Persistence pays. A Portland, Ore., hospital system is hiring local doctors and buying a medical office building to help bail out members of a failing medical group. The system previously offered the group a loan, which was declined.
To try to respond to a looming shortage of primary-care physicians in the Portland market, five-hospital Legacy Health System has agreed to hire 18 doctors and four nurse practitioners from Portland's HealthFirst Medical Group, which expects to close Aug. 31.
Legacy will also buy a 25,000-square-foot medical office building in the fast-growing Portland suburb of Tualatin and lend an undetermined sum to a separate group of former HealthFirst physicians who are starting a pediatric practice.
"This has been an unusual circumstance," said Legacy spokeswoman Quita Lupfer. "We're responding to a market crisis."
Legacy's interest in hiring HealthFirst doctors is not new. This spring, Legacy offered a $15 million loan to HealthFirst to help it break free from Physician Partners, its management services organization, but HealthFirst nixed the deal. Many physicians questioned the group's ability to repay the loan.
Keith Marton, M.D., Legacy's senior vice president and chief medical officer, said the system is investing "several million dollars" in the new doctors and office space.
This move comes as many hospitals around the country are trying to disentangle themselves from ownership of physician practices. On the West Coast, for example, Sutter Health and Catholic Healthcare West are reconsidering their physician-integration strategies. And Detroit Medical Center recently slashed its staff of employed primary-care physicians to 180 from 300 (July 19, p. 20).
The newly purchased Tualatin clinic is close to 116-bed Legacy Meridian Park Hospital, also in Tualatin. As a result of the new acquisitions, Legacy is launching a subsidiary, Legacy Clinics, to oversee new clinics at three of its hospitals.
Although it traditionally has refrained from buying physician practices, Legacy decided to take advantage of HealthFirst's woes to build up its own primary-care network, Marton said. Primary-care shortages are showing up in some parts of the market, and Legacy needs to take steps to protect itself, he said.