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Wednesday, 30 October 2013 01:34

MedWest dissolves to make way for sale of Harris, Swain hospitals: HRMC acquisition announcement pending

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The MedWest system forged by the hospitals in Haywood, Jackson and Swain County three-and-a-years ago will dissolve, ending a short-lived partnership that was rocky almost from the start.

 

But the hospitals may not be going their separate ways entirely. MedWest is disbanding to make way for even bigger changes in the hospitals’ collective future: acquisition by a large hospital network.

WestCare, which includes both Harris and Swain County hospitals, will be sold to Duke LifePoint Healthcare. Meanwhile, Duke LifePoint is a contender to buy Haywood Regional Medical Center as well, although Haywood hospital leaders emphasized they have not made a formal decision yet.

“WestCare has made a decision, Haywood has not,” said Mark Clasby, the chairman of MedWest board and Haywood County’s Economic Development Director.

If Haywood does chose Duke LifePoint, the former MedWest trio would still be closely linked under the same parent hospital system despite the MedWest banner going away. 

“WestCare will be operated independent of Haywood Regional Medical Center,” Bunny Johns, chair of the WestCare Board, said in a press release.

The MedWest system has been engaged in searching for a larger hospital system to partner with, citing financial challenges facing small hospitals in today’s health care landscape.

The WestCare hospital board voted this week to sell Harris and Swain hospitals to Duke LifePoint Healthcare, a joint venture of Duke University Health System and LifePoint Hospitals.

“This is a game-changing step forward for the WestCare hospitals,” Johns said.

Johns said WestCare patients will continue to have the “full continuum of quality healthcare services” they do now, plus some.

Duke LifePoint will bring clinical expertise but also a cash infusion allowing the hospital to expand and grow, said Dr. John Buenting, a WestCare Board member.

Buenting called it a “new, completely different strategic approach to that implemented under MedWest Health System.”

Mission Hospital System issued a statement Tuesday saying it was disappointed that WestCare chose to align with Duke LifePoint, a Tennessee-based for-profit healthcare company.

“At a time when so many are struggling to receive the care that they need, the incremental burden on residents and communities to not only pay for care but also ensure returns to shareholders on Wall Street and around the globe is troubling,” said Jon Yeatman, Mission’s vice president of strategic development. “Regardless, Mission will continue to support the residents of these communities as we have for so many decades.”

Meanwhile, patients of HRMC can expect to find out more in the near future about what lies ahead for their hospital.

As a public hospital, Haywood operates under a different set of rules than WestCare, which is a private nonprofit entity.

State statute stipulates that public hospitals follow specific steps aimed at public disclosure when contemplating a sale of the hospital. HRMC is obligated to disclose basic terms of the acquisition offers it has gotten and then hold a public hearing.

“Because Haywood Regional Medical Center is a public hospital authority, the Haywood Regional Medical Center board will follow the open public process set forth in the state statutes,” said Clasby.

The public hearing is scheduled for Wednesday, Nov. 12, with more details to be released later this week.

Disclosure of other offers HRMC has gotten — if any — will also be released in coming days. Duke LifePoint Healthcare is one of the entities in the running to acquire HRMC, and has been confirmed as a top contender. Whether it is the only offer on the table, or whether there are other viable offers to consider, won’t be known until the hospital makes the public disclosure.

As a public hospital, a sale of HRMC would also have to be approved by the Haywood County Board of Commissioners, adding another step to the process.

 “We are encouraged to have reached another milestone in this process,” Frank Powers, Chair of the HRMC Board said in a press release. “We look forward to the public hearings and working with the County Commissioners to find a decision that will most benefit our patients and community,” said Powers.

The health care landscape nationwide has been in a state of flux as hospitals everywhere face rising costs and shrinking payments. There has been a near constant shuffling of the deck as hospitals move in and out of mergers and acquisitions. Small, rural hospitals in particular have scurried to the gates of bigger ones, seeking a safe harbor from the financially trying times.

Both Harris and HRMC have been losing money in recent years. Both hospitals hoped the MedWest affiliation would improve bottom lines and make them stronger, but the hopes weren’t full realized.

The MedWest affiliation stumbled nearly out of the gate. Some believe the neighboring hospitals weren’t truly ready to give up their autonomy and combine their operations, and thus didn’t realize the true cost savings a merger is supposed to bring. Others blamed the failed merger on cultural differences between the two medical staffs and a competitive rather than cooperative attitude.

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