Commitment, Growth, Stability and Quality: A Health Care Story

One of the subplots to the health care reform story has been the plight of the independent community hospital.

With its recent announcement, Conemaugh Health System (CHS) has emerged as a protagonist in this storyline and may well be foreshadowing health care’s next chapter, at least for independent community hospitals. 

Little more than two weeks ago, CHS in Johnstown, Pa., announced Duke LifePoint Healthcare was acquiring it. It’s certainly not the first announcement of an acquisition of a nonprofit by a for-profit in this state, but the financial and clinical strength of CHS make it especially noteworthy.

CHS is the largest health care system in west central Pennsylvania and includes two Memorial Medical Center campuses, Miners and Meyersdale medical centers, and at least two dozen outpatient and physicians’ practice locations in four counties.

Duke LifePoint Healthcare is a for-profit joint venture of Duke University Health System, Inc. and LifePoint Hospitals that was established to build a dynamic network of hospitals and health care providers. 

With Duke’s acquisition of CHS, it has taken its biggest step thus far in building that network, as CHS is the largest system it has acquired.

Under the leadership of CHS CEO Scott Becker, the system has been successful, so it’s easy to believe the system was operating from a position of strength. This was not a buyout of a financially failing institution.

By all indications, it was the culmination of a vision set forth years ago. It’s also likely a harbinger of things to come for community hospitals if they are to remain viable. And it may just have put CHS on footing to become one of Pennsylvania’s powerhouse health systems, among the likes of the University of Pittsburgh Medical Center and Geisinger Health System. 

In 2010, I talked with Becker about the future of community hospitals. What was announced on March 14 isn’t exactly as Becker had described it, but it’s close. 

He told me the solution for their survival would be in creating a new model of integration in which community hospitals in the same region build collaborative relationships with each other yet remain independent and, in fact, still compete with each other. Under such a model, they can align themselves against behemoths like the Ascension Health, Tenet Healthcare and Sutter Health systems of the world. A merger of equals, as he described it, that still allows for opportunities for each individual system.

CHS is having that very discussion right now with Somerset Hospital, not to acquire it, but to partner with it under the new ownership of Duke LifePoint. 

So whether we call this the climax of the CHS story or the rising action to the climax, what comes next will certainly be intriguing.

From this point on, where does the story go? How do Duke LifePoint Healthcare and CHS tell their story, strategically and tactically? 

It’s health care, so of course it’s a story of quality care and access to that care. But it’s much more. Here is what I see, in order, as strong storylines.

1. Commitment – We’re here to stay, and we’re going to be a major player. As Becker said, CHS may now become the largest system in Western Pennsylvania to accept Highmark and UPMC insurance.

2. Growth – William F. Carpenter III, chairman and CEO of LifePoint Hospitals, told the Johnstown Tribune-Democrat that by building up and expanding Conemaugh’s programs and working with other hospitals in the region, Duke LifePoint can build its business here while allowing patients to receive top quality care without driving to Pittsburgh or other cities. At the same time, it can pull patients in that it might not otherwise have.

3. Stability – Some health care experts have predicted the death of many independent community hospitals under the Affordable Care Act, either through closure or acquisition. Although CHS has indeed been acquired, it’s a model unlike any others in the state. CHS was operating from a position of strength. The likelihood that CHS will retain its community hospital character is good. And Johnstown benefits – economically and psychologically. Other regional community hospitals may benefit, too.

4. Strengthened quality and access to care – This is a storyline insurers and referrers need to hear as much, if not more, than patients. It gives the system good leverage.

How the system handles the nonprofit to for-profit component of the story will be interesting. Duke LifePoint Healthcare has assured the level of charity care will remain. Nonprofits provide charity care in exchange for tax-exempt status. CHS is no longer tax-exempt. Many will be watching how a for-profit manages a former nonprofit community hospital. 

It is a new day for health care. And a new time calls for new ways of communicating. Tired tactics and messages have largely become irrelevant. As it leads the charge into the brave new world of health care, CHS has an opportunity to communicate with its stakeholders in the same way – creatively, innovatively and meaningfully.

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Jason Snyder is a  senior vice president for WordWrite Communications.