Politics and turf.
The much larger allopathic medical establishment had been at odds with Osteopaths since the turn of the 20th century. DOs had developed their own hospital systems that were prominent in certain states and cities as they couldnt get privileges in allopathic institutions. This started to change in the 1960s, partly due to the influence of Nelson Rockefeller, governor of New York and for a short time, Vice President of the United States under Gerald Ford. However, it took some 20-30 years for this to be widely accepted. Podiatrists had a similar timeline in their fight to gain admitting and hospital privileges. In the early and mid 1990s, there was much talk of merging the two, ultimately leading to a project in about 1995 called "Physician 2015." This was an attempt in a grand unification of MD, DO, and DPM.
It was mired in politics and turf from the start. Why? Their is the entire medical establishment of the AMA, LCME, ACGME, AAMC, for MDs, AOA, COCA, AACOM, for DO, and similar groups for DPM. Every state has their own medical board and many had a separate board for Osteopaths and Podiatrists. Every specialty across MD and DO, and in every state, county, city, has a society with its own turf to protect. It was a mess. The podiatrists got no respect and pulled out quickly, the medical and osteopathic colleges pulled out soon after, but the national groups kept talking, and talking, and talking for years about combining residencies.
What I think finally pushed them to act was the constraint on residency slots. Even though residency programs are educationally run often by a school, the actual employee slot belongs to the hospital and is paid primarily by medicare. And once a hospital gets a slot, it never gives it up. So as the traditionally osteopathic hospitals starting losing essentially losing market share to the ever merging and growing MD hospital corporations and losing potential doctors who as DO choose to attend MD residency and work in traditional MD slots, they had lots of open residency slots. Over a thousand slots a year not being filled in Osteopathic programs . The Allopathic side saw these as potential growth and finally "Physician 2015" led to the merger of residencies