Methodist Hospitals in Northwest Indiana considers partnerships

"Health care reform has put greater pressure on hospitals and health care systems to increase access to care while also minimizing costs," CEO Ray Grady stated. "This has made it challenging for many organizations to navigate this new marketplace independently."

He said Methodist has been approached by numerous health care organizations about potential partnerships.

Since the passage of the Affordable Care Act in 2010, hospitals have been merging at a frenetic pace. They're positioning themselves for a shift in the payment system from fee for service to a model based on quality and cost-efficiency. They're also trying to gain leverage in negotiations with insurers, which are themselves rapidly consolidating.

In the past year in the Region alone, Harvey-based Ingalls Health System merged with University of Chicago Medicine, the LaPorte and Starke Hospitals were bought by for-profit Community Health Systems, and Jasper County Hospital was absorbed by Franciscan Alliance.

Methodist, which has campuses in Gary and Merrillville, is the Region's smallest hospital system by number of employees, following Community Healthcare System, Franciscan Alliance and Porter Health Care System.

Grady stated that Methodist is financially stable and thus "operating from a place of strength." Methodist had $355.8 million in revenues in 2014 on $345.5 million in expenses, a margin that has gotten smaller each year since 2011, according to IRS 990 filings.