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Stand-Alone Hospitals Wrestle With Financial Challenges

Rene Letourneau, for HealthLeaders Media, June 24, 2013

"The board does ask the question, certainly, but we are looking at clinical affiliation efforts as opposed to financial," Dupper said. "We don't think we have to do an ownership or balance sheet affiliation. Clinical partnerships would be the best for us and our community. Good stewardship has put our organization on a solid financial foundation. … The question is about whether we can continue to be relevant and provide the services needed in the community and participate in commercial payer products."

"I don't believe that where we are we can avoid looking at other kinds of associations, short of full mergers," Machula said. "Enloe has started conversations with four hospitals in the region to have discussions about sharing data … but before we get there, we have to discuss what the model will be and who is going to suffer the costs."

At Winona Health, the current strategy is to maximize vendor relationships to stave off the need for consolidation, Allen said.

"[The board] didn't want to take a hand-the-keys-over approach, so I went to our key vendors—in IT, in particular—and went deeper with them, and through that, I am getting scale. I'm becoming part of a larger organization that has scope and scale and talent. … I'm building the infrastructure that is needed to make ourselves operate larger without becoming larger."

James Doyle, executive vice president and CFO at Elmhurst Memorial Healthcare in Chicago, represented the sole hospital among the panel that has decided to enter into a merger. Elmhurst will join with Edward Hospital and Health Services in Naperville, IL, on July 1.

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