Providence St. Joseph Health, Ascension merger would create the largest hospital operator in the U.S.

The deal, if finalized, would create the largest hospital operator in the U.S.

Providence St. Joseph Health and Ascension are in merger talks, according to a new report, a move that would create the largest hospital operator in the U.S. 

A deal is far from assured, sources close to the negotiations told The Wall Street Journal, but the two health systems have discussed a number of configurations for a possible merger over the past several months.  

If the two entities merged, the united system would include 191 hospitals across 27 states and would have a combined annual revenue of $44.8 billion, according to the article. This would top HCA Healthcare, the country's largest hospital operator, which owns 177 hospitals and reported $41.5 billion in revenue last year. 

Innovation Awards

Submit your nominations for the FierceHealthcare Innovation Awards

The FierceHealthcare Innovation Awards showcases outstanding innovation that is driving improvements and transforming the industry. Our expert panel of judges will determine which companies demonstrate innovative solutions that have the greatest potential to save money, engage patients, or revolutionize the industry. Deadline for submissions is this Friday, October 18th.

RELATED: Number of hospital mergers and acquisitions on pace to top 2016, Kaufman Hall analysis finds 

The move, if it's confirmed, is the latest salvo in the battle between insurers and providers for market share. Martin Gaynor, an economics and health policy professor at Carnegie Mellon University, told the WSJ that many healthcare entities are feeling the pressure for greater leverage in negotiation. 

"It can be a vicious cycle where consolidation happens in one place, and then other players say, 'I need to consolidate too,'" Gaynor said. 

RELATED: A look back at mergers and acquisitions in 2016 

Two other "megamergers" were announced over the past week. Advocate Health Care and Aurora Health Care revealed their merger plans, which would create one of the largest nonprofit, integrated health systems in the country. The merger would include 27 hospitals and a combined annual revenue of $11 billion. 

Dignity Health and Catholic Health Initiatives also announced a merger, creating a new, unified Catholic health system. The new system, which has yet to be named, would include 139 hospitals across 28 states if it receives regulatory approvals.

Suggested Articles

As drugmakers face billions in legal settlements and judgments, we must keep our eye on what will truly defeat the opioid crisis.

As the public debate on health reform rolls on, a new report analyzes how these different approaches could impact insurers' bottom lines.

A House panel is going to consider several changes to Nancy Pelosi's drug prices plan, including stiff penalties for not being transparent.