Leaders of Swedish Medical Center and Northwest Hospital & Medical Center announced they have taken initial steps toward combining the organizations.

The hospitals' boards of trustees recently signed a letter of intent authorizing management to discuss a merger. After satisfactory conclusion of due diligence and completion of a definitive agreement, hospital officials say they hope to complete the merger by the end of 2004.

"Swedish and Northwest have partnered successfully on a number of patient-care programs in the past several years, including cancer and cardiac care," said Lane Savitch, chief operating officer of the Swedish Medical Center/Ballard Campus and a leader of the integration effort. "We think the logical next step is to come together more fully."

"As nonprofit hospitals, we have similar missions and values, we provide complementary clinical programs and many physicians already practice at both facilities. If we integrate our programs, it will open up new referral options for physicians, and patients will have access to stronger, better-coordinated health-care services," he added.

While Swedish operates three medical-center campuses, officials say the Swedish/Ballard Campus would be most impacted by a merger, given the close geographic proximity of that campus to Northwest Hospital & Medical Center. There is no intention to close either facility; the organizations are committed to continuing operations at both locations. The organizations will be exploring the possibility of consolidating acute-care services at Northwest and revitalizing Ballard around specialty acute-care and outpatient services. Additionally, the organizations will be looking at how best to maximize use of their facilities and best meet the changing health-care needs of the community.

Hospital officials note that changing demographics in Seattle's northend, including a decline in the need for inpatient hospital beds, and a shift to outpatient care, will factor into their decisions about the future provision and location of services.

Northwest president and CEO Bill Schneider points out that there is another big factor behind the organizations' decision to consider merging. "Both Swedish and Northwest were planning to invest significant capital over the next several years to upgrade facilities, purchase new medical equipment and improve information-technology systems," he said. "This reality led us to look at new ways to work together to make the most efficient use of our collective resources," he added.

Schneider acknowledged, "there is still a lot of work to be done before this deal is complete, but we're confident that we're on the right path. There is a great deal of optimism about this plan."

Swedish Medical Center has 1,245 licensed beds on three Seattle-area campuses and employs more than 7,100 people. Key programs include the Swedish Cancer Institute, Swedish Heart Institute, orthopedics, neurosciences, obstetrics and high-risk OB, general surgery, pediatrics, primary care, sleep medicine, organ transplant, a home-care program and clinical research. A nonprofit hospital established in 1910, Swedish merged with Ballard Community Hospital (now Swedish Medical Center/Ballard Campus) in 1992 and Providence Seattle Medical Center (now Swedish Medical Center/Providence Campus) in 2000.

Northwest Hospital, located at 1550 N. 115th St. in north Seattle, opened in 1960 as a nonprofit community hospital. Currently, it has 281 licensed beds and more than 1,600 employees. Major clinical programs and services include emergency services, critical care, cardiac care, stroke care, cancer care, childbirth services, rehabilitation care, neurosciences, diagnostic imaging, geropsychiatric center, Gamma Knife Center, laboratory services, and education and wellness services.