Thursday's announcement that Carle health system plans to acquire Advocate BroMenn Medical Center and Advocate Eureka Hospital is big news for Central Illinois.
Advocate BroMenn the No. 6 largest employer in Bloomington-Normal, with around 1,337 employees, according to the Economic Development Council.
WGLT's Charlie Schlenker spoke on Thursday with Colleen Kannaday, president of Advocate BroMenn and Advocate Eureka. Kannaday will remain on as president.
Kannady spoke to WGLT about what the acquisition will mean for employees and patients and how it fits into the trend of hospital mergers and acquisitions.
WGLT: Why is this a good deal?
Kannady: BroMenn and Eureka have a longstanding partnership and have been doing a lot of clinical partnership with Carle over the last couple of years, including areas like gyneoncology, and some advanced cancer, trauma services, infectious disease. And so we really view this as the next evolution in our partnership with them. And quite frankly, the opportunity from a regional perspective to join a large, strong, patient-centered healthcare system, we believe will allow us to continue to grow in our community and to expand services not only here locally, but throughout the region.
You were already part of a large strong system. What makes this better?
Right. From a regional perspective, over the last 10 years our partnership with Advocate—now Advocate Aurora—has been fantastic, and we are stronger today because of the partnership of Advocate, and the support and what they have provided to this region and the investments that they've made. And as we've continued to strengthen our partnership with Carle and the work that we're doing, Advocate is also continuing now … and as Advocate looks at other markets, and the markets where they serve, we just believe that now was the right time for us to join and to become a part of a large regional strong healthcare system, and that it made sense, the best opportunity for our patients and for the communities.
Advocate and Aurora joined together in 2018. Is that pretty much digested now, or is it still in process?
I think Advocate and Aurora have come together and have really worked on a lot of the centralization of what it takes to operate as one system, and I think that integration is pretty much done. And for us again, going back to our focus, our focus has been on the partnership that we've been doing and the relationships that we've built with Carle from a local perspective. And so the timing just made sense for us to join Carle and to really be a part of a strong regional system. And the opportunity to continue to expand.
I think the other thing is, Carle as an integrated healthcare system has a health plan. And so, our opportunity, and our focus, and our ability to do some unique things for this market in this region will be really fantastic going forward.
How does that work? You're talking about Health Alliance, right?
Right. What Carle has is the only provider-based health plan in the state, which is just a unique opportunity in terms of the delivery of care and clinically really being able to focus on how to provide care to patients in the best setting.
Does that really change things for insured people in Bloomington-Normal? Health Alliance already has a sizeable presence in the community because it's an option for state workers. Does that make it easier for you? Or is it relatively neutral?
It's a wonderful opportunity for us because we will be a part of Carle and have a health plan. We've not begun to explore what opportunities that might present, but we believe it will be really great going forward and present a wonderful opportunity for our patients in the community.
What does this mean for employment at BroMenn and its associated businesses?
Carle is very committed to all of our team members. And we anticipate that all of our team members will want to move over and become a part of the Carle system.
Are there duplications that will be looked at to trim things down?
No, quite the opposite, actually. We believe there's the opportunity as we look to the future to be able to expand services. And so the likelihood is that we will be able to grow, which will be great for not only our community, from a patient care perspective, but also from an economic development perspective.
The Advocate system is much larger than the Carle system. How will that affect access to capital and the ability to replace or acquire expensive equipment and new technology?
So Carle is an incredibly strong system from a financial perspective. Their focus is really on the region. And from an access to capital perspective, obviously it's too early to say how that plays out.
But given the focus geographically with Carle, the opportunity to continue to make significant investments and look at new services and upgraded capital will be will be very good.
Can you give listeners a sense of that health? I've heard it said Carle is financially wealthier than a lot of systems its size. But what does that mean?
I don't have those numbers to be able to provide.
Advocate BroMenn and Eureka have been the southernmost piece of Advocate. Did that present Advocate an easy option to offload when it wanted to concentrate on Aurora and points north?
I don't think this is a situation of offloading. It's been a natural evolution of the partnerships that we've developed here locally, with Carle, with their physicians in the clinical service alignment. And as Advocate Aurora continues to look at growing, the alignment and the timing of this really just presented a great win for us and for our community and for the region.
How important is regionality in health care?
I believe regionality is very important. And the opportunity to have strong clinical partners that can help to expand the services that are provided locally. And even sometimes sharing of physicians across different markets. And then the opportunity to have a strong tertiary, quaternary partner within the region to be able to transfer a higher level of trauma like a Level 1 trauma. I think it's a great benefit to our community to have that within the region.
There are about 100 health care mergers every year. That trend has been fairly constant the last decade or more. With the acquisition of BroMenn and Eureka by Carle, does this create a likelihood of further regional consolidation with other systems, such as UnityPoint in Peoria or Springfield Memorial?
I would not be able to begin to speculate on what Carle's plans might be from that perspective.
What are your plans?
For me personally, I am very excited about this opportunity. I am remaining on as president of BroMenn and Eureka and will lead this part of the market. And I'm very much looking forward to becoming a part of the Carle leadership team.
How would you assess the cultural differences between the two organizations?
From the work that we've done to done together over the last two years, I would say culturally, both organizations are incredibly aligned around patient safety, quality service, and I believe this will absolutely be a seamless transition.
There was a study in the New England Journal of Medicine recently that questions the impact of health care mergers on patient outcomes. Financial stability improves for healthcare institutions, and they improve technology, but not necessarily prices. Those tend to go up because larger hospitals then have better bargaining power with insurers. And it seems to be working relatively neutral or in some cases negative for patient outcomes. What's your sense of that, sitting on the other side of the table?
My sense is, given our integration with Advocate over the last 10 years, we've improved our quality outcomes. We've improved our safety. We've expanded care and added new services, and we have made care more affordable. And that's been a part of our commitment and that will absolutely continue as a part of the Carle health system.
When do you think the merger trend will ease up?
I cannot begin to speculate on the merger trends and what that will look like going forward. I just know in healthcare, change is a constant, and the landscape is ever evolving. And we are continuing to evolve with that.