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7 lessons on partnerships from Akron General Health System and the Cleveland Clinic

In addition to mergers and acquisitions, hospital partnerships and affiliations are becoming increasingly common in the healthcare industry. At the Becker's Hospital Review 6th Annual Meeting on May 8, Thomas L. Stover, MD, President and CEO of Akron (Ohio) General Health system discussed his organization's partnership with the Cleveland Clinic.

AGHS, which was founded in 1914, is well known today for its care delivery model that focuses on prevention as opposed to following the sick care model.

Five years ago, AGHS was struggling financially. Before seeing the full effects of the Patient Protection and Affordable Care Act and Medicaid expansion, consultants from Booz Allen Hamilton informed AGHS executives that, if the organization continued operating as-is, it would be losing $15 million a year by 2017 and would probably close within three years.

"The reality hit us right, square between the eyes that something had to be done because we couldn't keep the organization going with a future that looked so bleak," said Dr. Stover.

So began AGHS's journey to find a partner.

AGHS established six criteria to consider when evaluating potential strategic partners, including cultural fit, a focus on health and wellness, clinical expertise, IT capability, a strong commitment to the community and financial strength.

The system found the Cleveland Clinic fulfilled all of the necessary criteria, especially the cultural fit. At the same time, by partnering with AGHS, Cleveland Clinic would gain a partner with a focus in preventative medicine and health and wellness.

In June 2014, AGHS and Cleveland Clinic signed a letter of intent, followed by an affiliation agreement in August 2014 that was made official roughly a month later.

Together, the two organization have worked toward the same objectives of strengthening and improving access to high-quality and affordable care, enhancing the clinical programs offered at AGHS, preserving AGHS's charitable mission and focus on medical education and research, identifying operational efficiencies and growing.

For other hospitals looking into partnership options, Dr. Stover shares the following seven lessons he learned from AGHS's deal with Cleveland Clinic.

1. Obtain external expert guidance.

2. Set terms and partnership selection criteria, and then stick to them.

3. Assemble key teams that are inclusive to work on the partnership.

4. Expect to hit some bumps in the road.

5. As much as you may want to, don't rush partnership efforts.

6. Be sure to consider cultural similarities.

7. Always over-communicate with your partner, because transparency is key.

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