'A Lot More Secure Future'

April 7, 2008
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MUSKEGON — Now that the long-anticipated wedding of Mercy General Health Partners and Hackley Hospital has been consummated, Muskegon will see how the marriage fares.

The city’s two hospitals became one on April 2 under the moniker Mercy Health Partners, ending more than 100 years of sometimes bitter health care competition in the manufacturing center on the Lake Michigan shore.

MHP President & CEO Roger Spoelman said the challenge is daunting, but he is confident that melding the organizations is the right move for the community, and he challenged government, schools and businesses to consider consolidation as well.

Novi-based Trinity Health, which acquired Mercy General in 2000, is MHP’s parent company.

“We’re able to garner the resources of both organizations, bring them together, reduce duplications, and focus our attention with a laser-like focus on what this community needs and deserves,” said Spoelman.

MHP’s Board of Trustees will be chaired by Mark Fazakerley of Eagle Alloy. The 15-member board includes five representatives from Hackley, five from Mercy General and five from Trinity Health, including Phil McCorkle, president and CEO of Saint Mary’s Health Care in Grand Rapids.

“People say, now you’re a monopoly and you can do whatever you want with prices, and we’ve said, no, we’re not a monopoly. In fact, there’s a lot of health care just east of us and to the south of us,” Spoelman said.

“Sixty percent of our business is Medicare and Medicaid. So it’s government. The other 40 really is largely made up of our customer base, our employers in this area. We have every reason to want to serve them as appropriately as we can and to partner with them. We don’t want to provide things that they don’t need or want.

“We want to make sure that they can remain vibrant and healthy by being able to attract employees, a work force that wants to stay here. And so that partnership will remain very strong.”

Muskegon Area Chamber of Commerce President Cindy Larsen said the local business community is ready and willing to continue its conversation with MHP.

“At this stage, I’m sure the newly merged organization is still creating a vision, but it’s very important for the business community to understand where it is they want to go, so we can talk about how it supports the economic vision for the community,” Larsen said.

That vision is a holistic economic development view, integrating health care into the economic fabric of the community, beyond the merged hospitals. Larsen said she thinks there is more fodder for discussion for the Unified Health Care Task Force, a group of business, government and health care leaders who encouraged the hospitals to consider working together.

“My guess is that there will continue to be a role for the task force, because the original intent of the task force was to look at the overall health care provider situation on the lakeshore. It wasn’t just about the hospitals,” Larsen added. “I do anticipate we will meet again to continue a visioning process.”

McCorkle, who joins the MHP board from the board of Mercy General, said financial challenges in health care mean that collaboration makes more sense.

“History has proven we don’t need multiple hospitals here in the Muskegon area,” he said. “This move to create a combined organization is just the right thing to do. The things that made us successful in the past probably will not make us successful in the future, and so we’ve got to be creative and figure out what are those kinds of things that create the success. We need to look geographically as western Michigan, not so much as Muskegon or our Grand Rapids community.”

Spoelman said MHP has promised to honor contracts with two nurses’ unions: the Michigan Nurses Association, which represented Hackley’s staff, and Service Employees International Union, which represented Mercy General employees. He said he is encouraging the two unions to consolidate in Muskegon.

“We want schools and municipalities to think about consolidation: If we can do it, you can do it,” he said. “We’re telling them (the unions) the same thing.”

With an attrition rate of 10 percent to 14 percent annually, Spoelman said he is hoping to avoid layoffs, but some are inevitable.

“We’re going to manage that very tightly so that we replace very few,” he said. “We can move things around and combine jobs so that when somebody leaves us … we can handle that through natural attrition.

“There will be some (layoffs) because there’s always some duplication that occurs when an organization comes together with another. We think it’s a small number, but we’re going to make sure that people get outplacement help and whatever assistance they need.”

Among the service lines being eyed for consolidation: pediatrics, cardiovascular care, obstetrics, trauma and oncology. A new cancer center is poised to open within a few weeks, Spoelman noted.

Dr. Bruce Olson, an internist and infectious disease specialist, said he thinks the combined financial and clinical resources of MHP will power health care quality in Muskegon.

“Recruitment of new, well-trained specialists was one of the important goals of this merger,” Olson added. “It’s been difficult more recently — a lot of it because of the economy locally. This should help us do that. We’ll be looked at by new physicians looking for a place to live and work as a more unified community, a more unified system where there is a lot more secure future.”

Mercy Health Partners will have more than 4,000 employees and 375 doctors. It will be owned by Trinity Health, based in Novi. Trinity Health is the nation’s fourth-largest Catholic hospital system with revenues of $6.1 billion. It manages or owns 45 hospitals, including Saint Mary’s Health Care in Grand Rapids and Muskegon’s former Mercy General Hospital.

The merged health system will include four hospitals. Together they recorded 21,000 inpatient discharges and 137,000 emergency and urgent care visits in the past year.

After conducting meetings with focus groups that included people from Muskegon, Spring Lake, Ludington, Fremont, Fruitport, Grand Haven and other lakeshore communities, the merging organization settled on the Mercy Health Partners name. Individual facilities will retain their identities: Hackley, Muskegon General, Mercy and Lakeshore campuses.

Mercy General was created 10 years ago by another merger. It has been owned by Trinity Health since 2000. It had 230 beds on two campuses. Mercy General reported revenue of $239 million for the fiscal year that ended last June.

Hackley Hospital had 181 beds and included Hackley Lakeshore Hospital in Shelby, which has 24 beds. Hackley overcame a $3 million deficit in fiscal 2006 to post $1.6 million in the black on revenues of $231 million in the fiscal year that ended last June. But its bond rating had been downgraded last year. 

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