Another Potential Hospital Merger on the Horizon [CT News Junkie]

July 17, 2015

CT News Junkie

A day after Lawrence & Memorial Hospital announced it was joining the Yale New Haven Healthcare Corporation, Day Kimball Healthcare and Hartford Healthcare announced they were exploring a “strategic partnership that could lead to a formal affiliation.”

According to a press release from Hartford Healthcare, the two organizations will begin the process of affiliating, which is expected to take several months.

In the meantime, the two organizations will participate in an initiative to enhance quality and safety for the benefit of patients. These agreements and partnerships will take place as the two organizations work on a more formal arrangement.

“An affiliation with HHC would provide DKH clinicians and patients with access to HHC’s key system-wide health care service lines,” Robert Smanik, president and chief executive officer at Day Kimball Healthcare, said. These include cancer care, orthopedics, behavioral health, cardiology, stroke treatment, outpatient services, and neuroscience.

“Conversely, DKH, with our unique background in rural health, will work with HHC as it continues to focus on population health improvement,” Smanik added.

Day Kimball has healthcare centers in Danielson, Dayville, Plainfield, and Putnam. It has more than 1,400 employees, including nearly 300 highly-skilled physicians, surgeons, and specialists.

Hartford Healthcare is the second largest hospital group in the state with $2.4 billion in net revenue.

“As a full member of Hartford HealthCare, DKH would bring to our system its considerable expertise and experience in providing integrated medical services in the northeast area of the state as well,” Elliot Joseph, president and chief executive officer of Hartford HealthCare, said.

“This would be a significant partnership and we look forward to working with Day Kimball Healthcare as we go through the review process,” Joseph added.

The reason many of these announcements are currently being made is because legislation passed earlier this year by the General Assembly, which outlines how these affiliations are made, does not kick in until December.

The legislation, touted by both Senate President Martin Looney, D-New Haven, and Senate Republican Leader Len Fasano, R-North Haven, seeks to increase competition in the health care market by requiring that large hospital mergers and acquisitions be subject to appropriate market review in terms of costs and market power. The bill requires a market impact study for large consolidations and requires the Office of Health Care Access to justify the post-sale conditions it requires.

Looney and Fasano have both expressed concern about the contraction of the market and the loss of independent hospitals. It’s why they teamed up to introduce the legislation that will impact these mergers in the future.

“Hartford HealthCare, similar to Yale New Haven Health Network, also seems set on expanding their market power by gobbling up the little guys,” Fasano said Thursday. “It’s troubling because the evidence we have seen so far points us to a clear conclusion: less competition means less choice and higher prices. A state with just one or two massive health care providers does not offer the competition and balance that best serves patients. We need patient centered collaboration among independent providers, not market consolidation with just one or two dominant providers.”