Firms, Holland Hospital decry ZCH Spectrum union

August 30, 2010
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Some large employers in Holland and Zeeland are among those hoping to forestall Spectrum Health’s potential acquisition of Zeeland Community Hospital.

The group of business and community leaders is calling for a merger instead between ZCH and its neighbor 10 miles to the west — Holland Hospital — despite a history of rocky relations between the two.

“We know our data, and the data is that people spend 85 percent of their health care dollars within 15, 20 miles of where they live,” said Bruce Los, vice president of Zeeland’s Gentex Corp.

“The connection is with the primary care physicians, so that’s the relationship that we are the most interested in and concerned about.”

But ZCH President and CEO Henry Veenstra made it clear that leaders of the 57-bed hospital chose their course last month when they signed a non-binding letter of intent with Spectrum and don’t plan to veer from it for the 120 days it is effective.

“The choice was Spectrum Health,” Veenstra said, noting that the board of trustees’ difficult decision followed months of talks with Holland Hospital and a more formal request for proposals process.

“At this point, given the conditions of our letter of intent, we are in exclusive dialogue with Spectrum Health. We have given our word we would not talk to others about the possibility of aligning with them at this time. We made that public, and people knew that.”

The 209-bed Holland Hospital stands ready to re-open talks with ZCH, said President and CEO Dale Sowders.

Holland Hospital administrators and board members have publicly weighed in in favor of a two-city hospital partnership. The Holland Sentinel this month published their statement to that effect, which even included a mea culpa regarding an especially touchy issue: Holland Hospital’s construction of a medical office building less than a mile from ZCH last year.

“We regret that our new facility in Zeeland has become a divisive issue,” the statement reads, and goes on to offer to discuss its use as part of a joint Holland-Zeeland strategy.

Sowders said that Holland Hospital decided to construct the building to prevent Metro Health Hospital in Wyoming — which has new doctors’ offices in Hudsonville and Allendale — from extending its stretch further west.

He said that he is concerned about costly duplication of services should Spectrum Health own and invest in ZCH. He said that Holland worked with Spectrum to develop an intensive care unit for newborns, as well as cardiac catheterization services.

“Today, Holland has invested a couple of million dollars in a 64-slice CT that has a very high level of imaging capability. Now Zeeland and Spectrum — or Zeeland and whomever — they could say we should have a 64-slice CT, as well. That’s a $2 million investment to get that in place. And now there’s one at Holland and one at Zeeland, when the one at Holland today already is not at full capacity,” Sowders said.

“So we get back to the questions of the business community that has been established here. That may be very good from Zeeland and Spectrum’s point of view, but what about the people paying the bill? And is that a rational use of resources?

“I think it’s very appropriate that the business community weigh in because that makes their future uncertain, as well.”

Los said that the Ottawa County business community has long supported the two hospitals, not only by providing health insurance for thousands of employees, but with fundraising drives and volunteerism. He said the result has been two hospitals that offer quality and value, which he thinks could be placed at risk with a loss of local control.

“Things ultimately change when the bottom-line decisions are not being made in the community,” Los said. “This isn’t an anti-Spectrum thing, but, very honestly, the pricing of a lot of the services we receive in Grand Rapids compared to the services we receive in Holland and Zeeland is significantly higher.”

Spectrum raised its list prices by an average of 8 percent at its Grand Rapids facilities for the 2010-11 fiscal year. Spokesman Bruce Rossman said that the health system’s community hospitals — Greenville’s United Hospital, Reed City Hospital, Kelsey Hospital and Gerber Memorial in Fremont — set their prices.

Other companies represented in the informal group, which has issued a position paper and published its opinion in The Holland Sentinel, include Haworth Corp., Trendway Corp., Macatawa Bank, Herman Miller Inc., Howard Miller Clock Co., FMB/First Michigan Bank, Bilmar, Prince Corp., as well as The Holland Group Inc., Royal Technology Corp. and ALTL Inc. Most of the others involved are from education entities such as Holland’s public and private school districts, Hope College and Grand Valley State University.

While Sowders said Holland Hospital would like more public discussion about the fate of southern Ottawa County’s two hospitals, including the fates of local doctors, Veenstra said he is focused on the due diligence with Spectrum now at hand.

“We respect this group’s opinion. They, for whatever reason, feel that there is a better choice,” Veenstra added. “We certainly understand that honorable people can have a difference of opinion on things.

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