What does Summa want in new partner?

Oct. 01--Wanted: Summa Health is seeking a new partner that has strong financial background, desire to grow, experience with or familiarity with a health insurance plan and the same values in population health and charity care.

Last Wednesday, the Akron-based health system put itself on the market, saying it believed it was in a strong position to find a new partner to boost patient services, improve finances and thwart competition.

Summa leaders said nothing was off the table, including a merger, partnership or "full integration" with fellow Northeast Ohio rivals or out-of-state players.

But Summa, which includes hospitals Akron City, Barberton and St. Thomas, SummaCare insurance, stand-alone emergency departments and outpatient and physician offices, is on the market as one package.

Summa interim President and CEO Dr. Cliff Deveny said he doesn't just want a new dance partner. He is seeking a new spouse for Summa "because with a dance partner you can always break up."

Deveny said the right partner has to be a teaching hospital "that is comfortable with population health and a health plan ... If we want them to enhance services, they have to have the ability to bring other providers where there are gaps."

Summa also is looking for a partner with strong finances, he said.

"We're talking $3 billion, $5 billion, $ 7 billion" in annual revenues, said Deveny, "or a potential partner that we can fill these gaps and if we come together we're a bigger group of things."

Summa's minority partner, Mercy Health, is not interested in taking the relationship to another level. It finalized its $8 billion merger with Maryland-based Bon Secours, on Sept. 5, making it one of the nation's largest Catholic health systems.

However, Deveny said if Summa doesn't find a good new partner, there are five years left on the Mercy agreement and Summa is financially healthy enough to wait it out.

Tom Campanella, director of the health care MBA program and a professor of health economics at Baldwin Wallace University, said it makes sense that Summa would look for a new partner, though he thought Bon Secours with its national platform and size could have been a good thing for Summa, if they were on the same page.

SummaCare is one of the strongest things Summa Health has in its portfolio, Campanella said.

The health insurer has 71,000 members throughout Ohio, including 24,000 Medicare Advantage customers. The insurer has commercial plan members in about 20 counties in the state and 31 counties with Medicare.

Overall, Summa is an attractive potential partner, said both Campanella and J.B. Silvers, a health finance professor at Case Western Reserve University's Weatherhead School of Management.

"I think they are fundamentally a very strong organization," said Silvers, a former SummaCare board member who served as president and chief executive of University Hospital's now-defunct insurance company, QualChoice.

"They ran into a few bumps in the last few years and that happens to a lot of organizations," he said, referring to a crisis after an abrupt switchover of its longtime emergency room physician group on New Year's Day 2017 after failed negotiations. Then, CEO Dr. Thomas Malone resigned weeks after hundreds of doctors voted no confidence. That also led to a national accrediting agency revoking the hospital's ability to train resident emergency department doctors because of numerous deficiencies following the staffing switch.

"There are some suitors that it may be an issue and for others, it's like, 'Hey, that happened' ... I don't think that would be a deal-breaker in any scenario," said Campanella.

Transparency and trust

Deveny and Board Chair Anthony Lockhart said they want to be transparent about the partner search.

It was imperative and smart for Summa leaders to be as transparent as possible given the mistrust that developed after last year's struggles, said Campanella.

Had Summa done all of the work behind the scenes and word got out, "it would have done a lot of damage," he said.

Quiet on plans

Most of the potential suitors being named among those in the industry and community are staying mum on their plans.

Cleveland-based MetroHealth Health System, which recently has been given the green light to expand outside of Cuyahoga County after a new state law was passed, and University Hospitals both declined comment on Friday on the subject.

Cleveland Clinic spokeswoman Heather Phillips said, "Although we have not spoken to them, we are open to talking with Summa about opportunities."

Susan Manko, a spokeswoman with UPMC, affiliated with the University of Pittsburgh, said: "As one of the nation's leading providers and insurers, and given our successful track record of affiliations, UPMC is constantly approached by other hospitals and organizations who want to explore opportunities to partner with or become part of UPMC. While we are often in discussions with such organizations, there is nothing new to announce at this time."

And in a telephone interview Friday, Akron Children's Hospital CEO Bill Considine said there's no truth to rumors in town that UPMC officials have been visiting his hospital in recent weeks.

"We have had zero conversation with our colleagues at UPMC. I know the people over there. We have had no conversations with UMPC and whether Summa is, I don't know," he said.

Considine said he wishes Summa the best in its search and knows Deveny and the board "are doing what they need to be doing relative to looking at options and stabilize what was a rocky ship."

But Considine said Children's, which will remain independently owned, is not in the mix for any multiparty affiliations including Summa.

Children's runs the neonatal units at Summa Akron City Hospital and Cleveland Clinic Akron General and has been in active discussions to extend its contract with Summa after 2020.

Considine said he hopes that Summa finds a way to maintain local control.

"I have seen what's happened to other organizations that go into relationships where you lose that local corporate citizenship and the hat that you wear," he said. "Personally, I really believe they can remain independent and keep that local governance and keep that local management through alliances, partnerships. There are organizations out there that they can partner with that aren't organizations that need control.

"It won't be my call. It's their call. Children's wants to be part of the solutions for them ... We respect their decision process," he said.

Asked whether he is concerned about a potential suitor in University Hospitals and its Rainbow Babies and Children's Hospital, Considine said no.

"There's not an organization that's been making an investment in pediatrics that we've made. There's nothing that Summa could get in pediatrics that they can't get from Akron Children's regardless of what partner they bring to the table," he said.

Beacon Journal consumer columnist and medical reporter Betty Lin-Fisher can be reached at 330-996-3724 or [email protected]. Follow her @blinfisherABJ on Twitter or www.facebook.com/BettyLinFisherABJ and see all her stories at www.ohio.com/betty.

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