United General and PeaceHealth Agree to Extend Timeline of Transition
April 25, 2013

At today’s meeting of the Public Hospital District #304 Board of Commissioners, United and PeaceHealth leaders reported that significant progress has been made toward achieving the vision of the alliance which is to ensure that District residents have local access to specialized, sustainable and innovative health care.

With the master agreement in place and with the work toward realization of all the benefits of the alliance continuing, the parties have agreed to implement the 30-year operating agreement no later than July 1, 2014.
Two significant events triggered the need to extend the implementation timeline. Regulatory approval procedural delays at the state level, and secondly, the full integration of United and PeaceHealth operations required to support this important alliance will require more time to develop than originally anticipated.  

United and PeaceHealth are currently working together under an interim services agreement which will be expanded as of July 1, 2013. This agreement was designed by joint United-PeaceHealth leadership to improve service, value and operating efficiencies. The change also allows for more detailed integration planning and execution over the interim 12 months.
 
“We have made enormous strides towards this alliance and we will continue to do so,” said Greg Reed, CEO of United General Hospital. “Leaders of both organizations are committed to a seamless and successful transition. We simply need more time to minimize any disruption to our services.”

“Our relationship is strong and both parties remain committed,” said Nancy Steiger, CEO/Chief Mission Officer for PeaceHealth St. Joseph Medical Center.  “We hold collaboration as a core value, and remain fully committed to full alliance and a long term relationship to ensure personal and community health.”
 

United General Board Approves PeaceHealth Alliance
November 15, 2012

We are pleased to announce that at their meeting this morning, our Board of Commissioners unanimously approved the proposed alliance with PeaceHealth. By reaching this milestone, we have taken the next step to becoming integrated with PeaceHealth’s operations not only in Skagit and Whatcom Counties, but also in Western Washington and Oregon.

“This is a momentous occasion,” said Chuck Ruhl, President of the Board of Commissioners of Public Hospital District #304, as he signed the resolution approving the alliance. “We did not arrive at this decision lightly, but after months of discussions and due diligence, we are very happy to be going forward.”

Shown standing, left to right: Commissioners of Public Hospital District #304, Bob Stanley, David Walker, Jeri Kaufman, and Gary Kent. Seated: Nancy Tieman, Vice President, Strategy, Innovation and Development of PeaceHealth St. Joseph Medical Center; Chuck Ruhl, President of the Board of Commissioners of Public Hospital District #304.

The alliance, which entails PeaceHealth leasing and operating United General, has also been approved by boards of PeaceHealth St. Joseph Medical Center, the PeaceHealth Northwest Network and PeaceHealth. Under the new arrangement, Public Hospital District #304 will retain ownership of the land and facilities, while turning management over to PeaceHealth.

We anticipate that the alliance will become effective on July 1, 2013, when United General Hospital will become PeaceHealth United General Medical Center. We will keep you updated as this transition proceeds. If you have questions or comments, please feel free to contact us.

Background on the Alliance
The alliance has been a long time in the making because both organizations want to ensure its success. United General first approached PeaceHealth more than two years ago and together we began exploring a closer relationship. In May 2010, PeaceHealth Medical Group established a clinic on our campus, staffed by physicians who specialize in pulmonology, gastroenterology and sleep medicine. Our community responded very positively to those new services. Since then, other Bellingham physicians have also transitioned to United, including cardiologists and surgeons.

For United General, PeaceHealth is a natural partner because we have overlapping service areas and many people in our community are already familiar and pleased with the care they receive from PeaceHealth. We also know that PeaceHealth’s highly integrated system can bring valuable expertise to our community. In addition, PeaceHealth operates a large tertiary hospital and regional referral center – PeaceHealth St. Joseph Medical Center in Bellingham - that offers a highly regarded cardiac program, OB/GYN, and other services that United doesn’t offer.  

More and more health care organizations are standing together, in order to be able to continue to provide care for their communities. Factors such as lower patient volumes, federal health care reform, state legislative changes, decreased reimbursement, and increased charity care have impacted how health care services are delivered and are driving changes such as these.

UPDATE: OCTOBER 19, 2012

United General Hospital and PeaceHealth are continuing to build on the specialty care we provide in tandem for the community. Today, we are taking an important step on that journey: PeaceHealth has filed a Letter of Intent with the Washington State Department of Health to pursue a Certificate of Need to transfer the bed license from United to PeaceHealth. This begins the formal process of forming an alliance. The next step will be pursuing approval from governing boards for both PeaceHealth St. Joseph and United General.

We began exploring this alliance about a year ago and have taken great care to ensure that it benefits both organizations and the communities each serves, and is consistent with our mission, vision and values. 

We believe that by working together, we will be better able to leverage our collective expertise, manage costs, and provide greater care to patients through improved care delivery models and reduction of duplication and waste. 

