A Flurry Of Provider Affiliations in SoCal

A flurry of affiliation deals have been announced by Southern California hospitals this week in a continuing consolidation of the provider environment that serves the sprawling region.

None of the deals involved a merger specifically, but one local healthcare expert believes it indicates a need for some of the region's smaller providers to find high-end tertiary or specialty partners in order to remain competitive.

The most significant deal was disclosed on Wednesday, when the UCLA Health System announced an affiliation with the Motion Picture and Television Fund. Under the terms of the affiliation, MPTF's six outpatient centers would be integrated into the UCLA clinic system while continuing to serve MPTF members exclusively. MPTF patients would also be able to access UCLA's broad range of inpatient and specialty care services. 

Prior to the affiliation, UCLA and MPTF partnered on a geriatric psychiatric unit at MPTF's inpatient facility in Woodland Hills.

“We couldn't have found a better partner than UCLA Health system to future-proof the provision of high-quality health care for our entertainment industry community —care that they deserve and have come to expect and from our doctors," said Bob Beitcher, MPTF's chief executive officer.

In a second prominent deal disclosed on Wednesday, Providence Health Services of Southern California announced an affiliation that would bring oncology services provided by Duarte-based City of Hope to its five hospitals and a variety of clinics it operates in the South Bay and the Santa Clarita and San Fernando Valleys.

“We partnered with Providence because of their traditions, values and the quality of care they provide in their communities,” said City of Hope President Robert Stone. “Together, we can expand our longstanding commitment of delivering patient-centered care in the right place to the largest number of people. This is the model of the future, and this is what patients deserve.”

In a third affiliation announced on Tuesday, Shriners Hospital for Children – Southern California announced it had struck a deal to perform pediatric surgeries at Huntington Hospital in Pasadena. The deal allows Shriners, whose current facility is a small campus southeast of the Koreatown section of Los Angeles, to perform its surgeries at Huntington's state-of-the-art facility. 

The Shriners' 17-member medical staff have all been granted privileges at Huntington as part of the deal. They specialize in orthopedic and reconstructive and reparative plastic surgery.

“We are pleased to be partners with Huntington Hospital, a recognized leader in healthcare. Working together we will be able to reach more children in need of expert care and serve them even more efficiently and effectively,” said Larry Adamson, chairman of the board of governors of Shriners Hospitals for Children – Southern California.

As many as 300 Shriners patients per year are expected to be treated at Huntington, officials said.

The Shriners operate 20 hospitals in the United States and historically have focused on charity care since it opened its first facility in 1922. 

However, the Great Recession hit the Shriners’ endowment hard, and in 2011, it began accepting commercial insurance for the first time, as well as co-payments from insured patients. The alternative would have been closing as many as eight of its hospitals, according to officials.

Steven T. Valentine, president of The Camden Group, a hospital and medical group consulting firm in El Segundo, noted that the activities among all the hospitals are reflective of a market where specialty providers are under pressure to find wider markets.

“Each had a changing and difficult future given the regionalization in southern California and the health systems consolidating into networks and delivery systems,” Valentine said particularly of the Shriners, City of Hope and MPTF. “Each had issues with an adequate referral base and by joining a larger network gain better access to volume/population.”

Valentine said he expected more such affiliations to occur in Southern California in the near future.