URBANA - OSF HealthCare announced a major transformation in its east central Illinois operations Tuesday, revealing plans to merge two regional hospitals into a single entity with dual campuses.
Beginning Jan. 1, 2026—pending state approval—OSF HealthCare Heart of Mary Medical Center in Urbana and OSF HealthCare Sacred Heart Medical Center in Danville will unite under a new model aimed at streamlining services and expanding behavioral health care. The Urbana campus will take the lead in delivering inpatient behavioral health services, while continuing to offer emergency care, inpatient beds, diagnostics, lab work, and additional clinic services.
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The decision comes after months of analysis and community feedback, as OSF leadership worked to identify solutions to long-standing challenges such as provider shortages, declining inpatient use, and financial strain. Officials say aligning operations between the two hospitals will eliminate service duplication and make better use of existing resources.
“This change allows us to address critical gaps in care and build a stronger, more sustainable health care system for the region,” OSF said in a public statement.
The transition is expected to bring expanded mental health offerings to Urbana, including programs for young adults, patients with co-occurring medical and psychiatric needs, and seniors requiring geriatric psychiatric care—services the organization says have been in short supply locally.
OSF acquired both hospitals in 2018 and has since invested heavily in infrastructure and community-based services. However, hospital leaders acknowledged that staffing losses and reduced inpatient demand required a rethinking of their care delivery model.
Staff affected by the transition will receive individual support, with OSF pledging to help Mission Partners—its term for employees—explore more than 170 open positions locally, in addition to opportunities throughout its broader network.
OSF emphasized that continuity of patient care remains a top priority throughout the merger process. Patients and care teams will be guided through any transitions, ensuring communication and support at every stage.
The planned merger awaits approval by the Illinois Health Facilities and Services Review Board later this year.
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