Joint medical venture puts cooperation at the forefront

WILLMAR -- As Rice Memorial Hospital, Affiliated Community Medical Centers and a team of consultants and lawyers worked out the details of a joint venture in cancer care and medical imaging, there were times when the entire deal might have come apart at the seams.

"We could have said, 'Bag this.' But we got through it all," said Terry Tone, administrator of Affiliated. "We found out we weren't quite as different as we thought."

Last week the two organizations made it official: Starting Jan. 1, they will enter a joint venture to integrate cancer care and medical imaging services.

In the long run, there's more to be gained from cooperating than from competing, officials say.

"We're making it a more valuable asset and a stronger program," said Lorry Massa, chief executive of Rice Hospital.

The joint venture, known as Willmar Medical Services LLP, was formally approved this month by the board of the city-owned hospital and by Affiliated's board of directors.

The Willmar City Council, which has oversight of Rice Hospital, is expected to endorse the hospital board's vote tonight.

The partnership is a major step in working together for the hospital and for the multi-specialty regional clinic.

The two have coexisted uneasily at times. In the past, they've clashed -- sometimes sharply -- over competing services.

Increasingly, though, they've been moving in the direction of more, rather than less, cooperation.

"Integration is where things are headed," Massa said.

Both organizations point to the Willmar Surgery Center as a prime example of their ability to work together. The same-day surgery center, which opened in 1986 under the shared ownership of Affiliated and Rice, has been "a success from its inception," Massa said.

More recently, Rice and Affiliated have developed shared programs to provide orthopedic surgery and a hospitalist program.

Officials from both the hospital and clinic believe there will be many long-term benefits from their newest joint venture.

For one, it should help streamline and reduce duplication of expensive medical imaging technology, officials said.

"It became an issue about where things are done and who gets the revenue. This helped equalize the deal," Massa said. "We now have the ability to sit down in the future and discuss where does it make the most sense to have the services. We can make the decision about what's best for patients because we're jointly going to operate it. We won't compete with each other in those areas."

It's a chance to lower health care costs by becoming more efficient, Tone said.

"You've got to be efficient. You've got to streamline costs and squeeze out inefficiency," he said.

Because the joint venture is structured as a 50-50 partnership, Rice and Affiliated can share in whatever profits are generated -- and share the losses as well.

Officials are especially eager about the potential for a comprehensive, integrated cancer center, a concept that first began to be explored in the mid-1990s.

Indeed, cancer services were the reason the joint venture was proposed in the first place, said Dr. Ronald Holmgren, president of Affiliated Community Medical Centers.

"I think that was the driving force here. We wanted a cancer center," he said.

Officials believe an integrated cancer program -- one that provides services at a single, visually identifiable site -- will allow for care that's more coordinated, as well as less difficult for patients to navigate. They believe it also will better position the Willmar Cancer Center to offer new therapies and to be competitive in recruiting oncology professionals.

"Our doctors really saw the need to pull this together," Tone said.

Public reaction so far to the joint venture has been limited but mostly positive.

"I think this is really innovative thinking. The patients and everybody benefits from this," said Jim Dokken, a member of the Willmar City Council and the city's liaison to the Rice Hospital board.

Gary McDowell, administrator of Family Practice Medical Center, said he's still waiting to assess the impact. The family practice clinic has its own radiology services but sends most patients to Rice Hospital for MRIs and CTs.

Overall, McDowell sees the joint venture as good news.

"If they can work together, that's huge. It's a win-win for everybody," he said. "It really has to do with your philosophy of competition. If you believe you have to have everything, it won't be positive for your community. If you believe you can share so the whole is greater than the sum of the parts, it's positive. If people are willing to talk and communicate and look at the whole being greater than the parts, that's where you gain your successes."

Family Practice Medical Center has its own partnership with Rice Hospital -- the ownership and management of the Lakeland Health Center medical office building.

"Absolutely the relationship has been positive," McDowell said.

Holmgren said there's been a growing recognition that in order for rural health care to survive and flourish, some degree of cooperation is necessary.

"There's a realization of that, more so now than there was two or three years ago," he said.

In the case of the Willmar Medical Services joint venture, "we had a similar vision and goal," he said. "When you have a similar vision and goal, all the rest falls into place."