The Health System Perspective
Capella Healthcare, Inc. ended 2014 with a flurry of activity to help strategically grow the company through a variety of mechanisms including new acquisitions and partnerships.
Michael A. Wiechart, who was named Capella’s president and CEO in January 2014 after serving five years as senior vice president and chief operating officer of the company, recently shared some of his thoughts on growing and adapting to meet the needs of a changing healthcare delivery system. Capella, which was recognized by Modern Healthcare as one of the country’s fastest growing healthcare companies in 2012 and 2013, now owns and/or operates more than a dozen acute care and specialty hospitals in seven states — Arkansas, Missouri, South Carolina, Oklahoma, Oregon, Tennessee and Washington.
The latest acquisition expanded Capella’s presence in South Carolina. “We recently consummated the Carolina Pines Regional Medical Center transaction and came into 2015 very excited to have that facility as part of the Capella family,” Wiechart said.
The community hospital in Hartsville, S.C. and its related outpatient services were previously subsidiaries of Community Health Systems, Inc. This latest move comes shortly after Capella announced a clinical collaboration with the Medical University of South Carolina (MUSC) and the formation of Midlands HealthONE Network, a regionally-based healthcare delivery network.
“Healthcare providers are building clinically integrated networks and forging other partnerships because to be competitive in the future, providers will need to demonstrate that they can delivery quality outcomes and cost-effective care while staying attuned to the needs of local communities,” Wiechart said when the MUSC partnership was announced in late November.
He told Nashville Medical News creating value for local communities and physicians is central to Capella’s mission. By providing governance, support and resources to appropriately grow a local health system’s medical staff and service lines, Wiechart said Capella can help communities keep a robust delivery system in an era of dramatic change.
“Our focus as an organization has always been based on two things – patient care excellence and a decentralized leadership model, which we believe provides the best platform for promoting growth organically,” he explained. He added the value proposition is to deliver high quality patient care while effectively beating the competition.
In addition to growth strategies such as acquisitions and integrated care partnerships, Capella also has a collaborative relationship with Saint Thomas Health. “The difference is the Capella-MUSC relationship is a clinical integration model whereas Capella-Saint Thomas is a true equity partnership,” he explained. Wiechart continued, “Each market is going to have nuances about it so that I don’t think you can take a cookie cutter approach.”
However, he added, he does see a shift towards complex clinical partnerships that move away from a siloed approach to care delivery and are based on regional relationships. He also said he thinks the trend of physician employment by a health system is a market reality that will continue to accelerate.
With hospitals in various regions of the country, Wiechart has a first-hand view of geographic differences in both health status and in standards of care. “It’s why we don’t think national solutions are the best option but more of a regional approach,” he explained.
He also said shifting population needs have resulted in a much heavier emphasis on care in the outpatient setting. “The movement from inpatient to outpatient is good for the industry as a whole from the perspective of quality of care and cost … and is something we support,” Wiechart said. While that might seem odd coming from a company that owns and operates hospitals, Wiechart noted the company’s focus is shifting to meet the new reality.
“We are a multisite provider and not just necessarily inpatient providers,” he explained. “Within Capella, three out of every four dollars that we are investing in patient care are in the outpatient enterprise. Ten years ago, that was just the opposite.”
Wiechart added this new reality also increases the need for smaller, non-urban hospitals to find a strategic partner like Capella to help them continue to do what they’ve always done … care for communities.
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