MMC Announces Intent to Join Spectrum Health

Memorial Medical Center (MMC) today signed a letter of intent to join Spectrum Health. While non-binding, the letter of intent establishes that MMC will work exclusively with Spectrum Health to develop a definitive agreement.

The agreement, according to board and administration sources, will assure a future with a strong local healthcare presence. The agreement will preserve MMC’s Board of Directors, meaning there will continue to be a local voice in governing the hospital. Other benefits include expanded healthcare services, better access to capital, improved access to medical specialists, additional professional opportunities for community physicians, and retention of MMC’s local staff.

Spectrum Health chosen after nationwide review

After much study and deliberation, Memorial’s Board of Directors voted last fall to explore a relationship with larger, integrated healthcare systems. Using a controlled, competitive process, the Board circulated information to selected systems across the country. When the proposals, presentations and visits were complete, the board reached a unanimous conclusion that Spectrum Health’s proposal best met its objectives.

“Our primary goal in this process has been to preserve MMC as a viable healthcare provider in this location for future generations,” said board chair Al Deering. “That is our key responsibility as a board. After a thorough evaluation, we believe that joining Spectrum Health is the best possible solution for the communities and people we serve, as well as for our doctors and staff.”

“The details will be negotiated over the next few months,” Deering added. “Our discussions with Spectrum Health have been very positive and we expect no problems reaching a definitive agreement.”

“Our local board will continue to have significant decision-making authority and oversight for the hospital’s operations. We feel confident that Spectrum Health will fully support our goals in this part of West Michigan.”

“This is a significant step in an excellent working relationship that has existed between our organizations for many years,” said Richard C. Breon, President & CEO, Spectrum Health. “The combination of resources and services that will result from the integration will support the mission of both organizations and ensure high quality care in western Michigan.”

“Win for all”

Memorial Medical Center CEO Mark Vipperman termed the decision a “win” for everyone.

“First and foremost, our patients will benefit,” Vipperman said. “They will benefit from expanded services, access to specialists, and enhanced recruitment of additional physicians. Joining Spectrum Health strengthens this organization for the challenges ahead and will stabilize a healthcare presence in this part of Michigan for the future.

“We are assured that our current employees will be retained as employees of Spectrum Health when the merger becomes finalized and will continue to provide patients with excellent care,” added Vipperman. “We believe expanded services could strengthen our position as the largest employer in Mason County.”

Vipperman said the hospital’s medical staff would also benefit from the partnership.

Chief of staff Steven Strbich, DO, agreed, saying “Our medical staff will benefit from additional professional opportunities and enhanced support from being part of a strong, integrated healthcare system. It will also help us in recruiting new physicians to practice here.”

The letter of intent is non-binding, meaning either partner can withdraw, but both parties say that possibility is very remote.

“Given the rapidly changing healthcare industry, the board recognized it was our responsibility to explore all options to better meet the healthcare needs of our community,” said Deering. “We concluded that now, while MMC is in a strong financial position, was the best time to position our hospital to meet the challenges facing the healthcare sector of our national economy.”

“Without a partnership we would be much more vulnerable to regulatory changes and evolving market forces and our future would become increasingly uncertain.”

The board hired Juniper Advisory LLC to advise MMC on possible business combinations. The Chicago-based firm is a leading consultant to non-profit hospitals on potentially beneficial relationships in an era of accelerating consolidation. Juniper recommended approaching 27 healthcare systems across the country and worked with the board and administration to narrow the selection down to a few finalists.

“Throughout the process,” Deering added, “MMC’s Board retained the option to remain independent. However, we believe Spectrum Health understands West Michigan and shares our commitment and sense of mission. It is a very sound cultural fit for us and will allow us to serve the community even better as far into the future as we can see.”

Vipperman added that the entire Memorial Medical Center executive team supported the board’s action.

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