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OHSU, Salem Health Call off Collaboration

Senate President Peter Courtney says he is disappointed at the end of the partnership.
June 20, 2017

Less than two weeks after officials at Oregon Health & Science University told The Lund Report they intended to negotiate a new agreement with Salem Health, that effort to repair a relationship originally forged through OHSU Partners has collapsed.

Nearly two years ago, Salem Health joined forces with OHSU to create OHSU Partners LLC, with the aim of combining the two systems’ clinical and financial operations. They intended to work toward Oregon-wide healthcare transformation by creating an integrated health system.

According to their 40-year agreement, Salem Health and OHSU agreed to retain their own governing boards and their own work force. At the end of each quarter, they shared their financial risks and rewards.    

But a statement released by OHSU spokeswoman Beth Heinrich said Salem Health intends to return to its independent Salem Health brand.

“The organizations recently agreed that specific aspects of the original joint management agreement were not serving the two organizations optimally, and replaced their original agreement with a transition agreement,” she told The Lund Report. “They then began renegotiations to determine if a differently-structured, ongoing partnership was of mutual interest.”

Senate President Peter Courtney said he was disheartened by the news of the break-up. “I’m disappointed that Salem Health and OHSU cannot find a path to continuing their formal affiliation,” he said in a press release. “This is an opportunity missed. The bottom line should not be about institutional differences. It must always be about providing the best possible care for the patients. Through their remaining joint ventures, I hope these two juggernauts can continue to work toward a new standard of top quality care throughout Oregon. It would be sad to see them give up that vision.”

“While we will no longer pursue a formal, integrated partnership, we will continue to collaborate on existing programs and explore additional collaborations and joint ventures that are determined mutually beneficial,” said Mitch Wasden, CEO of OHSU Healthcare.

“Salem Health has had a long-standing relationship with OHSU and we look forward to future conversations around how we can work together to improve health care for our communities,” said Cheryl Wolfe, president and CEO of Salem Health.

OHSU also has had several leadership changes in the past few years, with the resignation of the provost, the administrator of the cancer center and the CEOs of OHSU Foundation and Doernbecher Children’s Hospital Foundation, all of whom left without any explanation. Since then, those positions have been filled. One CEO, Keith Todd, served both foundations, and has since stepped down.

Salem Health and OHSU were the founding members of OHSU Partners LLC, a management company they founded that was jointly governed by the respective boards of directors for the organizations.

In May, Salem Health transferred its membership interest in joint governance of OHSU Partners LLC to OHSU. OHSU assumed direction of the work previously managed by OHSU Partners LLC.

Tuality Healthcare was added as an OHSU Partner in February 2016, but its contractual agreement is directly with OHSU and is not impacted by this decision.

Adventist Health appears ready to sign an agreement with OHSU Partners soon, according to Kristi Spurgeon Johnson, direct of marketing. 

"Our due diligence continues, and we're nearing the end of our discussions," she told The Lund Report
 

Diane can be reached at [email protected].

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