Be­hind As­cen­sion re­or­ga­ni­za­tion

Sub­sidiaries split from sys­tem un­der re­or­ga­ni­za­tion

Modern Healthcare - - FRONT PAGE - Melanie Evans

As­cen­sion Health, the na­tion’s largest pri­vate not-for-profit health sys­tem, has moved to en­ter new an­cil­lary health­care mar­kets with a re­or­ga­ni­za­tion that went into ef­fect with the new year. The re­or­ga­ni­za­tion cre­ated a new par­ent com­pany, the As­cen­sion Health Al­liance, for the health sys­tem and sev­eral sub­sidiaries and shuf­fled top lead­er­ship for the multi­bil­lion­dol­lar or­ga­ni­za­tion.

The move split As­cen­sion Health, which op­er­ates 76 hos­pi­tals across the U.S., from its health tech­nol­ogy and other sub­sidiaries, a ven­ture cap­i­tal fund and other an­cil­lary op­er­a­tions.

An­thony Ter­signi, pres­i­dent and CEO of the Al­liance, said the new or­ga­ni­za­tion would al­low As­cen­sion Health to fo­cus on hos­pi­tal op­er­a­tions and health­care de­liv­ery and leave sup­port ser­vices and sub­sidiaries to man­age­ment by the Al­liance.

Al­liance ex­ec­u­tives will seek to ex­pand sub­sidiaries, such as health­care equip­ment com­pany Trimedx, and launch oth­ers, such as the newly cre­ated physi­cian ser­vice or­ga­ni­za­tion, Clin­i­cal Hold­ings Corp., to mar­ket ser­vices to doc­tors and Ro­man Catholic hos­pi­tals and health sys­tems, Ter­signi said.

Agree­ments may not be lim­ited to Catholic health­care providers but all ar­range­ments must ad­here to the eth­i­cal and re­li­gious di­rec­tives for Catholic health­care, ac­cord­ing to As­cen­sion.

Based in In­di­anapo­lis, Trimedx re­ported in­come of $7.9 mil­lion and as­sets of $45.4 mil­lion for the year that ended June 30, 2010, the most re­cent fig­ures avail­able.

The As­cen­sion Health Care Net­work, a joint ven­ture be­tween As­cen­sion and pri­vate eq­uity firm Oak Hill Cap­i­tal Part­ners, will also oper­ate as an Al­liance sub­sidiary. The for-profit ven­ture is seek­ing to ac­quire Catholic hos­pi­tals but has yet to an­nounce any trans­ac­tions.

The ven­ture cap­i­tal fund will also oper­ate as a sub­sidiary of As­cen­sion Health Al­liance. Ter­signi said the Al­liance will seek to ex­pand its ca­pac­ity as an in­cu­ba­tor for new tech­nol­ogy, ei­ther through in­vest­ments or to use its hos­pi­tals as a test­ing ground for emerg­ing com­pa­nies.

As­cen­sion of­fi­cials say the re­or­ga­ni­za­tion will bet­ter pre­pare the health­care not-for­profit to adapt as health­care con­tin­ues to shift from hos­pi­tals and clin­ics to com­mu­ni­ties and homes, Ter­signi said.

As­cen­sion’s re­or­ga­ni­za­tion comes as pol­i­cy­mak­ers and busi­nesses seek ways to curb spend­ing on hos­pi­tals and hos­pi­tal ex­ec­u­tives are seek­ing ways to cut ex­penses and ex­pand out­pa­tient care.

Tom Cas­sels, ex­ec­u­tive di­rec­tor for re­search and in­sights at the Ad­vi­sory Board Co., said health sys­tems, un­der pres­sure from an ag­ing pop­u­la­tion, pay­ment re­form ef­forts and slower re­im­burse­ment rate growth, are seek­ing to diversify be­yond the typ­i­cally de­liv­ery of acute-care ser­vices. “The health­care in­dus­try is go­ing on a bud­get,” he said, which puts hos­pi­tals on a bud­get.

Dr. Andy Ziskind, man­ag­ing di­rec­tor for clin­i­cal so­lu­tions for Huron Con­sult­ing Group’s health­care prac­tice, said health sys­tems across the U.S. are seek­ing ways to stan­dard­ize and cen­tral­ize op­er­a­tions—from billing to busi­ness of­fice to sup­plies to in­for­ma­tion tech­nol­ogy—in a bid to in­crease ef­fi­ciency. Also un­der way are ef­forts to re­duce vari­a­tion in med­i­cal care, he said. “We’re clearly see­ing hos­pi­tals and health sys­tems re­ally work on achiev­ing what I would call op­ti­mal per­for­mance,” he said.

Mean­while, some sys­tems are seek­ing to work more closely with doc­tors as hos­pi­tals

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