Tennessee health system takes step to join Prisma Health

A Tennessee health care organization based in Chattanooga has signed a non-binding letter of intent to join the Prisma Health system.

Erlanger Health System has agreed to what both organizations are calling a “strategic partnership” that “will build on Erlanger’s deep legacy of high-quality, compassionate care and position the organization for long-term sustainability, growth, innovation and success.”

“The proposed partnership, which includes $2 billion in strategic capital investments to expand access and advance care delivery, follows a thoughtful and extensive evaluation process led by Erlanger’s Board of Directors, and is designed to protect services the community depends on while strengthening the regional economy,” said a news release announcing the plan.

Erlanger is a private, non-profit health system affiliated with the University of Tennessee Health Science Center College of Medicine. The system includes seven hospitals.

“More than 130 years ago, Erlanger was founded through an extraordinary gift that reflected a belief in our community and its potential, and today this investment assures our ability to meet our mission well into the future,” Erlanger President and CEO Jim Coleman said in the release. “By partnering with Prisma Health, we will be able to fast track our vision and keep Erlanger at the forefront of medicine. Together, we will ensure Erlanger remains a leader in health care for the next century and beyond.”

All employees and medical staff in good standing will be retained and the Erlanger name will continue to be used in future branding. Erlanger will continue to have a dedicated leadership team and occupy the majority of seats on a newly created/established Prisma Health Eastern Tennessee board. Additionally, Erlanger will have representation on the Prisma Health corporate board.

Erlanger cited a like-minded regional focus on health care for the decision to choose Prisma Health for the initiative.

“Erlanger has a history of leading the market in the levels of care and patient experience that we provide,” Erlanger board chair Barry Large said in the release. “Health care is changing rapidly and we knew that given our position of strength and national recognition for our clinical quality, we had a responsibility to explore options that would allow us to accelerate our plans forward to an even brighter future.”

Prisma Health serves more than 1.6 million patients annually through 20 hospitals and a broad network of physicians, providers, educators and researchers. The partnership, according to the release, will leverage the $2 billion investment to:

• Enhance access to specialized and complex care in Erlanger’s service areas through expanded clinical capabilities, specialty services and investments in innovation and technology.
• Bring new investment to add more funding to important long-term capital and facilities projects such as improving the Erlanger East Hospital campus and Erlanger Baroness Hospital.
• Protect mission critical programs including the system’s Level I trauma center and children’s hospital along with safety-net operations and transplant programs.
• Enrich academic partnerships, graduate medical education, residency programs and research while maintaining its position as a teaching organization.
• Support Erlanger’s ability to grow and strengthen its workforce — “the heart of Erlanger” — through continued investment in its physicians, nurses and employees through enhanced recruitment, retention and professional growth opportunities.
• Enhance Erlanger’s ability to adapt and thrive in a complex, competitive health care and regulatory environment.

“Protecting and securing Erlanger’s mission, culture and legacy is a priority in our proposed partnership,” Mark S. O’Halla, president and CEO of Prisma Health, said in the release. “This partnership will help ensure Erlanger has the support and expertise necessary to build on its momentum and serve its communities at the highest level for decades to come.”
As part of this partnership, Prisma Health will establish its East Tennessee regional headquarters in Chattanooga. Coleman will lead as regional CEO for East Tennessee, providing leadership and oversight of Erlanger and guiding the organization’s growth and integration throughout the market, the release stated.

Both organizations will now enter a period of due diligence and continued evaluation. Any final agreement would be subject to approval by Erlanger’s board of directors, the Erlanger Health Oversight Panel, Hamilton County Commission and applicable federal and state regulatory authorities.
Nothing is changing today for patients and all appointments and services will continue as usual, according to the release.

“We are an attractive partner because of the extraordinary work our physicians, providers, nurses and employees have done over the last several years,” Coleman said in the release. “Their dedication has made Erlanger the strong, respected health system it is today, making it possible for us to secure the interest of a highly respected health system that shares our values and vision for the future. We have never been more committed to our mission to compassionately care for all, and that commitment remains unchanged.”
For more information and updates visit erlangerfuture.org.

The Erlanger system includes the region’s only Level I trauma center, children’s hospital, Level IV NICU, kidney transplant center, 24/7 stroke care, and many more essential services, the release said. Erlanger is the sole provider of tertiary care services spanning a 50,000 square-mile region encompassing southeast Tennessee, northwest Georgia, northern Alabama and western North Carolina.

Prisma Health serves more than 1.6 million patients in South Carolina and Tennessee.