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Tuesday, 28 February 2012 10:43

Pennant adds two partners to health care collaborative

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WEST MICHIGAN — The addition of Mary Free Bed Rehabilitation Hospital and Carson City Hospital begins building a health care collaborative beyond its founding members.

The two hospitals are the first to join Pennant Health Alliance, which formed 18 months ago to offer hospitals an alternative to a merger in an age of consolidation in the health care industry. Founding members include Metro Health in Wyoming, Ann Arbor-based University of Michigan Health System, and the West Michigan operations of Trinity Health that comprise Mercy Health: Saint Mary’s Health Care in Grand Rapids, Muskegon’s Mercy Health Partners, and hospitals in Cadillac and Grayling.

Mike FaasMetro Health CEO Mike Faas, who serves in the same role for Pennant Health, sees another two or three hospitals signing on in 2012, though the collaborative’s primary focus isn’t growing membership.

“The value isn’t how many join. It’s who joins and what they bring,” Faas said. “It’s the strength of the partnership.”

Members bill Pennant Health Alliance as a way for hospitals to generate the benefits of a merger without actually merging into a larger heath system.

“Our partnership with Pennant will provide us with a competitive advantage and better prepare us for new health reform challenges,” Carson City Hospital President and CEO Matthew Thompson said. “As a rural community hospital, our goal is to keep care local and continue to provide our patients comprehensive care close to home.”

Founders say the alliance allows members to remain independent and still tap the expertise of larger partners such as U of M Health System to drive operating and clinical improvements through the sharing of best practices for backroom administrative functions and clinical care.

Metro Health, for instance, generated $3 million in cost savings in 2011 by adopting best practices and administrative process improvements learned from U of M Health System, as well as from the joint purchase of medical supplies and equipment, Faas said.

“And we expect that to grow, not shrink, with some of the things we’re looking at next,” he said.

Pennant Health Alliance can also help with transitioning to electronic medical records and quality and performance reporting.

Since coming together in August 2010, Pennant’s founding partners have primarily focused on “building the infrastructure” for collaboration by learning one another’s capabilities and how best to take advantage of them, Faas said.

“It’s been a lot of finding out what each institution has and what we can borrow from each other,” he said. “We’re beginning to understand better how to do things.”

Getting to that point now enables Pennant Health Alliance to begin bringing additional members on board. Signing Mary Free Bed and Carson City Hospital provides the alliance some momentum, though Faas emphasizes that the focus is on expanding capabilities and not just adding numbers.

“Every organization is critical to the next set of organizations that want to join,” he said.

The concept of a regional or statewide alliance between independent hospitals is not unique to Michigan.

The January issue of Hospitals and Health Networks magazine carries a cover story about the formation of similar ventures around the nation, including a 17-hospital collaborative in the state of Wyoming and a 16-hospital network in northern Texas.

Read 2117 times Last modified on Sunday, 12 August 2012 13:10

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