Bedford Hospital and Luton and Dunstable Hospital plan merger
Two hospitals hope to merge in a move which could save £12m over five years.
Bedford Hospital plans to link up with the Luton and Dunstable Hospital by April.
A&E units, maternity and paediatric services would be kept at both sites, according to proposals which would need to be approved by NHS England.
Mayor of Bedford Dave Hodgson welcomed the plans and said it was "about making sure that we have the right services in the right places".
"If we've got managers jointly running Bedford Hospital and Luton and Dunstable Hospital, I don't see it as a big problem," he said.
Bedford Borough councillor Louise Jackson said she was "cautiously optimistic" as she would not want Bedford to "lose control" of its own hospital.
A Bedford Hospital employee, who did not want to be named, told the BBC she heard about the plans from her mother.
"I feel very disappointed," she said. "If you're going to do something, tell the staff so we are aware and can prepare. It's just not fair."
Stephen Conway, chief executive of Bedford Hospital, said it was difficult to inform all staff of the news.
"We have 8,000 staff across the two sites, it's going to take us a few days for everyone to hear about it," he said.
"This is a more strategic merger, to make sure we recruit the best staff in the future and retain staff.
"There's been endless speculation over the last few years. This will give some security to staff and the local population."
The Bedford Hospital NHS Trust and the Luton and Dunstable University Hospital Trust hope to submit a full business case for the merger in December.
If approved, they hope to establish a new trust board by April.