Conemaugh Health System and Somerset Hospital leaders have agreed to develop what is being called a “collaborative relationship” to explore ways to reduce duplication and other expenses related to competition, while both remaining independent organizations.
Somerset President and CEO Ron Park and Conemaugh President and CEO Scott Becker announced the newly inked nonbinding agreement during a Thursday press conference at The Georgian Inn at Somerset.
Details of the relationship will be hammered out over the next 90 days, but areas could include physician and staff recruiting, electronic medical records, expansion of existing programs and introducing new services and technology, Park said.
Physician recruitment is one of the prime areas both organizations feel will be enhanced by working on a regional basis to expand programs instead of duplicating programs, he said.
“We are very much looking at expanding primary care in our community,” Park said, explaining that working collaboratively with Conemaugh should enhance the recruiting, while reducing duplication.
New physician practices may be jointly owned by both organizations, with staff in those practices paid under a yet-to-be-defined joint entity.
“Over the next few months, leadership from both Conemaugh and Somerset will come together to develop an operating agreement that will define a partnership, or ‘joint venture,’ to collaborate on physician practice development,” Park explained. “Both Somerset Hospital and the Conemaugh Health System will retain independence. Therefore hospital-based employees will remain employees of their respective hospital corporations.”
Conemaugh will be able to bring more of its specialists into Somerset to build relationships with patients there and improve the referral process back and forth between the two hospitals, Becker said.
“What we want is the best care, in the right location, at the right cost,” Becker said.
Conemaugh’s Meyersdale Medical Center and residents of that area could benefit from enhanced services under a collaboration because future investment would be directed to the community’s needs, Park said. Currently, any new Somerset services in Meyersdale at least give the appearance of a push into Conemaugh’s market, he added.
“We will be able to do things jointly that will help support the people and community of Meyersdale,” Park said. “We are really limited to look at it the way we are now.”
The relationship also offers new opportunities for the Conemaugh’s extensive education programs, Becker said.
Collaboration is essential in today’s health care environment, Becker said. By creating a regional network, the two hospital organizations can build a stronger base.
“What we have agreed to do is to be open with each other in the strategic planning areas,” Becker said. “We will build that process collaboratively.”
While they noted that it is impossible to predict the industry’s future, both leaders stressed that the new collaboration was not undertaken as the first step toward a merger.
“We have no intention today to become part of the Conemaugh system,” Park said.
Talks leading to Thursday’s announcement began in January with some informal meetings with a few board members from each organization, Becker said, noting that it was shortly after Park was named CEO.
Both boards have approved the letter of intent and will work together with administrative staffs to define the collaboration.
“Everybody recognized that staying the same might mean moving backward,” Somerset board Chairman Bruce Shipley said.
Board members saw in Conemaugh the opportunity to remain strong and provide quality care without sacrificing local control, he said.
“We have a board that is committed to staying independent,” Shipley said. “We feel this enhances our chance of being able to do that.”
The collaboration could improve both organizations’ position in obtaining favorable reimbursement contracts with health care insurance giants Highmark Blue Cross Blue Shield and UPMC Health Plan, Becker said.
It could even lead to a joint insurance plans that could be offered through local employers, he said.
Communities served by the two organizations will be the ultimate winners under a successful collaboration, Park said.
Randy Griffith covers health care for The Tribune-Democrat. Follow him on Twitter at twitter.com/photogriffer57.