At some point in the near future, the signs for Virginia Mason Memorial hospital in Yakima will be replaced by new ones with an old name — Yakima Valley Memorial Hospital.
New signs will be the most obvious indication of the hospital’s transition to an independent, local health care system. In late October, Memorial’s board of directors voted to end the hospital’s affiliation with Seattle-based Virginia Mason.
The vote came after concerns about some aspects of local care in light of an expected merger between Virginia Mason and CHI-Franciscan, a Catholic nonprofit health system.
Before the Virginia Mason merger with Tacoma-based CHI-Franciscan, 41% of Washington’s hospitals were affiliated with the Catholic Church, and many were unable to provide some types of care, including abortions, birth control and other services that conflict with Catholic doctrine. The Virginia Mason merger has raised concerns throughout Washington, especially in communities where it is the only hospital, about what services could be cut when the merger is finished.
Virginia Mason Memorial officials have said they expect the process of removing affiliation would take one to three months. They said Memorial will continue its relationship with Virginia Mason for referrals and other health-related matters but will officially be independent.
“From a patient care perspective, there really is no change. We will change our name. We are affiliated with Virginia Mason until Jan. 1, then we will change our name officially to Yakima Valley Memorial, and we are working now with a sign company,” said Carole Peet, CEO and president of Virginia Mason Memorial.
“It’s the branding, the naming of all the pieces of paper, as with any business when you change a name. That’s relatively easy.”
Concerning patient care, “we really weren’t that connected except when it comes to IT. It is one of the more challenging things,” Peet added. “We are very actively working on that with Virginia Mason and third-party organizations that support our IT services.”
Transition planning for independence involves two components — legal and operational, Peet said.
“The operational component could take longer than 60 days. We want to make sure that we continue to provide high-quality patient care, look at everything from a patient care perspective,” she said.
Memorial is the only hospital in Yakima, a city of more than 90,000, after the closure of Astria Regional Medical Center in January. Astria Health filed for bankruptcy protection in 2019. It continues to operate hospitals in Sunnyside and Toppenish.
Although the care patients receive at Virginia Mason Memorial isn’t going to change, Peet stressed, she hopes the public is supportive and realizes the challenges hospital leaders have in front of them “and the hard decisions we’re going to have to make.”
“The decision to remain independent is an unusual and challenging decision” in health care, Peet said. “The board made that decision because they thought it would be the right decision for Yakima.”
Memorial’s board of directors decided to withdraw the affiliation after hearing from a group of retired physicians and other community members. The physicians raised concerns about access to services and specialty care locally under a merger. The overall Virginia Mason and CHI Franciscan merger continues to move forward, just without Memorial.
Yakima still will work with Virginia Mason, just as it did before the formal affiliation.
“For serving the population, long-term it was most beneficial to remain independent and not be part of a larger national organization,” Peet said. “We remain very collaborative in working with Virginia Mason around referrals and patient care, and those relationships existed before the affiliation.”
No public hospital district
Some have wondered about the possibility of Yakima voters forming a public-hospital district to support local health care. Peet said that isn’t on the table.
“A public-hospital district is not an option we’re evaluating at this point,” she said.
Public-hospital districts are formed by a vote of local residents and are junior taxing districts. Those tax dollars are a small proportion of their total revenue, according to the Association of Washington Public Hospital Districts.
They are units of local government, led by an elected Board of Commissioners. Public-hospital districts are subject to all state laws related to transparency and open government, including the Open Public Meetings Act, the Public Records Act and others.
Prosser and Benton, Kittitas and Klickitat counties have public-hospital districts, the Association of Washington Public Hospital Districts directory notes.
Five-year strategic plan
About six months ago, Virginia Mason Memorial officials developed a five-year strategic plan focused on growth, sustainability and efficiency, Peet said. All are critical for an independent stand-alone hospital in times when mergers, not independence, are the norm as health care systems seek the best ways to maximize revenue and the most efficient ways to deliver care.
“We’re looking at our populations, what kind of programs does that population support,” Peet said. “Our strategic plan really speaks to long-term sustainability. We’re going to have to make decisions about financial sustainability.”
Virginia Mason Memorial is the sole provider of acute care in Yakima for a reason, Peet said. It wasn’t sustainable for two hospitals, she said.
“That’s what our strategic plan really speaks to; how do we continue to grow? We have to take a very close look at how do we serve the bulk of the population,” she added. “There may be some niche things we can’t do.”
Yakima Valley Memorial began its affiliation with Virginia Mason in January 2016 to weather challenges in the health care industry, including falling Medicare and Medicaid reimbursements. That continues to be a challenge, so creating a sustainable health care delivery platform “within our challenging payor mix” is crucial, Peet said.
“We are a safety net hospital … an organization that serves a proportionately large percentage of Medicare and Medicaid” patients, she said. “When you look at our payor mix, it’s a challenging payor mix in terms of reimbursement.”
Payor mix is the percentage of hospital revenue that comes from private insurance companies along with self-paying patients and government insurance programs such as Medicare and Medicaid.
“Health care reimbursement in financing continues to be challenging. And when Memorial affiliated with Virginia Mason, I think there were some misperceptions,” Peet said. “Really why Memorial affiliated was to gain and learn from Virginia Mason on their quality and clinical care. We remained financially independent from Virginia Mason.”
“We continue to focus on our financial sustainability. It’s a challenge for health care organizations across the country, especially now in a pandemic,” she said. “We’ve been greatly impacted from the pandemic. We’re still in a pandemic. We need to continue to stay focused on what we need to do to protect our health care workers.”
The hospital board and its executive leadership team are excited about the future, Peet said. Feedback from patients and their families on what Virginia Mason Memorial is doing well and what it could do better would be helpful.
“We need everybody’s help moving forward,” she said. “I’m excited. I know we can do this, but we need everybody rolling in the right direction and supporting us.”
Correction: A previous version of this story incorrectly identified Harborview Medical Center as a public hospital district. Harborview is owned by King County and managed by the University of Washington.