Mercy Health Confirms Talks With St. Vincent Over Hot Springs Hospital

Mercy Health on Tuesday confirmed an Arkansas Business report that said St. Vincent Health System of Little Rock had made a formal bid to acquire Mercy Health Hot Springs.

In a short statement, Mercy said it is in discussions "toward a letter of intent" with Catholic Health Initiatives, which owns St. Vincent.

"Mercy Health and Catholic Health Initiatives (CHI) are in discussion toward a letter of intent. The agreement would consider a possible transfer of sponsorship of Mercy Hot Springs hospital and physician clinic to CHI and its affiliate, St. Vincent Health System in Little Rock," the statement said.

On Monday, Arkansas Business reported in the "Whispers" section of its print edition that the two were in talks. At the time, Barb Meyer, a spokeswoman for Mercy in Chesterfield, Mo., said the health system didn't "have any definitive plans at this point" and wouldn't confirm that St. Vincent had made an offer.

St. Vincent President and CEO Peter Banko also declined comment.

Word of the talks comes two and half months after Mercy's plan to sell its Hot Springs hospital to Capella Healthcare of Franklin, Tenn., which operates National Park Medical Center across town, fell through. The parties scuttled the merger when the Federal Trade Commission said it didn’t support it.

In July, Mercy said it was still seeking a buyer for Mercy Hot Springs, which includes the 282-bed hospital and 80-physician clinic.

St. Vincent would appear to be an ideal mate. Both Mercy and St. Vincent are private, Catholic-owned institutions.

The deal is also exceedingly less complex than one St. Vincent had been exploring with the University of Arkansas for Medical Sciences, another proposal that was dropped this year. The two health systems, each with a major hospital in Little Rock, had begun exploring what was variously described as an affiliation or alliance in August 2012

Also Tuesday, National Park Medical Center announced an expansion plan with estimated costs of $40 million to $45 million.

The hospital says it hopes to expand its offerings in cardiology, medical imaging, emergency services, outpatient services, surgery and women's services.

(The Associated Press contributed to this report.)