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Harrison Medical Center announces plan to affiliate with Franciscan Health System

Harrison's future plans include expansion of their silverdale campus.After a nearly yearlong search for a larger system to partner with to assure future stability, Harrison Medical Center has announced its plans to affiliate with Tacoma-based Franciscan Health System.

The affiliation will allow Harrison and Franciscan, both private nonprofit operations, to “expand services, improve the delivery and quality of care, and broaden access to services for individuals, employers and communities in the South Puget Sound and on the Kitsap and Olympic peninsulas,” according to a news release Harrison issued.

Harrison’s 16-member board of directors and an advisory committee have spent most of this year in a process to recruit and evaluate possible partners for a merger or other type of affiliation.

CEO Scott Bosch“We started off looking at more than dozen systems, both locally and nationally,” Harrison president and CEO Scott Bosch said in an interview Tuesday. “We are all relieved finally to be able to announce this and move forward with the next phase.”

Although Bosch had said recently that Harrison — founded as a community hospital in Bremerton in 1918 - is financially able to continue operating independently, the decision to search for a regional partner was prompted by the current climate of mergers in the hospital industry and the implementation of federal health care reforms in the next couple of years.

A Franciscan-Harrison partnership will form a system of nearly 11,000 employees and 2,000 medical staff members, with projected annual net revenues of $2 billion, according to the news release. Harrison has about 2,400 employees, including a medical staff of more than 400 physicians and specialists.

Bosch said the affiliation with Franciscan will enhance Harrison’s ability to implement its long-range strategy to build out the Silverdale campus. “A key part of this is their commitment to invest significant resources into health care services provided through inpatient and outpatient centers across our communities,” he said.

“We can enhance the services that we offer and build on the economies of scale that a larger organization can provide,” Bosch said. “In light of upcoming national reforms, this partnership helps ensure we keep our enduring promise of exceptional health care to the residents of the Kitsap and Olympic peninsulas and North Mason County.”

Leaders of both systems said the affiliation process, pending approval by both institution’s boards as well as the state Department of Health and other regulatory agencies, should be completed by June 30, 2013. They also talked about shared values being a key to what they expect will be a long-term partnership.

“Harrison Medical Center and Franciscan Health System share similar cultures, values and goals,” said David Veterane, chair of Harrison’s board of directors. “We see this relationship as a way to expand the good work that has been done in our community for the past 95 years.”

Franciscan CEO Joe Wilczek said the affiliation “will benefit the community for generations. Both Harrison and Franciscan have long traditions of service. Each provides health care to everyone, regardless of their ability to pay. Our shared mission and values, as well as our shared commitment to excellence, will allow us to work together to better serve residents throughout the region.”

The announcement had no information about how Harrison and Franciscan plan to coordinate specific services, or what effect the deal will have on either organization’s staff and facilities.

“That is obviously a very important question,” though it’s too early in the process to predict, Bosch said. It will be part of negotiations as the two systems begin to work out a myriad of details, contracts and other partnership arrangements.

“My sense is we will try, where we can, to effectively and efficiently consolidate services,” he said. “But our intent is to grow our ability to serve other communities, perhaps through expansion of existing facilities. So both (consolidation and expansion) are possible.”

Harrison employees were told about the affiliation plan earlier in the day, before it was announced publicly on Oct. 16.

Harrison’s health care system operates 20 locations, all but two of them in Kitsap County. Harrison’s main hospital, built in Bremerton in the 1960s, houses a cardiovascular center that includes open-heart surgery; an oncology department; inpatient and outpatient surgery center; a critical-care unit and a 24/7 emergency room.

The hospital also has an orthopaedics department, although that will be relocated to a new orthopaedic hospital scheduled to open next summer at Harrison’s Silverdale campus. Harrison operates a birthing center, pediatrics unit, outpatient surgery center and 24/7 emergency room at its existing Silverdale facility.

Harrison’s facility in Port Orchard provides adult primary care, 24/7 emergency care, as well as a lab and a number of specialist services. There is also an urgent care clinic in Belfair; various specialty clinics in Bremerton, Silverdale and Poulsbo; and a family care clinic in Forks. Harrison Medical Center (www.harrisonmedical.org) also offers health and wellness services at the Haselwood Family YMCA in Silverdale.

Future expansion plans include building an ambulatory care center on Bainbridge Island within the next two years.

Franciscan Health System includes St. Anthony Hospital, which opened in 2011 in Gig Harbor; St. Joseph Medical Center in Tacoma; St. Clare Hospital in Lakewood; St. Francis Hospital in Federal Way; St. Elizabeth Hospital in Enumclaw; Franciscan Hospice House in University Place; and the Franciscan Medical Group network of primary-care and specialty clinics in Kitsap, Pierce and King counties.

Franciscan, which has 8,400 employees and 1,550 medical staff members, has in recent years opened a medical clinic in Port Orchard and began offering hospice care in Kitsap County. It has so far been unsuccessful in seeking state approval to provide home health care in Kitsap.

Franciscan’s parent company is Catholic Health Initiatives (CHI), a national nonprofit health organization with headquarters in Englewood, Colo. CHI announced a planned merger earlier this year with PeaceHealth, a regional system based in Vancouver, Wash., with a system of hospitals and clinics in Washington and Oregon.

“We’ll be coming along with the Franciscans into this new company, which we think has a lot of advantges as well,” Bosch said. “So we’re not just affiliating with Franciscan, we’re also seeing a future where we’ll be part of something large enough to work at any scale.

“Whatever health reform brings us, we can work together as a system to meet our community needs.”

Bosch also said that the Harrison Medical Center Foundation will not be part of the affiliation, and that money raised from donors will be used only in the local community.

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