Visiting Nurse Association Corp. of Kansas City, the metropolitan area's largest home-care agency, will merge with Health Midwest in a high-profile example of an accelerating trend.
VNAs throughout the nation are merging and affiliating with hospitals and healthcare systems. "There are affiliations in the talking stage, the planning stage and the implementation stage," said Pam Hamilton, spokeswoman for the Denver-based Visiting Nurse Associations of America, which represents about 200 VNAs.
In a 1993 survey of 143 VNAs, 6.6% said they probably would integrate with hospitals in the next year, while 13.9% said they would integrate in three years to five years, said Geneva Tulga, a home-care executive who conducted the survey.
The merger of Kansas City's VNA with Health Midwest will create a $650 million company making 400,000 home visits a year. VNA's operating agencies reported 1993 revenues of $22.1 million. Health Midwest runs three hospital-based home-care agencies and 13 hospitals with 1,864 staffed beds.
The companies expect to complete the merger in June. No cash will be exchanged.
In the merger, VNA Corp. probably would become part of a Health Midwest holding company, said Jan Helfer, director of strategic planning for VNA. Health Midwest would name three additional people to VNA's now 14-member board of directors. Richard Roberson, VNA's executive director, would become chief executive officer of the VNA Corp. and a Health Midwest vice president.
"We have got to position ourselves as part of the healthcare continuum of service," Ms. Helfer said. "I don't think there is a place for us to stand alone."
In VNA's search for a partner, it talked with many not-for-profit hospitals in the area, she said. VNA has had a longstanding relationship with Health Midwest, and since 1992 it's provided billing and collection services to Health Midwest's agencies.
VNA board members feared that the company would lose referrals if Health Midwest expanded its operations, forcing VNA to shut down many services, Ms. Helfer said.
Meanwhile, VNA wanted to make it clear that it still would work with hospitals serving poor communities, she said. Its letter of intent with Health Midwest spells out VNA's commitment to providing home-care services to Medicaid and indigent patients.