Ascension enters joint venture to deliver post-acute care

Ascension Health is launching a post-acute-care joint venture with the ambulatory-care subsidiary of Envision Healthcare, a publicly traded outsourcing company for physician services and medical transportation.

The joint venture would pair St. Louis-based Ascension Health, one of the largest U.S. hospital and long-term-care operators, with Evolution Health, the subsidiary launched by Greenwood Village, Colo.-based Envision in 2012 to expand into the $64 billion ambulatory-care management market. The deal significantly bolsters Ascension's reach in post-acute care, which the system recently said it would consolidate under a newly formed entity, Ascension Health Senior Care.

Ascension’s senior-care division ranks as the nation’s second-largest, not-for-profit long-term-care operator.

The company’s executives were not available for interviews at deadline. Ascension Health CEO Robert Henkel said in a news release that the health system’s existing home-care operations would benefit from the joint venture. “We believe there is much to be learned by working with Evolution Health in a way that ensures the most effective and efficient care across our national health ministry in support of our mission of serving all persons,” he said.

Ascension joins other major U.S. health systems with ambulatory deals as pressure to control health spending accelerates a technology-enabled shift toward more medical care delivered outside of hospitals.

Catholic Health Initiatives, another large U.S. hospital operator, acquired home-care company Consolidated Health Services for $43 million in 2010. Since then, the division’s operations have doubled to nine states with 60 locations. San Francisco-based health system Dignity Health paid $455 million in 2012 to buy U.S. HealthWorks, a network of occupational health and urgent-care clinics.

Ascension Health’s new joint venture will offer home care, infusion therapy and hospice in five Ascension Health markets with projected revenue of $75 million to $100 million in the first year. The deal is expected to go into effect at the end of the year.

The system has increasingly turned to such arrangements rather than acquisitions to care for patients as they move across the continuum of care.

Follow Melanie Evans on Twitter: @MHmevans