Becker's Hospital Review

Register Today! Becker's Hospital Review CEO Strategy Roundtable - Nov. 5, 2014 - Chicago 26 Market share. Physician recruitment. Clout with payers. Despite the marked increase in collaboration within the healthcare industry, huge rivalries persist, especially in the largest urban markets across the country. Who are the greatest rivals in healthcare? Here are 10, as selected by our edi- tors and presented in alphabetical order. Carolinas HealthCare System vs. Novant Health (Charlotte, N.C.). In no market is the battle over inpatient beds hotter than in Charlotte, where 16-hospital Novant Health, actually based in nearby Winston-Salem, and 35-hospital Carolinas control all eight hospitals in Mecklenburg County (where Charlotte is the county seat). Currently, the two are fighting to obtain approval for additional beds in Mecklenburg County, where the state has deemed 40 new beds can be built. Both had submitted proposals to the state, but in April, Carolinas was grant- ed a certificate of need for all 40 beds. Novant is appealing the decision. If the clash is anything like the one for a CON in nearby Fort Mill, S.C. — which in- volved the two systems and Tenet's Piedmont Medical Center — don't expect a quick resolution. The three systems fought each other and the state over its CON decision there for nearly eight years. While Carolinas, led by Michael Tarwater, is a larger system, Novant's growth in the last 10 years, led by former CEO Paul Wiles and succeeded by Carl Ar- mato, has been more significant. According to the Charlotte Observer: "With nearly $7 billion in annual revenue, Carolinas HealthCare runs about 30 hospitals and owns more than $1 billion worth of property in Mecklenburg County alone. It has more than $2 billion in investments. In the five-year period ending in 2011, it spent $1.8 billion on capital projects. Growth at Novant Health, the region's other major hospital sys- tem, has been almost as dramatic. Novant owns 13 hospitals, including the three Presbyterian hospitals, and has total annual revenue of more than $3 billion. The system had about $1.6 billion in cash and investments in 2010 – a three-fold increase over the decade." Cerner vs. Epic. Both Cerner and Epic were founded in 1979, and 35 years later, the two compete head-to-head for health IT business, electronic health record implementations, in particular. Verona, Wis.-based Epic leads the EHR market, with roughly a 40- to 50-percent market share, according to various estimates. Kansas City, Mo.-based Cerner is second and thought to have a 15-percent share, according to KLAS. Cerner Founder, Chairman and CEO Neal Patterson oversees more than 12,000 employees who make up the company, which had $2.91 billion in rev- enue for 2013. Epic, also still led by founder Judy Faulkner, has roughly 7,400 employees and $1.7 billion in 2013 revenue. (Cerner's portfolio of products is larger and also includes hardware). Both have been criticized for their high costs and implementation challenges, as well as inoperability difficulties. In response, Cerner and other EHR vendors, including Allscripts and athena- health, formed the CommonWell Health Alliance, an industry coalition aimed at increasing interoperability between EHR platforms. Epic refused to join, calling the group an attempt to increase the vendors' market shares. Epic instead partnered with client Kaiser Permanente, Walgreens, Surescripts and other or- ganizations to form Carequality, which aims to increase data exchange between hospitals, physicians, payers, retail clinics and other healthcare stakeholders. Cleveland Clinic vs. Mayo Clinic (National). While Cleveland and Mayo Clinics both are the most prestigious provider organizations in their individual markets, they are competitors on the national and international stage — two organizations that come to mind when people think of local- based, but nonprofit, national healthcare organizations. With locations in Rochester, Minn., Florida and Arizona, Mayo is home to more than 4,000 physicians and scientists. It also operates the Mayo Clinic Health System, a network of clinics and hospitals in Minnesota, Wisconsin, Iowa and Georgia. Further extending its national reach (and tertiary refer- rals), Mayo has entered into 29 affiliations with hospitals through its Mayo Clinic Care Network, which provides e-consults and other clinical expertise to local healthcare providers. Cleveland Clinic, with 3,200 physicians and scientists, operates 95 care sites in northern Ohio, including its flagship campus and a handful of commu- nity hospitals it has merged with or acquired. Its affiliate network provides regional systems with clinical consulting and a branded affiliation, as well as the opportunity to enter into national bundled payment contracts with employers. So far, 14 systems have signed on to be either cardiovascular or orthopedic and spine network affiliates. Like Mayo, Cleveland Clinic also has a Florida presence, with its Cleveland Clinic Florida in Weston. Internationally, it operates Cleveland Clinic Canada in Toronto and Sheikh Khalifa Medical City in Abu Dhabi. It will open its much anticipated 364-bed Cleveland Clinic Abu Dhabi next year. Mayo has been less aggressive in the international market, though it does cater to medi- cal tourists from outside the U.S. and counts hospitals in Mexico and Puerto Rico among its affiliates. Both systems have gained national recognition for their high levels of in- tegration and clinical outcomes. Cleveland Clinic, led by Tony Cosgrove, MD, has expanded rapidly under his tenure and established a reputation for outstanding patient care and service — an approach Dr. Cosgrove details in his new book, "The Cleveland Clinic Way." John Noseworthy, MD, who leads Mayo, is sharply focused on improving efficiency and wants reimbursement to reflect the quality of care provided — quickly. Community Health Systems vs. HCA (National). With 208 hospitals in 29 states, Franklin, Tenn.-based CHS is the largest for-profit hospital op- erator in the nation. Just down the road in Nashville, HCA oversees its 165 hospitals in 20 states. Last year, CHS announced it would acquire another for-profit operator, Health Management Associates, in a deal valued at $7.6 billion. The deal made it the largest for-profit operator, "dethroning" HCA — a term used to describe the deal by the Nashville Business Journal. Although CHS edges out HCA on number of hospitals, HCA operates 115 standalone surgical facilities, making the two companies' overall footprints across the country somewhat similar. HCA has consistently had higher same-facility admissions growth than CHS, according to the Journal, and has higher revenue — at $34.2 billion for 2013 compared to CHS' $13 billion in fiscal 2013. Both are publicly traded, and they often go head-to-head on RFP responses to acquire facilities across the country to expand their ever-growing folds. Duke Medicine vs. UNC Healthcare (Raleigh-Durham, N.C.). Head- quartered less than 20 miles apart, Duke and UNC have more than just a bas- ketball rivalry, where Duke's Coach K (Mike Krzyzewski) and Dean Smith (UNC's winning coach from 1961-1997) have become legends for their leader- ship and successful development of teams. Durham-based Duke Medicine and Chapel Hill-based UNC Healthcare are also notable health system competitors. U.S. News & World Report' rates Duke top in the state, while UNC comes in third. For the Raleigh-Durham metro area, it's second. While Duke has a 10 of the Biggest Rivalries in Healthcare By Lindsey Dunn

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