The two CEOs representing the Scarborough and Rouge Valley hospitals appeared before the Central East LHIN this morning following news last week that their proposed merger was off – at least for now.
Both Rik Ganderton and Robert Biron looked nervous knowing at least in this venue the decision to pull back from the brink would be regarded as a disappointment. Had the two merged, they would have formed the seventh largest hospital corporation in the province.
The outcome of the meeting was predictable – the LHIN would work with the two hospitals to further an integration agenda and develop next steps. Both CEOs agreed to come back in April after meeting with the LHIN senior staff.
LHIN CEO Deborah Hammons tried to put the best face on the situation noting that the $3.8 million already invested in the merger was not entirely lost –getting the public to understand the position of the hospitals was “money well spent.”
That part may have been weighing on the minds of Biron and The Scarborough Hospital Board. It was TSH, not the two hospital boards, which pulled the plug, recognizing that proceeding with very little tangible financial support was a substantial risk.
Biron said that his hospital was not willing to merge at any cost. Nor was his board willing to negatively impact patient services to do so.
“There is no shortage of failures of merged organizations,” he told the LHIN. He may have been thinking of his own organization where up until recently tensions still persisted between the Scarborough General and the Scarborough Grace hospitals.
If TSH had come out of the gate cutting clinical services community support would have quickly evaporated. After all, the whole point of the merger was to enhance patient services, not lop them off.
Unlike Ganderton, Biron played down the financial impact of the merger, focusing on the perceived strategic advantage such a large hospital corporations might have in attracting funding, patients and skilled health professionals.
He admitted that it would take six years for the hospitals to recoup their investments in the merger plan. Both CEOs stressed this was a long term plan.
Biron also recognized that it would be impossible for the present boards to tie the future merged board to commitments made today. He may have been thinking of the existing commitment made to retain the existing four Scarborough emergency departments. That may be a difficult promise to keep, particularly if the four sites are eventually rolled into a single new mega-hospital.
Byron stressed that the support for the merger was critical on funding for the initial capital feasibility study, not on a new hospital (or hospitals). On that much the TSH was at least willing to take a leap of faith.
The two CEOs said the bulk of savings were very much contingent on new facilities, Biron noting that the process to replace his aging surgeries had already been delayed by the merger. Had the merger taken place, the new hospital would be number one in surgeries using operating theatres that Ganderton called “Dickensian.”
After months of practically finishing each other’s sentences, Ganderton’s views did more openly diverge with Biron. The Rouge Valley CEO took time to explain why his board approved the merger despite only $3 million in new commitments from the province.
Much of the decision came down to a Friday night conversation with the Minister of Health. While Biron saw the $3 million as falling short of their minimum threshold, Ganderton viewed the investment as encouragement to go forward.
Hammons also noted that $6.8 million (including the $3.8 million already spent) in such a tight funding environment did represent a significant commitment.
Ganderton spoke of his history of working with the Ministry of Health and the LHIN towards successful projects and said an encouraging e-mail the Minister had sent was enough for his hospital to take the leap of faith Scarborough was not willing to take.
Putting the breaks on the merger doesn’t mean the two hospitals will revert to the status quo. Among other things, the consultation process brought the staffs of the two hospitals likely closer together than any other two health care providers in the province. That is likely to open doors to new levels of cooperation.
Biron said there were a number of integrations already in play although no timelines have been established. The first will likely impact child/maternal services.
Is this really the end of merger talks? Biron told the LHIN “you never say never.”