BLOOMINGTON, Ind.Bloomington Hospital has entered a period of due diligence expected to lead the 258-bed hospital toward becoming part of Indianapolis-based Clarian Health in 2010. The Local Council of Women, Bloomington Hospitals founding organization, voted 403-149 in favor of working on a deal with Clarian Health, which owns six Indiana hospitals and manages a seventh. Bloomington Hospital also owns 24-bed Bloomington Hospital of Orange County in Paoli, Ind. The parties intend to sign a definitive agreement this summer and then embark on an 18-month regional planning process led by a community task force that will determine the areas future needs for healthcare services and how to deliver them with Bloomington Hospital as the hub. In particular, the process will guide development of a second campus in Bloomington, for which Bloomington Hospital has purchased 85 acres that could include a new hospital in the next five to 10 years. Bloomington Hospital would remain a distinct company, Chief Financial Officer James Myers said, but would be controlled by Clarian Health, which would gain the ability to appoint and remove 51% of the hospitals governing board. We were looking really to what was the best thing to create a good integration of healthcare from a clinical and financial perspective in our market area, Myers said.
LANSING, Mich.Michigan Gov. Jennifer Granholm vetoed a move by the states Certificate of Need Commission to restrict the provision of proton-beam therapy to a consortium of the states largest cancer providers in order to head off duplication of the expensive technology (See related editorial, p. 23). The veto hasnt deterred six organizations that stepped forward to create such a collaborative, said a spokesman for one of the members. They still believe in and support the value of working together, Henry Ford Health System spokesman Dwight Angell said in a written statement. In a letter explaining her decision, Granholm cited the potential unintended consequences of creating special treatment for proton therapy over competing technologies that might benefit patients. She also cited comments from the Justice Departments Antitrust Division, which concluded that the proposed standards are likely to harm competition and will potentially result in harm to cancer patients in Michigan, as well as present a possible violation of federal antitrust law. Granholms veto creates a new opening for Beaumont Hospitals to win approval for its application for a proton-beam facility on its Royal Oak, Mich., campus, a $159 million joint venture with Bloomington, Ind.-based ProCure Treatment Centers, which the CON Commission must act on by July 1. Beaumont President and Chief Executive Officer Ken Matzick said that he is in favor of a collaborative approach to the service and is in talks with two other Michigan health systems. We didnt think that mandating who should work together was a very rational approach to bringing proton-beam therapy to the state, Matzick said.
FARGO, N.D.MeritCare Health System, a Fargo-based organization that owns or manages four hospitals, announced that it may reduce its workforce by up to 300 positions even though its patient volume continues to increase by 8% to 9% each year. MeritCare has 7,588 employees and said that 90 will lose their jobs, 90 will have their work hours reduced and 120 open positions will go unfilled. The workforce reductions are being tied to an announcement by Blue Cross and Blue Shield of North Dakota that it will withhold 2.5% of its reimbursement to MeritCare between Aug. 1 and Dec. 31 of this year. An anticipated 10.6% cut in Medicare physician reimbursement is also being cited as a reason for the layoffs. Denise Kolpack, vice president of the North Dakota Blues plan, confirmed that it will withhold up to 2.5% of its reimbursements in an attempt to deal with an unexpected cost increase in claims. Kolpack said the organization had budgeted $15 million in underwriting losses for 2008 but, if current claims trends continue, projections indicate that it will have to pay out between $22 million and $25 million. In addition to withholding reimbursement, the company is leaving open positions unfilled, and cutting its travel and advertising budgets. MeritCare has 20 regional clinics in Minnesota and nine in North Dakota. As part of its downsizing, a clinic in LaMoure, N.D., will close, and two Minnesota clinics will be open fewer days.
SPRINGFIELD, Ill.An appeals court heard oral arguments June 18 in 202-bed Provena Covenant Medical Centers fight with local and state officials to recover its property-tax exemption. The hearing before the Illinois 4th District Appellate Court was the latest in a back-and-forth that started more than five years ago. In the last volley, a Sangamon County Circuit Court judge in July 2007 ruled in favor of the hospital and overruled Illinois Revenue Department Director Brian Hamer, who had concluded the Urbana, Ill.-based hospitals provision of charity care was too meager to merit the exemption. Illinois Attorney General Lisa Madigan appealed Provena Covenants victory on Hamers behalf, and the three-judge panel is expected to issue a ruling by mid-September. The hospital, part of six-hospital Provena Health, Mokena, Ill., has recovered $6.1 million from Champaign County to account for the disputed property taxes paid since 2003 plus interest.