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Building a New Healthcare Model By David Pittman

Every day is now a “Banner” day at two Tucson hospitals affiliated with the University of Arizona formerly known as University Medical Center and Kino Hospital. Banner Health’s $1.2 billion acquisition of the UA Health Network in late February reverses a once dreary financial outlook for the two hospitals, renamed Banner–University Medical Center Tucson and Banner–University Medical Center South, respectively. It also will bring vastly ramped-up resources for medical research to UA. These financial turnarounds were not orchestrated overnight. Complex negotiations involving UA, Banner and the Arizona Board of Regents took 14 months to complete. The money will come from Banner in $40 million annual payments over the next 30 years. Half of that money will go to UA Health Sciences and half to UA Colleges of Medicine in Tucson and Phoenix. With this purchase, Banner, already the largest hospital group in Arizona, cemented its position as the state’s largest private employer with nearly 45,000 employees. In many respects, UA and Banner now become partners. For instance, UA medical schools in Tucson and Phoenix, along with clinical academic research, and faculty recruitment of physicians will be governed through an Academic Management Council equally repre-

sented by members from Banner and UA. A vast array of other university-affiliated healthcare operations – including Diamond Children’s Medical Center and UA Health Plans – also become part of Banner. Tom Dickson, a seasoned healthcare leader with a record of turning financially struggling hospitals from red

We intentionally created a structure that forces us to make decisions that are not in the best interest of either party – but the entire enterprise. –

Kathy Bollinger, Executive VP Banner-University Medicine

ink to black, is the new CEO of Banner–UMC Tucson and Banner–UMC South. Before coming to Tucson, Dickson served as CEO at three Phoenixarea hospitals, including Banner Thunderbird Medical Center in Glendale for the past nine years. Dickson said Banner has already gone through an elaborate planning process and launched a plan of action to turn

the Tucson hospitals around. “We have identified 11 different initiatives we will focus on during the first year,” he said. “Those include patient experience, financial performance, length of stay and other basic foundational strategic initiatives. We have formed teams – faculty and staff working with partners from Banner – examining ways to improve results.” Dickson predicted the talent and tradition of UMC, combined with Banner’s expertise in delivering care, would ultimately provide excellent results. “The organization here has such a depth of talent,” he said. “The faculty, the physicians, the employees, we have an amazing group of core staff here and a great tradition. With Banner’s track record and the talent we have retained from UA Health Network and that exists within the UA, we will enhance patient care and support the training of tomorrow’s physicians.” UA President Ann Weaver Hart predicted the acquisition will lead to a cutting-edge healthcare model that “will reshape academic medicine in the United States.” Ron Shoopman, member of the Arizona Board of Regents and president and CEO of the Southern Arizona Leadership Council, agreed. “The integration of the research and academic medicine conducted at the UA into this highly efficient model that continued on page 46 >>>

Summer 2015 > > > BizTucson 45

BizTucson Summer 2015 Issue  

The Region's Business Magazine

BizTucson Summer 2015 Issue  

The Region's Business Magazine