By Scott Robertson
Holston Medical Group will be impacted greatly by whatever decision the states of Virginia and Tennessee make regarding the Mountain States-Wellmont proposed merger. To date, however, HMG has not spoken with either state formally, choosing to wait and see what the hospital groups will say in their COPA requests.
That fact doesn’t mean HMG is unconcerned. “We have the same concerns I think everybody has,” CEO Scott Fowler told The Business Journal in late January. “How do we protect this incredible investment the community has made in its hospital systems? I think the Wellmont Foundation is $400 million of community money. The hospitals are the place where health care has been invested in by the community. So we want the hospitals inside our environment to be strong and stable.
“The hospitals have said, ‘We need to merge because it’s our only real chance of viability,’” Fowler continued. “We’re for that if it can still be done while managing the change to value. We’re waiting to see what that means in terms of what they’re willing to do.”
Fowler says part of the reason both systems spent in ways that made little long-term sense in the past was the fact they had money to spend. A merged company, he says, will have the ability to borrow even more. “We don’t want to see this become an extension of what we had, just getting access to more capital to control markets. Hopefully the government will manage that.
“We have a great amount of faith in both the willingness to do the right thing by Alan Levine and Bart Hove, and trying to figure out how to do this,” Fowler said. “But they have their primary obligation to keep those hospital systems strong and basically in control of the environment.” And while HMG has no formal place at the table, Fowler said, both systems have had C-level discussions with him. “We have been working back and forth. There are two key components for us. One is the absolute unrestricted, unblocked access to the data we need to take care of patients. This business about not sharing data with doctors in order to somehow protect the patient – that doesn’t fly. They have given reassurance we will have access to that data after the merger.
“The second thing is, as we move from the model where the hospital is the center of the universe to a more integrated model of care, we have to have the ability to do outpatient things that we currently can’t do under the Certificate of Need (CON) law. In our region, for instance, there are virtually no outpatient surgery centers that are not controlled by hospitals. We need control of outpatient services in order to balance things. The hospitals are very aggressive if we try to get a CON. They say it’s not needed. Those are the two things we have stood on.
“We want the ability to compete with them,” Fowler said, “especially in those areas where their monopoly gives them a lot of power, but there’s not a reason to have a monopoly, like outpatient services or physician services. We’re not asking for a guaranteed advantage, but we should certainly be allowed to compete.”