Wyoming Medical Center is actively discussing affiliation agreements with a “variety” of “incredibly well-known” larger hospital systems, a WMC board member said Friday, in an effort to curb the ever-rising cost of health care.
“No decisions have been made,” said Dr. Mark Dowell, who is also the health officer for Natrona County. “We think it’s a very big win for the community and the state of Wyoming. We don’t want people having to go out of state for care. It’s a very positive thing, and we want the support of the community. Our eyes are wide open. We’re not selling out, not doing that at all.”
There’s been little update from the state’s largest hospital since it hinted in a vague April press release that an affiliation agreement with a larger hospital may be on the horizon. A spokeswoman for the hospital told the Star-Tribune in early May that, despite rumors, WMC was “not in negotiations with any particular hospital or system at this time.”
Spokeswoman Kristy Bleizeffer said the hospital doesn’t “have anything to add at the moment” when reached by email Friday.
But it appears the hospital is seriously pursuing an affiliation agreement. Dowell, who stressed repeatedly that any such deal would be a positive and a net-win for Casper and Wyoming at large, said the board is “in the middle of exploring and discussing with organizations.”
“This is still the exploration stage, but we are talking to organizations at a good level,” he said. “... We’re moving forward. No question about that. It’s not something we’re going take years to decide and move on.”
He declined to name the organizations the board is talking with, saying he “legally” couldn’t.
“We have made it very clear that we’re going to stay Wyoming Medical Center and everything we stand for, no matter who we potentially affiliate with,” Dowell added.
Dowell said the board had discussed possible affiliations for several years but that those conversations have sharpened in the past two years, which roughly coincides with the arrival of CEO Michele Chulick.
Her tenure has coincided with an expansionist mindset at WMC. In Chulick’s 23 months in Casper, the hospital purchased its primary local competitor, Mountain View Regional. It also fully launched its telestroke program, which earned a local neurologist national recognition last month.
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Asked if any affiliation agreement would mean new facilities across the state, Dowell said the board wasn’t at that point yet.
“We certainly want to be the big hub for the state of Wyoming,” he said. “We already consider ourselves that, but we want to be even bigger.”
He added WMC was “doing well” financially and was considering affiliations “from a position of strength.” Indeed, publicly available financials for the hospital suggest as much. Two independent health economists examined recent documents for the hospital at the request of the Star-Tribune.
Dr. Ge Bai, a professor at Johns Hopkins University, said the hospital was “doing great financially.” Nancy Kane, a health finance expert at Harvard, said the “hospital entity is pretty profitable” — though she warned that it was losing money consistently on its primary care clinics.
A statement of the hospital’s liabilities and assets from the third quarter of this fiscal year, posted just last month, showed an operating income of $8 million, plus nearly $5 million in investment income. WMC posted $196.5 million in revenues and gains through March, an increase of nearly $30 million from the year before (though expenses also increased sharply).
Affiliations are becoming an increasingly attractive option in Wyoming. Cheyenne Regional Medical Center, the second-largest hospital in the state behind WMC, previously affiliated with Colorado giant UC Health. So, too, did Laramie’s Ivinson Memorial.
Dowell said WMC’s affiliation would not be like either of those agreements. Ivinson is smaller and, he said, Cheyenne Regional had “lost a lot of its care.”
“Not us,” he said.
The reason affiliations are popular is because health care is expensive, especially so in Wyoming. Recent reports have consistently shown that care here is among the most expensive in the country. Health economists previously told the Star-Tribune that a way for smaller hospitals — like WMC — to save money on equipment and services would be to affiliate with a larger system.
Enter a giant like UC Health (which Bleizeffer said WMC was not negotiating with in early May). Such a hospital system has the buying power to pick up several MRI machines at lower costs, for example, while WMC would have to pay full price on any machine it buys. That, in turn, means the hospital has to make up the money it invested in the machines in what it charges patients to use them. The same goes for different medical services.
Kane, the Harvard expert, noted that “commercial payers” — referring to those with private insurance — “must pay a hefty markup” at WMC, given the hospital’s mix of patients who had Medicare, Medicaid and private insurance.
“We cannot continue to expect to act as a referral hospital and hospital that will see patients irrespective of their pay scale,” Dowell said, “We cannot realistically be expected to do that ... withou being proactive and doing something.”