Consolidation question

Exploration process seeks community input, facts on future of ThedaCare hospitals

Posted on Apr 1, 2016 :: Health Care
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Posted by , Insight on Business Staff Writer

Will Theda Clark and Appleton Medical Center each close in favor of one consolidated, more centrally located hospital? And if so, where will it be?

These are the questions that have the community buzzing. ThedaCare leaders and those involved in the exploration process are seeking the answers to those questions and more: Mainly, will a consolidation make sense?

In February, the ThedaCare Board of Trustees approved a long-term exploration of facilities that might culminate in the construction of one regional, updated hospital with better overall access.

The hospital exploration process, which will include discussions with community members and business leaders, was sparked after ThedaCare affiliated with Community Health Network in 2014 and conducted an inventory of its facilities, says Dr. Dean Gruner, CEO and president of ThedaCare.

“One of the things that came out of that was a realization that it might be time to study whether the community would be better served with a single hospital location rather than two separate ones,” Gruner says.

The goal of a possible consolidation is to dramatically improve delivery of care as well as health care costs. While physicians and hospital managers overwhelmingly support the idea of a single hospital, “this is not a done deal,” Gruner says. “We have to go through all the work and we have to prove to our community leaders on our board that it makes sense.”

The intention is to convert the existing hospitals into other uses, says Kathi Seifert, owner and president of Katapult, LLC, and a member of a task force discussing the exploration. One larger, regional hospital would eliminate duplication and improve efficiencies.

Additionally, both hospitals are currently in locations that don’t have the best access — the 58-year-old AMC is in a residential area, Theda Clark is in downtown Neenah by the river — locations that made sense when the hospitals were built, before automobile travel had become standard.

“Time is such a huge factor in saving lives, and if you can find locations that would be much easier to get to, it could help the medical community serve them much more quickly,” Seifert says.

ThedaCare could possibly continue to keep medical offices or the emergency rooms operating at one or both of the current hospital campuses, Gruner says. The 107-year-old ThedaCare Regional Medical Center – Neenah may be difficult to update in certain ways but may have potential in others, he says. Most of the campus is currently nonprofit, and changing the use, such as senior apartment housing, would have implications for the community’s tax base.

“It’s guaranteed we’re going to have a lot of unused space, and we’ll have to figure out how that space can best be used or repurposed,” Gruner says.

That’s why ThedaCare plans on taking a couple of years to discuss all the options, says Gruner, who expects the entire process to take four to five years, including two to three years of discussions, prep work and design, and if the regional hospital is approved, another two years to build.

While initially taken aback by the proposal, Neenah Mayor Dean Kaufert has since had discussions with Gruner and feels reassured that a consolidation is not on the fast track.

“We’d like to be part of the process,” Kaufert says. “We’d like to help them identify sites within the city that we could package, or help them stay within the city limits of Neenah, closer to the highway, if that’s something that has to be.”

But Theda Clark has been an integral part of the city of Neenah for more than 100 years, and the economic impact of losing the 1,052 employees traveling through downtown Neenah each day is a concern. Kaufert says the idea of repurposing the hospital or keeping portions of it open would assuage some of the impact.

“I do understand the hospital is probably outdated,” Kaufert says. “It’s probably a matter of efficiencies, and being able to run one large hospital is probably less expensive than running two hospitals.”

Appleton Mayor Tim Hanna also says he understands what ThedaCare is trying to do in terms of staying competitive, modernizing facilities and at the same time lowering overhead costs.

“They’re not going away,” Hanna says. “It’s not like they’re closing. In fact, depending on the route that they choose, I think it has the potential to actually expand their reach, in terms of how far they draw from.”

The city of Appleton will continue to work with ThedaCare to understand the system’s goals, he says.

“We would love to try to accommodate their needs in the city of Appleton, but if it’s somewhere else that makes sense, we’ll certainly work with them, because they’re good for the entire area,” Hanna says.

ThedaCare currently employs 7,002 people, including 1,360 at AMC and 1,052 at Theda Clark. Gruner says ultimately a merged facility would result in a net decrease in employment. However, ThedaCare has a no-layoff policy and most of the decrease would be managed by attrition as the hospital system has about a 10 percent turnover rate. The rest would be managed by retraining employees to serve in other areas.

A larger regional facility would help attract top physician and nursing talent, further improving delivery of services, Gruner says.

While it’s premature to discuss the location of a future hospital, Gruner says they’d likely look for something along the Highway 10/441 or Interstate 41 corridors.

“What we’re going to want is probably what everybody else can imagine — we will want to have this with better access and higher visibility than either of our current locations,” Gruner says.

ThedaCare has long been strongly committed to outstanding quality and efficiency, Seifert says. “A lot of strides have been made, but in order to take both cost and quality to another level, this is why considering this opportunity makes such great sense for us as a region.”