Cloquet hospital joins state coalition

Community Memorial Hospital is joining a healthcare network that should allow it to gain the strength of numbers while maintaining its independence.

The Headwaters Network is a new coalition of 19 rural Minnesota hospitals and more than 50 clinics - including CMH and Raiter Clinic in Cloquet - that will provide care to more than 750,000 Minnesotans.

"With a bunch of other rural facilities together, Headwaters has over three quarters of a million patients," CMH CEO Rick Breuer said. "Suddenly, you have the size and scale of a health care system, without handing your keys over to Central Headquarters somewhere else."

Networks like Headwaters and the Rough Rider Network in North Dakota are a new approach for rural hospitals to band together to meet the mounting challenges of delivering health care in rural communities, including rising costs and staffing shortages, and negotiating with powerful insurance companies.

"None of this will affect access to care or the care we offer," Breuer said. "Over time, it should enhance our offerings. Working with others may allow us to start new service lines we couldn't start on our own, for example."

Being part of a network will certainly result in cost savings, as Headwaters can negotiate with vendors in the same way a Mayo or Sanford health care system could. Breuer said it will also improve care, as the doctors and others across the network will meet and work together to determine best clinical practices. With more cases, they will have more results to compare, be it treatment of pneumonia, Lyme disease or other cases.

Breuer said having a larger number of patients and health care facilities will also allow Headwaters to work with insurance companies to cover programs to keep people healthy, a paradigm shift that is gaining steam industrywide.

"Instead of just being rewarded and paid for treating people when they're sick, what if everyone gets on the same path of trying to reward each other and all of society for staying healthy," he said. "That is a huge philosophical shift, and a huge shift in how we deliver care, and what we think of our role. I'm pretty excited about that."

It's not the first time the hospital and clinic have worked within a network. Breuer said they have worked within groups to share technology and imaging services, and workers' compensation services.

"Those have all been great because it enhances our ability to get a piece of equipment or offer a service that we otherwise couldn't afford," Breuer said. But Headwaters will take that collaboration to another level, he said, because it's about both business and clinical practices, and the network can negotiate as one.

At the same time, each hospital will remain its own boss, able to react to the needs of the community it serves instead of serving a larger entity.

"The members of the Headwaters Network believe that helping rural hospitals to remain independent is the best way to serve the health care needs of our communities," said Ken Westman, chairman of the Headwaters board and CEO of Riverwood Healthcare Center in Aitkin, in a news release. "We also believe that our independence is strengthened by our interdependence. The more we can work together, the better we can care for our communities."

Every hospital still has its community-based board, community-based physicians, and leadership team making decisions for it's individual communities, Breuer stressed.

At the same time, those doctors, CFOs, nurses and clinic managers now get a "supportive peer community," said A. Clinton MacKinney, the chief medical office for Cibolo Health, which will manage the network. In turn, having that support system will help member hospitals recruit and retain clinicians, he said in a news release.

Breuer has high hopes the end result will be better health in the communities served by the Headwaters members.

The Headwaters network is in discussions with other rural hospitals in Minnesota interested in joining as members, and expects to grow.