The alliance will enhance our existing relationship that began many years ago and was mostly recently supplemented with the development of a PeaceHealth Medical Group specialty clinic on United’s campus in May 2010. That clinic is staffed by PeaceHealth physicians who specialize in pulmonology, gastroenterology and sleep medicine. Other Bellingham care providers have transitioned to United as well, including cardiologists and surgeons.

The Certificate of Need process requires a formal application in which the parties describe the services proposed, the estimated cost of the proposed project and the service area.  We expect to file this in late November. 

The Department of Health’s review process begins once the application is filed. This normally takes about five to six months, and includes a 45-day public comment period. 

Our hope is that the application and review processes can be completed by the Spring of 2013 so that the alliance between PeaceHealth and United General Hospital would become effective July 1, 2013.

ORIGIANAL Q & A FROM 2011
PeaceHealth Alliance Discussions

Q1:      What is being announced? 
A1:       The United General Hospital (United)  Board of Commissioners (Skagit County Public Hospital District No. 304) and PeaceHealth have signed a non-binding Letter of Intent that indicates their desire to enter into formal discussions regarding a possible alliance with between United and PeaceHealth.

Q2:     How would such an alliance be structured? 
A2:       The proposed alliance envisions United becoming part of PeaceHealth’s Whatcom’s (Northwest’s) regional network of care, with a full integration between United and PeaceHealth’s operations throughout Skagit and Whatcom Counties.  The proposed alliance entails PeaceHealth leasing and operating United General Hospital.

Q3:      Has the decision already been made to form this alliance? 
A3:       No. The Letter of Intent allows the two of us to now formally explore alliance options.  Nothing has been decided yet: the letter of intent is only the beginning of the process.  The Letter of Intent is non-binding. 

Q4:      Why would United consider this alliance? 
A4:       Health care reform and market pressures have resulted in many small community and Critical Access hospitals seeking to partner with a larger, more integrated health system.  For United, PeaceHealth is a natural partner because:

1.  PeaceHealth and United have overlapping services areas.
2.  PeaceHealth is already operating a clinic on the United campus, staffed with physicians from PeaceHealth Medical Group.
3.  PeaceHealth is a much more integrated system of care and could bring great expertise to United General.
4.  PeaceHealth has great expertise in  operating community and critical access hospitals

In addition, PeaceHealth operates a large tertiary hospital and regional referral center – PeaceHealth St. Joseph Medical Center in Bellingham - that offers a highly regarded cardiac program, OB/GYN, and other services that United doesn’t offer.   

Q5:      How would PeaceHealth benefit from the alliance?     
A5:       United and PeaceHealth can work effectively together to meet the full range of health care needs for the residents of Public Hospital District 304.  Joining with United contributes to economy of scale in operations, and complements the services already provided by PeaceHealth St Joseph Medical Center in Bellingham. Both United and PeaceHealth share a mission of serving rural communities that need and want a viable community hospital.

Q6:      Who initiated this process?
A6:       More than two years ago, United invited PeaceHealth into discussions about ways the two organizations could work more closely together. From those initial discussions, a multi-specialty clinic was created on the United campus, staffed by PeaceHealth Medical Group physicians. The clinic has been so successful that United and PeaceHealth have continued to explore ideas on ways to increase and streamline health care in United’s service area. PeaceHealth does not enter a new community without first being invited.

Q7:     What is the expected timeframe for these exploratory discussions with PeaceHealth and when would a final decision be made?
A7:      The letter of intent sets forth a 180-day period during which discussions will take place, but an extension is also possible. Both organizations are dedicated to taking as much time as needed to arrive at a mutually beneficial decision.

Q8:    How would an alliance impact jobs at United?
A8:     It’s much too early to know the answer to this question; however, by the end of the six-month evaluation period, this and many other questions will be able to be answered.  However, the only way United and PeaceHealth would agree to a deeper relationship would be if the alliance was projected to generate new growth, capacity and demand for services.  That may ultimately have a positive impact on jobs.

Q9:    Why would United consider an alliance with PeaceHealth rather than Skagit Valley Hospital?
A9:     Both PeaceHealth and Skagit Valley Hospital serve communities and patients in areas adjacent to United’s Hospital District. Both offer high quality care.  PeaceHealth is a larger organization, with significant scale economies and a high degree of integration within and across the Northwest Washington region. PeaceHealth St. Joseph Medical Center offers a comprehensive range of tertiary and specialty services in nearby Bellingham that are presently not offered anywhere but in Seattle. We believe that this potential alliance would give the residents of Skagit County many more choices when it comes to choosing their health care providers.

