October 22, 2009

Carle Foundation Hospital Seeks State Approval to Integrate with Carle Clinic

Carle Foundation Hospital has filed an application with the Illinois Health Facilities and Services Review Board announcing the mutual intentions of the Hospital and Carle Clinic Association to integrate essentially as a not-for-profit entity. This is just one critical step in the process towards combining the health care operations of both into a single health care system. In November, the physician owners (Associates) of Carle Clinic Association will consider the terms of the proposal by Carle Foundation Hospital to purchase Carle Clinic Association and its subsidiary Health Alliance Medical Plans.

"There is no doubt in my mind that integration will be the best way to strengthen our abilities to serve our community. We will be able to offer healthcare options to more individuals, while shoring up the effectiveness of services we provide throughout the region," said James C. Leonard, MD, president and CEO of The Carle Foundation.

"Carle Clinic and Carle Foundation Hospital have long partnered to provide high quality care and advanced technology and services," stated R. Bruce Wellman, MD, President and CEO, Carle Clinic Association. Integration with Carle Foundation Hospital would allow us higher levels of cooperation throughout the organization. We believe this integration will improve all aspects of the patient care experience, from service delivery, to alignment of quality and outcome goals, efficiency, and the ability to develop a common electronic medical record."

"The Carle organizations are important to our region's health care and integration will keep that system strong long into the future with elevated overall performance." said Marty Smith, Chairman of the Board of Trustees of The Carle Foundation. Furthermore, integration will preserve the independence, local leadership, and community-orientation of the Carle system."

Carle Foundation Hospital will agree to purchase Carle Clinic for $250 million dollars.  This includes all locations, equipment, and assets of Carle Clinic; Health Alliance Medical Plans; and property owned by Carle Clinic. A significant portion of the purchase price reflects the market value of Health Alliance Medical Plans, which will continue to operate as a for-profit business. The purchase price was based upon an independent valuation using established third-party valuation methodologies.

Under this proposal, the physicians of Carle Clinic will become employed by the The Carle Foundation. The Hospital would continue to have an open medical staff. Employees of Carle Clinic, including employees of Health Alliance Medical Plans, will become employees of The Carle Foundation.

As a not-for-profit organization, the charitable mission of the integrated system will be most similar to the current charitable mission of The Carle Foundation.  The current charity care policy of The Carle Foundation will be extended to the physician practices and will continue for the Hospital and several of its business units.  Charity care is available to patients who qualify and complete the application process. In FY 09, the Hospital alone provided more than $7.8 million in charity care.

The integration will support all of the Hospital's safety net services, which exist to provide the same health care experience regardless of patient demographics and socioeconomic status. A tertiary care facility, the Hospital directly operates numerous safety net programs, including pediatric services, obstetric services, neonatal intensive care services, a Level 1 trauma center and emergency department. As an integrated organization, Carle will coordinate core services more effectively with local and regional providers and improve the delivery of health care services in central Illinois. The Illinois Health Facilities and Services Review Board will host a public hearing at the Urbana City Council Chambers at 10:00 a.m. on Wednesday, November 4, for community input.

Note: Additional details related to the proposed integration follow.

Based in Urbana, IL, The Carle Foundation is the not-for-profit parent company of a variety of health care services. At its core is Carle Foundation Hospital, a 315-bed regional care hospital which offers a higher level of clinical service and technology than any area hospital, serves as the area's only Level I Trauma Center and provides Level III Perinatal Services. The Hospital offers a full range of inpatient and outpatient diagnostic, therapeutic, and ancillary services and has earned multiple accreditations and quality recognitions.

Carle Foundation Hospital places a significant emphasis on education and medical research. Committed to the highest academic standards of undergraduate, graduate, and continuing medical education, it is the primary teaching hospital for the University of Illinois College of Medicine at Urbana-Champaign. With its emphasis on translational research, the Hospital is currently working with Carle Clinic physicians and University of Illinois scientists on multiple studies related to aging, cardiology, gastroenterology, imaging, genomic research, and especially breast cancer in conjunction with the Mills Breast Cancer Institute.

Carle Clinic Association is one of the largest private physician groups in the United States, with more than 330 physicians practicing in more than 50 specialties at regional locations across central Illinois. In 2009, 24 Carle Clinic physicians were honored for their outstanding contributions by America's Best Doctors®. ??Our experienced staff continues pioneering breakthroughs in medicine through clinical trials for Alzheimer's, gastrointestinal disorders and cancer, and through our research affiliation with the world-renowned Mayo Clinic. Carle Clinic also partners with Carle Foundation Hospital to operate three centers of excellence - Carle Cancer Center, Carle Spine Institute and Carle Heart and Vascular Institute - bringing the latest diagnostic and treatment options to the communities we serve.

Additional Information?

Why Integration?

  • Create an integrated health care delivery system that unites the complementary strengths of Carle Clinic and Carle Foundation Hospital and elevates their overall performance?
  • Enable the provision of the best care to every patient through integrated clinical practice, education and research?
  • Coordinate patient care among multiple sites and across various health care settings?
  • Lower the cost of delivering care by achieving efficiencies through a single management team and coordinated staff across the enterprise?
  • Optimize the value and quality-improvement capabilities of a single electronic medical record?
  • Preserve the independence, local control, and community-orientation of the Carle system
  • Enhanced competitive position and potential for long-term growth and stability?
  • Better positioned to support regional healthcare needs and collaboration with other providers

Expected Benefits of Integration:?

  • Coordinate care across the continuum to deliver high-quality, high-value care?
  • Ensure the availability of safety net services including improved access to ambulatory care services and improved regional collaborations?
  • Expand the Hospital's charity care policy to the broad array of ambulatory care services that will be integrated into the system?
  • Create clear accountability for the total care of patients through unified management and clear communication channels?
  • Align physician and Hospital quality goals?
  • Enhance and maximize provider commitment to patient safety and quality improvement initiatives?
  • Maximize integration of the electronic health record and optimize its use?
  • Establish unified research priorities, commitments, and incentives to encourage innovation in care delivery