The Stanford Health Services And Ucsf Medical Center Merger Essay

Baylor Scott & White Health, formerly Baylor Healthcare Systems and Scott & White Health, respectively, merged in October 2013 to become one of the largest healthcare systems in the United States. With a new-shared vision, mission, and values statement, this paper examines the strengths, weaknesses, opportunities and threats present in light of this new merger. A carefully considered execution plan is imperative to ensure continuity of exemplary healthcare and a seamless merger of two similar cultures. As stated by Joel Allison, CEO of Baylor Scott & White, “of mergers that fail, probably seventy five percent fail because of culture.” The execution plan presented in the following pages will help this new entity avoid the risk of losing the trust of their patients and the communities they serve, while creating a new culture acceptable by all that provide and receive the healthcare services of Baylor Scott & White Health.

On paper, the merger between these two institutions made sense – both institutions were close to one another and competing for diminishing resources. Together they could reduce administrative costs and join forces to negotiate with large insurance companies. The need to create a new culture and dissolve historically existent power struggles were two large tasks that needed to be addressed in order to ensure a successful merger. However, the way in which the merger was organized did not lead to a successful merger. UCSF Health Care did not spend adequate time creating a shared culture in which the two organizations would see one joint organization with shared power (resources).

Founded in 1946, Seattle’s Group Health Cooperative was created by doctors and community members who believed that there needed to be a health care program that was affordable, member centered, and held principles of social justice. This cooperative was one that had been successful for many years, but just recently was acquired by the not for profit Kaiser Permanente health-care company on February 1, 2017 for 1.8 billion dollars. Although Group Health is a cooperative and Kaiser Permanente is a nonprofit healthcare company, they have similar views on how they run their companies because both have missions to put their members and employees first. This is something that the articles stressed because this merge is going to affect thousands of members and employees. I plan on focusing on the process Kaiser Permanente had when wanting to take over Group Health Cooperative, the pros and cons of the final decision to merge the two healthcare programs, and ultimately how Group Health’s marketing and management strategies will be implemented in the merge. (12)

Stanford Hospitals and Clinics (SHC) is a world renowned academic health system that is comprised of 386 primary and specialty care clinics and the 476 bed Stanford Hospital (US News & World, 2015). The hospital and most clinics are situated in Stanford, California or the surrounding cities. The mission of SHC is “to care, to educate, and to discover for the benefit of patients and the larger community” (Denend, Mendelson & Zenios, 2010). They exemplify this mission by being nationally ranked in 13 adult specialties, including: #9 in ear, nose, and throat; #10 in cancer; #13 in diabetes; and #18 in cardiology (US News and World Report, 2015). Their excellent across multiple disciplines has helped SHC gain worldwide recognition for

The second is to consider that costs in California heath care are rising and California hospital costs was based on price competition that was created by the process of selective contracting according to researchers which has also resulted in the threat to patients. Thus the factors that play a decisive role in the health care strategy are "expenses to patient volume, case-mix, hospital specialization, hospital size, ownership, location," (Zwanziger; Melnick; Bamezai, 1994) and such factors. The hospitals that are going to be compared are the Irvine Medical Center, Ronald Reagan UCLA Medical Center, and the Cedars-Sinai Medical Center.

In the hope of better coordinating the care of patients, improving quality and lowering costs, the ACA provides incentives for physicians and hospitals to work together in several ways, such as Accountable Care Organizations (ACO’s) or establishing bundled payments for episodes of care (Martin Gaynor, 2012 ) which has spurred consolidation (Becker, Gamble, & Rosin, 2015). Additionally, compliance with various federal programs such as Meaningful Use requires a significant investment in technology which can be fiscally challenging for smaller provider groups; driving acquisitions of these smaller entities by larger health systems. Other reasons cited by hospital administrators in the pursuit of consolidation is to ensure a steady stream of physician referrals (NPR, 2010), and to create economies of scale and increased efficiencies, the fruits of which result in reduced costs and therefore cheaper care for patients (ProMarket Writers, 2016). However, what most hospital

Some hospitals have merged with other healthcare organizations in hopes of providing a more integrated delivery system. However, delivery in many organizations is still quite fragmented leaving many US citizens dissatisfied. According to a 2011 survey conducted by the Commonwealth Fund;

