Chattanooga, Tenn.-based Erlanger Health System has signed a non-binding Letter of Intent (LOI) to enter into a strategic partnership to join Greenville, S.C.-based Prisma Health. Erlanger stated the proposed partnership with its fellow nonprofit health system would position it for “long-term sustainability, growth, innovation and success.”
The proposed partnership would include $2 billion in strategic capital investments to expand access and advance care delivery.
“Healthcare is changing rapidly and we knew that given our position of strength and national recognition for our clinical quality, we had a responsibility to explore options that would allow us to accelerate our plans forward to an even brighter future,” stated Barry Large, Chair of the Erlanger Board of Directors.
The proposed partners intend to strengthen their exclusive strategic focus on the southeastern U.S. “Prisma Health will augment what we already do well, enabling us to take patient care in our region to the next level more quickly,” stated Sheila Boyington, Immediate Past-Chair of the Erlanger Board of Directors. “Greenville and Chattanooga share many similarities, and we believe the regional, patient-first focus of Prisma Health adds to the cultural fit of this partnership.”
Erlanger’s seven-hospital system includes its region's only Level I Trauma Center, children's hospital, Level IV NICU, kidney transplant center, and 24/7 stroke care. It is the sole provider of tertiary care services spanning a 50,000 square-mile region that includes southeast Tennessee, northwest Georgia, north Alabama, and western North Carolina. Prisma Health operates 20 hospitals that serve South Carolina and Tennessee.
The partnership would find Prisma Health establishing its East Tennessee regional headquarters in Chattanooga. Current Erlanger President and CEO Jim Coleman would become the Prisma’s Regional CEO for East Tennessee, “providing leadership and oversight of Erlanger and guiding the organization’s growth and integration throughout the market.” All employees and medical staff “in good standing” would be retained, the Erlanger name would continue to be used, and Erlanger would retain a dedicated leadership team and occupy the majority of seats on a new Prisma Health Eastern Tennessee board, while gaining representation on Prisma Health’s corporate board.
Erlanger and Prisma have now “entered a period of due diligence and continued evaluation,” with any final agreement subject to approval by Erlanger's Board of Directors, the Erlanger Health Oversight Panel, Hamilton County Commission and applicable federal and state regulatory authorities. In the meantime, existing operations continue as usual. Erlanger stated that it “remains committed to transparency and will continue engaging employees, physicians, community leaders and the public throughout the process.”
An exclusive website to provide more information and updates about the proposed partnership is online at erlangerfuture.org.
