Oregon hospital systems are pursuing merger

Two Oregon hospital systems say they are exploring the possibility of a merger.

Doug Boysen, president and CEO of Samaritan Health Systems, and Maggie Hudson, president and CEO of Santiam Hospital & Clinics.

Samaritan Health Services and Santiam Hospital & Clinics said this week that they have signed a nonbinding letter of intent to pursue an affiliation. If the deal is finalized and approved by regulators, Santiam would become part of Samaritan Health Services

The two organizations said they will work toward brokering a definitive agreement over the next several months. Officials said the “complete affiliation” could take a year or more.

Samaritan, a nonprofit system, operates five community hospitals and more than 100 clinics in Linn, Benton and Lincoln counties in western Oregon. The system employs more than 6,000 workers and serves more than 290,000 residents.

Santiam, which is also a nonprofit system, operates an acute-care hospital in Stayton, Oregon and runs 11 clinics. The organization boasts a staff of more than 600 and serves 40,000 people.

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Both organizations said Santiam would remain under local leadership. Santiam’s physicians and staff would remain in place.

The two systems said they plan to expand healthcare services in Oregon’s mid-Willamette Valley and central Oregon coast regions.

If both organizations decide they want to come together, they would submit an application for approval from the Oregon Health Authority. The authority’s review process would include a period for the public to weigh in on the deal, the systems said.

Santiam’s board unanimously endorsed moving forward with the letter of intent. Maggie Hudson, Santiam’s president and CEO, said in a letter to the community that the two systems share similar values. “Through thoughtful and thorough assessment, it is clear Samaritan Health Services, built upon these same guiding principles, is the right partner for us,” Hudson wrote.

“Together, we can do more good – for our patients, our communities and our staff. This potential affiliation is a strategic shift to secure a better future for the patients served by Santiam Hospital & Clinics,” she wrote. “Together, we can do more good – for our patients, our communities and our staff. This potential affiliation is a strategic shift to secure a better future for the patients served by Santiam Hospital & Clinics.”

Samaritan Health Services operates five hospitals, including Good Samaritan Regional Medical Center, pictured above.

Doug Boysen, president and CEO of Samaritan Health Systems, said the partnership will benefit both systems in the long run.

“The healthcare industry is evolving, and we believe that this affiliation will ensure that Samaritan Health Services and Santiam Hospital & Clinics both remain sustainable, strong institutions, providing access to quality health care,” Boysen said in a statement.

Boysen also wrote a letter to the community about the deal. In the letter, he wrote, “This opportunity with Santiam Hospitals & Clinics allows Samaritan to continue to evolve, grow and maintain our mission of building healthier communities together.”

Much like hospitals across the country, Oregon hospitals have endured some tough financial headwinds in the past couple of years. The majority of Oregon’s hospitals operated in the red in the first half of 2023, according to the Hospital Association of Oregon.

Becky Hultberg, the president and CEO of the Hospital Association of Oregon, told Chief Healthcare Executive® in an October 2023 interview that the state’s hospitals have struggled to maintain services.

"We are seeing some providers make difficult decisions now," Hultberg said.

Two other hospital organizations in the Northwest have announced merger plans in the past week.

The Overlake Medical Center & Clinics is poised to become part of the MultiCare Health System in Washington state. The health systems announced this week that they have signed an affiliation agreement.

Under the deal, Overlake and its clinics would join MultiCare and become the flagship health system of MultiCare’s new “North Sound” region.

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