Some hospitals and health systems are striving to reduce costs and prepare for accountable care organizations by banding together in shared service arrangements.
Such arrangements allow independent organizations to share functions like recruitment and alignment of physicians, health information technology, group purchasing and revenue management, says Rob Betka, a consultant at Catalyst Management Advisors in Grand Rapids, Mich.
"Hospitals have to continue to focus on cost management, and shared services are a way they can do it without legal problems," Mr. Betka says. He points to a nearby example of this arrangement, Pennant Health Alliance, bringing together Metro Health in Grand Rapids, Trinity Health in Novi, Mich., and the University of Michigan Health System in Ann Arbor, Mich. And in New Jersey, St. Barnabas Health Care System and Atlantic Health are in discussions about forming a shared services agreement to reduce costs.
In the Pennant Health arrangement in Michigan, community hospitals and independent physicians can join the organization as a member or buy specific services. The coalition will actively recruit additional hospitals and independent doctors around Michigan to join.
"We know we need to get ready for health care reform, and the best way to do that is with a partnership," Metro Health CEO Mike Faas told Mlive. "We believe the future is working together and partnering, not controlling and owning."
Mr. Faas said the arrangement can serve as an alternative to rapidly growing Spectrum Health, a system also based in Grand Rapids. "Pennant is really all of the pieces that haven't aligned yet and who are they going to choose to align with," he said.
Meanwhile, Spectrum Health has been operating its own version of shared services, running a loose regional network of 21 community hospitals, 14 of which are outside the Spectrum system. The organization provides independent hospitals access to clinical quality programs, purchasing and expertise.
John Mosley, senior vice president for strategic development at Spectrum Health, says such arrangements legally prohibited from sharing access to capital, employee benefits, strategic planning, legal counsel, managed care contracting or any form of pricing or reimbursement.
Learn more about Catalyst Management Advisors.
Learn more about the Pennant Health Alliance.
Find out more about shared services and ACOs:
- New Jersey's St. Barnabas, Atlantic Health to Partner
- University of Michigan Health, Two Other Systems Launch Pennant Health Alliance
- 4 Ways Community Hospitals Can Align With a Health System, Short of Acquisition
Such arrangements allow independent organizations to share functions like recruitment and alignment of physicians, health information technology, group purchasing and revenue management, says Rob Betka, a consultant at Catalyst Management Advisors in Grand Rapids, Mich.
"Hospitals have to continue to focus on cost management, and shared services are a way they can do it without legal problems," Mr. Betka says. He points to a nearby example of this arrangement, Pennant Health Alliance, bringing together Metro Health in Grand Rapids, Trinity Health in Novi, Mich., and the University of Michigan Health System in Ann Arbor, Mich. And in New Jersey, St. Barnabas Health Care System and Atlantic Health are in discussions about forming a shared services agreement to reduce costs.
In the Pennant Health arrangement in Michigan, community hospitals and independent physicians can join the organization as a member or buy specific services. The coalition will actively recruit additional hospitals and independent doctors around Michigan to join.
"We know we need to get ready for health care reform, and the best way to do that is with a partnership," Metro Health CEO Mike Faas told Mlive. "We believe the future is working together and partnering, not controlling and owning."
Mr. Faas said the arrangement can serve as an alternative to rapidly growing Spectrum Health, a system also based in Grand Rapids. "Pennant is really all of the pieces that haven't aligned yet and who are they going to choose to align with," he said.
Meanwhile, Spectrum Health has been operating its own version of shared services, running a loose regional network of 21 community hospitals, 14 of which are outside the Spectrum system. The organization provides independent hospitals access to clinical quality programs, purchasing and expertise.
John Mosley, senior vice president for strategic development at Spectrum Health, says such arrangements legally prohibited from sharing access to capital, employee benefits, strategic planning, legal counsel, managed care contracting or any form of pricing or reimbursement.
Learn more about Catalyst Management Advisors.
Learn more about the Pennant Health Alliance.
Find out more about shared services and ACOs:
- New Jersey's St. Barnabas, Atlantic Health to Partner
- University of Michigan Health, Two Other Systems Launch Pennant Health Alliance
- 4 Ways Community Hospitals Can Align With a Health System, Short of Acquisition