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Dignity Health, Catholic Health Initiatives announce merger plans

The deal has been approved by both system's governing boards and is anticipated to close in the second half of 2018.

Beth Jones Sanborn, Managing Editor

Catholic Health Initiatives and Dignity Health have announced plans to merge into a new, nonprofit Catholic health system that will serve 28 states, Dignity said in a statement.

The new system will include more than 700 care sites and 139 hospitals, staff roughly 159,000 employees and more than 25,000 physicians and other advanced practice clinicians. The organizations will not overlap geographically across hospital service areas, Dignity said. The new system will establish a corporate base in Chicago and will operate under a new name slated to be chosen in the second half of 2018. Local facilities will continue operating under their current names.

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Dignity CEO Lloyd Dean and CHI's CEO Kevin Lofton will lead the new organization together as CEOs, each with specific responsibilities and decision-making authority. They will oversee strategy and integration planning together, with Lofton having authority over mission, advocacy, sponsorship and governance, system partnerships, and information technology and Dean with authority for all of operations, including clinical, financial, and human resources.

"We are joining together to create a new Catholic health system, one that is positioned to accelerate the change from sick-care to well-care across the United States," said Kevin E. Lofton, chief executive officer of CHI. "Our new organization will have the talent, depth, breadth, and passion to improve the health of every person and community we serve."

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"By combining our ministries and building upon our shared mission, we will expand our commitment to meeting the needs of all people with compassion, regardless of income, ethnicity, or language," said Lloyd Dean, president and chief executive officer of Dignity Health. "We foresee an incredible opportunity to expand each organization's best practices to respond to the evolving healthcare environment and deliver high-quality, cost-effective care."

Key priorities for the new system will include expanding community-based care and offering access to outpatient settings and virtual care that is more convenient, clinical programs that focus on special populations and the chronically ill as well advancing digital technologies and innovation, Dignity said.

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Dignity said the new system will keep its commitment to supporting communities through charity care, grants, and loans to help create healthier communities. In fiscal year 2017, the systems collectively provided approximately $4.7 billion in charity care, community benefit, and unpaid cost of government programs.

"The new system will be guided by our shared mission that emphasizes social justice for all people and will work to ensure that those values are part of the local and national health care environment," Dignity said.

Dignity Health and CHI are no strangers to each other and have partnered on other initiatives. A little more than a year ago, they formed Precision Medicine Alliance, which will create a large community-based precision medicine program. A precision oncology program is being implemented in three service areas, and four-to-six more service area launches are planned across the country in the next 12 months. The program's objective is to be available at nearly 150 CHI and Dignity Health and care centers across the U.S., serving approximately 12 million patients annually, Dignity said.

The deal has been approved by both system's governing boards and is anticipated to close in the second half of 2018, subject to federal, state, and church approvals.

Twitter: @BethJSanborn
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