When Albert Wright Jr., PharmD, became CEO of Morgantown-based WVU Medicine in 2014, the system had five hospitals. It now has 31 across four states, and its largest deal yet just took it into Pittsburgh’s suburbs.
That reach is deliberate, Dr. Wright said Nov. 2 at Becker’s CEO + CFO Roundtable. West Virginia has just 1.8 million residents, and its largest city, Charleston, has fewer than 50,000.
“If you’re going to be successful, you’ve got to really embrace that rural healthcare component,” he said.
Here are five keys to the system’s growth strategy, particularly beyond the state line:
1. Scale protects the mission.
The West Virginia Legislature created the health system in 1996, when lawmakers worried that out-of-state, for-profit operators acquiring hospitals would not invest in West Virginia the way a homegrown system would. When the board hired Dr. Wright, it had just adopted a strategic plan to grow the system in size and scope.
The goal was to move from an academic medical center in Morgantown to an academic health system covering the region.
“As great as our academic medical center is, in a large, rugged, rural state like West Virginia, you’re never going to improve the health of the state through just an academic medical center,” Dr. Wright said.
Size also keeps the system based in West Virginia as large regional players build up nationwide.
2. Expansion feeds complex care in Morgantown.
Most academic medical centers of WVU Medicine’s size sit in urban areas with millions of people within a 30-minute drive. WVU’s 900-bed flagship hospital, by comparison, sits in a town of 35,000. To sustain what Dr. Wright calls “low-volume, high-complexity” programs, such as pediatric heart surgery and a level 4 NICU, the system needs a feeder network.
Pennsylvania expands that pool. The new territories in Westmoreland, Butler and Clarion counties give WVU Medicine direct access to about 750,000 more people, Dr. Wright said. The system already draws heavily from neighboring states: He said about half the license plates in the academic medical center’s parking lot are from Ohio, Pennsylvania and Maryland.
Pennsylvania also brings scale for WVU Medicine’s group purchasing organization and for Peak Health, its provider-sponsored plan, which will begin offering Medicare Advantage plans in the state.
“It gives us scale and relevance with payers to make sure we create fair reimbursement relationships,” he said.
3. Crossing the border gradually.
WVU Medicine tested its model in border states before expanding more intentionally. It added a couple of critical access hospitals in Ohio, a hospital in Oakland, Md., and Uniontown (Pa.) Hospital, which joined in 2020.
“That built confidence for us that our model works in other states,” Dr. Wright said.
Next came Greensburg, Pa.-based Independence Health System, a five-hospital system, part of a broader push beyond state lines by West Virginia’s two largest systems.
Dr. Wright said WVU Medicine remains committed to geographic adjacency. Greensburg is roughly equidistant from Morgantown and downtown Pittsburgh.
“If you drive from Greensburg into Pittsburgh, you’re crossing a number of tunnels and rivers,” he said. “If you’re coming to Morgantown, you’re coming down a straight highway, and it’s free parking.”
4. Keep the money and decisions local.
Hospitals that join WVU Medicine want local control, and the model is built around that. Five functions are corporate: IT, much of finance, HR, compliance and legal. Corporate overhead is capped at 7.5% of net patient revenue. Each hospital keeps a local board with fiduciary responsibility, and there is no corporate sweep.
“If they’re profitable, those dollars stay in those communities,” he said.
That model is the biggest integration challenge with Independence, which arrived with its own corporate CEO and CFO. WVU Medicine is deconstructing that layer and moving the hospitals into its regional structure.
“We have a model that works for us, and we’re not going to move away from it,” Dr. Wright said.
5. Grow services, not just referrals.
Many academic medical centers pull patients to the flagship and cut services in local communities. WVU Medicine aims to do the opposite, Dr. Wright said, pointing to a couple of sites where it has reopened labor and delivery. Every hospital that has been in the system for a while has gained clinical services and jobs, he said.
To recruit in new markets, WVU Medicine pays West Virginia University tuition for the children of employees with more than three years of service, a perk that now reaches its Pennsylvania hospitals.
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