HOSPITALS SAY UNION WOULD SAVE $47 MILLION

Affiliation of Cape Girardeau's two hospitals could save $47 million over five years, says a recently completed efficiency study.

Officials from Southeast Missouri Hospital and St. Francis Medical Center issued a written statement Tuesday that said a preliminary draft of the study, conducted by Arthur Andersen and Co. consulting firm, has been completed.

"The study has identified substantial savings in the event the two organizations do affiliate," officials said in the statement.

A Joint Study Committee, made up of representatives of both hospital boards and administrations, is studying the draft report, the written statement said. The review will continue over the next several weeks, the statement said.

Hospital officials otherwise are keeping mum on results of the study. The statement did not include any details on where the savings might be realized.

Neither James Wente, administrator of Southeast, nor James Sexton, president and chief executive officer of St. Francis, would comment further on the written statement.

The statement did say the affiliation is proceeding "on the projected timeline."

The hospitals announced in December that they are studying the feasibility of a permanent affiliation. The affiliation, which may include a merger the two, is aimed at cutting costs and increasing efficiency while maintaining local control of both hospitals.

Sexton said in December that a full merger was one possibility, but the Joint Study Committee is studying a number of different options.

He said at that time any affiliation would most likely include some type of common governance between the administration or boards of the two hospitals.

In March, Sexton and Wente said that if the affiliation occurs, Southeast Missouri Hospital has agreed it no longer will perform sterilization procedures or therapeutic abortions for women. That agreement resolved an ethical issue for the Springfield-Cape Girardeau Diocese, with which St. Francis is affiliated. Those procedures violate Catholic rules.

Wente said in March that the hospitals will have to become more efficient if the affiliation goes through, and that might mean laying off employees. The two hospitals employ about 2,800 people.

The local part of the affiliation process should be completed by July. But the affiliation process could be stretched another 12 to 18 months if federal anti-trust agencies decide to investigate the process.

Officials from both hospitals have said they expect federal involvement.