SCHENECTADY — A proposed merger between St. Peter’s Health Partners and Ellis Medicine that was in the works for more than five years will no longer move forward, the health systems announced Friday.
St. Peter’s Health Partners and Ellis Medicine released a joint statement that said the two entities had “mutually agreed” to end the merger talks and would sever agreements that allowed them to combine and collaborate on services. Those agreements will now end Aug. 16, the statement says.
There are currently no plans to cut positions, the health systems said. Over the next 60 days, “SPHP will partner with Ellis to evaluate roles, prioritizing opportunities to retain and support” employees, the statement reads.
The Daily Gazette first reported the news, including details from internal emails Ellis President and CEO Paul Milton sent to employees.
The health systems first signed a non-binding letter of intent to merge in 2020, at a time when Milton said that Ellis Medicine would not remain financially sustainable if they were to remain independent. In an email on Friday, Milton told employees the Ellis Medicine Board of Trustees decided it had a “fiduciary responsibility” to reassess the healthcare market and “the partnership opportunities available in today’s market,” the Gazette reported.
Ellis began the process of issuing a request for proposals to explore other potential partnerships last month. St. Peter’s “chose not to participate,” the joint statement says.
The health systems touted the benefits of their close collaboration over the past six years, saying in their statement that the partnership stabilized Ellis Medicine’s operations and financial performance.
St. Peter’s now plans to shift its priorities to “focus on expanding ambulatory and outpatient services,” the statement says.
“Our partnership with Ellis Medicine produced significant, measurable progress in a challenging healthcare environment,” Dr. Steven Hanks, president and CEO of St. Peter’s Health Partners, said. “Together, we enhanced quality outcomes, strengthened core service lines, and helped restore financial stability. … As we move forward, SPHP will continue to focus on strategic investments that expand access, improve patient experience, and meet the evolving needs of the communities we serve.”
Milton said in a statement that the board’s “responsibility is to evaluate the available options and determine the best path forward” for Ellis.
This was not the first time that Ellis had explored a merger. In 2016, its board looked at multiple proposals from both local and out-of-state entities as it considered whether a merger, consolidation or affiliation with another health system might better serve its community. In 2018, the board decided that Ellis should stay independent.
Both Ellis and St. Peter’s health systems were created from mergers that occurred this century, but their forerunners have roots dating back to the 1800s.
The original Ellis Hospital dates back to 1885, when the Schenectady Free Dispensary opened on Union Street with just five beds. St. Peter’s Health Partners formed in 2011 from a merger of three local health systems: Northeast Health, St. Peter’s Health Care Services and Seton Health. Four legacy hospitals in Albany and Troy came with the package — St. Mary’s, which opened in 1848; Albany Memorial, which opened in 1868; St. Peter’s, which opened a year later; and Samaritan Hospital, which opened in 1898.
Jesse Taylor contributed reporting. This is a developing story. More details will be added.