UMC, UPH to combine into single company

Mar 5, 2010 — The Arizona Daily Star

Stephanie Innes

Mar. 5, 2010 (McClatchy-Tribune Regional News delivered by Newstex) -- University Medical Center Corp. and University Physicians Healthcare are planning to combine forces.

Merging the two companies into one nonprofit parent company is part of a process that could be complete by midsummer.

"We believe we'll get lots of value, and it doesn't mean we're shrinking the work force," said Dr. William M. Crist, the UA's vice president for health affairs. "Rather, we'll grow the clinical enterprise. I see expansion and opportunities for more jobs."

A tentative name for the new parent company is University of Arizona Medicine, or UA Medicine.

There will be no major immediate change for patients, though streamlining electronic medical records and combining work forces will result in health care that operates more efficiently overall, Crist said.

"I think it's a big deal. Forming this large company is of major importance to further developing the College of Medicine," he said.

"Creation of a single company will result in management efficiencies and make the clinical enterprise supporting the UA College of Medicine more competitive in the marketplace. The UA College of Medicine is the only one in the state responsible for training medical doctors and doing medical research."

University Medical Center Corp. operates University Medical Center, near the University of Arizona. University Physicians Healthcare operates University Physicians Hospital at Kino, on Tucson's south side; manages the UA College of Medicine's physician faculty practice; and manages a health plan that directs patients to various health-care facilities.

The two hospitals would become a "combined clinical enterprise," officials said Thursday.

When current expansions are complete within the next few years, the two hospitals will have about 850 beds between them, up from nearly 600 today.

The Arizona Board of Regents is scheduled to get legal advice about the merger in an executive session next week.

Both companies were spun off from the UA and have maintained primary missions of supporting the UA College of Medicine, and a strong working relationship exists among UPH, UMC, the College of Medicine and the UA, Crist said.

The Board of Regents still appoints the UMC board, for example.

The purpose of the merger is to realign and economically deliver the best package for patients, Crist said.

Crist oversees the UA's partnership with University Medical Center, University Physicians Healthcare and University Physicians Hospital, among other responsibilities.

"A bigger entity has a lot of additional power in the marketplace," Crist said. "That's why health systems are formed -- it gives a huge advantage in terms of having more facilities rather than a single hospital.

"The College of Medicine has been limited in terms of expanding and training its health-care work force," he said. "We need more patients and beds -- this allows for that."

Although there will be consolidation and streamlining of health-care services, University Medical Center Chief Executive Officer Kevin Burns and UPH CEO Larry Aldrich do not foresee any job losses as a result of the merger. Both Burns and Aldrich said they are supporting the process. Though nothing has been finalized, the plan is that UMC would manage both hospitals and their clinics.

Pima County owns UPH Hospital, and UPH has a lease to operate it. County Administrator Chuck Huckelberry expects that a report on the companies' plan will go to the county Board of Supervisors within the next few weeks. The county and its taxpayers provide financial support to UPH Hospital, which has an unusually high volume of uninsured and underinsured patients.

"It all came out of a lot of discussions about how to grow the University of Arizona College of Medicine," Huckelberry said of the merger. "We're in dialogue with everybody, and we think it's a positive thing."

Contact reporter Stephanie Innes at 573-4134 or sinnes@azstarnet.com Follow her on Twitter at twitter.com/stephanieinnes

Newstex ID: KRTB-0014-42603672