There’s still one more hurdle before the deal can go through: approval from the Oregon Department of Justice.
SALEM, Ore. — This story comes from the Portland Business Journal, a KGW News partner. The full story is here.
The Oregon Health Authority threw Santiam Memorial Hospital a lifeline on Friday, granting the struggling hospital an emergency approval to merge with the larger Salem Health Hospitals & Clinics.
The two hospitals have been trying to join forces for months, but Santiam’s financial condition deteriorated so much that by early July, it said it was at “imminent risk of insolvency” if regulators did not expedite approval of the transaction.
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OHA granted the parties’ request to exempt the affiliation from review by the agency’s Health Care Market Oversight program. The statute allows certain transactions to be exempt under specific circumstances, including an imminent financial crisis that would harm healthcare access.
“OHA determined the current situation immediately threatens healthcare services, and the proposed transaction is urgently needed to protect health consumers,” OHA said in a statement. “The Oregon Legislature established HCMO’s emergency exemption process to provide some flexibility when there is a verifiable emergency.”
There’s still one more hurdle before the deal can go through: approval from the Oregon Department of Justice, which has scheduled a hearing on the transaction for Aug. 5. Last week, the two systems said the DOJ was causing a delay and placing the merger at risk, as the hearing is scheduled for four days after the two had hoped to complete the merger. Attorney General Dan Rayfield said the DOJ is simply following the law, which requires the AG to approve mergers of charitable organizations under the Hospital Transfer Act of 1997.
The two hospitals issued a statement applauding OHA.
“Today marks an important milestone for the future of Santiam Hospital & Clinics and the communities we serve,” Maggie Hudson, president and CEO of Santiam, said. “We are grateful to (OHA) for its thoughtful review and timely approval of the emergency exemption application, recognizing the urgent need to preserve local healthcare access in the Santiam Canyon. This decision brings us one step closer to securing a strong and sustainable future for our patients, staff and communities.”
OHA evaluated 336 comments and a variety of documents, including financial reports, contracts and agreements. The 40-bed Santiam hospital is based in the Marion County community of Stayton, while the 644-bed Salem Hospital is located in Salem.