Arizona Edition: YRMC Explores Partnership with LifePoint Health

Jul 8, 2021

This story aired on KAWC’s Arizona Edition on July 2, 2021   

 

  

  

(HOST) Lou Gum (LG)  

I'm Lou Gum. This is Arizona Edition on KAWC. 

We're talking about partnerships today. Later, we'll hear about a longstanding partnership between the local Cocopah Tribe and the City of Somerton that has them together fielding an incredibly well-trained group of firefighters providing service to both communities. 

But first, a potential partnership that could fundamentally change healthcare in Yuma and the region.   

Yuma Regional Medical Center announced this week that it has agreed to a non-binding letter of intent “to explore forming a joint venture that would build on YRMC's longstanding legacy and advance health care services in the human community.”  

So, what does that mean? And how will this possible joint venture impact the local community and local health care workers? 

To find out more, I spoke with the CEO of YRMC, Dr. Robert Trenschel.   

Dr. Trenschel, thank you so much for your time. We're talking about this potential partnership with LifePoint Health. Can you explain first though, what are the motivations for YRMC and the board to seek a partnership in this way?  

 

Dr. Robert Trenschel (RT)  

Sure, great question. You know, three years ago we explored, you know, was an affiliation or a partnership, a good idea? And we went through a lot of effort at that point.  

And at that time the board decided with everything that was going on in healthcare, at that time in the healthcare landscape, it might not have been the right time to do things. But they committed to look at it again three years later, Knowing that, you know, the landscape changes and there's just multiple changes consistently in healthcare.   

So they did, they looked at it again three years later. Which was this, this episode, which really started in probably mid-2020, and the board has always been particular about looking at a partnership or looking at an affiliation from a position of strength. Meaning that we're a strong organization financially, we're a strong organization clinically, were a strong organization operationally.  

The board did not want to go into any type of partnership exploration process from a position of, this is something we have to do. Because they want to look at it clearly and say, you know what's in the best interest of our community? What's in the best interests of our patients? What's in the best interests of the hospital and the health system, and how do we enhance that?  

It's hard to do that when you have to make a decision, but it's easier to do that when you don't have to make a decision, and you could really then negotiate really, and be in a position of strength.  

So that was the impetus really for the board. Knowing that health care does change in the future and there is value to scale when you're talking about health care, you know larger systems have expertise. They have assets they can bring to bear. You know when you look at COVID, just looking at that, we did very well during COVID, but larger health systems certainly had more resources that they could deploy to other hospitals and those of their systems. So as the board looked at this, they felt like it was the appropriate time.  

You know, we went through a pretty rigorous, they went through a very rigorous process, looking at, we're really looking first for a cultural fit. And the board had a set of objectives that they wanted to achieve, and via a partnership or via an affiliation, but most importantly, first and foremost was, is there a cultural fit? And then if there is a cultural fit, how can we explore these objectives? So that's really what brought us to today.  

 

LG:  

You sort of addressed it there, but was there concern that, you know, a larger network would sort of take away the local identity?  

  

RT:  

Well, you know, I don't know that there's really any concerns. It's just that they were really looking for benefits, but also wanted to address, you know, any concerns that could come forward. And local identity is important, that’s an important point you bring up. And you know one of the benefits of LifePoint is that they operate in smaller rural communities throughout the country.   

That is their niche, that that's the type of hospital that they operate.   

They don't operate many hospitals in urban centers, so they're very particular, as are we about the community impact an individual hospital has on that particular community, and the importance of that hospital to engage with the community in a meaningful way.  

So, none of that will change if anything it will just continue to grow into the future.  

 

LG:  

As you mentioned, that sort of regional understanding, it seems like that was important for the board to find a partner that understood a community.  

 

RT:   

Absolutely. And when we did our reverse due diligence with LifePoint, you know we visited some of their hospitals and not the hospitals they asked us to visit, you know. We had an advisor really walking us through this and we visited some LifePoint hospitals and we visited some LifePoint hospitals that were in a position similar to ours but had been 2,3,4, years post affiliation or post, you know, partnership.  

