HCMC and Hennepin Faculty Associates to integrate

Hennepin Faculty Associates (HFA) a private, non-profit physician practice plan will integrate its operations into Hennepin Healthcare System, Inc., doing business as Hennepin County Medical Center (HCMC), a public subsidiary corporation owned by Hennepin County.

The two entities reached agreement on a Letter of Intent in September and the physician members of HFA voted to dissolve the corporation and become employees of HHS. The Hennepin Healthcare System, Inc. board approved the plan earlier this month and yesterday the Hennepin County Board approved changes to the HHS bylaws to make it possible. It will become official Jan. 1, 2012. There will be no change to the mission of the medical center, which will continue its commitment to provide patient-centered care, medical education and research.

The move will integrate two organizations that already have a longstanding relationship. HFA has been providing the majority of physician services to HCMC under contract since 1984. Prior to 1984, physicians were employed directly by Hennepin County to provide services at the medical center. Since HFA physicians constitute the majority of the medical staff at HCMC, the merger would not change current caregiver relationships.

“Integrating puts us in the best position to remain a strong, innovative health care system in the emerging regulatory environment and, as an aligned system, we can continue to provide the high quality, patient-centered care that is an HCMC tradition, said Arthur Gonzalez, HCMC CEO. “We are fortunate to have the opportunity to align with a nationally recognized group of physicians who already have relationships with our patients and can work closely with us to ensure a smooth transition.”

HFA is a non-profit corporation, so no direct payment is involved in the proposed merger. As part of the transaction, assets including a building on the downtown Minneapolis campus currently used for administration and clinics, several primary care and specialty clinics currently operated by HFA, accounts receivable and part-interest in a parking facility will be transferred to Hennepin Healthcare System, Inc. HFA has no outstanding debt.

“Hennepin Faculty Associates served our community well as an independent organization for almost 30 years,” said Donald Jacobs, MD, HFA Chairman and CEO. “With integration we are able to preserve the quality of medical care and teaching, while changing the operational structure to ensure that the provision of patient-centered care and teaching tomorrow’s health care professionals remains our primary focus.”

Leading hospitals and physician groups across Minnesota and the U.S. are integrating operations to align delivery of care.

“As health care reform takes shape, state and federal health care programs across the nation are being redesigned to shift the financial risks of caring for patients to the people and entities that are providing the care,” said Lawrence Massa, Minnesota Hospital Association president and CEO. “To survive economically, providers must find ways to increase efficiency and contain costs. Integrated delivery systems offer one way to achieve these financial goals while preserving the quality of patient care.”

In Minnesota, HCMC was one of only four providers to create a Coordinated Care Delivery System to serve General Assistance Medical Care patients for a short time in 2010. In 2012, HCMC will be part of a new demonstration project called Hennepin Health that will be based on the coordinated care model and include capped payments and shared risk for taking care of a specific patient population.

“It is in the interest of HCMC and the physicians who provide care to operate as a single organization, rather than separate entities, in order to best serve patients in these new models of care delivery,” said David Jones, chair of the Hennepin Healthcare System, Inc.

The Minneapolis Medical Research Foundation is currently owned by HFA and it will become a non-profit subsidiary of Hennepin Healthcare System, Inc. as part of this agreement.

Hennepin County Medical Center is a nationally recognized Level 1 Adult Trauma Center and Level 1 Pediatric Trauma Center with the largest emergency department in Minnesota. The comprehensive academic medical center and public teaching hospital includes a 477-bed acute care hospital and primary care and specialty clinics located in downtown Minneapolis, six primary care clinics in Brooklyn Center, Brooklyn Park, Richfield, St. Anthony Village and in Minneapolis in the Whittier Neighborhood and on East Lake Street, retail clinics in Bloomington and Eden Prairie and an employee clinic in the Hennepin County Government Center.

For the fifteenth year in a row, Hennepin County Medical Center is listed in the U.S. News & World Report rankings of the top U.S. Hospitals in its annual “America’s Best Hospitals” report.

Hennepin Faculty Associates is an independent medical group of nearly 400 healthcare providers. We provide health services at Hennepin County Medical Center, a nationally recognized academic medical center, at HFA’s private clinics and at sites elsewhere in the Twin Cities and we conduct research at our subsidiary organization, the Minneapolis Medical Research Foundation.