A planned partnership between Carolinas HealthCare System and UNC Health Care – two of the state’s largest hospital chains – will likely affect thousands of North Carolinians.
Many details of the arrangement are expected to be worked out over the next six months. But here’s some of what we know about what the deal may mean for patients, employees and Charlotte:
Leaders of the two systems say their partnership will allow them to expand care in under-served rural areas. They also say they plan to team up to improve cancer treatment, mental health care and substance abuse treatment.
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But it’s likely that patients will pay more for their health care under the new arrangement, several experts said.
That’s because consolidation gives hospitals more leverage to negotiate higher reimbursement from insurance companies. Insurance companies then pass those costs along to patients in the form of higher premiums and co-pays.
“You’re going to pay more for services if you are uninsured or if you have insurance,” predicts Gerard Anderson, who heads the Johns Hopkins Center for Hospital Finance and Management. “These organizations are already so large that any economies of scale just won’t happen.”
Kevin Schulman, an expert in hospital consolidation who teaches medicine and business at Duke University, said he, too, expects patient costs to rise.
“One of the leaders of the two organizations said they’d have more leverage with insurers, which translates into higher premiums or co-pays,” Schulman said.
Martin Gaynor, a health policy expert at Carnegie Mellon University who has studied hospital consolidation, said health care officials often predict that consolidation will bring many benefits, including better care and lower costs.
In reality, though, such outcomes have been “the exception rather than the rule,” he said.
Officials said they expected the partnership to expand the system, but they also didn’t rule out the possibility of job cuts in Charlotte and elsewhere.
“Will we continue to look for ways to drive efficiency and affordability? That’s part of this as well,” said Carolinas HealthCare CEO Gene Woods. “We will have to drive efficiencies, because that’s what we have to do in health care.”
Woods listed bill-processing as one area where efficiencies might be found but said it was too “early in the process” to provide specifics on how jobs might be affected.
Carolinas HealthCare employs about 65,000 people, including about 35,000 in the Charlotte region.
“Our goal from this partnership is to serve more communities, so we’re looking to grow as a system,” Woods said. “So in that scenario you need more talented folks to do that.”
“We believe that what’s required here is actually more talent and more clinicians to help us expand in areas like rural care, in areas like behavioral health,” he said.
Woods also said the partnership would help the systems retain employees and attract talent from across the nation: “I believe that as this announcement gets across the country, we’ll be fielding phone calls in terms of people that want to join us.”
For years, Charlotte has been America’s largest city without a full-fledged medical school.
Officials of the two systems hope creating the partnership will help recruit doctors and researchers while giving residents in the combined territory better access to clinical trials. But with major issues still to be worked out – from the name of the “new master brand” to the location of the combined headquarters – expanding Charlotte’s medical school doesn’t seem to be high on the list.
Carolinas Medical Center, the flagship hospital of Carolinas HealthCare, has hosted third- and fourth-year medical students since 2010, when the UNC Chapel Hill medical school opened a Charlotte campus.
Bill Roper, the CEO of UNC Health Care and dean of the Chapel Hill medical school, described the Charlotte location as one of the most popular placements for med students.
“We look forward to growing that with them,” Roper said this week.
He said he plans to brief UNC Charlotte Chancellor Philip Dubois on the partnership with Carolinas HealthCare, but wasn’t ready to elaborate.
In 2015, a consultant hired by Charlotte health care and business leaders said a full four-year med school would help Charlotte and other parts of the state recruit and retain much-needed physicians. He suggested “a public partnership” between the UNC School of Medicine-Charlotte Campus and UNC Charlotte, with other Charlotte universities collaborating.