PHOENIX-In basketball, a triple threat is a player in position to shoot, dribble or pass. In Arizona, it's the pending consolidation of Samaritan Health System, HealthPartners of Southern Arizona and Mercy Healthcare Arizona.
The boards of the three largest systems in the state have agreed to pursue "affiliations or other combinations of operations and facilities."
"Clearly, cooperative relationships that can improve quality and lower costs are in our community's best interest," said Jim Crews, Phoenix-based Samaritan's president and chief executive officer, in a memorandum to employees concerning the talks with Mercy.
"At this time, we do not know where this process will lead or how long it will take, but we are excited about the potential of working with an organization that, like Samaritan, is committed to community-based healthcare and community service," Crews said.
Samaritan and HealthPartners announced plans to merge last September (Oct. 2, 1995, p. 17). The discussions among the three systems began in late April. For now, they're "still in the preliminary phases of discussions," said Rhonda Vroman, spokeswoman for Phoenix-based Mercy.
Executives at the three systems have said talks eventually could lead to a full merger.
However, it's still too early to predict exactly what forms the alliances, joint ventures or collaborations among the systems might take.
"We're continuing to explore a variety of strategies," said Dan Green, vice president of system development at Samaritan.
Samaritan and Tucson, Ariz.-based HealthPartners, which operates Tucson Medical Center, will merge to form the state's largest not-for-profit system later this summer. Named Integra Health System, the new organization will have about 2,400 beds, $1.3 billion in annual revenues and $39.3 million in annual net income. The seven-hospital system will hold $1.4 billion in assets.
If Integra were then to merge with Mercy, it would have almost 3,000 beds, including the two largest hospitals in the state: Good Samaritan Regional Medical Center and St. Joseph's Hospital and Medical Center, both in Phoenix.
Although the three systems had been longtime rivals, they're finding that cooperation will serve them better than competition in the future.
In fact, the groups have been putting their heads together in a variety of efforts during the past few years:
Last December, Mercy agreed to buy a stake in Integra's for-profit insurance division, named HealthPartners of Arizona. Samaritan formed the managed-care company with HealthPartners of Southern Arizona in July 1995. The plan serves about 360,000 enrollees (Dec. 18/25, 1995, p. 4).
Samaritan and Mercy jointly led the development of the Phoenix Area Medical Education Consortium.
Samaritan and Mercy submitted a joint bid to the Maricopa County Board of Supervisors to operate the county health system. Their proposal was rejected last December.
Samaritan and Mercy have worked with the A.C. Green Foundation on initiatives to reduce the incidence of teenage pregnancy.
Mercy Healthcare Arizona has collaborated with Phoenix Children's Hospital, which leases space within Good Samaritan, to provide local pediatric services more efficiently.
The Western HealthCare Alliance, a partnership of Samaritan and HealthPartners of Southern Arizona, is bidding to cover 750,000 Civilian Health and Medical Program of the Uniformed Services beneficiaries in 15 Western states.
Pressures stemming from managed care have caused much of the unexpected cooperation among previous adversaries throughout the state.
In addition, the entrance by Nashville, Tenn.-based for-profit giants Columbia/HCA Healthcare Corp. and OrNda HealthCorp into Arizona during 1994 and 1995 also sparked romance between former enemies.
Samaritan, one of the largest not-for-profit multihospital systems in the Southwest, runs or manages six hospitals, six primary-care clinics, three skilled-nursing centers as well as other facilities and programs.
Yet the system carries a debt load of $335 million and is in the midst of a massive cost-cutting and restructuring effort. For fiscal 1996, it aims to save $21 million.