Florida Hospital share purchase creates ‘super-regional network’
Florida Hospital has purchased a minority share of Health First, a nonprofit health system in Brevard County, the organizations announced on Thursday afternoon.
The partnership will create a “super-regional delivery network,” extending services to consumers from Gulf Coast to the Space Coast, the health systems said.
Florida Hospital’s financial investment will gain it seats on Health First’s board of directors. The CEO of Health First will have a seat on Florida Hospital’s board.
“We'll provide some capital dollars and allow [Health First] to become stronger,” said Daryl Tol, president and CEO of Florida Hospital. “Health First will continue to govern and run their organization and at Florida Hospital we’ll continue to run our organization, but we'll have selective work that we'll do together.”
Tol didn’t say the exact amount of Florida Hospital’s minority share in Health First, but said it will be in the ballpark of 20 percent to 25 percent.
Health First, which is financially about one-fifth the size of Florida Hospital, is not planning on staff reductions, said Steve Johnson, president and CEO of Health First. He added that the partnership isn’t the result of financial strains felt by many smaller systems in today’s healthcare market.
“We're extremely strong financially. … But we didn't want to wait as inevitable health care pressures come. So it made more sense to partner with someone we know and is strong than waiting into the future,” said Johnson.
Health First will maintain its brand. Tol said Florida Hospital has no plans to take over Health First.
“Both organizations are strong and innovative, and we see this being an indefinite relationship,” Tol said.
The two nonprofit health systems have been working on the partnership for about a year, but their relationship dates back five years, when Health First provided a private label of its health plan to Florida Hospital.
Under the Florida Hospital Care Advantage brand, Florida Hospital has been providing a range of insurance products, including health insurance plans for its employees.
“The future involves a lot of innovation around coverage and reducing costs and I think the health plan is a significant aspect of what consumers and employers are looking for,” said Tol.
Health First has found itself in the middle of a few headlinegrabbing lawsuits in recent years, including an antitrust lawsuit with a group of Space Coast doctors, which was settled in 2016 after one day in federal court.
The health system also has an ongoing legal battle with Parrish Medical Center involving its oncologists.
“Health care is very complicated and many organizations find themselves at the midst of legal proceeding. We find Health First to be principled and ethical. We trust them and they trust us,” said Tol.