Spectrum, MMPC fate to be told this month

June 14, 2009
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Spectrum Health’s board of directors is expected to vote June 30 whether to bring the largest physicians’ practice in the state under its corporate umbrella.

Shareholders of the physicians’ practice, Michigan Medical PC, are scheduled to vote July 8 on whether to leave behind their independent, for-profit status to join Spectrum as a stand-alone subsidiary, MMPC Chairman John MacKeigan said.

The votes are the culmination of several years of on-again, off-again merger talks between Spectrum Health and MMPC.

“It’s a different environment, a different era,” MacKeigan said. “I think the community and the physicians understand the arguments for an integrated model probably better than they did three years ago. The chances of success are increasingly higher.”

Spectrum Health spokesman Bruce Rossman declined to confirm the hospital system’s board’s agenda.

MacKeigan said two-thirds of MMPC shareholders would have to agree to the plan for it to happen. While not all of MMPC’s 200-plus doctors are shareholders, all shareholders are doctors, he added.

He said that if the deal is approved, MMPC would not join as part of the Spectrum Health Medical Group, but instead would become its own subsidiary. If all goes well, the MMPC unit would become part of the medical group after several years, he said.

“Because we were in this before, it was easy to dust off some of the old paperwork and modernize it and begin discussions internally about the values of doing this or not,” he said.

Part of what concerned MMPC doctors with earlier attempts was a loss of control. MacKeigan said he thinks those issues are resolved.

“There is a system understanding of the need for physician input into program development, an appointment of a physician leader of the medical group at Spectrum, a better understanding of the needs of physicians and the value of physicians in the health care system,” he said. “You can build buildings, but you need physicians and program development to enhance the buildings.”

Physicians also are bracing for reform in reimbursements that could favor physician-hospital partnerships and make quality and patient outcomes a larger component of reimbursement levels, he said.

MMPC is investing $39 million in an Epic Systems Corp. software system, and Spectrum Health recently revealed that it intends to move to Epic for outpatient applications, he said. Metro Health also uses Epic. Trying to merge those systems at a later date would be costly, he said.

Spectrum Health also is negotiating to purchase West Michigan Heart, a 34-doctor cardiology practice in Grand Rapids, Vice President John Mosley said last week. Like the MMPC physicians, those doctors do not plan to join the Spectrum Health Medical Group, he said.

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