Becker's Hospital Review

24 CEO / STRATEGY Intermountain CEO discusses merger with SCL Health: 'It's not a financial play. It's a service commitment.' By Kelly Gooch S alt Lake City-based Intermountain Healthcare and Broomfield, Co- lo.-based SCL Health have finalized a merger put in motion in December 2021. With the deal completed, April 5 marked the first official workday under the combined organization. Marc Har- rison, MD, president and CEO of Inter- mountain Healthcare, discussed what excites him most about the merger, the challenges ahead in terms of integration and the reasoning behind the deal. By the numbers The combined system, called Inter- mountain Healthcare, operates 33 hospi- tals, including a virtual hospital, and 385 clinics across Utah, Idaho, Nevada, Col- orado, Wyoming, Montana and Kansas. The combined entity has approximately 59,000 employees and 4,700 licensed hospital beds and provides health insur- ance to about 1 million people. Dr. Harrison serves as president and CEO of the merged organization. SCL President and CEO Lydia Jumonville will maintain her title during the integra- tion period and is leading integration activity. Mike Leavitt, who previously served as three-time elected governor of Utah and HHS secretary, is chair of the combined board for the merged organization. "She has been fabulous," Dr. Harrison said of Ms. Jumonville. "This is difficult, awkward stuff. She has been gracious and an expert and hard-working, and I credit a lot of our success today to Lyd- ia's leadership." The combined entity has three regions, headquartered in Salt Lake City, Broom- field, Colo., and Las Vegas, respectively. The company headquarters is in Salt Lake City. Each region has its own lead- ership team, and there is one enterprise leadership team. Although the identity of the new com- pany is Intermountain Healthcare, In- termountain is respecting the Catholic facilities of SCL Health as those facilities continue their legacy mission, Dr. Har- rison said. SCL Health's Catholic hospi- tals will retain their names. "We will be respectful of the local history of the SCL Health name. We don't want to disrupt a hospital like [Saint Joseph Hospital] in Denver, which has a storied history with the community," Dr. Harrison said. "But that will be an Intermountain hospital going forward. It's a 'yes, and' approach, where we respect the culture of SCL Health and they become part of Intermountain Healthcare." Dr. Harrison did not highlight the com- bined revenue of the new organization, though that figure is reported to be an estimated $14 billion. "That's not what's important to us," he said. "What's important to us is driving value-based care across the United States. And I hope that intentional omis- sion of that number emphasizes that commitment. It's not a financial play. It's a service commitment." Service opportunity and growth Dr. Harrison told Becker's he's excited about the service opportunity that comes with the merger because Intermountain and SCL Health have similar values. SCL Health is "committed to the en- tire community, including the poor. They have excellent quality. They are a transparent and low-cost provider, as are we," Dr. Harrison said. "They're ex- cited to get on the value journey. They currently don't take risks [in terms of value-based contracts with payers], al- though they have affordable care." Still, he acknowledged the hurdles. The challenge comes "when each party, in the interest of the new organization, makes compromises in the best interest of the future," Dr. Harrison said. He added: "So far, I'm seeing civility and thoughtfulness and mission orientation, all of which are long-term characteris- tics of Intermountain Healthcare and SCL Health. I'm going to watch carefully because I know these are hard things to do as well." Why SCL Health? The merger with SCL Health is not the first merger Intermountain has consid- ered in recent years. The health system also considered a deal with Sioux Falls, S.D.-based Sanford Health. But in De- cember 2020, Sanford and Intermoun- tain halted merger discussions after the abrupt exit of Sanford's longtime presi- dent and CEO, Kelby Krabbenhoft. Dr. Harrison said Intermountain learned a great deal throughout the discussion process with Sanford. "Best of all, I think it really clarified for us what we want out of a potential merg- er partner," he said. "SCL Health came to us after the Sanford opportunity fiz- zled, because they realized we were in the market for creative growth. They felt aligned with us — mission, vision, values — where we think healthcare's going, commitment to the community, afford- ability, and so one of the things I'll eter- nally be grateful to Sanford for is it let SCL Health know we're out there. It has really been a lot of work, and at times difficult, but always inspiring to work with SCL Health leadership and board, driving toward this merger." n Marc Harrison

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