San Diego, Orange County children’s hospitals complete merger
Jan 08, 2025
On Tuesday, just before noon, executives from Rady Children’s Hospital in San Diego and Children’s Hospital of Orange County jointly announced the completion of a merger that has been more than a year in the making. They also unveiled a new logo to memorialize Rady Children’s Health, the new name of the combined organization covering a Southern California region that is home to more than 6 million people, 1.3 million of them children.
The announcement came two months after California Attorney General Rob Bonta gave the deal his conditional approval provided that the merged hospital group comply with a list of 24 conditions, including commitments to continue serving those on state-sponsored health insurance and providing charity care in cases where treatment is unaffordable for affected families.
The new logo, which features a smiling bear and Rady’s long-standing playful use of a kite as an apostrophe, will be used in digital communications immediately though no firm timeline for its use in hospital signage has yet been announced.
Executives for both organizations were emphatic in an interview early this week that very little will change regarding the operation of existing facilities. Medical staffs will retain their own bylaws and caregivers will continue reporting to existing management structures.
“We’ve heard, ‘are there layoffs, are we closing locations?’,” said Dr. Patrick Frias, Rady’s chief executive officer. “We want to make it very clear to families and employees that no, we aren’t, and they aren’t.
“The access to the locations that we have and the care and the workforce is the same today as it was six days ago, and we want to reassure the community of that.”
Rady’s medical center campus, next to Sharp Memorial Hospital in Serra Mesa, is 63 miles south of CHOC’s Mission Viejo campus and nearly 80 miles closer to the border than its main campus in Orange. Some may wonder whether these two entities might come up with a strategy to better cover the middle distance. Are there any plans to add facilities, say, in northern San Diego County or southern Orange County?
Kimberly Chavalas Cripe, CHOC’s current president and chief executive, said Monday that the two organizations have been unable to fully share clinical and financial information at a level that would be necessary to understand what types of new initiatives might make sense. So any daydreaming of new facilities or programs is premature.
“I’m not sure that something in the middle necessarily would better serve the patients; it may be that all of this could be expanded on the respective campuses and facilities we operate,” Chavalas Cripe said. “Those are really complicated topics that we need time to evaluate and see, is there a better way to take care of our patients?”
“We know that this is going to take some time to figure out, and now we have the green light where we can start that extensive planning.”
Research, especially through clinical trials, is an area of such obvious collaboration that both organizations feel comfortable saying they see expansions in the near future. Rady has a long history of working with UC San Diego experts while CHOC already partners closely with medical faculty at UC Irvine.
“Over time, we would anticipate enhanced access to clinical research, clinical trials,” Frias said. “One area where we’ve collaborated over the years is our genomic institute in San Diego, and the opportunity to advance that collaboration, and genomically informed care across a broader population of patients, will only further enhance our opportunity to participate in broader clinical trials.”
Eventually, the merged organization plans to connect its electronic health record to make working together more seamless.
For now, Chavalas Cripe added, there are no plans for major changes to financial operations.
“The purpose and the reason we’re doing this is not to drive financial savings,” Chavalas Cripe said, adding that the attorney general’s conditional approval requires separate contracting for 10 years. “We’re in different marketplaces and have different payors and different payor relationships, so this is really about clinical planning, education and research expansion.”
The two executives will serve as co-CEOs, continuing to run their respective operations, for the next two years, at which point Chavalas Cripe, who has been at CHOC for more than 30 years, plans to retire, with Frias then becoming the sole CEO of Rady Children’s Health.
While the merger’s completion was announced to staff on Tuesday, it technically started on New Year’s Day with the merger closure on Dec. 31, 2024.