Glens Falls Hospital, which also operates clinics and specialty care facilities throughout the southeastern Adirondacks, announced the move yesterday.
Hospital CEO David Kruczlnicki says the talks come, in part, as a response to Obamacare and declining government reimbursements for Medicaid and Medicare.
"There's an imperative for healthcare providers to work together...to not only improve the management of costs and find efficiencies but also to find opportunities to improve quality and enhance access to care and services."
Hospital officials say there are no plans currently for a full merger between Glens Falls Hospital and Albany Medical, but they say they haven't ruled out that kind of development.
Glens Falls Hospital is one of the North Country's largest employers, with a 300 million dollar annual budget.
Kruczlnicki says this announcement shouldn't worry business leaders in the Glens Falls area.
"If I were a business leader in this community, I'd be encouraged that the community hospital is scanning the horizon as pro-actively as it is, and being as forthright with the community as it is."
In recent weeks, hospitals across the North Country have announced job cuts and other cost reductions, as they grapple with cost-cutting efforts in Albany and Washington DC.
Nursing homes and other health-care providers have also announced cutbacks in services that rely on government reimbursements.