GRAND RAPIDS — Metro Health’s quest for a partner already has at least one potential suitor highly interested.
A decade after making a rejected offer to acquire Metro, Trinity Health remains “absolutely” interested in working out some kind of union, said Roger Spoelman, who heads Trinity’s West Michigan operations under the Mercy Health banner.
In West Michigan, the Novi-based Trinity Health owns Saint Mary’s Health Care in Grand Rapids and Muskegon’s Mercy Health Partners, plus hospitals in Cadillac and Grayling. Adding Metro Health to the Trinity Health fold would enable both to better compete in West Michigan against market leader Spectrum Health.
“I just believe it could be a very good partnership,” Spoelman said. “It would be very good for both of us.”
Metro Health and Trinity Health are already partners with the University of Michigan Health System in the Pennant Health Alliance, a coalition formed two years ago for the joint purchasing of medical supplies and equipment, shared administrative services and the sharing of best clinical practices.
Metro Health President and CEO Mike Faas also serves as chief executive for the Pennant Health Alliance. Faas said last week that Metro wants to talk to both its partners in Pennant Heath about the potential for a stronger partnership with either one.
While Metro could remain independent and work through Pennant Health, Faas sees a good possibility that some form of new partnership will emerge.
“I don’t think it’s impossible that we’ll come through this and say, ‘We like just what we are and we’re going to stay the way we are and work through Pennant,’” Faas said. “I think it’s much more likely that we’ll end up with a strategically-aligned partner that (involves) either some kind of massive joint venture capital-wise, and/or even owns a percentage or all of Metro Health.”
Faas said that Metro also wants to talk to Borgess Health, which once discussed a merger with Metro 10 years ago, and with Flint-based McLaren Health.
Any partnership with Metro Health could come via a joint venture, an equity investment or an acquisition. The Wyoming-based Metro wants to examine a potential partnership that could help it better compete and grow as reforms take hold the health care industry and drive consolidation among care providers.
Mike LaPenna, a health care consultant and principal at The LaPenna Group Inc. in Grand Rapids, said Trinity Health would make a logical partner for Metro Health because it would generate economies of scale and improve Trinity’s position in the Grand Raids area. He called a possible Metro-Trinity link as “very interesting and powerful strategic initiative.”
Saint Mary’s, Mercy Health and Metro Health all have strong primary care networks in their markets. Combining them would make for a formidable market competitor, LaPenna said.
“If you ever put together the Metro stuff and the Trinity stuff, you’d have a robust primary care network,” LaPenna said.
Metro Health plans to retain a consultant to help identify potential partners and to determine what form a partnership could take. When Metro begins that process, which Faas expects to take up to a year, it’s likely to find plenty of potential suitors come forward, LaPenna said.
The health system, which relocated to a new suburban hospital campus five years, offers a partner a modern facility that doesn’t require capital for updates, plus a network of outpatient health plazas across Kent and Ottawa counties, LaPenna said.
Throw in a growing market with a solid economy, and Metro “has a lot to offer,” LaPenna said. He considers the Grand Rapids area the best market for health care in the Midwest.
“If you’re not in Grand Rapids, it offers access to the most important market in Michigan right now,” LaPenna said.