Q10:    How is this proposed alliance different from the previous affiliation between United and Skagit Valley Hospital?
A10:     PeaceHealth is committed in all of its communities to provide as much care as possible, closest to a patient’s home. Likewise, PeaceHealth offers a full array of tertiary services in Bellingham that are complimentary to, but do not duplicate the core services offered by United.  We anticipate that a PeaceHealth-United General Hospital alliance would lead to additional growth in services and improved access to care within the Hospital District. 

Q11:    Would an alliance increase or decrease options for health care in the community?
A11:     The potential alliance is anticipated to increase choice to District residents, who will be able to direct where they want to receive their referral health care services. This would include specialty and tertiary services.  PeaceHealth has a 130-year track record of providing care closest to a patient’s home, as well as respecting patient choice in their referral options.

Q12:    Would there still be local influence in Public Hospital District No. 304?  
A12:     Yes. PeaceHealth serves in many small and rural communities, with local boards that are key to addressing the needs in individual communities.   In a Peace Health-United General Hospital alliance, there would be a local community board. 

Q13:    Does an alliance with PeaceHealth mean that I will automatically be transferred or referred to Bellingham?
A13:     No. PeaceHealth would strive to provide services that can be safely and prudently provided at United.  In the event that a patient needs specialized care that United does not offer, the patient will be referred to the facility that can best provide that care. Peacehealth and United always respect a patient’s choice.

Q14:     I am a taxpayer and a voter in Public Hospital District 304. Will there be an opportunity to learn more about what is anticipated with PeaceHealth and to provide input?  
A14:     Yes.  We are only in the early stages of exploring a potential alliance. No final decisions have been made. Before any decision is made, the leaders of United will seek additional input from the community.  There will be numerous opportunities for public input. 

 Benefits of a Proposed Alliance

Q15:    How would the proposed alliance strengthen United?
A15:     This alliance builds strength for United’s future. The healthcare industry as a whole is undergoing significant consolidation and new partnerships because of many factors.  Some of this change is due to the current economic climate, and many are in anticipation of Healthcare Reform changes, and new technology needs for increased reporting expectations. A close relationship with  PeaceHealth would better position United to grow, obtain favorable long-term financing, and utilize PeaceHealth’s heavy investments and innovations in information technology, evidence-based care processes, and quality outcomes.  

Q16:   Would there be a positive impact on patient safety or quality?
A16:    United and PeaceHealth share a common vision for continuous improvement regarding patient safety and quality, and aspire to produce reliable outcomes that rank among the best in the country. From a stewardship perspective, both organizations strongly believe that an alliance would help expand access to services, deliver reliably higher quality care and at lower costs. 

Q17:   Will this limit my choices or provide more choices for care and services?
A17:    The potential alliance will explore programs that would provide broader access to and choice of quality health care services within the Hospital District. An alliance between the two organizations would create a leading network of care for communities in both Skagit and Whatcom counties.

Together, both organizations will be better able to leverage their collective health care expertise and resources for the benefit of the community and our patients. With seamless access to the tertiary services at PeaceHealth St. Joseph Medical Center, United could increase options available to the community.

 United and PeaceHealth “Fit”

Q18:    What makes these two organizations such a good match? 
A18:    United is focused on enhanced and sustainable services for hospital district residents. This includes access for residents regardless of their ability to pay. United was looking for a partner that can help in stabilizing and expanding services and one that shares common mission and values. PeaceHealth, an integrated system of Northwest hospitals, medical groups and laboratories, repeatedly produces clinical and service outcomes in the top percentile nationally.

Q19:    Is there similarity between the two organizations’ approach to providing care?
A19:     PeaceHealth and United are highly aligned in terms of mission and vision:

• Both have similar core values.

• Both have deep roots in serving the health care needs of communities – especially smaller, rural communities.

• Both have strong brands associated with community values and serving all people, regardless of their ability to pay.

• Both enjoy and foster high levels of engagement and trust with their staffs.

• Both have deep commitments and track records for delivering quality health care.

Q20:    What does it mean that PeaceHealth is founded in the Catholic tradition?
A20:     PeaceHealth was founded over 125 years ago by Catholic Sisters (Sisters of Peace) who came to Fairhaven and other northwest communities to provide healthcare services to loggers, miners, and others living in this part of the country. Over the years, PeaceHealth has partnered with hospital districts, municipalities, and other organizations, to provide healthcare services to whole communities.  PeaceHealth’s Catholic tradition is embodied within its four core values of social justice (treating all people equally), respect (treating all people with dignity and respect), collaboration (working with all constituents in the community), and stewardship (respecting patients’, caregivers’ and the community’s finite resources).  PeaceHealth serves all people, regardless of their ability to pay. 

Sedro-Woolley Community Forum Question and Answers September 2011 (pdf 84Kb)
Questions & Comments from Community, August 2011 (pdf 59Kb)
Questions & Comments from Hospital Staff, July 2011 (pdf 16KB)

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