REGION : Santa Monica Hospital Weighs Sale, Merger

Santa Monica Hospital Medical Center is considering merging with or selling the facility to either St. John’s Hospital and Health Center or UCLA Medical Center.

Ted Braun, a spokesman for Santa Monica Hospital, confirmed that UniHealth, the facility’s parent company, has been talking to UCLA Medical Center since June about a possible affiliation. Santa Monica Hospital has also continued discussions with St. John’s Hospital about an affiliation, and hospital officials expect a development in the talks by next week.

“Everything is on the table,” said Ross K. Goldberg, vice president of corporate communications for UniHealth, a Burbank-based nonprofit health corporation that also owns California Medical Center in Los Angeles.

“Over the last eight to nine months, discussions have been unfolding . . . including talk of affiliations, cooperative ventures and sale” of the facility, Goldberg said. “We are trying to determine whether or not it is more advantageous to the community to be affiliated with St. John’s or UCLA.”

Talks between St. John’s and Santa Monica hospitals began soon after the Northridge earthquake effectively closed inpatient services at St. John’s Hospital for nine months. St. John’s reopened in October, with its inpatient capacity reduced from 501 beds to 260. Santa Monica Hospital also sustained considerable damage in the quake, temporarily losing 80 of its 280 inpatient beds.

It was while both facilities were repairing and reassessing their inpatient capacities that the rival hospitals considered affiliation.

Mark Laret, chief executive officer of UCLA Medical Group and deputy director of UCLA Medical Center, said the Westwood facility entered into talks with UniHealth after it became clear that an affiliation could be formed between the two Santa Monica facilities.

“We felt that, particularly with UCLA doctors, we could create a health-care system that would be very appealing to HMOs and other payers,” Laret said.

Health-care experts said the resulting tug-of-war between the facilities was a byproduct of a rapidly changing health-care market.

“The Westside hospital market is very intensely competitive,” said David Langness, a spokesman for the Hospital Council of Southern California. “The outcome of these negotiations that are going on between these Westside hospitals, (which are) all jockeying for market penetration and positioning, will influence health-care delivery on the Westside for years to come.”