1. Economies of scale: What do hospital mergers mean for patients and the community?

ROY MAYNARD, rmaynard@tylerpaper.com

Baylor Scott & White, the state’s largest not-for-profit hospital system, has entered into a partnership agreement with Tyler’s Texas Spine & Joint Hospital Inc., both systems confirmed on Tuesday. United Surgical Partners International (USPI) is part of the deal.

The Baylor system will have a controlling stake in Texas Spine & Joint Hospital, which will continue to be at least partially physician-owned.

“We look forward to partnering with Baylor Scott & White Health and USPI as together we expand our service area to more East Texas communities,” said Tony Wahl, chief executive officer of Texas Spine and Joint Hospital. “By integrating into the Baylor Scott & White Health system, a greater number of patients will be able to access expert, award-winning care.”

There are plans for future facilities, the company said. There also will be a rebranding, but it’s not yet clear what the new name will be.

“We will incorporate Baylor Scott & White into the name,” said Jess Mowery, a spokesman for Texas Spine & Joint. “Over the next weeks and months, that’s one of the things we’ll iron out.”

USPI will serve in a management capacity, Mowery said.

“We are excited by the opportunity to partner with USPI and this great group of physicians to serve the people of Tyler, Smith County and all of East Texas,” said Jim Hinton, president and CEO of Baylor Scott & White Health. “We believe this is an excellent way to expand our high-value integrated delivery network into new communities throughout the state.”

 

SPINE & JOINT

Texas Spine & Joint Hospital was formed in 2002 by a group of 23 Tyler doctors. The $18 million, 20-bed facility, in a remodeled Montgomery Ward store, brought together orthopedic surgeons, neurosurgeons and pain medicine specialists from three local groups.

The emphasis was on ensuring that doctors control their patients’ care.

In its first years, Texas Spine & Joint Hospital received numerous awards for excellence. In 2008, for example, it was ranked among the top 5 percent in the nation and No. 2 in Texas for spine surgery.

Texas Spine & Joint Hospital found itself at the center of the Patient Protection and Affordable Care Act (Obamacare) controversy in 2010, when it sued the federal government to challenge the constitutionality of a portion of the ACA which prevented the expansion of physician-owned hospitals that accept Medicare.

That portion of the law blocked the hospital’s planned $37 million expansion.

On Tuesday, Mowery noted that in the federal government’s eyes, Texas Spine & Joint is still physician owned. It won’t be allowed to expand its count of inpatient beds.

“But we will be able to expand into clinics and outpatient surgery centers,” Mowery said. “That’s what we’re hoping to do.”

In 2016, Texas Spine & Joint Hospital was named one of Healthgrade America’s 100 Best Hospitals for joint replacement for three years in a row, and one of the group’s 100 Best Hospitals for spine surgery for five years running.

 

BAYLOR

Baylor Scott & White began as the Texas Baptist Memorial Sanitarium in 1903. It was established by the state of Texas and opened in a 14-room home in Dallas. The Baptist General Convention of Texas agreed to help support the hospital and pledged to raise funds for a new hospital building.

In 1909, the hospital moved to a new 250-bed facility, opening as the most advanced hospital in the region.

It became Baylor Hospital in 1921 to reflect its relationship with Baylor University.

And in 1921, Baylor administrators developed the “Baylor Plan,” the first prepaid hospital insurance plan in the nation, and the forerunner of Blue Cross.

In 2012, the Baylor Health Care System and Scott & White Health Care announced a merger into a $7.7 billion entity, with 42 hospitals, more than 350 patient care sites and 4,000 physicians, according to the group’s website. At the time, it was the largest not-for-profit health system in Texas.

Staff writers Augusta Robinson and LouAnna Campbell contributed to this report.