January 16, 2013

ECHN seeks to join CT care-merger frenzy

Add Eastern Connecticut Health Network to the list of Connecticut hospital systems looking for a merger partner.

The nonprofit parent to Manchester Memorial and Rockville General hospitals is considering a merger or affiliation with six different hospital operators, Dennis McConville, ECHN's senior vice president said Wednesday.

In the latest deal announced hours earlier Wednesday, St. Francis Hospital and Medical Center disclosed its intent to combine forces with St. Louis' Ascension Health Care Network, a for profit Catholic hospital operator.

McConville said ECHN, which is facing financial headwinds like the rest of the industry, put out a request for proposals at the end of last year seeking a merger or affiliation partner with deeper pockets so that the organization can keep up with investments in technology, infrastructure, and personnel.

McConville said the RFP went out to six operators and four of them responded by the Tuesday deadline. McConville wouldn't disclose the hospitals that have shown interest in a deal but he said they include in-state and out-of-state organizations as well as nonprofit and for-profit entities.

McConville said federal health care reforms, proposed funding cuts from the state and federal governments, and the need to make significant capital investments is driving the search for a partner.

"We are not being forced to affiliate at this time, but that's not to say the financial pressures aren't mounting," McConville said.

McConville said ECHN will look at the RFP responses and whittle down the choices in a month or two to determine the right partner.

ECHN's partner search comes amid a flurry of merger and acquisition activity among Connecticut hospitals over the last few years.

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