To talk with their board, to talk with their physicians, to talk with their staff, and to see what they felt about the transition and did they live up to everything that they said they were going to do? And what are your feelings now?   

Obviously, you know not everybody is 100% happy even at YRMC today, but ultimately, and overwhelmingly, we found that they live up to their obligations, and they live up to their promises and that people were happy with the transitions that occur.  

 

LG:   

The letter of intent sort of kicks off a process. What process does it kick off?  

 

RT:  

It kicks off the due diligence process, so we uploaded, and that's due diligence on both sides. So, we uploaded a significant amount of information into a data room and now LifePoint will do confirmatory, investigation of that, you know, to assure that you know what we told them is true, and we'll do the same thing you know from a financial perspective as well, to look at their finances. Make sure they're a solid company. We know they are, but that's part of the reverse due diligence as well.   

That's a 90-day period and there's a significant amount of information to glean through. They'll look through every contract, they will look through every agreement, look through our financials, they’ll look for audit. Any risk we have out there, they want to know about that. So, it's really a deep dive into the organization.  

 
LG:   

What questions are not at this point answered, for example, and I'll just throw out some things that come into my head, who will YRMC employees work for? Will the name of the hospital change?  

 
 
RT:  

Sure, all great questions and we have answers to those. The name of the hospital will not change. It'll still be Yuma Regional Medical Center. Yuma Regional Medical Center means a lot more to us Yumans than LifePoint does.  

And LifePoint recognizes that, and they don't obligate their hospitals to take on the LifePoint name or anything of that nature, which again speaks to the culture of LifePoint in how they are sensitive to, you know communities and community need. That was a positive in our regard as well. 

And all employees will become employees of LifePoint health.  

So Yuma Regional Medical Center will continue as an entity and maintain an ownership interest in the joint venture. But the majority holder will be LifePoint and all employees will be employees of LifePoint Health.  

 
 
 

LG:   

Would that be a straight transition or would they have to apply for their jobs?  

  

RT: 

No, they'll have those jobs and I don't know if they’ll have to go through an application process I don't think so. That's a detail we don't have. But LifePoint has obligated themselves that all employees in good standing will have a job. Obviously, that's subject to you know any regulatory review or standard screening procedures that go on, but all employees will have that opportunity.  

 

LG:   

The website mentions this, and I want to let people know that there is a website to find out more information about this partnership. It's called Yumaregionalforward.org. So, the website mentions this so I feel comfortable asking about the implications for YRMC's relationship with Hospital District One. Last year, the hospital filed a suit against the entity, a dispute over rent, apparently, which may be confusing for regular people, what's the status of that lawsuit and how would this pending partnership be impacted or not, by that dispute?  

  

RT:  

Sure, so we've had conversations with the district and you know, we look forward to furthering those conversations you know, to reach a positive conclusion for everyone.  

 

LG:  

I want to ask you a little bit about COVID, but before I do how big a deal would this partnership be in terms of health care in our region?  

 
RT:  

Huge, and that's really part of what motivated our board in this direction. You know there will not be a contraction of services, there will only be an enhancement of services, additional services that are offered for our community. Behavioral health is a significant component of what our board was looking to bring to our community that we really haven't been able to do in the past. LifePoint's committed to do that.  

So from a pure healthcare perspective, the benefit to our community will be extraordinarily significant. Bringing in additional specialties, improving access to care, and, you know, service line growth, that's more of an industry term but certifying growth to make for visits to be more streamlined for patients when they have a particular disease process.  

This should also result in the in the formation of a foundation, which will also be significant for the benefit of the Community.  

 

LG:   

I want to ask just a few questions about the COVID-19 vaccine and the current state of vaccinations in our region.  

I did a little analysis yesterday. Yuma was actually in the top half of counties in the state for vaccination rate. Still, less than half of people are vaccinated ahead of perhaps an arbitrary 70% goal the Biden Administration set for this weekend.  

How satisfied are you with where the county sits now at about 46-47%?  

 

RT:  

Yeah, that's good, but you know, I, I'll tell you that, I mean, I just don't understand the vaccine hesitancy that people have.  

