Naperville Sun:
In an age of mergers, Edward Hospital in Naperville remains staunchly independent
By Dave Gathman and Dan Cassidy
Sun-Times Media
August 18, 2012
Hospital mergers in the Chicago area are becoming commonplace, but Edward Hospital in Naperville is proud to be one of the few independent hospitals left in the western suburbs.
The hospitals of today — usually supported by a swarm of care centers and office buildings and imaging centers and labs and fitness centers and maybe even a nursing home or senior housing complex or two — have come a long way from your great-grandpa’s homey institutions.
With all the growth have come mergers, as some hospitals look for economies of scale to help fund all their facilities. One of the few remaining independents, Sherman Hospital in Elgin, may join with Cadence Health to become one even bigger organization, with Sherman joining the trend of hospitals becoming part of a chain of multiple hospitals.
If Sherman does get bought or merged — either by Cadence Health or by the even larger, 12-hospital Advocate Health Care Network which includes Good Samaritan Hospital in Downers Grove — the only independent hospital left in the far-west suburbs will be Edward Hospital in Naperville.
And even the chains are getting bigger, as evidenced last November when Provena Health System — which owned Elgin’s Provena Saint Joseph Hospital plus Provena Mercy Medical Center in Aurora, Provena St. Joseph Medical Center in Joliet and several other hospitals — merged with Resurrection Health Care, another Catholic chain that owned hospitals in Chicago and the suburbs.
On its own
Financial reasons can be a big part of why hospitals merge into larger groups. At Edward in Naperville, hospital officials say they are monitoring all the mergers going on.
“We understand there is a lot of activity out there,” said Brian Davis, vice president of marketing and government relations for Edward Hospital and Health Services.
However, Davis said that Edward is in good shape financially, so a merger is not on anyone’s mind right now. In fact, he pointed out, Edward is busy growing.
“We are in a strong market position,” Davis said. “We have the wherewithal and resources to expand and grow.”
Work is now under way to add two floors to the West Building on Edward’s Naperville campus. The $63.7 million West Building project will add two floors of beds and includes a new third floor with 36 medical and surgery beds for orthopedic and spine patients and a physical therapy gym and a new fourth floor with 24 Intensive Care Unit beds.
When the work is done in 2013, the two-floor addition will increase Edward’s bed inventory from 309 to 357, plus the 101 beds of Linden Oaks, Edward’s behavioral health hospital.
Also, on Monday, Edward will open its southern-most health care center at 16519 S. Route 59 in Plainfield. It will include three doctors, physical therapy, specialist doctors and imaging services.
Edward has also been working for a few years to get state approval to build a second hospital on its 60-acre medical campus near 127th Street and Route 30 in Plainfield. Edward already has an emergency room, surgery center, cancer center, imaging facility and doctor’s offices at its Plainfield campus.
With 26 facilities and more than 4,000 employees, Edward Hospital is the largest employer in the Naperville area.
“We’re a regional medical center and we are growing,” Davis said.
Big issue
If almost everybody is doing it, there must be some advantage to merging with other hospitals and forming big chains. Not surprisingly, that advantage is financial.
At an extreme, combining two hospitals into one corporate structure can allow both to be physically combined into one campus, as happened after Delnor Hospital of St. Charles merged with Geneva Community Hospital in 1986. But completely closing a hospital is rare, and requires approval from the state board. Susan Milford, senior vice president of Centegra Health System, notes that a merger allows consolidations at a less drastic level that save money and, arguably, even improve patient care.
Multiple locations “allow (a chain) to leverage resources and put the right services in the right place,” Milford said. “For example, you want an emergency room within a reasonable distance of every home, so you probably would leave one of those at each hospital. You’d probably even want the offices for primary-care physicians near each location.”
But for expensive services that aren’t used by as many people, such as diabetes centers, heart-surgery centers and cancer centers, patients are willing to travel farther, Milford said.
Larger size also allows a chain of hospitals to have more clout when negotiating for prices with insurance companies and suppliers, Milford noted.
“The provisions of health-care reform encourage consolidation among health-care providers, which is why news of hospital mergers is so prevalent right now,” Sherman’s Tonya Lucchetti-Hudson adds. “The new standard for health-care providers is to deliver the best outcomes for the most people for the least amount of money.”
Davis agrees that the game is changing for hospitals with the new health care rules.
“Hospitals are going to see more patients because more people are insured,” Davis said.
That’s why Edward is in growth mode, he said. Edward also has a variety of collaborations and agreements with other health groups to help provide the service customers want.
“A great example of that is Illinois Health Partners, our partnership with DuPage Medical Group, Edward Medical Group and hundreds of independent physicians, to improve care for the entire region,” Davis said. “We plan to expand that partnership to more patients in the future.”
There is a simple reason why Edward is busy with a variety of ventures to expand services.
“This community demands we keep up,” he said.
As one of the last of the independents in the area, Edward is in a unique position to deal with the changing times in health care. Davis said that niche can be a very good thing, allowing the hopsital to “be nimble” and “responsive to the needs of the community.”
“We value our independence,” Davis said.
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