Kaleida Health will become the active parent of Eastern Niagara Hospital in Lockport next year, once state and federal regulators approve the deal.
The announcement Tuesday emphasized that the arrangement is not a merger, but the Eastern Niagara board's future actions will be only recommendations to Kaleida's board, which will have the final say.
In addition, Eastern Niagara's longtime CEO, Clare A. Haar, will depart once the transition is completed, likely by mid-2018.
"This is a strategic partnership we've wanted for some time," Kaleida president and CEO Jody Lomeo said.
He made the announcement in a news conference at the Lockport hospital, portrayed the arrangement as a win for a community which has worried about the future of the 134-bed facility and the quality of the care offered there.
"The idea here is to preserve jobs and preserve health care," said Eastern Niagara board chairman George V.C. Muscato.
Eastern Niagara has been in and out of financial trouble for decades, and it has rated low on several quality measures in State Health Department reports.
"I think it's really good news for the residents here," Lomeo said. "I think the news today can give the community assurance that we're here to stay."
Kaleida and Eastern Niagara set up a partial affiliation a couple of years ago, but local control was maintained in that arrangement.
Lomeo said Kaleida said Eastern Niagara was competing with Kaleida's Millard Fillmore Suburban Hospital in Amherst.
"We would like to stop that competition because it's not good for anyone," he said. But Eastern Niagara patients will have access to more advanced services at other Kaleida sites.
Lomeo said in the next 60 days, the Freed Maxick accounting firm will work on a financial review of Eastern Niagara.
Kaleida spokesman Michael P. Hughes said Eastern Niagara lost $600,000 last year on $60 million in revenues. Muscato said this year's financial statements show the hospital in the black.
The hospital's recently announced plan for a new $8.2 million building including an enlarged emergency department and more medical offices will go forward.
No immediate changes are made in the staffing level of about 600 employees, Lomeo said.
In the next 90 days, Kaleida will implement a quality plan and begin a search for a new president to succeed Haar, who has been the most important figure in health care management in eastern Niagara County for more than two decades.
She was the president of Inter-Community Memorial Hospital in Newfane when it affiliated with the then-Lockport Memorial Hospital as the Lockport facility teetered on the edge of bankruptcy almost 20 years ago.
The two facilities eventually merged into the Eastern Niagara Health System. The Newfane site is open for radiology, lab work and other services, but no longer offers acute care.
"I've been in this community 24 years. It's time for a change for me personally," Haar said. "I think it's time the hospital had a new CEO."