Greensboro-Based Cone Health Plans to Merge With Sentara Healthcare | Eastern North Carolina Now

Publisher's note: The author of this post is Jordan Roberts for the John Locke Foundation.

    Greensboro-based Cone Health and Norfolk, VA-based Sentara Healthcare on Wednesday announced plans to merge the two hospital systems. Tara Bannow from Modern Healthcare reported,

  • The CEOs of both not-for-profit health systems shot down the notion that the proposed deal is happening in response to pressures caused by the COVID-19 pandemic. Instead, they said they believe it will help patients by expanding access to care and adding new insurance options and caregivers by adding stability. Norfolk, Virginia-based Sentara and Greensboro, N.C.-based Cone have signed a letter of intent and hope to close the deal in early to mid-2021.
  • "We've all had to deal with the impact of the pandemic, including financial and otherwise, but we're both very, very strong organizations and we're in the position to make this decision coming from strength and being proactive," said Cone Health CEO Terry Akin.
  • The resulting system would have 17 hospitals-12 from Sentara plus Cone's five-and $11.5 billion in revenue. Sentara drew $6.8 billion in revenue in 2019, while Cone drew $2.2 billion. Sentara has a small presence North Carolina currently, with one small hospital in Elizabeth City. Cone's operations are entirely in North Carolina, specifically in the five-county area surrounding Greensboro.
  • Sentara CEO Howard Kern would become CEO of the new organization, while Cone's Akin would stay in Greensboro as president of the Cone Health division. The resulting system's corporate headquarters would be in Norfolk. In an interview, Kern stressed the deal would be a straight merging of assets, not an acquisition, with no money changing hands.
  • Kern and Akin agreed the biggest draw to the deal was their aligned views on the importance of value-based payment arrangements and the need to deliver higher-quality care in a way that's more cost effective.

    This is a massive merger between two health care giants in the southeast. Mergers of this size typically result in higher prices and sometimes lower-quality care than what patients received before. The health care sector has a major consolidation problem in that providers and insurers combine at an alarming rate. In earlier research pieces, I hypothesized mergers and acquisitions of this size would increase following the financial hardships of COVID-19 related decreases in services. The CEOs balk at the notion that COVID-19 was the driving force, but it likely played some role in the decision.

    On top of that, both hospitals have a self-professed dedication to value-based care, which goes hand-in-hand with hospital mergers. The results are still fairly mixed on the effectiveness of value-based care. Regardless of the reason for the decision, this will impact North Carolinians living in the Triad area for better or worse.

    I have written a few pieces on the literature behind hospital mergers. See:


    This merger will likely face anti-trust scrutiny from the federal and state governments. As always, these types of mergers could produce benefits for patients. Yet, as we've seen, and what the literature tells us, it is unlikely to make patients better off in the long run.
Go Back


Leave a Guest Comment

Your Name or Alias
Your Email Address ( your email address will not be published)
Enter Your Comment ( no code or urls allowed, text only please )




Bemoaning NYC’s ‘Mad Rush’ for the Exits John Locke Foundation Guest Editorial, Editorials, Op-Ed & Politics Canada’s COVID-19 Experience Offers Valuable Lessons


HbAD0

Latest Op-Ed & Politics

ancient forests being destroyed to build wind turbines and solar "farms"
President Joe Biden took direct aim at Supreme Court Justice Clarence Thomas during a recent interview, referring to him simply as “the guy who likes to spend a lot of time on yachts.”
The best way the county and city can help hold down inflation is to resist all tax increases
Pope Francis lambasted leftist gender ideology during an address this week, warning that it presented an extreme danger to mankind.
amnesty would just encourage more illegal aliens to storm our borders
The Christmas candy was barely off the shelves when the Valentine’s candy appeared. Red and pink hearts with caramel and nut-filled chocolate goodness caught our eye. We are reminded of how we love love. Young love, especially.
far left sugar daddy has also funded anti-Israel groups and politicians in US
Be careful what you wish for, you may get it

HbAD1

America needs to wake up and get its priorities right
Former President Donald Trump suggested this week that if he becomes president again, he might allow Prince Harry to be deported.
It's a New Year, which means it's time to make resolutions — even for prominent evangelical leaders. The Babylon Bee asked the following well-known figures in the faith what they hope to accomplish in 2024:
Vice President Kamala Harris will visit a Minnesota Planned Parenthood clinic, reportedly the first time a president or vice president has visited an abortion facility.
An eight-mile stretch of the Blue Ridge Parkway near Asheville has been temporarily closed due to a string of “human and bear interactions,” the National Parks Service announced.
University of Wisconsin tried to punish conservatives for the fact that liberals regularly commit crimes to silence opposition
most voters think EU officials not doing a good job on illegal immigration
Come from behind by GOP candidate is a blueprint to 2024

HbAD2

 
Back to Top