Officials from a northwest Indiana health care group are expressing disappointment that talks about a proposed merger have been suspended. Methodist Hospitals, which has full-service facilities in Gary and Merrillville, says it was "unable to align on critical issues" with Mishawaka-based Franciscan Alliance after a 10-month process. Franciscan Alliance has 14 hospitals and a presence in Indiana, Illinois and Michigan.

A statement issued by Methodist Hospitals says the parties considered financial, operational and clinical service line implications and discussions "were compounded by headwinds in the healthcare industry." The statement adds "Methodist Hospitals is resolute in its commitment to continue to look for the right opportunities to chart a path forward that will ensure sustainability, continued growth and success.  In the meantime, we are financially sound and are confident in our ability to continue navigating the current marketplace."

Methodist Hospitals first announced the proposal to merge with Franciscan Alliance last March, when Methodist Chief Executive Officer Ray Grady said he was optimistic about the possibilities of the merger. Talks of the health care system being open to merger first became public in June of 2016 and in October of 2016, Grady said he was open to combining or staying independent.