"The Ronan Report" provides insight about the activities at the Western Maryland Health System in Cumberland, Maryland, and about the changes taking place in healthcare today from a CEO's perspective.

Wednesday, June 19, 2013

The AARP Weighs in on Hospital Mergers

In the June issue of the AARP Bulletin, there is an article on hospital mergers, "Hospital Mergers May Be Good for Business, But Patients Don't Always Benefit.”  Numerous people have advised me over the last two weeks that the article is in the AARP Bulletin and that it may be of interest to me due to our proposed alliance with Meritus Health System in Hagerstown and Frederick Health System in Frederick. 

Actually, it is an accurately written article. It describes the trend to consolidate due to tremendous financial pressures on hospitals to cut our costs. Hospitals are partnering with others in health care (many who were previously competitors) and such alliances are enhancing patient care. Patient admissions are declining rapidly as hospitals such as ours try to care for patients in the most appropriate setting, and such alliances or partnerships are allowing hospitals to better coordinate patient care under a more bundled payment approach, which takes away the argument that alliances increase the cost of care. 

The policy makers, as well as the regulators, are constantly looking for ways to get savings from hospitals as we adjust how we do business today.  At WMHS, we have been very fortunate to have agreed to be a TPR hospital three years ago whereby we are paid under a value-based payment methodology and not a fee-for-service methodology, which is based on volume.  I appreciate the AARP publishing such a piece as it clearly supports our initiative of "Meeting the Challenge of Health Care Change" at WMHS.

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