Integrated Health System: A Case Study

At the time of the IPO in ’69, HCA operated 11 hospitals throughout Tennessee and the neighboring states. With the backing of strong capital investments, HCA experienced rapid growth in just one year’s time and was operating 26 facilities with an aggregate of 3,000 hospital beds in its portfolio. This was achieved with diversity via mergers, acquisitions, and contractual agreements to manage non-HCA

In 1997 University of California, San Francisco (UCSF) merged its two public hospitals with Stanford’s two private hospitals. The two separate entities merged together to create a not-for-profit organization titled UCSF Stanford Health Care. The merger between the health systems at UCSF and Stanford seemed like a good idea due to the similar missions, proximity of institutions, increased financial pressure with cutbacks in Medicare reimbursements followed by a dramatic increase in managed care organizations. The first year UCSF Stanford Health Care produced a profit of $22 million, however three years later the health system had lost a total of $176 million (“UCSF-Stanford Merger,” n.d.). The first part of this paper will address reasons

Since most specialty procedures are inpatient services, EMC’s inpatient occupancy rate suffers. The occupancy rate for Emanuel Medical Center – fifty percent – is far below that of its competitors and industry benchmarks. To accompany this, EMC (on average) receives a lower reimbursement for in-patient Medicare services per patient seen in comparison to its competitors. A result such as this is correlated with directly to the fewer amount of specialty services that EMC offers. In order for Emanuel Medical Center to be able to compete with other hospitals in its service area, it is imperative that EMC evaluates what services they currently offer and are capable to offer in the future to add value to the hospital, increase its revenue stream, and expand its patient mix. Currently, Emanuel Medical Center has not succumbed to its increasing financial pressurealthough EMC has had a negative operating income for five straight years. A negative operating income places EMC at a disadvantage because it limits the hospitals ability to renovate its aging building or hire new specialists to offer revenue enhancing procedures. EMC’s competitors, on the other hand, have large sources of revenue due to their mergers with large healthcare networks such as Catholic Healthcare West. Another competitor, Kaiser Permanente Modesto Medical Center, has extremely large financial resources due to the fact

Vertically integrated health care system that I have chosen is the Veterans Administration (VA) it's accountable for a large patient population for military veterans. As stated, The Veterans Health Administration is America’s largest integrated health care system with over 1,700 sites of care, serving 8.76 million Veterans each year (VA.GOV). The services that's provided to veterans is health care, rehabilitation, employment, education, home loan guaranties, and life insurance coverage. VA control costs by buying in bulk and control costs by engaging in a deep, single-source relationship with each patient. The Assistant Secretary for Management oversees all resource requirements, development and implementation of agency performance measures,

There are several different reasons as to why a long term care facility would seek to join either an integrated health system (IHS) or an integrated health network (IHN). The motivation to participate typically comes from either a requirement or eagerness to enhance the organization's situation within the long term care environment. Organization chose to incorporate an integrated system or network when the goals of the whole outweigh the goals of the individual organization's current state.

Unfortunately, although antitrust agencies are paying attention to recent court actions against mergers, the FTC investigates only 1-2% of consolidations (McCanne, 2014). It is also important to remember than public payers such as Medicare and Medicaid set prices to physicians and hospitals with no room for negotiating and conversely private insurers may use their market-share leverage to negotiate reimbursements. Integrative care in the form of hospital consolidation has been shown to reduce costs by 10-20% but this cost has not been shown to produce a cost savings to private insurers (Cutler & Morton, 2014).

Over the years Canada has been making efforts to adopt an integrated health care system. There is existence of disconnected sections in the healthcare system that involves hospitals; doctor’s working conditions, community service groups among others. Various provinces in Canada are taking risks and experimenting with different structures and approaches in an effort to provide better services and overall improved healthcare to its residents. Examples include: Regional Health Authorities and Local Health Integration Networks. Despite all these efforts, Canada’s regional health authorities still do not have characteristics of a fully integrated system. (Hospital Management Research Unit 1996, 1997). In contrast to Canada, most developed countries

