The mixed marriage of Wall Street high-flier HealthSouth Corp. and straight-laced Chicago teaching hospital Northwestern Memorial Hospital is doing better than expected.
MODERN HEALTHCARE has learned that Northwestern and Birmingham, Ala.-based HealthSouth will expand their outpatient rehabilitation joint venture by adding two more sites to their existing six.
The two sites, to be built by mid-1999, will lie on the fringes of Northwestern's service area, said Michael Haley, president of the for-profit joint venture. Exact locations have not been determined. All sites, current and future, are leased.
Northwestern and HealthSouth began their partnership in October 1995 with one outpatient site and added five sites in November 1996.
HealthSouth inherited the joint venture from Caremark when HealthSouth purchased the company's orthopedics division. The original joint venture began between Northwestern and Baxter, which later spun off a division into Caremark, in August 1989.
"Patient access was our primary focus," said Haley, who is also Northwestern's vice president of alternate-site services. "We wanted to provide our patients who need physical therapy services with more convenience in location."
All sites focus on outpatient rehabilitation and sports medicine, although some offer specialty programs.
Executives of the prestigious 176-bed Rehabilitation Institute of Chicago, which is located on Northwestern's medical campus, declined comment on the growing relationship between Northwestern and HealthSouth. Northwestern has an existing referral relationship with RIC for patients who need inpatient rehabilitation care.
A joint board comprising six representatives-three from each organization-oversees the HealthSouth-Northwestern rehabilitation services. Both parties have equal ownership of three facilities, Northwestern is the minority partner in three others, and the two organizations will be equal partners in the two future sites.
Northwestern and HealthSouth split the revenues based on percentage of equity, a Northwestern spokeswoman said. The hospital declined to release the venture's annual revenues.
HealthSouth, which has a network of more than 1,800 outpatient surgery and rehabilitative healthcare facilities throughout all 50 states, manages all the joint venture sites.