Hartford Healthcare is in expansion mode once again, this time quietly adding one of the state’s largest multispecialty groups to its growing roster of medical practices.
Hartford Healthcare has purchased the assets of the Connecticut Surgical Group, a 200-employee practice, with more than 40 doctors and 12 office locations in Greater Hartford.
Terms of the deal are not being disclosed.
But doctors and employees of Connecticut Surgical — which has subspecialties in colorectal, thoracic, and general surgery, podiatry, and urology among other service areas — have joined a newly formed unit within Hartford Healthcare, called Hartford Specialists.
The integration of the two organizations began Oct. 1, sources said.
Officials from both sides say the deal was a natural progression of a partnership that has grown increasingly tight in recent years. Connecticut Surgical has helped develop tertiary subspecialty services at Hartford Hospital, where the group also has an office. The group has served as a strong referral base to the hospital as well.
Jeffrey Flaks, the CEO of Hartford Hospital, said the integration of the Connecticut Surgical Group is a move toward creating a center of excellence for the region that will allow for more seamless coordination of care and enhanced access to services.
It will allow both organizations to coordinate planning around physician recruitment and service expansion, while putting providers under a single electronic medical record and scheduling system, Flaks said.
“In subspecialties, because surgeons are so integrated into the care of the hospital, we saw a lot of value in moving in this direction,” Flaks said. “This presents an opportunity to have more seamless coordination of care.”
Connecticut Surgical Group has about a dozen locations around the state including in Hartford, Glastonbury, Farmington, and Avon. They operate in or near MidState Medical Center in Meriden and The Hospital of Central Connecticut in New Britain, which are both part of the Hartford Healthcare network.
All of those locations will remain open, officials said.
Jeff Cohen, the former president of the Connecticut Surgical Group, said the integration probably wouldn’t have been likely four years ago. But the relationship between the two healthcare providers has grown much closer in recent years as they have partnered on projects including service line developments for weight loss and breast cancer treatment.
“It became clear to me that not being together presented more of an obstacle than staying separate,” said Cohen, who is now leading the surgical institute at Hartford Hospital.
Cohen said he believes the combination will help Hartford Healthcare recruit doctors nationally. Flaks said it will also will further the hospitals teaching and research mission.
Connecticut Surgical is being integrated into Hartford Specialists, which includes a number of subspecialty groups that are employed by the hospital, Flaks said.
Hartford Specialists now has 68 physicians, including transplant and cardiac surgeons, orthopedics, neurosurgeons, and oncologists. The organization provides physicians practice management and infrastructure IT support, Flaks said.
The hospital still has relationships with many private practices as well.
Flaks said all employees of Connecticut Surgical were given the chance to make the transition although the CEO position was eliminated. Sources say the group’s former top executive, Doug McKell, has left the organization.
Hartford Hospital’s integration of Connecticut Surgical is part of a growing trend across the country of consolidation within the healthcare industry.
It is being spurred largely by financial pressures related to healthcare reform and lax reimbursements from government payers, which is making it harder for independent physicians to do business on their own.
There is also a movement to try to better coordinate care among the various players in healthcare by putting them under a single network.
Additionally, health care reform is requiring doctors to modernize their practice with new payment models and technology like electronic medical records, which can cost tens of thousands of dollars to implement.
Hospitals are attracted to physician groups, in part, because they provide a steady referral base.
Hartford Healthcare has been among of the most active networks in Connecticut. Earlier this year, for example, it completed a $28 million acquisition of Newington-based Constitution Eye Surgery Center, which has turned Hartford Healthcare into a major player in Greater Hartford’s outpatient ambulatory eye surgery industry.
Chris Dadlez, president and CEO of St. Francis Hospital in Hartford, said the degree of integration in Connecticut has been much less than in other states, but the movement has been gaining steam recently.
Indeed, many larger hospital systems have added to their physician rosters in recent years and competition to attract doctors remains strong.
Dadlez said many Connecticut doctors still have an appetite to maintain their independence, but broader industry challenges are starting to make them think twice.
Recent estimates by the Connecticut State Medical Society show that between 60 and 80 percent of practicing physicians in the state are in groups of four doctors or fewer.
“It’s still very fragmented out there, but you are starting to see some change,” Dadlez said.
But consolidation doesn’t necessarily mean hospitals have to outright acquire a doctor’s practice.
Other business models are also proving popular.
St. Francis, for example, directly employs about 150 physicians. But the hospital has access to a network of 700 independent healthcare practitioners through St. Francis HealthCare Partners, which serves as a physician hospital organization.
It’s a system where the hospital doesn’t purchase the physician practices outright, but aligns with them through clinical integration. It allows for both groups to organize for the purpose of contracting with health insurers in order to create more scale to enhance their leverage in negotiations, Dadlez said. It also allows them to create similar working protocols to improve quality of care, and share resources like infrastructure for electronic medical records.
“It’s an attractive concept to doctors who want to maintain independence,” Dadlez said.
