While VHA is fighting for its not-for-profit soul against Columbia/HCA Healthcare Corp. and other investor-owned chains, one of its founding hospitals has decided that the bottom line is bigger than such philosophical worries.
Baptist Medical Center in Oklahoma City is close to finalizing a deal to sell a 12.5% interest in its statewide managed-care plan, Healthcare Oklahoma, to Columbia/HCA, sources close to the negotiations told MODERN HEALTHCARE.
Baptist and Columbia/HCA officials declined comment. Stanley Hupfeld, Baptist's president and chief executive officer, is on VHA's board.
Columbia/HCA is also having informal discussions about a possible acquisition of 420-bed University Hospital in Oklahoma City, Columbia/HCA executives confirmed. The giant chain already owns 354-bed Presbyterian Hospital, which is located across the street from University.
Healthcare Oklahoma is owned by three VHA hospitals. It also is linked to 12 other VHA hospitals in Oklahoma through Oklahoma Health System. No further details were available at deadline.
If approved, 552-bed Baptist would become the first VHA-shareholder hospital to sell an equity interest in its managed-care network, said C. Thomas Smith, VHA's president. VHA is an alliance of 1,132 not-for-profit hospitals.
"The decision made was because in that particular community there was a sense that those delivery sites (Columbia/HCA's hospitals) were needed to have a complete and full delivery system to offer to the customers in that network," Smith said. "It won't be the only one we are going to see within VHA to look for full market coverage. It doesn't surprise me."
Healthcare Oklahoma would become the state's dominant hospital-based managed-care network with 23 hospitals. That number includes five hospitals owned by Healthtrust, which is awaiting federal antitrust approval to merge with Columbia/HCA.
In the University development, David Dunlap, president of Columbia/HCA's Oklahoma region, confirmed the discussions and the fact that both companies are engaged in more formal studies of the sale separately.
University officials said they expected to appoint executives to begin formal discussions with Columbia/HCA and other suitors this week.
Thomas J. Frist Jr., Columbia/HCA's vice chairman, also said Columbia/HCA would like to add University Hospital to its growing stable of university-based teaching hospitals (See related story, this page).