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The Spokesman-Review Newspaper
Spokane, Washington  Est. May 19, 1883

Purchase of Rockwood Clinic and Deaconess and Valley hospitals should be final by early summer

Tacoma-based MultiCare expects to wrap up the purchase of Rockwood Health System by early summer, officials said.

The $425 million sale, which includes Deaconess and Valley hospitals and Rockwood Clinic, is under review by state regulators. MultiCare’s application to the state alludes to a growing role for telemedicine in the Spokane market.

The nonprofit health system also says it will look for ways to improve patient care and reduce costs.

“We expect a decision in mid-June if everything goes according to plan,” said Marce Edwards Olson, a MultiCare spokeswoman.

Rockwood Health employs about 3,600 people at the two Spokane-area hospitals and a network of 12 Rockwood clinics.

Rockwood competes for the Spokane area’s health care business with Providence Health, which also has two Spokane hospitals, clinics and smaller hospitals in outlying areas.

Rockwood’s sale will bring the tenure of Community Health Systems in Spokane to a close. Tennessee-based CHS bought Deaconess and Valley hospitals in 2008 and Rockwood Clinic since 2009.

CHS is one of the nation’s largest for-profit hospital companies with 200-plus hospitals and affiliated clinics. Last August, CHS announced it would sell off hospitals and clinics after several quarters of financial losses.

MultiCare approached CHS about buying Rockwood Health. The secular health system, which has hospitals and clinics in the south Puget Sound area, wanted to expand its geographic reach into Eastern Washington, MultiCare CEO Bill Robertson said in an earlier interview.

MultiCare plans to pay the $425 million purchase price out of its $1.6 billion in cash and reserves, officials said in the application to the Washington Department of Health, which is reviewing MultiCare’s finances and operating history.

The company won’t announce specific plans for the Spokane operations until the sale is final, said Olson, the MultiCare spokeswoman. But the state application hints at MultiCare’s future direction for Deaconess and Valley hospitals.

“MultiCare sees the health care industry changing, where in the future, hospitals aren’t the center of care,” Olson said. “The patient and their primary care provider are at the center.

“It’s about making sure that people get the care at the front end to prevent more costly care later.”

As part of that trend, MultiCare has expanded telemedicine offerings and opened urgent care centers in its Puget Sound markets.

For $25, MultiCare patients can consult a provider and get prescriptions for 11 common health ailments through the text-based eCare system. Patients can use the system for problems such as colds and flu, pink-eye and female bladder infections. The system kicks people out if they have chest pain or other serious issues requiring immediate care, Olson said.

MultiCare’s “Doctor on Demand” costs $49 for a 15-minute virtual visit with a provider on a smart phone, tablet or laptop.

At MultiCare’s five hospitals in the Puget Sound region, people with chronic diseases who cycle through emergency departments are identified and referred to programs that help them get regular care to manage their condition.

“We want to help them get care in a less costly setting,” Olson said.

MultiCare’s application also said the health system can bring stability to Deaconess’ finances. The 388-bed hospital controls about 20 percent of the local market share, according to the application. In two of the past four years, Deaconess reported modest losses.

Valley Hospital has turned consistent profits in recent years, ranging between $15 million to $30 million annually, according to the application. The hospital has 123 beds.

No financial information was provided on Rockwood Clinic, whose sale is not subject to state review.