To head off a perception that the Federation of American Health Systems will be controlled by industry giant Columbia/HCA Healthcare Corp., the trade group of investor-owned companies is broadening involvement by smaller chains.
For example, the executive committee of the Washington-based group now includes Community Health Systems' president and chief executive officer, E. Thomas Chaney.
In the past, the seven-member executive committee has only included larger hospital chains. Houston-based Community has 40 hospitals, most of them small and rural.
Columbia would have ended up with three seats on the federation's seven-member executive committee when the chain's $5.6 billion merger with Healthtrust is completed next month, but Community will now fill one of them.
The next largest chain, Santa Monica, Calif.-based Tenet Healthcare Corp., owns 83 hospitals. Previously called National Medical Enterprises, Tenet acquired a 35-hospital chain, American Medical International, last month.
"There's a perception, which is totally understandable, that we represent Columbia and Tenet," said Thomas Scully, who became the federation's president and CEO in January. "It doesn't help us to be perceived as a two- or three-company organization. We're going to pay attention to all our members."
When its merger with Healthtrust is completed, Nashville, Tenn.-based Columbia will own about one-fourth of the nation's 1,300 investor-owned hospitals. It will be the nation's largest health system in terms of hospitals.
Columbia's brawn was apparent at the federation's annual meeting last week in Dallas. Its booth in the exhibit hall was nearly mobbed during an afternoon session in which suppliers were invited to meet with buyers.
The expanding girth of Columbia has prompted some smaller hospital chains to privately question their influence in the shadow of the industry giant.
Keith Pitts, chief financial officer of OrNda HealthCorp, agreed that the federation must be a broad-based organization to survive. OrNda is the nation's fourth-largest investor-owned hospital chain. "We're confident that the federation will continue to serve all the members," he added.
To enhance involvement by smaller hospital chains, Scully has assigned a federation staff member to communicate regularly with 19 small and mid-sized hospital chains.