Financial pressures have led bosses at Darent Valley Hospital in Kent to explore a potential merger with the NHS trust in Medway.
Chief executive Susan Acott said Dartford and Gravesham NHS, which runs Darent Valley, had a £0.5m deficit four months into the new financial year.
She said talks with Medway NHS would lead to a decision this month about the feasibility of a merger.
The two Kent trusts could merge by next summer, she added.
She said: "We're already showing signs of some financial stress, so we want to try and make certain that we've got a clear future very, very quickly.
"We are making a decision in September about the feasibility of this merger, with our colleagues in Medway."
And she said: "We're about half a million pounds overspent at the moment.
"Given where we are in the year, we need to try and take some action to correct that."
Ms Acott said the best way of tackling the problem was to form a strong partnership with a neighbouring hospital, and Medway Maritime Hospital was the nearest site.
She said a merger could bring economies of scale in the areas of management, procurement, and IT, and by the two hospitals avoiding duplication of some services.
The two hospitals already worked together to provide some services, such as urology and dermatology, she said.
But she added: "We recognise that for people's convenience, they need to be able to access the majority of services locally."
She said services such as A&E, maternity, outpatient clinics and paediatrics would continue on both hospital sites.