A merger is a partial or total combination of two separate business firms and forming of a new one. There are predominantly two kinds of mergers: partial and complete. Partial merger usually involves the combination of joint ventures and inter-corporate stock purchases. Complete mergers are results in blending of identities and the creation of a single succeeding firm. (Hicks, 2012, p 491). Mergers in the healthcare sector, particularly horizontal hospital mergers wherein two or more hospitals merge into a single corporation, are increasing both in frequency and importance. (Gaughan, 2002). This paper is an attempt to study the impact of the merger of two competing healthcare organization and will also attempt to propose appropriate

In the Harvard Business School case study of Intermountain Health Care (IHC), we learned about the efforts made by IHC to adopt a new strategy for managing health care delivery that is focused on improving care quality while simultaneously saving money. Beginning in 1986 as a series of experiments tying cost outcomes to traditional clinical trials, IHC’s approach to delivering care became known as “Clinical Integration” which “referred to both an organizational structure and a set of tools” (Bohmer, 2002). The organizational structure required a departure from the traditional administrative management model to one that “involved administrative and medical

This case study looks at the challenges faced by Matt Hayes, executive director of Riverview Regional Medical Center (RRMC). Previously named as “The Holy Name of Jesus Hospital”, the facility was owned and operated by Catholic nuns. The Hospital Management Associates (HMA) bought the facility in August 1991 and modify the name to Riverview Regional Medical Center. Hospitals that were taken over by HMA upgraded to state-of-the-art facilities that provided high quality medical care. RRMC run numerous private practices throughout the city and shared common medical staff with their chief opponent, Gadsden Regional Medical Center (GRMC). However, the common staff from the Emergency and Radiology department were not shared. Over the past years, RRMC has been facing multiple challenges concerning the different services provided by the facility (Swayne, Duncan, & Ginter, 2013).

It has not been easy for Baylor Scott & White Healthcare to travel this journey, as it had to align its policies to the national health care priorities and embrace a slogan STEEP to provide quality healthcare to its clients. The organization bears a high quality strategy that is well spelt out in its vision and mission. The organization has worked to ensure that all the stakeholders make quality healthcare a priority. In other words, the organization has worked hard to link performance management incentives to clinical indicators and in the end create a multidisciplinary healthcare improvement operations team that can function across all

In 1998, the Massachusetts General Orthopedic Associates (MGOA), a specialized unit within Massachusetts General Hospital (MGH), hired Dr. Harry Rubash and Dr. James Herndon, respectively, to help to remedy the annual financial deficits, which were “financed” by dipping into endowment and borrowings from MGH. These financial deficits have been continually getting into MGOA’s mission of providing high-quality patient care, research, and teaching (Barro 3). In the immediate months after accepting their positions of leadership, both Rubash and Herndon steered the hospital into the green turning a modest profit. However, it was clear that their new initiatives wouldn’t be viable for the long term. To do so, Rubash and Herndon proposed a new physician compensation plan. This plan included a development fund tax, a bonus, in addition to periodic adjustments to a base salary based on individual physician performance in regards to how profitable the physician was for MGOA. Initial physicians’ reaction to the proposed plan varied, however, if the case study was an indication, Rubash and Herndon were determined to implement their plan.

Kaiser Permanente offers a holistic health care system by combining a nonprofit insurance plan with its own hospitals and clinics. Additionally, since the plan pays a fixed amount for medical care per member, there is a considerable financial incentive to keep people healthy and out of the hospital. Kaiser oversees, administers and provides a comprehensive care for patients, ranging from providing screening and diagnosis to filling a prescription to running a hospital where the patients undergo surgery. This strategy of integration is at least 10 percent less expensive than other providers’ services (Abelson, 2013).

Cost is the driver that will most likely cause healthcare organizations to merge. Most healthcare organizations have issues with spending. Most industries today are faced with a variety of obstacles in achieving or remaining profitable. The healthcare industry is no exception. Profitability is enough of a challenge under normal circumstances, but especially so during fragile economic times. Uncertain revenue streams and rising costs have many healthcare organizations understandably apprehensive.

Hospitals and health systems in the U.S. are experiencing a remarkable transformation in their business models directed from numerous influences that are projected to ultimately turn the industry around. Pressures include providers troubled with the quantity of services they are responsible for, to providers who concentrate on presenting high-cost services that give emphasis to sustaining healthy populations (Dunn & Becker, 2013).