Flint, Mich.-based McLaren Health Care will soon have 12 hospitals in its system, as Port Huron (Mich.) Hospital signed a letter of intent to join McLaren.
The board of Blue Water Health Services, the parent of 186-bed Port Huron Hospital, evaluated eight potential partners during a six-month review process, ultimately choosing to affiliate with McLaren. The two organizations will now go through due diligence, which will take "several months," before signing a definitive agreement.
Financial terms of the deal were not disclosed. However, McLaren is expected to make "substantial" capital investments in Port Huron Hospital, including a new acute-care tower.
Port Huron Hospital officials cited reduced Medicare reimbursements, increased competition throughout the region and a "changing population" as reasons to affiliate with a larger health system. Previously, Board Chairman David Thompson said the hospital is in good financial shape with a strong operating margin, making the time ripe to choose a partner on its own terms.
"Our position of strength makes this the optimal time to consider joining a larger organization because we stand to obtain the greatest promise of future success," the board said in a news release.
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