Two large Chicago-area hospital operators are exploring a merger in a deal that could create the largest Catholic-owned health care system in Illinois, sources told the Tribune.

Chicago-based Resurrection Health Care, which operates six hospitals in Chicago and the suburbs, has signed a letter of intent to “explore merger” with Mokena-based Provena Health, which owns six hospitals in the suburbs and downstate.

Both hospitals have been hurt by the increasing number of patients unable to pay medical bills because of the struggling U.S. economy. Many hospitals have been turning to partnerships to create economies of scale, and looking for ways to create a more streamlined patient experience.

“By working together, we not only increase access to outstanding and compassionate care…but leverage the benefits of our advanced continuums of care within the new health reform law,” said Provena Health President and Chief Executive Guy Wiebking.

The market is demanding more from hospital operators to stay competitive. By merging, hospitals can pool their capital to buy computer systems, electronic record-keeping and the latest developments in medical technology.

The latest in bells and whistles are also needed because of the health care overhaul, which requires hospitals to operate more efficiently. Hospitals that have high rates of readmissions for patients insured by Medicare, for example, might have their government payments reduced.

Resurrection’s hospitals include Holy Family Medical Center in Des Plaines, Our Lady of the Resurrection Medical Center in Chicago, Resurrection Medical Center in Chicago, Saint Francis Hospital in Evanston and Saints Mary and Elizabeth Medical Center in Chicago.  Provena Health operates hospitals under the Provena brand in Aurora, Elgin, Joliet, Urbana and Danville.

Both hospitals currently provide inpatient and outpatient services from nearly 100 locations across the state and into Indiana. A combined entity would have nearly 5,000 physicians on their medical staffs and more than 22,000 employees.

As with any merger, there is always the potential for workers to lose their jobs, and neither Provena or Resurrection was ruling that out.

A combined Provena-Resurrection system would have nearly $3 billion in operating revenue. It would still be somewhat smaller than the state’s largest hospital operator, Advocate Health Care, which has also been expanding through mergers and acquisitions in the Chicago area and in other Illinois communities.

The potential partnership could be an attractive  one for Loyola University Medical Center to join. Loyola has been exploring merger and acquisition targets, and has said it would favor a deal with a Catholic system. Loyola executives could not be reached this afternoon for comment.

bjapsen@tribune.com