Letter of Intent Signed for New Combined Health Care System

In an effort to advance the health of patients and transform the delivery of health care, Baylor Scott & White Health and Memorial Hermann Health System have signed a letter of intent to merge into a combined system.

“This is about two mission-driven organizations—both committed to making safe, high-quality healthcare more convenient and
affordable—building something transformative together,” Jim Hinton, CEO of Baylor Scott & White Health, said in a statement. “We must lead the change in our industry, while insisting we continue to fulfill our unwavering commitments to meeting the needs of all Texans.”

The Texas-based health systems are nationally recognized and both are dedicated to improving access and continuity of care. Together, the combined not-for-profit entity would consist of 68 hospitals, two health plans, and around $14.4 billion in revenue. Further, it would include more than 1100 care delivery sites, roughly 73,000 employees including nearly 14,000 independent and academic physicians. 

“Together, we believe we will be able to accelerate our commitments to make care more consumer centric; grow our capabilities to manage the health of populations; and bend the unsustainable health care cost curve in the state,” said Chuck Stokes, president and CEO of Memorial Hermann. “Through this combined system, we have a unique opportunity to reinvent health care and make a profound difference in the lives of millions of Texans.”

The combined health care system would equally be split between Baylor Scott & White Health and Memorial Hermann. It is expected that the merged company will have executive and support staff located in Austin, Dallas, Houston, and Temple. Further, although the Baylor Scott & White and Memorial Hermann facilities will maintain their brands in their respective markets, the new entity would operate under a new name.

The deal is still pending approval from the Federal Trade Commission and state attorney general. The organization hope to reach an agreement by early 2019 and finalize the merger by the middle of 2019.

“This proposed combination starts the next chapter in the legacies of service and innovation for both systems,” said Ross McKnight, chair of the Baylor Scott & White Holdings Board of Trustees. “It will not only make a positive difference in the lives of millions here, it will become a national model.”

—Julie Gould