I mean, I understand the people, you know, everybody has a right to do what they want to do with their own body. I fully endorse that. Support that. But when you have a disease like COVID and you know it's proven to be lethal in many cases, not all cases, but in many cases you know.  

I think getting the vaccine is just the safest thing to do for everyone. Keep businesses back open and to you know, be done with all the mask mandates and everything like that. It's good where we are.  

I think we need to do and should do better and that you know that's my personal and professional perspective on that.  

 
LG:   

The Delta variant is another concern. What can you tell us about that variant in our region, perhaps? And your concerns. Particularly for the unvaccinated.  

 
RT:  

Sure, I don't know that I can speak particularly for our region, I know my understanding is it is present in in every state. You know the Delta variant is covered by the vaccine. And you know the biggest issue with those that are un-vaccinated is that, you know, the more that people get infected with COVID and are sick with it, not those that are vaccinated, but the more that the un-vaccinated become ill with COVID is the reason why these variants are spreading.   

 

So the more people we can get vaccinated, the less risk will have from any of these variants. Really developing into a new virus, which could potentially result in another lockdown which we don't want to have happen.  

So this is where you know everybody needs to get vaccinated unless they have a true faster indication to the vaccine.  

 

LG:  

And last question Doctor Trenschel, before I let you go, I've talked to you several times over the last 400 days. What is the hospital like today versus 100 days ago or 200 days ago?  

 
RT:  

We're in a great position today compared to 200 days ago. We don't have as many COVID patients in the hospital today as we did then, so that is great news.  

Our staff performs wonderfully. I think we really saw what our staff was made of. I think we really proved to ourselves that were an excellent organization and can respond to that community need in our patient's needs.   

So, I think there's a sense of pride in our hospital and our staff in terms of what we went through, how we came through it, and how we worked together as a team for the benefit of our community.  

LG:  

Dr. Robert Trenschel, CEO of Yuma Regional Medical Center Sir, always a pleasure to talk to you. Thank you for your time.  

 

RT:   

Thank you, Lou. Same here. Have a great weekend.  

 
LG:   

One thing that could change is the model for health care in Yuma County. LifePoint is a holding of the Apollo Management Group, meaning they are for-profit in a follow-up, I asked Dr. Trenschel about that shift from a nonprofit to a for-profit model for hospital management.   

 
 

 

In an email, he said quote “since the early days of this search, the YRMC board has remained firmly focused on finding a partner that shares our same values and deep commitment to keeping care local, ensuring the availability of expanded services and community support has always been first and foremost. While we looked at both for-profit and not-for-profit institutions, what really mattered most in our search was finding a partner that was committed to Yuma, our patients' employees, and physicians. LifePoint Health was the unanimous choice based on their demonstrated commitment to quality patient care. Keeping care, close to home and giving back community,” you can read the full statement on KAWC.org later today.   

 
 
 

The website to find out more about the potential joint venture between YRMC and LifePoint Health is YumaRegionalForward.Org. I'm Lou Gum. This is Arizona edition on KAWC. We'll be right back.  

FULL STATEMENT: 

  

Since the early part of this search the YRMC Board has remained firmly focused on finding a partner that shares our same values and deep commitment to keeping care local.  Ensuring the availability of expanded services and community support has always been first and foremost.  

While we looked at both for-profit and not-for-profit institutions, what really mattered most in our search was finding a partner that was committed to Yuma, our patients, employees and physicians,  LifePoint Health was the unanimous choice based on their demonstrated commitment to quality patient care, keeping care close to home and giving back to our community.   

LifePoint Health has also donated over $1.8 billion in charity care. Also important to our board in their decision process was the desire to find a partner that would continue and build on YRMC’s community roots and involvement. 

LifePoint’s culture, goals and vision reflect our own: to create places where patients choose to come for healthcare, physicians want to practice and employees want to work. We are excited for what this potential partnership provides a great opportunity for YRMC to address some of the most critical issues facing us as a community – including things like mental health and the need for expanded access to services in Yuma.