Mission responds to partnership termination

Jul. 24, 2013 @ 06:03 AM

Citing challenges in the heath-care climate, Mission Health’s CEO said a partnership with Rutherford Regional Health System (RRHS) had to be changed.

That change prompted the RRHS Board of Trustees to terminate its negotiation with the Asheville-based hospital and seek out other suitors.

On Tuesday, Mission Health CEO Ronald A. Paulus said the challenges facing rural health care are “unprecedented.”

“Market realities require a reconsideration of all assumptions that we each have made over time not just for RRHS or Mission Health, but for everyone,” Paulus said.

Terry Hines, RRHS Board of Trustees chairman said Mission Health wanted to make changes to the initial memorandum of understanding (MOU) which prompted RRHS officials to “see what other options were available to us.”

Paulus said the affiliation process between the two health systems “worked as intended” and Mission Health presented findings, conclusions and a review of the health care landscape regionally, state and nationwide.

“I believe that doing things the traditional way is unlikely to be successful,” Paulus said.

The agreement between the two entities had been ongoing since September 2012 and the parties agreed to an MOU in January 2013 which began the due diligence phase of the negotiations.

“The MOU was a non-binding agreement that enabled the parties to engage in further discussions and for Mission Health to perform a detailed clinical-business assessment commonly referred to as due diligence,” Paulus said.

The non-binding agreement would have allowed RRHS to become an affiliate of Mission and authorized the RRHS Board of Trustees to complete negotiations regarding the partnership.

One question surrounding the original MOU was the makeup of the RRHS Board of Trustees under the agreement. RRHS CEO Cindy Buck said initially, the Board would act with a “level of autonomy.”

She said the RRHS Board of Trustees “will have 80 percent of board members coming from the local community” and that the hiring and firing of RRHS management will continue to come from an executive team appointed by the RRHS CEO and approved by both boards of Mission and RRHS.

Now, Hines said RRHS will re-open the process of seeking out a potential affiliation partner with other groups which had initially expressed interest. He said Mission Health would also be part of that mix.

“There will be new proposals but they will come from those groups that previously expressed interest,” Hines said.

He said those proposals could come “over the next few weeks” and RRHS should be in a position to name a potential partner at that time.

As for Mission Health, Paulus said they will still look for ways to help providers in western North Carolina.

“Mission Health will always seek ways to help any provider in western North Carolina in a way that best serves the community and is sustainable for the long run,” Paulus said.