Providence St. Joseph Health of Renton, which operates Providence St. Peter Hospital in Olympia, reportedly is in talks to merge with another Catholic hospital operator, according to Reuters, and a Wall Street Journal report published Sunday.
If Providence and St. Louis-based Ascension Health come to terms, the combined nonprofit organization would operate 191 hospitals in 27 states and generate annual revenue of $44.8 billion. It would become the largest hospital chain in the country, surpassing HCA Healthcare, a for-profit company.
In July 2016, Providence Health & Services merged with Irvine, California-based St. Joseph Health to create Providence St. Joseph Health. At the time, the combined organization operated 50 hospitals and 829 physician clinics and other services across seven states.
The two have been in talks about a deal for months but have not reached an agreement, the Journal reported. The paper said that unlike for-profit companies, mergers of nonprofit hospital operators do not typically involve one entity buying the other.
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The merger talks come at a pivotal time in the industry, as a series of deals, major changes to the 2010 Affordable Care Act, or Obamacare, and rising drug prices have reshaped the U.S. healthcare landscape, CNBC reported.
Last week, Catholic Health Initiatives and Dignity Health announced that they had signed an agreement to align their organizations. The merger would result in the formation of a large and diverse Catholic health system.
On Dec. 3, CVS Health and Aetna proposed a $69 billion merger, arguing it would enable the companies to tackle soaring health care spending by offering lower-cost medical services in pharmacies. That deal, the year's largest, would combine one of the nation's biggest pharmacy benefits managers and pharmacy operators with one of its oldest health insurers.