BayCare Health System, the leading health care player in Tampa Bay, expects to acquire another hospital for the first time since its creation 15 years ago, expanding its reach into Polk County.
BayCare officials said Wednesday they plan to purchase Winter Haven Hospital. If the deal goes through, it would become the latest independent hospital to join a larger organization. The trend of consolidation in health care is growing as providers cope with rising costs and a transforming system.
The nonprofit BayCare, which got its start when a group of area hospitals joined forces to be more competitive, currently operates the St. Joseph's hospitals in Tampa, St. Anthony's in St. Petersburg and the Morton Plant Mease hospitals in mid Pinellas.
BayCare controls more than a third of the hospital business in the Tampa Bay market, and has constructed new facilities over the years. But Winter Haven marks its first hospital outside its core communities in Pinellas, Hillsborough and Pasco.
"Even as big as we are, we can get greater economies of scale," said BayCare President and CEO Steve Mason.
The U.S. health care system is expanding its focus from caring for the sick to emphasize wellness and prevention. Insurers such as Medicare increasingly are penalizing providers for poor performance, and reimbursements are shrinking.
BayCare, like other organizations, needs to provide better quality, lower-cost care for large populations of patients.
For 527-bed Winter Haven Hospital, the benefits would be immediate. It expects to save as much as $1.5 million buying pharmaceuticals and supplies with BayCare's negotiating power.
Its patients could gain better access to advanced procedures in pediatrics and neurology available at St. Joseph's, said Winter Haven President Lance Anastasio.
After discussing consolidation with several large health systems, Winter Haven decided BayCare was the best fit.
"We think our values and vision and culture are all very congruent," Anastasio said.
BayCare and Winter Haven have signed a letter of intent, which will allow both parties to explore consolidation over the next four months. If all pans out as expected, Winter Haven would join BayCare in early to mid 2013, officials said.
Mason said BayCare could be interested in additional hospitals just outside of Tampa Bay, although it doesn't see itself as a statewide corporation. But it has not been talking with St. Petersburg's Bayfront Medical Center, another independent hospital interested in "strategic" partnerships.
"Every freestanding hospital in the state of Florida is looking at some kind of consolidation," Mason said.
In Tampa Bay, two other standalone hospitals — All Children's Hospital and University Community Hospital — recently joined larger organizations. All Children's is now part of John Hopkins Medicine, while Florida Hospital/Adventist Health System bought University Community.