By Richard S. Gubbe
The landscape of health care in the region has changed significantly over the past two years, with new alliances, strengthened affiliations and new sources for services.
Two major concerns will carry forth. While an increase in treatment options is always helpful, will that translate to a lowering of costs to the consumer? Will the consumer continue to suffer from price-gouging and needless procedures?
The mergers and acquisitions of the three major providers in the area — SwedishAmerican, Rockford Health Systems and OSF St. Anthony — have shown both growth and posturing.
Are these acquisitions a bigger fish swallowing the little fish to grow into an even bigger fish? Is the health care industry going the route of banks, hotels and casinos? Indications are all three outlets have traded up to better themselves and a changing marketplace. What has transpired is an expansion of services and the aligning with big names to do what seems to be a trend across the country: big is more stable.
The consumer wants a better deal from the industry, but seeing that in dollars may have to wait. For now, expansion of services is adding to the value of health care providers, says Dr. Bill Gorski, president and CEO of SwedishAmerican.
“Value doesn’t always have to be money. It can be access to more resources,” Dr. Gorski told The Rock River Times.
Early statistics show the Affordable Care Act has done little to curb hospital profits thus far, a segment on 60 Minutes reported recently. Instead, only a reduction in Medicare fees has been found.
“People look for the easier way out, and pills and potions seemed to be the easy way out. It’s human nature,” Dr. Gorski said. “The medical profession has fostered that over time, and it will take time to reverse that.”
With large mergers in Chicago and across the land, everyone has a partner at the profitable dance.
“What is really happening is we are spending an extraordinary amount of money, and the quality of service doesn’t match up,” Dr. Gorski said.
He said the federal and state governments, along with private insurers “are demanding a higher quality of care.”
That scrutiny, it is hoped, will drive prices downward. Meanwhile, Gorski said his services will continue to expand, such as the new better-life wellness program at the YMCA and the opening of the cancer treatment center. SwedishAmerican has been a pioneer in holistic health in the area, and Gorski sees only more in the future.
“I don’t see us pulling back on that,” Dr. Gorski said. “The platform is there now.”
The Illinois Health Facilities Planning and Services Review Board approved the merger of SwedishAmerican with UW Health recently after a five-year affiliation. Now, Dr. Gorski has to please two boards of directors. He called the affiliation agreement “a very mutual coming together. There were some things in northern Illinois we could do together, and the cancer center is the culmination of the affiliation agreement.”
This Illinois regulatory step was required to move forward with the merger and the change of ownership of SwedishAmerican to University Health Care, Inc.
Mike Dallman, president and CEO of University Health Care, Inc., said: “UW Health pursued a partnership with SwedishAmerican because we both share a commitment to enhancing the health of the communities we serve. We are aligned in our collaboration to meet the challenges of a changing health care environment together.”
SwedishAmerican Health System and UW Health had signed a definitive agreement last fall to merge the organizations and make SwedishAmerican an integral part of UW Health.
SwedishAmerican maintains its local board with responsibility for local governance and policy-making. Management remains local with responsibility for day-to-day operations. Dr. Gorski continues as the president and CEO of SwedishAmerican, and will report to both the SwedishAmerican board and the board of University Health Care, Inc., the not-for-profit organization that facilitates relationships with health systems on behalf of UW Health.
The agreement includes $255 million in capital over the next five years invested in the Rockford market for information technology, hospital infrastructure and new clinical care locations. Combined, the organizations’ net revenues are approximately $3 billion.
Rockford Health Systems
Illinois Health Facilities and Services Review Board also recently approved the merger between Mercy Health System and Rockford Health System to create a combined multi-regional health system that will provide care in more than 40 northern Illinois and southern Wisconsin communities.
The new combined system operates five hospitals, employs more than 550 physicians, with approximately 7,500 employees, and provides outpatient service in more than 80 centers of care. It continues to operate as a not-for-profit organization with a charitable mission to provide excellent health care services close to home.
Mercy Health System President and CEO Javon R. Bea said: “With the necessary regulatory and legal processes complete, we are excited to begin planning our integration strategy. By thoughtfully aligning our organizations, we will create a regional system that honors our existing legacies while strengthening both systems for the future.
“Our patients will continue to experience the high-quality care they have come to expect from Mercy Health System and Rockford Health System, and as our integration progresses, patients will have access to more services and specialties than ever before,” Bea added.
Rockford Health System President and CEO Gary E. Kaatz added: “This merger is great news for residents of northern Illinois and southern Wisconsin. As the founding partners of this new system, Mercy Health System and Rockford Health System will together forge a future that responds to the needs of the communities we serve. This new system is anchored in our region and will provide not only expanded and advanced medical care, but jobs and economic opportunity.”
With the finalization of the merger, the two systems will engage in integration planning to enhance care for the patients and communities they serve. The system will establish its headquarters in Illinois.
Bea will lead the new system, which will operate under a newly formed parent company. Rowland J. McClellan will serve as the parent board chairman. Kaatz will continue to serve as Rockford Health System president and CEO, reporting to the Rockford Health System Board as well as to Bea as CEO of the parent company. Bea continues as CEO of Mercy Health System.
Founded in 1883, Mercy Health System serves more than 1 million individuals through its 70 facilities in 24 southern Wisconsin and northern Illinois communities. Over the last 25 years, Mercy has grown from a stand-alone community hospital with no employed physicians into an integrated health system offering a network of primary and specialty care physicians, three hospitals, sub-specialty centers, insurance products, long-term care, retail services and preventive health and wellness programs. The system has more than 400 physicians and 4,000 employees.
Mayo Clinic announced in 2013 that OSF HealthCare passed Mayo’s review process to become the newest member of the Mayo Clinic Care Network. OSF, the fourth-largest health care provider in Illinois, is an integrated health system owned and operated by The Sisters of the Third Order of St. Francis. OSF provides care to more than 3.7 million people in the communities it serves throughout Illinois and the Upper Peninsula of Michigan.
David Hayes, M.D., medical director, Mayo Clinic Care Network, said: “Mayo Clinic and OSF share a patient-centered culture that thrives on improving outcomes and increasing value. The Mayo Clinic Care Network helps achieve those results. We look forward to continuing our long-standing relationship with this excellent organization and its dedicated staff, working together during the coming years to improve patient care and develop new delivery models.”
Kevin Schoeplein, chief executive officer of OSF Healthcare System, added: “Mayo Clinic is one of the most respected health care institutions in the world, and like OSF, is blessed with extraordinary clinicians. Because of this collaborative relationship, our patients will benefit from an impressive merging of medicine, science, research, and the learned experiences and intuition of highly skilled clinicians from both systems.”
According to Kathleen Forbes, M.D., chief clinical officer for OSF Healthcare System, “The collaborative relationship between OSF HealthCare and Mayo Clinic is designed to be a long-lasting one. By working together over time, OSF and Mayo Clinic hope to build new and innovative ways to provide the best possible care to patients and their families.”
The Mayo Clinic Care Network extends Mayo Clinic’s knowledge and expertise to physicians and providers. OSF physicians will connect directly with Mayo Clinic specialists on questions of patient care using electronic consulting called eConsults.
OSF physicians have access to the latest Mayo-vetted medical information through AskMayoExpert, an online database developed and used by Mayo Clinic physicians.
OSF employs more than 14,000 people and consists of eight medical centers and two colleges of nursing. OSF Medical Group is a comprehensive, integrated network of health care facilities, services, physicians and employees in Illinois and Michigan.
From the Jan. 28-Feb. 3, 2015, issue