The Towson hospital's owner, Catholic Health Initiatives, put it up for sale after a surgical scandal threatened its business and besmirched its reputation.
St. Joseph's said that all the hospitals it is negotiating with have agreed to honor its "Catholic identity." However, citing confidentiality agreements as talks continue, hospital officials won't clarify what that means.
The conflict between religious and secular ownership in merging hospital groups has raised questions and even killed deals.
St. Joseph itself was at the center of such discord in the 1990s when it shelved merger talks with Greater Baltimore Medical Center because of an outcry from women's groups that feared the deal would curtail abortions and other reproductive services. More recently, Kentucky Gov. Steve Beshear turned down a chance to merge a public hospital in Louisville with Catholic Health Initiatives after public opposition that the deal would have led to fewer women's services such as contraception.
More of these partnerships are taking place despite the complexities as the hospital industry continues to consolidate. Smaller systems facing competitive pressures and the uncertainty of health care reform are looking to become part of larger, financially sound institutions.
"There is no doubt that religion complicates hospital mergers," said Jon O'Brien, president of Catholics for Choice, which disagrees with a variety of the religious doctrines of Catholicism.
Cardinal Edwin F. O'Brien argued in a commentary piece that ran in The Baltimore Sun in January that St. Joseph's should be bought by another Catholic institution.
"The foundation that led to St. Joseph's modest beginnings and decades of growth is the same one that must see it through this difficult time in its storied and illustrious history," O'Brien wrote. "It is a foundation rooted in the Franciscan tradition and its Catholic identity."
O'Brien, as apostolic administrator of the Arcdiocese of Baltimore, must approve any hospital merger, but a spokesman would not elaborate on whether he would shoot down a merger with a non-Catholic hospital.
Such intervention is rare but the Vatican has stepped in to stop a hospital merger, said Lois Uttley, director of the MergerWatch Project, a group that works to save reproductive health services in hospital mergers.
In some mergers, secular hospitals have agreed to ban abortions and other services to abide by Catholic doctrine. Other hospitals have used more creative means, such as segregating whole floors where these services could be allowed. In simpler examples, the Catholic and secular hospitals operate as separate entities with separate rules.
A Catholic hospital may have more say if it has the upper hand in negotiations, said those who follow religious hospital mergers. In its case, the troubled St. Joseph may be more willing to negotiate to get the best deal for the facility.
"If the non-Catholic hospital is in the better position and is committed to keeping its full menu of reproductive health services that outcome can be better for women," Uttley said.
The mergers become particularly troublesome to groups like Catholics for Choice when they would leave no other alternative for women to seek care, such as in rural areas with few hospitals.
St. Joseph began looking for a partner because of troubles it faced after complaints surfaced in 2009 that cardiologistDr. Mark Mideiperformed hundreds of unnecessary medical procedures. The hospital notified approximately 600 patients that they had stents placed in their arteries that they might not have needed. Hundreds of those former patients have since sued St. Joseph and its parent company. Midei was forced to resign from the hospital and lost his license in Maryland, a decision he is fighting.
The hospital not only has lost revenue, but patient admissions, doctors and other staff. It also has agreed to increased federal oversight after an investigation into a kickback scheme that resulted in a $22 million settlement and repayment of funds for questionable procedures.
Only one of St. Joseph's suitors, St. Agnes Hospital, is a Catholic hospital. The other two, LifeBridge Health and the University of Maryland Medical System, are non-Catholic entities. LifeBridge Health's Sinai Hospital and its geriatric facility are Jewish institutions.