As crews work steadily toward the completion of the $116 million Mercy Orthopedic Hospital in southeast Springfield, Mercy officials are busy vetting the possible purchase of an independent orthopedic facility with ties to CoxHealth.
On Aug. 2, Mercy confirmed to Springfield Business Journal it had entered into negotiations with Orthopaedic Specialists of Springfield. According to a Mercy statement, discussions include some of the physicians working to re-establish orthopedic programs for Mercy’s Joplin operation. Other surgeons also would work at Mercy in Springfield or with other providers.
A purchase of the $8.7 million OSS building, 3045 S. National Ave., also is under discussion.
Dr. Stephen Christiansen, a longtime Springfield surgeon who has a history of recommending patients to physicians at OSS, said he has been a party to persistent talk among several local physicians that Mercy was negotiating a purchase of OSS.
“It’s pretty well-known that … an agreement is supposed to have been reached,” Christiansen said. “(Mercy) is building an orthopedic hospital. Maybe (officials) are thinking they can eliminate competition, get three or four of the orthopedists they want and maybe two or three of those guys are going to retire, which would further eliminate competition.”
Mercy Springfield Communities spokeswoman Sonya Kullmann said it’s possible that OSS physicians would be incorporated into the orthopedic hospital under construction at U.S. Highway 65 and Evans Road. She referred all other questions to Mercy’s statement.
OSS Clinic Administrator Mary Sherrer could not be reached for comment by press time.
The potential merger reflects a rise in health care merger and acquisition activity across the country.
In February, Norwalk, Conn.-based Irving Levin Associates Inc., a firm that studies data related to merger and acquisition activity in finance, health care and senior living industries, reported that 86 hospital M&A deals were completed in 2011, the highest number in the past decade. In 2010, 75 health care mergers took place and 51 were finalized in 2009. The data indicate that more than $86 billion worth of health care-related transactions have taken place in the U.S. since 2002.
Laurie Duff, vice president of corporate communications for CoxHealth, said Mercy’s move is one that could have a positive impact on CoxHealth’s operations. Duff said she expects several of the OSS physicians already performing in-patient services at Cox South to extend their relationships.
“I think it is probably a good move on Mercy’s part, and we are pleased that several of the physicians have reached out to CoxHealth and expressed their interest in working with us,” Duff said. “We think that’s a good thing for our patients.”
Duff connected Mercy’s interest in an independent orthopedic provider to health care reform.
“This is, I think, another sign of the pressures of health care reform in that it brings together hospitals and physicians to work together in an integrated fashion,” Duff said, noting 80 percent of CoxHealth’s physicians are employed by or work exclusively with the health care system. “It makes sense to work collaboratively.”
Officials broke ground on the 48-bed Mercy Orthopedic Hospital in July 2011, and completion is expected by August 2013. When the hospital opens, it is expected to employ about 250.
OSS formerly operated as Ozarks Area Orthopaedics Associates, working under the CoxHealth umbrella. The contract ended in January 2004.
Christiansen, co-owner of Ozark Medical Surgical Associates, speculated the move could be a way for Mercy to pick up some quality former CoxHealth physicians and outpace CoxHealth’s efforts to be a leader in orthopedic services.
CoxHealth opened the Meyer Orthopedic Center in spring 2010 as part of roughly $48 million in renovations to its facilities on the Walnut Lawn campus.
“What we’ve been able to do as a result of that is to bring all of those services from surgery to rehabilitation, transitional care, physical therapy and the medical fitness center all under one roof,” Duff said. “It has been an excellent thing for our orthopedic patients that we’ve been able to offer them all private rooms and individualized care.”
Christiansen said it is only natural that orthopedic physicians and patients would be attracted to giving and receiving care in a facility separate from a traditional hospital setting.
“From a physician perspective, would you want to work in a hospital where your patients aren’t always on the orthopedic floor and may be next to someone with pneumonia? Or would you rather be in a hospital that is entirely focused on your orthopedic care?” Christiansen said.
This installment of Springfield Business Journal’s Architects & Engineers Project Report showcases 26 endeavors by area design and engineering professionals.
