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CHI Franciscan and Virginia Mason health systems explore possible merger

por John R. Fischer, Senior Reporter | July 20, 2020
Business Affairs
CHI Franciscan and Virginia Mason in Washington state are discussing the possibility of merging together into one integrated healthcare system.
CHI Franciscan and Virginia Mason are in talks to potentially merge into a newly integrated healthcare system.

The two, along with CHI Franciscan’s parent company, CommonSpirit Health, signed a memorandum of understanding to explore the idea, under the expectation that becoming a joint operating company would provide greater access to more personalized and higher quality of care for the communities they serve in Washington state. They envision it as a prototype of care innovation on a national scale.

"CHI Franciscan is known for its operational experience and has achieved sustained, exceptional system performance, standing as a regional leader in quality, value and safety metrics," Ketul Patel, CEO of CHI Franciscan and president of the Pacific Northwest Division at CommonSpirit Health, told HCB News. "Virginia Mason is known for high-value care and has tremendous international cachet in quality, safety and patient satisfaction. Combined, the new organization will have the highest quality outcomes in the region, the opportunities to invest in innovation, and patients will have access to the best minds in health care."

CHI Franciscan and Virginia Mason have worked together to increase access and continuity of care for patients through previous collaborations in obstetric and women’s health, and radiation oncology. This joint work would be the base of a potential merger, which both organizations say would offer higher quality outcomes in the region, customer centric innovation, and solutions that would help overcome access barriers, disparities and inequities in care.

Their combination would bring together 12 hospitals and more than 250 sites of care, including same-day surgery centers, Benaroya Research Institute at Virginia Mason, Bailey-Boushay House, and the Virginia Mason Institute. It would also pair together their teams into one made up of more than 21,000 members and staff, including nearly 5,000 employed and affiliated providers. CHI Franciscan's CEO Ketul Patel and the Virginia Mason chairman and CEO would head the new organization, with each organization receiving an equal number of board seats.

The aim behind the merged company would be to reduce waste and align the best possible care for the patient across the entire system.

"This new health system will be nimble and self-transformative, reducing waste and aligning care and services across the organization to always have the patient’s best interest in mind," Dr. Gary Kaplan, chairman and CEO of Virginia Mason, told HCB News. "This will make it easier for patients to get the care they need, no matter what facility they enter. We will expand on our work at Virginia Mason where we view patients and their families as our equal partners as we co-design health care processes together, based on their perspectives and needs. By engaging patients in this way, we are confident we will transform health care, resulting in a better patient experience, more accessible care and better value."

The organizations have discussed evaluation and planning, and hope for the process to be finalized by the end of 2020.

All patients will continue to have access to their same site of care and continue to use their current insurance plans.

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