During the COVID-19 pandemic, Legacy Healthcare struggled financially as workers faced longer work hours and higher labor expenses. Legacy had begun to take precautionary action in order to deal with its financial struggles. They began requiring staff to take time off, even making plans to end birth services at Mount Hood Medical Center in Gresham. This plan would eventually be rejected by Oregon Health Authorities. The company’s struggle would continue all the way to 2023, with Legacy posting on social media a loss of nearly $172 million during its 2023 fiscal year.
However, on Aug. 16, 2023, executives from Oregon Health & Science University (OHSU) and Legacy Health announced that they had signed a non-binding letter of intent to create an integrated health system that would offer high-quality and essential healthcare service to patients throughout Oregon. This is the first step in a business transaction where Legacy hospitals and healthcare centers will become a part of OHSU’s state-affiliated hospital system and medical school. In the past, OHSU has made similar partnership deals with other companies, such as forming a partnership with Tuality Healthcare in 2016 and another partnership with Adventist Health in 2017.
The idea is that OHSU and Legacy will use their shared expertise to create a healthcare system that will provide public service. OHSU brings experience with serving complex patient needs, having a statewide healthcare training and educational program as well as leading in healthcare research. Legacy brings high-quality community-based care through its system of hospitals, specialty clinics and patient facilities. The combined system is expected to employ more than 32,000 people with more than 100 locations, 10 hospitals and an average of more than 3 million patient visits per year. This would make it the largest single employer in the Portland region with the primary focus of amplifying Portland’s community-focused healthcare, education, research and innovation.
In their letter of intent, the two organizations wrote that OHSU has plans to gather $1 billion over the next 10 years through funded bonds offerings to support primary and community-based services that will be a part of the system. Their commitment will better enable the combined organization to expand its health services including clinical programs, sites of care, technology solutions and new care models. The letter also states that Legacy will use its net cash and its investments above its outstanding debt at closing to a new independent foundation. The new foundation hopes to promote physical and mental well-being and address inequity in healthcare, including social determinants of health and behavioral health.
The Oregon Nurses Association, a union of nurses and other healthcare workers, made a statement regarding OHSU and Legacy’s merger: “OHSU management should step up with a fair contract for more than 3,000 nurses at OHSU before undertaking one of the largest healthcare mergers in Oregon’s history,” even going on to add in regards to the merger deal, “It brings up more questions than answers.”
Both OHSU and Legacy have stated that they are working towards a definitive agreement which is expected to come out soon. In regards to the companies combining, the merger deal is expected to close in 2024, according to both organizations.
