.

Elmhurst's high ratio of insured patients to Medicare patients is attractive to Northwestern, according to a Friday Crain's article.

Affiliation with Northwestern would give EMHC patients more access to clinical trials. Northwestern Memorial's more than 1,600 affiliated physicians also serve as faculty members of the Feinberg School of Medicine at Northwestern University, which has the reputation of being one of the country's premier academic hospitals.

"Our affiliation would provide EMH and its patients sophisticated on-site clinical programs and increased access to Northwestern’s advanced specialty services, clinical trials and research programs,” said Dean M. Harrison, president and chief executive officer, Northwestern Memorial HealthCare.

Northwestern also recently acquired Lake Forest Hospital in the northern suburbs.

Related Topics: Elmhurst Memorial Healthcare, Merger, and Northwestern Memorial Healthcare

The Smiths

9:42 am on Friday, October 28, 2011

EMHC's continued good operating cash flow...Hmmm can someone say Facility fee? What's next pay to park? We switched Doctors for the whole Family to a different practice nearby but NOT affiliated with EMH or Clinics.

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Bill Angel

9:58 am on Friday, October 28, 2011

What a HUGE surprise!

The hospital could never sustain a competitive advantage as a stand alone.
The hospital could never afford the debt service on a $600 million dollar debt.
Where would the new or increased market share come form?
Do patients really stay in the hospital longer today?
A simple market and finanical analysis would tell you the market is saturated with too many hospitals.
Doctor tel the patient which hospital to go to. 99% of the time it's where the doctor is on staff.
The hosptial board is essentially in the real estate development business.

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Jim R

10:08 am on Friday, October 28, 2011

I have become very frustrated with Elmhurst hospital. First a few years ago I was informed they would no longer handle my insurance, but fortunately my doctors said they were also connected with Good Samaritan which protected me for the rest of the year and made it unnecessary to look for new doctors. Now as I look at Medicare and coverage I find that Elmhurst is not on Blue Cross and Blue Shield Medicare Select hospitals. So now I get to select a different insurance or pay a much higher deductible. Maybe that explains the quote above: "Elmhurst's high ratio of insured patients to Medicare patients is attractive to Northwestern, according to a Friday Crain's article.". Please do not tell me that Elmhurst is a hospital that cares. In the past I have been contacted by a group collecting money for Elmhurst hospital. Personally I would not give them a dime, since they have shown they do not care for people like me.

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Just sayin...

10:45 am on Friday, October 28, 2011

I just won 500.00! I bet that Elmhurst Hospital would be bought out within 1 year of the move. And I do mean "bought out," not "merged." Small community hospitals cannot sustain what is going on withinin the healthcare/pharmaceutical industry and will no longer be eligible for many tax breaks. May be good news in disguise.

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Darlene Heslop

12:05 pm on Sunday, October 30, 2011

beat ya...i predicted it would be w/in 6 months... :-).

Jim R

10:57 am on Friday, October 28, 2011

It also appears NORTHWESTERN MEMORIAL HOSPITAL is one of Blue Cross Blue Shield Illinois Medicare Select Hospitals, but that would not necessarily mean a change in local policy.

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Bob Santini

1:56 pm on Friday, October 28, 2011

that's what the MBA schools teach these days; if you cannot compete, you "merge"; its the american way. and in the re-structuring, a few layoffs, no big deal. maybe the state's efforts to make not-for-profit corporations earn their tax exemptions will help us, or maybe Obamacare will; and if not, just remember ... "it's better to burn out than to fade away"

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MIKE

4:17 am on Saturday, October 29, 2011

Let's hpe Northwestern knows how to run a hospital, it appears they do. No hospital can remain independent of the big boys and EMH is paying the toll. Not necessarily a bad thing, just a sign of the times.

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MIKE

4:21 am on Saturday, October 29, 2011

To Jim R. - Are you saying EMH is not accepting Blue Cross Blue Shield or just your Medicare Select BCBS because I am sure Elmhurst and I guess Northwestern soon all accept Blue Cross Blue Shield regular insurance. Explain better?

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Jim R

7:54 am on Saturday, October 29, 2011

MIKE, if a hospital is not on the list of Blue Cross Blue Shield Illinois Medicare Select Hospitals the Blue Cross insurance has a much higher deductible for those on medicare. I do not know about other policies here since I am currently looking at supplemental insurance with Medicare.Apparently they do not have the same agreement with Blue Cross as hospitals on Blue Cross Blue Shield Illinois Medicare Select Hospitals. I thought an agent said I could go to Elmhurst but my deductible would be over $1,000 (thinking maybe 1400) which is not the case with those on this agreement. Other insurances may be different which is why I am currently looking at another insurance or would likely go to Good Samaritan. Maybe this explains it better:
http://www.bcbsil.com/producer/medsup.htm

marilyn v

6:05 pm on Sunday, October 30, 2011

I am very disappointed with Elmurst Hospital they did not do a good job when they had the old hospital, nurses were on computers all day and night, my husband had to stay with me for my care,this hospital is all politics get ride of the guys that were making all the bucks. Hope Northwestern takes over. Leo Franza did a poor job on taking care of the old one now he is gone GOOD. I plan on and hope other people do like wise and go to Good Sam they care.

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MIKE

8:08 am on Wednesday, November 2, 2011

Hi Marilyn - Sorry you had a bad experience at Elm. hospital. This is more the exception than the rule. When my father in law was ill, the nurses and doctors were super, very caring and dedicated people who really took an interest and wanted him to get better and he did. Any one else have a good tale about Elmhurst Hospital?

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Dan

8:15 am on Wednesday, November 2, 2011

I have another bad one. I just kept driving right past there the other day when I needed to go to the emergency room because of a bad experience I had earlier this year and thier unwillingness to resolve it. I'm sure there are many great doctors and nurses there I just won't be taking the time to find them.

marilyn v

3:46 pm on Thursday, November 3, 2011

Dan: yes there are still good doctors & nurses there I worked for them for 32 yrs so I know what is going on. I knew that they could not afford all the centers they opened and a sleep apnia and they the big one. Good luck and say well

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