More and more integrated hospitals and other providers are becoming prevalent in our community; two large systems in the Dallas Fort Worth area are Texas Health Resources and the Baylor Scott White systems. What exactly are these integrated hospital systems? An integrated healthcare system is one that through official agreements or ownership sets up a horizontal and vertical line of healthcare facilities and services to better deliver seamless healthcare to patients. An example to use is Texas Health Resources since its found in most corners of the Metroplex. With any large corporation and system comes confusion and other problems: such as regulatory obstacles, the complexity of operations, and unclear financial ownerships. Integrated healthcare systems appear at face value to be the solution to curbing the

The Stanford Health Services and UCSF medical center merger was projected to have a great turnout as it was supposed to be “enhanc[ing] the academic mission[s], strengthen[ing] referrals, and creat[ing] a more cost effective teaching hospital” (Sjoberg, 1999). The two competitors joined forces in hopes that it would alleviate the pressures of the new managed care systems by merging resources and acquiring more bargaining power. Stanford Medicine and UCSF came together at a time when many other academic health centers were looking to improve their negotiating powers with healthcare plans and physician groups. The merger offered hope to UCSF and Stanford by strengthening training programs and offering innovation plans as well as financial support.

Fourth, both health care organization are anticipated that during our organizational restructuring on the Care Select Health System would most likely affect job satisfaction levels and potentially compromise the quality of services provided, yet evidence on the impact of hospital mergers on staff satisfaction is surprisingly scarce. Therefore, Care Select Health System staff might perceive mergers as a breach of the psychological contract (implicit commitments and expectations between employers and employees) when they feel they are not listened to, when they have to ‘suffer’ from delays in service development and job uncertainties. For instance, cultures of merging organizations might also clash when they have opposing attitudes towards

The U.S healthcare system has been characterized as complex, fragmented and costly, and one that thus results in an inefficient allocation of resources. Due to this, the concept of integrated healthcare delivery systems (IDSs) has gained much interest over the past few decades. Throughout healthcare policy, these systems have been considered the better solution to addressing issues surrounding not only the cost of care to the system, but the quality of care that is provided from the system. Much in alignment with the concepts of managed care, integrated delivery systems act to contain the cost of healthcare, while providing quality care to the consumer.

Anti-trust laws in the United States have been effectively used to prevent monopolies in industries like telecommunications, oil and gas and computer software. Anti-trust laws are enforced in order to maintain free competition in the marketplace, which generates lower prices and incentivizes the development of high quality products. Today, hospital systems are experiencing an era of heavy consolidation, which include mergers and acquisitions and physician practice buy-outs. According to the Wall Street Journal, hospitals completed 86 merger and acquisition deals valued at $7.9 billion in 2011, which was the most in a decade. Like in other industries, this developing trend in hospital consolidations encourages price fixing and

Coyne et al. (2009) research question addresses if there are indeed a difference with efficiency and costs among size and ownership of hospitals in Washington State. This research is performed using only small (1-40 beds), medium (41-150 beds) and large (151 or more beds) not-for-profit and government owned hospitals (Coyne et al., 2009).There are other research studies performed on this matter to determine hospital size and performance and the researchers have found that the content is reliable and valid (Coyne et al., 2009).The Coyne et al. study used five efficiency and five cost indicators that are normally used as a measure of hospital performance (Coyne et al., 2009). Data on the differences between ownership type, hospital size and interaction among hospital ownership and size were tested with AVONA, a two-way analysis of variance (Coyne et al., p 166).Coyne et al research study results have shown that yes size and ownership type make a difference in the efficiency and cost results of hospitals. Among the ten measures studied there were five that make a difference in hospital size and costs. Some of the results of this study include current asset turnover imply that size matter but ownership types doesn’t, occupancy results

Core changes are less common than peripheral changes in the organization of hospitals. Using Lee & Alexander’s study 1 percent of the hospitals had core changes compared to 36.6 percent having peripheral changes. The percentages of change clearly identify peripheral changes as the more common organizational changes thus making it the more detrimental of the two. Another limitation should have been added stating that the rates of failure in core changes was not separate nor compared to those of peripheral changes.

This study examined whether the two health system formations analyzed in the previous essay, Health System A and Health System B, can pass the antitrust safety zone test for horizontal hospital mergers and acquisitions. The main data source for this essay is MarketScan® Commercial Claims and Encounters Database, which is a unique private insurance claims database that includes 23 million employees, dependents and retirees from around 100 large private employers (Adamson, Chang & Hansen, 2008). This study collected patient flow information from this detailed database, which includes patient and hospital characteristics.