Will the corporate merger announced February 28 between Nuvance Health and Northwell Health bring higher-quality clinical outcomes and lower healthcare costs to the mid-Hudson Valley?
Nuvance Health, a major health-services provider in Ulster and Dutchess counties, is seeking to become the northern component of huge Northwell Health, a network which after the acquisition of Nuvance will have 28 hospitals and 99,000 employees — of which about 14,000 of whom will work at Nuvance. Nuvance had $2.6 billion in 2022 revenues, Northwell $15.6 billion.
Long Island-based Northwell Health boasts that it is New York State’s largest healthcare provider and private employer, with about 900 outpatient facilities and more than 12,000 affiliated physicians. It claims more than two million patients annually.
In New York State, Nuvance includes Northern Dutchess Hospital in Rhinebeck, Vassar Brothers Medical Center in Poughkeepsie and Putnam Hospital in Carmel. In Connecticut, it operates hospital facilities in Sharon, New Milford, Danbury and Norwalk.
The proposed agreement between the two non-profit health systems will require regulatory approvals, which are expected to take about a year to obtain.
Nuvance, like WMCHealth’s HealthAlliance, the other major hospital player in Ulster County, has been operating in the red for several years. Nuvance saw its takeover by Northwell as its best option.
“This is a tough environment,” explained Nuvance CEO Dr. John Murphy. And if you do nothing and continue to operate at a loss, that is not good.”
The merger will probably improve Nuvance’s bottom line, though patients — if the pattern in other markets where hospitals have been joining forces repeats itself — will probably experience higher costs for health services.
Compared to other advanced industrialized countries, the U.S. healthcare system is known for its highest costs and poor outcomes for patients.
Sharing resources
“For the health of patients and their communities, hospitals are focused on developing and improving systems of care that are accessible and effective,” said the statement from CEOs Murphy of Nuvance and Michael Dowling of Northwell Health. “This includes working to ensure access to primary and preventive care along with a broad continuum of services and advanced infrastructure to better manage population health, improve outcomes, and reduce the cost of care. At a time when all hospitals are facing significant challenges, decision-making remains focused on how to best enable care providers to continue supporting their patients, workers and communities.”
“This partnership opens a new and exciting chapter for Northwell and Nuvance Health,” said Dowling, “and provides an incredible opportunity to enhance both health systems and take patient care and services to an even higher level.”
Dowling told Becker’s Healthcare that due to the growth of its ambulatory footprint and strategy only 47 percent of Northwell’s revenue was tied to inpatient hospitals. Northwell struck a 2018 collaboration agreement with one of Nuvance’s predecessor companies, the Western Connecticut Health Network, to share specific resources but remain operating as independent entities. In 2023, the systems partnered to launch urgent-care centers together.
Local Nuvance operations
One of those urgent-care facilities is at the Hudson Valley Mall at 1240 Ulster Avenue, where Nuvance Health, Northwell Health and GoHealth Urgent Care teamed up to bring personalized on-demand care to New York’s Hudson Valley.
“A key to a healthy community is ensuring people can quickly be seen by highly credentialed providers,” said Murphy at that time. “This joint venture allows us to meet our patients where they are, with the level of care they need, at convenient locations — or virtually from home.”
Northwell has been responsible for all clinical operations at the urgent-care location, including the employment of providers, care delivery and quality.
The local Nuvance footprint in Ulster County extends well beyond its hospitals across the Hudson River in Poughkeepsie and Rhinebeck. Though geographically dispersed, Nuvance’s presence in Kingston is considerable
It also provides gastroenterology services at its Ulster Avenue urgent-care location. It provides extensive primary care and on-gyn services in the Kingston Plaza location, 334 Plaza Road. It’s Heart and Vascular Institute is at 33 Grand Street. And it maintains space at 111 Mary’s Avenue for its Radiation Oncology Center.
Raising a dialogue
“Is our delivery system providing the best outcome for patients and at the lowest cost?” asked Angela Mattie, a professor in Quinnipiac University’s schools of business and medicine as well as a former health-care executive. Mattie was one of several experts interviewed in an excellent recent article by Michael Gagne of the Danbury News-Times.
“Mergers and acquisitions are nothing new any more,” Mattie told Gagne. “The small community hospital has gone the way of the dinosaur. The cost of delivering care has increased. It’s almost impossible to not be part of a large health-care system.”
Mattie called for a close evaluation of health outcomes. “We need to continue to raise a dialogue,” she said. “Is our delivery system providing the best outcome for patients and at the lowest cost?”
Governments at various levels have found themselves increasingly engaged with healthcare systems — profit-making and not — over issues of service quality, availability and cost. With the number of healthcare-providing hospital institutions rapidly dwindling and market oligopolies more the rule than the exception, they really have no choice: they must be involved. Consolidated medical providers “have more leverage to demand higher prices [from insurers] when they are the only providers in a geographic area,” said Sean King, Connecticut’s acting healthcare advocate.
The dialogue continues.
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