GBMC in talks with 3 suitors Hopkins, Northwest join St. Joseph as merger candidates

Seeks decision next month

Health care

March 24, 1998|By M. William Salganik | M. William Salganik,SUN STAFF

Even as it nears a decision on whether to merge with St. Joseph Medical Center, Greater Baltimore Medical Center is also holding serious talks with Johns Hopkins, Robert P. Kowal, GBMC's chief executive officer, said yesterday.

Kowal also confirmed that GBMC is in negotiations with Northwest Hospital Center in Randallstown.

The multilateral negotiations involving GBMC add a dizzying layer of complexity as area hospitals engage in an elaborate series of courtships. Amid predictions that the two dozen hospitals in the Baltimore region will coalesce into three or four major systems, independent hospitals are seeking partners, and smaller systems are looking to become larger systems.

Kowal said the Hopkins negotiations had gotten "pretty much just as far" as those with St. Joseph. Although Hopkins and GBMC "have been talking for a shorter period of time" than GBMC and St. Joseph, he said, "we have the basis for a very good proposal."

Kowal said GBMC could end up concluding a deal with any one of its potential partners -- or with more than one.

Dr. Edward D. Miller, chief executive officer of Johns Hopkins Medicine, said last week that Hopkins was looking to affiliate with one or two "strategic" community hospitals and was "very interested" in GBMC. He was not available yesterday. Hopkins would not comment on whether it would consider a GBMC deal that included Northwest and/or St. Joseph.

Linda Harder, director of public relations and marketing for St. Joseph, said, "Nothing is out of the question at this point in time. Partnerships could quickly grow to include other people." However, she added, the possibility of St. Joseph being involved, through GBMC, in a deal with Hopkins is "not something I'm aware of being discussed."

Northwest, which announced last fall it was looking to merge into a larger hospital system, said last week it had narrowed its choices to GBMC, St. Joseph, Sinai Hospital and the five-hospital Helix Health group. It declined further comment yesterday.

St. Joseph, a Towson neighbor of GBMC, announced last month an affiliation with Upper Chesapeake Health System, which runs both hospitals in Harford County. Pulling in GBMC and Northwest would create a system that brings together all the hospitals in Baltimore's northern suburbs.

GBMC has not decided exactly how to proceed in weighing the various possible arrangements, Kowal said, adding that the consulting firm Arthur Anderson "is assisting us in evaluating our options."

GBMC is hoping to decide what to do early next month, Kowal said, although it is possible that deliberations could be extended if talks with potential partners have not been completed.

The potential of a GBMC deal with St. Joseph has stirred controversy over the future of services such as tubal ligations (female sterilizations) and in-vitro fertilization. As a Roman Catholic institution, St. Joseph does not offer either. GBMC has said it would discontinue abortions if it affiliated with St. Joseph, but would not curtail any other services.

In particular, concern has focused on board structure and powers if the deal moves ahead. According to several persons with knowledge of the potential deal, board members representing St. Joseph and its parent, Denver-based Catholic Health Initiatives, would have "core reserved powers" giving them an effective veto over key decisions, such as defining the mission and naming a chief executive.

If St. Joseph and CHI have stronger powers, "What if they simply decide not to fund some of the projects or programs at GBMC?" worried Cynthia L. H. Crawley, president of the board of the Hospital for the Women of Maryland. The Women's Hospital merged with another to form GBMC in 1965, and its board still exists to administer its endowment.

Kowal said yesterday that any deal would preserve GBMC's control over its clinical services. "We're not going to give up our rights," he said.

The proposed deal, Kowal said, would involve creating a new entity with equal board representation from GBMC and from St. Joseph/CHI. The draft charter for the new organization, he said, says that it "preserves equally the missions, values and traditions of both organizations."

Harder said St. Joseph would "respect GBMC's mission to provide a range of quality health services for women."

Pub Date: 3/24/98

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