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Carroll Hospital looking for partners

Colleges and UniversitiesLifeBridge HealthSinai Hospital in BaltimoreNorthwest HospitalSt. Joseph Medical Center

Carroll Hospital Center has begun what it calls an "aggressive" search for hospital partners, saying it's open to all options, including the possibility of merging with another institution.

The 193-bed hospital has operated independently for its entire 53-year existence and is profitable, but CEO John Sernulka said changes in health care will put financial pressure on small hospitals like his in the near future.

"Reimbursement will continue to tighten," Sernulka said. "There will be less and less dollars pumped into the health care system."

Hospitals around Maryland are looking for ways to generate more revenue and cut costs as the state's reimbursement model moves from one based on number of admissions to one focused on capping costs with preventive care and by reducing overnight stays.

"These medical centers will have to look for significant cost savings, and that is often the impetus for mergers and acquisitions," said local economist Anirban Basu.

Examples of consolidation and resource pooling in the industry are numerous. Both the University of Maryland Medical System and Johns Hopkins Medicine have expanded by adding hospitals around the state to their networks.

Late last year, University of Maryland Medical System completed a merger with Upper Chesapeake Health in Harford County, and it acquired St. Joseph Medical Center in late 2012.

LifeBridge Health recently invested in Bel Air-based urgent care company ExpressCare. Three health systems in Western Maryland — Frederick Regional Health System, Meritus Health and Western Maryland Health System — announced last year that they had signed a letter of intent to form an alliance to explore ways to partner to better care for patients and find cost savings.

Sernulka said his hospital is putting no parameters on the types of partnerships it could enter and that he would consider a merger with a larger institution.

"I can tell you that it is an open slate," Sernulka said. "We don't have a preconceived, defined organizational picture of the relationship."

As part of a larger system, the hospital, Carroll County's second-largest employer with 1,975 workers, would have an easier time attracting doctors, Sernulka said. As more partnerships are formed between hospitals and health insurers, Sernulka said, size and scale also would prove advantageous.

In general, smaller hospitals gain easier access to the money needed for building improvements and new technology when they affiliate with a larger system. They can also tap into a larger hospital system's expertise and resources. Patients also gain more access to health care and specialists, even if they live in remote areas.

Carroll Hospital officials told physicians, nurses and staff about its partnership efforts in a letter and series of meetings. If a potential partner is selected, it could take up to six months to complete necessary due diligence and negotiations, the hospital said.

The hospital already has partnerships with other health systems, including with LifeBridge Health's pediatric and neonatal programs. It also has an affiliation with the interventional cardiology program at the University of Maryland Medical System and is forming a partnership with the system's stroke program.

University of Maryland also said it would consider new partnerships.

"UMMS has worked with Carroll Hospital Center on a number of projects in the past, and we look forward to talking with them more about their future needs," said spokeswoman Mary Lynn Carver.

LifeBridge Health, which owns Sinai Hospital of Baltimore and Northwest Hospital in Randallstown, said in a statement that it is "always open to considering new strategic partnerships where it makes sense for the community."

andrea.walker@baltsun.com

twitter.com/ankwalker

Copyright © 2014, The Baltimore Sun
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Colleges and UniversitiesLifeBridge HealthSinai Hospital in BaltimoreNorthwest HospitalSt. Joseph Medical Center
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