Call Number: SC0593
Stanford University. Office of the General Counsel.
Title: UCSF/Stanford Hospital Merger records
133 Linear feet (102 boxes)
Language(s): The materials are in English.
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[identification of item], UCSF/Stanford Hospital Merger Records (SC0593). Dept. of Special Collections and University Archives,
Stanford University Libraries, Stanford, Calif.
During the 1980s, both Stanford and UCSF engaged in major hospital expansion projects. Subsequent cutbacks of federal funds
resulted in the disappearance of traditional profit margins despite sizeable cuts in budgets at both institutions. In 1986,
California Pacific Medical Center, Stanford, and UCSF established the California Transplant Donor Network in San Francisco
to eliminate competition for transplant organs. This unusual act of cooperation was followed by a meeting in 1993 of Stanford
Dean David Korn with UCSF Dean Joseph Martin to discuss other areas of possible cooperation between the two medical schools.
At the 1995 meeting of the California Business Higher Education Forum, the topic of discussion was the decline in federal
funding for medical research and for Medicare payments for services. UCSF Chancellor Joseph Martin and Stanford President
Gerhard Casper took a walk during an intermission and agreed that the two schools ought to share more and compete less. Not
long thereafter, Stanford and UCSF announced that discussions were taking place regarding collaboration with patient care
programs, and the formation of other alliances between the two institutions. Both parties made it clear that the medical schools
and medical faculties would remain independent.
Despite labor concerns, the Board of Regents voted in July, 1996 that the merged health care system would be a private, non-profit
corporation. The Board of Regents approved the merger uniting UCSF Medical Center; UCSF Mount Zion Hospital, with Stanford
Health Services, which comprises Stanford University Hospital and related clinics; and the Lucile Salter Packard Children's
Hospital. UCSF Stanford Health Care (USHC) began operation in 1997.
There was a significant Increase in clinical activity in the first year of the merger, but the growth was not sustained. The
merger produced a profit of $22 million in the first year. Then, largely because of administrative costs, UCSF Stanford Health
Care sustained an $11 million deficit in the first quarter of the second year, and is expected to lose $60 million by the
end of the second year.
The expectation that the merger would create five multi-disciplinary service lines during the first five years was not realized.
The absence of an adequate information base and lack of faculty enthusiasm postponed the creation of service lines except
in adult cardiology, pediatric cardiology, and pediatric neurosurgery, and the failure to integrate the transplantation and
cancer programs of the two schools was a notable disappointment.
Supporters of the merger saw two distinguished faculties creating a single clinical entity, perhaps becoming the nation's
premier academic health center, but this goal was not achieved. After a year and a half, the two faculties failed to come
together, and in the first months of 1999 leaders of both institutions became aware of a large financial deficit. In spring
of the following year, the merger was officially dissolved.
Hospitals--Design and construction.