Ochsner Health eyes another merger less than a year after Lafayette deal
Fresh off a merger that grew it to a system of 35 acute-care hospitals, Ochsner Health announced Thursday it plans to get even bigger by combining with a seven-hospital system in Mississippi.
Rush Health Systems, based in Meridian, Miss., plans to become part of Ochsner, headquarted in New Orleans, La. The two not-for-profit systems described the deal—which they underscored is a merger and not an acquisition—as an expansion of a partnership that’s been in place since 2019. They expect the deal to close in mid-2022, at which point Rush will be known as Ochsner Rush Health.
The systems claim in a news release that merging will allow them to expand access to clinical specialties for Rush patients in east Mississippi and west Alabama, bringing cardiology, cardiovascular surgery, neurology, stroke care, cancer treatment and other specialties to patients in those areas.
Under their existing agreement, Ochsner and Rush have synced their Epic electronic health records platforms to help with care coordination, patient registration, scheduling and billing.
“Today’s news means that we are taking the next steps in our partnership,” Rush CEO Larkin Kennedy said in a statement. “We are excited to join Ochsner Health and work with them to continue to improve quality and decrease costs while enhancing access to highly specialized care closer to home.”
As part of Ochsner, Rush said in a news release it will be able to grow existing programs and offer new services for patients. Ochsner has pledged to boost minimum wage for Rush employees to $12 per hour once the merger is complete.
Ochsner CEO Warner Thomas said in a statement that Thursday’s announcement is a natural progression of the existing partnership between the systems.
“We look forward to building on the great work of Rush to improve access to high-quality, cost-effective and innovative care,” he said.
Ochsner and Rush said in their announcement that the resulting system will be governed by a board comprised of Rush community members, physicians and representatives from Ochsner. All medical staff will retain existing privileges after the merger and patients will be able to continue to use their existing insurance at all facilities.
Ochsner sealed its merger with Lafayette General Health in October 2020 to become the Gulf South’s largest healthcare provider. The two formed a system of 35 owned, managed and affiliated acute-care hospitals plus five specialty hospitals. Lafayette General had been on shaky financial footing and its CEO said joining Ochsner would add stability.
Ochsner’s operating margin was a slim 1% in the quarter ended March 31, 2021, with $15 million in operating income on $1.3 billion in revenue. That’s an improvement from its 3.4% loss margin in the prior-year period, which includes the first two weeks of the COVID-19 pandemic. Financial information for Rush could not immediately be obtained.