MCCULLOUGH-HYDE MEMORIAL HOSPITAL
What: Independent hospital opened in 1957
Where: Main campus in Oxford on North Poplar Street; other locations in Oxford, Hamilton, Ross, Camden, and Brookville, Ind.
President and CEO: Bryan Hehemann
Board of Directors Chair: Richard Norman
Website: www.mhmh.org
Inpatient beds: 60 licensed, 45 operating
Employees: More than 400
MERCY HEALTH
What: Nonprofit hospital and doctor group operating five Cincinnati-area hospitals. Mercy Health is a division of Catholic Health Partners
Where: Regional administrative offices in Blue Ash; hospitals include Mercy Health — Fairfield at 3000 Mack Road
Market President and CEO: Yousuf Ahmad
Market Leader and President, Mercy Health - North Market: Thomas Urban
Website: www.e-mercy.com
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After more than a year of deliberation about the hospital’s future and whether to stay independent or not, the board of directors of McCullough-Hyde Memorial have voted to pursue a partnership of some kind with Cincinnati-area system Mercy Health.
McCullough-Hyde, the only independent hospital in Butler County, and Mercy Health made the announcement Friday morning, following a Thursday night board meeting in Oxford.
Other Cincinnati hospital networks in discussion with McCullough-Hyde were TriHealth, UC Health and The Christ Hospital.
“It’s a very community-based, family-oriented hospital and people want to save that,” said Richard Norman, chair of the board of McCullough-Hyde.
“But we had to face the fact there are changes in the health care industry coming down the road … changes that were going to require us to do quite a few things that would be better done by us if we could partner with a larger organization that’s also facing those same challenges,” Norman said.
Concerns were that given McCullough-Hyde’s size (45 inpatient beds, $62.1 million revenues in 2012), the hospital won’t have the resources to make the changes required under federal health care reform alone.
Leaders anticipate the Oxford hospital’s Medicare and Medicaid populations to continue to grow. However, neither government program fully covers the costs of care, hospital officials said.
Industry-wide, hospital inpatient admissions are declining. And the way hospitals are reimbursed under federal health care reform is changing from providers being paid for the number of procedures performed to being paid based on patient outcomes.
With these challenges in mind, McCullough-Hyde first announced in October 2012 plans to look into an affiliation with a larger health system.
“(Mercy) is a great culture fit; we have an alignment with their vision, mission and values. That was a key element in the decision,” said Bryan Hehemann, president and chief executive officer of McCullough-Hyde.
Hehemann said Mercy as a division of Catholic Health Partners — Ohio’s largest health care system — will help provide “deeper resources” to the Oxford hospital, including an updated single-platform information technology system. He said the geographic proximity and existing physician relationship between Fairfield and Oxford were also factors in the decision.
Mercy Health operates Mercy Health — Fairfield Hospital, also in Butler County.
Hehemann added that the Mercy network has experience in the insurance and managed care markets, and in maneuvering the changing compensation model in health care that seeks to lower costs while improving patient outcomes.
“We share the vision together of enhancing health care services to the communities we serve,” said Yousuf Ahmad, market president and chief executive of Mercy Health.
A partnership “provides continuity of care that may otherwise not exist,” Ahmad said. “If I’m an Oxford resident, through this partnership I will now have access to services that I may not have otherwise.”
For example, the Fairfield and Oxford hospitals could have common cardiology, orthopedic, and other doctors as a result of the new partnership.
Friday’s announcement is the “first step in a long process,” Norman and Hehemann said. During the next six to eight months, representatives of both groups will discuss the details of the partnership, including revenue streams and materials purchasing before coming to a final agreement.
“We want to continue as a full-service hospital. We feel that’s a basis from which to start,” Hehemann said.
McCullough-Hyde officials said they want to maintain as much local control as possible.
“We know there are a wide range of opportunities … from a loose affiliation to an absolute merger,” said Norman, also former chief financial officer of Miami University. “We said we really don’t want look to at either but want to work in between those two. Somewhere in there we’re going to land and we don’t know where it’s going to be.”
Also in the coming months, the hospitals will conduct a community needs health assessment in the communities in which McCullough-Hyde operates to study population density and other demographics, availability of specialty services, the prevalence of diseases, and what specialities the hospitals need to grow together, for example, Ahmad said.
“Now with health care reform in full swing, our goal is to improve quality, reduce cost, (and) improve experience for the entirety of care,” Ahmad said. “We always focus on if we enter a community, that community has to fare better after we’ve been there.”
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