Becker's Hospital Review

18 CFO / FINANCE Partners HealthCare, 1.2M-member health plan consider merger By Morgan Haefner B oston-based Partners HealthCare and Wellesley, Mass.-based health insurer Harvard Pilgrim Health Care are nego- tiating a possible merger behind closed doors, e Boston Globe reported. Here are five things to know about the nego- tiations: 1. e possible tie-up would link Massachu- setts' largest physician and hospital network with a 1.2 million-member payer. 2. Partners and Harvard Pilgrim leaders have been talking about a potential deal for several months, people familiar with the matter told the Globe. Among potential transactions is Partners acquiring Harvard Pilgrim, though it's possible talks will end without a deal. 3. In a state where lawmakers are exploring several efforts to control medical costs, it is likely Partners and Harvard Pilgrim would face scrutiny if they move forward with a deal, according to the report. 4. Partners spokesperson Rich Copp told the Globe, "Partners HealthCare is constantly ex- ploring new partnerships and relationships with other providers and insurers with the goal of improving the delivery of healthcare to patients both locally and around the world. Harvard Pilgrim is certainly among those or- ganizations." 5. In January 2018, Partners entered into a de- finitive agreement to merge with Providence, R.I.-based Care New England. A study com- missioned by Rhode Island and obtained by WPRI found the proposed deal could raise health insurance premiums in Rhode Island. n Advocate Children's, NorthShore University HealthSystem to partner: 3 takeaways By Alyssa Rege O ak Lawn, Ill.-based Advocate Children's Hospital and Evanston, Ill.-based NorthShore University HealthSys- tem announced their intent to form a strategic partner- ship to expand pediatric care statewide May 16. Here are three things to know about the collaboration: 1. The goal of the alliance is to create a comprehensive sys- tem of pediatric care for residents across the state, and will comprise 600 pediatricians as well as hospital and ambulatory programs and services. 2. The organizations will share governance and financial re- sponsibilities for the partnership, which will be led by Advo- cate Children's Hospital President Mike Farrell and co-CMOs Frank Belmonte, DO, and Michael Caplan, MD, from Advocate Children's and NorthShore, respectively. 3. Officials will begin the transition and integration processes during the next few months. They expect to launch the deliv- ery network in July 2018. "This is about providing exceptional pediatric care for the children in our communities," said Mr. Farrell. "By linking to- gether such high caliber physicians, committed to excellence in safety, quality and service, we will no doubt make it easier to access comprehensive medical care. That's good for children, their families and communities." n Northwestern, Centegra seek to finalize 10-hospital merger By Ayla Ellison C hicago-based Northwestern Memorial Health- Care and Crystal Lake, Ill.-based Centegra Health System could close their merger deal by Sept. 1, according to a filing with the Illinois Facilities & Services Review Board. The two health systems have been in negotiations since 2016, when they signed a letter of intent to ex- plore a merger, and the deal is moving forward. "It's the next stop in the regulatory approval process," a Centegra spokesperson told the Northwest Herald regarding the recent filing with the Illinois Facilities & Services Review Board. Under the proposed transaction, Centegra's three hos- pitals would join Northwestern Memorial HealthCare's seven hospitals, and Northwestern would govern, di- rect and oversee Centegra's business, property and funds, according to the Northwest Herald, which cited the recent filing. Health system officials said in 2017 no cash would change hands under the proposed deal. In a report released May 3, Fitch Ratings said it expects Centegra's bond rating to be downgraded, potential- ly by several notches, if the system is not acquired by Northwestern. "Absent the acquisition by NMH, Fitch anticipates that Centegra's leverage metrics will contin- ue to be pressured for a number of years with a financial profile that shows vulnerability to economic variations or further margin compression," Fitch said. n

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