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Sunday, Aug. 16, 1998
Advantages seen in Spohn parent's merger
Spohn executive: Merged systems will have new president, may have new headquarters
Sisters of Charity of the Incarnate Word Health System in San Antonio, the parent of Spohn Health System, announced July 17 that it will merge with Sisters of Charity of the Incarnate Word Health System of Houston to create the sixth-largest Catholic health system in the nation.
The Corpus Christi-based Spohn system, established in 1905, employs about 4,500 people. It has three hospitals in Corpus Christi, one each in Kingsville and Beeville and another due to open in Alice in 1999. Spohn also operates clinics in Corpus Christi, Aransas Pass, Robstown, Beeville, Bishop, Falfurrias, Freer, George West, Hebbronville, Kingsville, Mathis, San Diego and Three Rivers.
Jake Henry Jr., president and chief executive of Spohn Health System, recently talked with Caller-Times business writer Jeffrey Tomich about the merger, which is expected to close by Jan. 1.
What will be the name of the combined health system?
We're using the nominative name Catholic Health South for the new, expanded organization. I'm not sure that name will be the name that is filed with the secretary of state when the merger is complete or not, but at least it's the name for the present.
Where will the new headquarters be?
I assumed that because the Sisters of Charity of Houston owned their headquarters and because the Sisters of Charity of the Incarnate Word of San Antonio leased their health system headquarters, that it would probably be a move to Houston. But I think that it sort of speaks to how sensitive the steering committee has been to this merger that there is actually conversation about moving the headquarters to a totally new location so that neither side feels that one is bigger or has a more entrenched position than the other. It could well be that the headquarters will be in Austin or Dallas.
Who will be the president of the combined system?
Neither the president of the Incarnate Word Health System (in San Antonio) nor the president of the Sisters of Charity Health System (in Houston) today will be the new president. There will be a national search for a new president. That's not to say that either of those people might not have some role in the reorganized system, but it won't be in the president's role. I think it's another way to say how sensitive they're being to not letting currently entrenched interests influence the new entity.
How does the merger help both systems?
I think there's no question that there is a sense that as one creates a greater critical mass that you spread expense over a greater asset base and, hopefully, bring down the unit cost of doing business. As a larger organization, you have more clout in Austin and Washington in terms of advocating for increased access for the poor and for those disenfranchised parts of society that just have a harder time getting health care.
How will the merger affect current operations?
It's fortunate that the markets do not overlap. The Sisters of Charity of Houston are very strong in the Golden Triangle area - the Houston-Beaumont-Port Arthur-area. But nowhere do they exist where we exist. It's nice in that regard. The question has been asked: ``How will it affect you locally?'' In all truth, I think it will be transparent. I think that on a philosophical level, it might affect us. We tend to be sort of decentralized with a lot of autonomy within our group here. The health system I came from (Henry was chief executive of St. Francis Hospital in Memphis, Tenn., owned by for-profit AMI/Tenet Healthcare Corp.) tended to be fairly centralized with a lot of decision making occurring in the larger health system office. I think that will really be the only major decision.
What is the status of the Alice hospital?
We've begun to put on sheathing and we'll open that operation on or before March 1, 1999. We're very excited about that. We had two rural health centers in Duval County, one in San Diego and one in Freer, but we had no institutional presence over there. We like to be collaborative where we can be with the providers that are already in a community. This was just one where it turned out to be better if we built our own hospital.
What else is ahead for Spohn?
We will be adding a second floor to (the Rachel Vaughan Radiation Therapy Center in Corpus Christi). We'll begin that in the late fall. That will be office space housing physicians and a large common area for outpatient chemotherapy. As well, we'll be announcing very soon a joint venture with M.D. Anderson in a special kind of cancer program where Anderson will be bringing some protocols down that we can work with.Post your comments about local news eventsFront Page || Main Index || News || Business || Texas || South Texas Outdoors || Birdwatching || Sports || Entertainment || Selena || Education || South Texas Attractions || World Wide Web