Boston-based Steward Health Care System has signed a letter of intent to purchase Mercy Health System of Maine. Portland, Maine-based Mercy is part of Catholic Health East and has two acute care campuses, a recovery center with inpatient care, and a network of employed physician practices.
Plans call for Mercy to remain a Catholic facility, with the Sisters of Mercy Northeast Community and the bishop of Portland overseeing Mercy's observance of the Ethical and Religious Directives for Catholic Health Care Services. Mercy, which now is a nonprofit provider, will convert to for-profit tax status.
Steward has not disclosed the amount, but it said it intends to invest in Mercy facilities and programs. Steward said it plans to retain Mercy's management team and employees.
Mercy administrators said that while the overall number of patients has increased at Mercy facilities over the last several years, the mix of services provided has shifted to the outpatient realm, which has impacted reimbursement. In light of reforms in the health payment system, administrators said Mercy needs to advance a population health approach and an accountable care model of service alignment, and they believe that being part of Steward will help to achieve these goals.
Steward has 10 Massachusetts community hospitals, six of them Catholic.
Steward and Mercy hope to sign a definitive agreement close to the end of the year.