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CHI Franciscan, Virginia Mason Sign Memorandum of Understanding for Joint Operation

Analysis  |  By Melanie Blackman  
   July 17, 2020

The two Washington-based health systems are exploring a partnership that will focus on patient care, innovation, and improved quality.

Washington state-based health systems CHI Franciscan, whose parent company is CommonSpirit Health, and Virginia Mason have signed a Memorandum of Understanding to explore a new partnership, through the formation of a joint operating company, the health systems announced on Thursday.

The "new integrated health system" would have 12 hospitals and over 250 care sites. It would be led by co-CEOs Ketul Patel, CEO of CHI Franciscan and president of the Pacific Northwest Division at CommonSpirit Health, and Virginia Mason chairman and CEO Gary Kaplan, MD.

The partnership will focus on creating innovative models of personalized care delivery to improve patient experience.

"We looked at a variety of models and partnerships and, through our existing affiliation with CHI Franciscan, came to the clear conclusion that combining our organizations to form a new health system would allow us both to shape health care nationally and continue our focus on the patient experience," Dr. Kaplan said in the press release. "There is much to be determined in the coming months as we hopefully transition toward a final agreement, but we are aligned on the vision and the strategy to achieve it."

"CHI Franciscan and Virginia Mason have partnered closely in recent years and through this

collaboration it has become clear there is much more we can do together," Patel said in the press release. "We've admired each other's desire to lead in improving the way health care is delivered, and we've recognized an incredible opportunity to do so together. We are confident that in building the health system of the future, we will reimagine care delivery in the Puget Sound region and beyond."

In November 2016 the two health systems signed a letter of intent to form an independent partnership to expand access to care and improve quality and safety. In March 2017, the two health systems signed the definitive agreement to finalize the formal clinical partnership and strategic affiliation.

The organizations hope to finalize the integration process by the end of 2020.

Related: How CommonSpirit Rapidly Scaled Digital Innovations for COVID-19

Related: What Will Never Be the Same Again in Healthcare?

Related: Virginia Mason's Gary Kaplan: 19 Years of Inviting Disruption

Melanie Blackman is the strategy editor at HealthLeaders, an HCPro brand.

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