CHS Partners With Cone Health In Triad
Carolinas Healthcare System is taking its first step into the Triad area. The hospital chain has agreed to manage Cone Health facilities. Cone Health has four hospitals located in Greensboro and one northeast of that city in Reidsville, so it's just a fraction of the size of Carolinas Healthcare System. For the past two years, Cone Health's CEO Tim Rice had looked at partnering with another hospital. "We're an organization that's somewhere around $1.2 billion in terms of net revenues and we think we have to be $3 to $4 billion to get to a sweet spot in terms of the scale for purchasing material, supplies, negotiations and those kinds of things," says Rice. Carolinas Healthcare System will certainly give Cone Health more clout. CHS brings in more than $6 billion in revenue and runs 33 hospitals. It's the second largest public hospital system in the country. Under the agreement, CHS will manage services at Cone Health. But Cone Health will remain independent and be governed by its own board. All staff, except its top five executives, will continue on as Cone Health employees. Patients won't see a change in service, since the agreement is largely administrative. CHS executive vice president Russ Guerin says about half the hospitals CHS runs function under similar agreements. The companies wouldn't disclose the financial terms of the deal. CHS is also preparing to manage its first hospital outside of the Carolinas. One of its management partners AnMed Health plans to sign a contract with Elbert Memorial Hospital in northeast Georgia.