CentraCare executives talk about affiliation with New River

The New River Medical Center Board was expected to sign documents this week further cementing its affiliation with St. Cloud-based CentraCare.
Affiliation legal documents were listed as an action item on the Dec. 13 board agenda. Thomas Schroeder, New River’s legal counsel, was the scheduled presenter.
Some type of memorandum of understanding (MOU) or letter of intent was scheduled for board members’ signatures Thursday night, said Joni Pawelk, New River’s director of marketing.
“I don’t have a crystal ball in front of me to tell you exactly what’s going to happen, but the indicators I’ve been tuned into indicate either a MOU or letter of intent most likely will be signed,” she said Tuesday. “The board has not worked through an interim management agreement; that won’t be signed nor have they worked through final lease documents.”
Three separate boards of directors with St. Cloud-based CentraCare Health Systems agreed Nov. 29 to move ahead with affiliation with Monticello’s New River Medical Center.
Jeanine Nistler,, CentraCare’s director of communications, confirmed the CentraCare boards had approved the local affiliation offer.
New River and CentraCare will work together in the coming months to jointly produce a growth plan, physician development plan and capital investment plan.
Four CentraCare Health System administrators addressed various aspects of the affiliation process Monday during a lunch meeting with local media.
Dr. Terence Pladson is CentraCare Health System’s president and chief executive officer; Craig Broman is president of St. Cloud Hospital, a separate entity within the CentraCare Health System but its largest overall system component; Dr. David Tilstra is CentraCare Clinic president and Jim Davis is CentraCare’s vice president of operations.
Davis is also president of CentraCare Health System-Melrose, CentraCare Health System-Long Prairie and Sauk Centre, and will work directly with New River Medical Center during a 100-day transition.
Davis is also president of Central Minnesota Emergency Physicians Corp. His name also appears on the Dec. 13 New River Medical Center Board of Directors’ agenda. –He’s scheduled to deliver a presentation about CentraCare.
“We are going to work together to create a 100-day plan that meets the community’s needs, represents the community, and has community input,” Davis said.
Public focus groups of 10 to 12 people will be formed from random New River Medical Center patient lists. Phone marketing surveys will be conducted as well.
“We will go through the list of patients and send out a letter to see if they are interested in participating in the process,” Nistler said during Monday’s meeting.
Davis said CentraCare wants to collect information to better define the population, the demographics and ratios it takes to support physicians of various types.
“Each affiliation [CentraCare has] is unique,” he said. “We don’t have a cookie-cutter [plan]. We look at the individual marketplace, providers, and facilities.”
Davis said CentraCare is the fourth largest health care system in the state of Minnesota. Heading towards the Twin Cities, its market ends right at Monticello.
Pladson said the St. Cloud-based health care provider has looks for new partnerships and collaboration efforts in communities where it already has expertise.
“We are interested in serving patients who could remain local, and could receive care at the specialty centers that we have here in St. Cloud or through partnered outreach programs where we bring specialists into the community” Pladson said, mentioning St. Benedict’s Senior Community in Monticello as an additional patient care facility within CentraCare’s network. “We have nine dialysis programs throughout the region, and built clinics in Big Lake and Becker.”
Pladson also mentioned the Monticello Cancer Center, the three-way joint venture involving North Memorial Medical Center, New River and CentraCare.
“We bring radiation therapy specialty expertise from our Coborn Cancer Center to the table,” he said. “We have the same kind of facility up in Alexandra.”
Davis said each of CentraCare’s rural hospitals (Melrose, Sauk Centre and Long Prairie) started out as government entities, similar to Monticello-Big Lake.
“They’ve discovered over time they could not sustain the health care delivery system in their community a government agency,” Davis said. “They really needed to be connected to something larger.
Tilstra addressed CentraCare’s current efforts to reach out to Monticello Clinic physicians, who have been at odds with New River Medical Center CEO Marshall Smith.
“We’ve already had meetings with them,”  Tilstra said. “We want to come together and have some understanding about their needs and goals. The thing that we are going to emphasize with them is that we’re going to build the medical community in Monticello to meet the community needs. Ultimately, if we need more providers there, that’s what we are going to recruit. We will be glad to help them with recruiting.”
According to Tilstra it would be Monticello Clinic physicians’ best interest to find a way to work with the hospital. “Getting them to come back to the table is important,” he said. “With physicians, one of the things you have to do is listen to their needs. They have strong opinions about patient care. We intend to be down in Monticello frequently. We want open lines of communication. That’s what’s going to bring them back to the table. We need to earn their trust.”
Davis said CentraCare executives and marketing staff would remain sensitive to possible naming issues that might arise as the affiliation process moves forward.
Monticello’s situation is a little more complex because of the number of communities in the district, he said. Pladson added: We intend to bring the tagline CentraCare to the Monticello operation early in the management agreement. We’re still trying to understand the value of the New River Medical Center name.”
Broman said the due diligence process associated with the affiliation agreement has been accelerated because of the financial challenges New River Medical Center. has faced. However, Davis said due diligence is more than accounting.
“It’s a review of human resources, policies and issues,” he said. “We need to look at our quality and medical bylaws, and the financial and insurance risks. It’s a pretty deep-dive process to go through. That’s the nature of these 100-day plans.”
Pladson said CentraCare would assume New River Medical Center’s operating risk effective Jan. 1, 2013.
“We are not planning to ask the hospital district for any taxation support for future hospital operations,” he said. “We’ll also assume the $16 million in outstanding debt and not ask for further operating levy support.”
According to Davis, since CentraCare is taking on operational and debt risk, its agreements with New River Medicial Center will include management oversight.
“We need to be responsible for the hiring and evaluation of all of the key executives,” he said. “It goes beyond the CEO. If we need to make changes, we will.”