Iowa Hospitals Set Aside differences to Work Together

by Mark Friedman  on Monday, Oct. 1, 2012 12:00 am  

Across the country, hospitals that were once rivals now are working together as a way to lower their health care costs.

In one such arrangement, the University of Iowa Health Care system in Iowa City and Mercy Medical Center in Cedar Rapids announced in April that they were partnering to form a Medicare accountable care organization. ACOs were created as part of the federal health care reform act and designed to encourage health care providers to work together to manage care for a patient.

The alliance came as a change for Mercy, which for years had viewed the University of Iowa system as a competitor, Mercy CEO Timothy Charles told Arkansas Business.

“The university was seen as an institution we should keep out of our community for competitive reasons,” he said.

See Also: Hospital Rivals Explore Benefits of Partnership

But about a year ago, Charles said, Mercy decided it was time to extend an olive branch to UI Health Care to discuss ways to care for the poor. Rising costs and impending health care reform helped make the timing right.

So far, Mercy and the UI have worked together on an electronic medical records system for Mercy, Charles said. “We’re sharing knowledge, expertise, resources as we bring that system online.”

The move will allow patients to move seamlessly between the two health systems, Charles said. The partners aren’t commingling assets, and no money has changed hands.

It is too early to estimate what savings will be realized, but Dr. Jean Robillard, vice president for medical affairs at the University of Iowa, said the savings were expected to be “significant.”

He said more alliances between the systems were being discussed, but he couldn’t release the details until they were final.

“What’s really good about this is it really brings the community and the academic health center working together rather than working against each other,” Robillard said.

Robillard said that if the two didn’t form a partnership, both sides would have continued to compete and duplicate services. “I think somebody would have paid for that,” he said.




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