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The Dose

Welcome to The Dose, which tackles the business and economics inside the turbulent world of health care and life sciences in Indiana. Your host is John Russell. To contact me call 317-472-5383.

IU Health making big push on two fronts in Bloomington

May 1, 2017

At Indiana University Health, 2017 could be called the Year of the Bloomington Drive.

The Indianapolis-based health system is aggressively ramping up its presence in the southern Indiana market with two big moves this year:

1. Effective today, IU Health is getting control of Premier Healthcare, one of Indiana’s largest independent physician groups, with about 40 primary care and specialty doctors. The move will end Premier’s 45-year run as an autonomous group. It also marks the latest move by a hospital group to scoop up physician practices, which are often valuable because they can refer patients to the hospitals for surgeries and outpatient procedures.

2)    This fall, IU Health will break ground on a brand-new, $340 million hospital on the Indiana University campus to replace an aging hospital complex about five miles away.

Together, the moves represent a major investment in Bloomington, which will solidify IU Health’s footing in the market.

IU Health’s acquisition of Premier was announced in February and the two parties have been gearing up for the combination for months. Premier operates 19 locations in Bloomington, Martinsville, Bedford, North Vernon and other cities across south-central Indiana. Terms of the deal were not disclosed.

Premier’s physicians will join IU Health’s Southern Indiana Physicians, a group of about 240 doctors in 37 locations. That group has been growing quickly in recent years as IU Health has scooped up Southern Indiana Pediatrics, Orthopedics of Southern Indiana and other practices.

The move by Premier to join IU Health comes just a year after seven cardiologists left Premier to join Southern Indiana Physicians. It also comes as the state's largest independent physician group, American Health Network, with about 300 physicians, is about to be acquired by health insurer UnitedHealth Group's OptumCare division.

IU Health said the acquisition of Premier is a natural move, as the two sides have many ties, formally and informally. All of the pulmonologists at IU Health in Bloomington were Premier doctors, said Ryan Kitchell, IU Health’s chief administrative officer.

“Premier doctors have been in the community a long time and are highly respected,” Kitchell said Monday. “We’ve worked with a lot of them.”

The group approached IU Health about combining forces, the two sides said in February, when they announced the deal.

Premier, formed in 1972 as Internal Medicine Associates, said it was looking for a partnership that would give it more resources as the industry undergoes sweeping changes.

“By strengthening our relationship with the IU School of Medicine and IU Health, we believe we will be better able to meet our vision of providing the highest quality of innovative health care to south-central Indiana,” Dr. Wesley Ratliff, Premier’s president, said in a written statement.

IU Health’s Kitchell said Monday the deal will allow the two sides to share information on patient care that will add to IU Health’s huge cache of data analytics on patient population that could further public health in that part of the state.

The two sides said patients would notice “few if any immediate changes as a result” of the acquisition. All Premier locations will continue to serve their customers.

Meanwhile, IU Health is gearing up for its groundbreaking this fall on a new hospital that will be based on a golf-driving range on the IU campus. The two sides announced the project in 2015.

The hospital is scheduled to open in 2020. Services will range from emergency and intensive care to obstetrics and a range of surgeries.

IU Health said the hospital will allow it to work closely with IU to train physicians and health care professionals.

“We have all worked together for many years, and continuing to build on this partnership only makes sense,” IU Health said in a statement.

The two organizations are separate, but have a long partnership with the IU School of Medicine. The IU School of Medicine was founded on the Bloomington campus. Many IU Health Bloomington Hospital physicians serve as faculty at the IU School of Medicine. Medical students on the IU Bloomington campus do a portion of their training at IU Health Bloomington Hospital.

“By locating the hospital on the IU campus and in such close proximity to many of IU’s health sciences programs, we will be able to further enhance care for our patients, and training for the next generation of healthcare providers,” IU Health said.

 

 

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