IU Health to open city office

October 28, 2017 GMT

IU Health has taken the temperature of the local market and likes its prognosis.

The state’s largest health care system will open a Fort Wayne primary care office with up to 15 providers early next year, officials announced Friday. The office, which will offer lab and imaging services, will have capacity for up to 20 physicians, nurse practitioners and physician assistants.

Dr. Geoffrey Randolph will lead the new Indiana University Health physician group as chief medical officer. Brian Bauer, former CEO of Lutheran Health Network, has been a paid consultant to IU Health in recent months. He is expected to have a formal role within the organization when the practice opens.

In an exclusive interview, IU Health President and CEO Dennis Murphy told The Journal Gazette that it’s the first step in a long-term plan that will result in “really a substantial presence in Fort Wayne ... paced over time.”

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Because the timing and scope of the investment are unknown at this time, Murphy was unable to put a dollar figure on it.

“This is a 30-year, 50-year decision for us. So this isn’t a short-term thing,” he said. “We don’t enter new markets lightly.”

The announcement marks the second time in as many months that IU Health has revealed plans for Fort Wayne.

In September, Riley Children’s Health announced plans to invest about $1 million to open a pediatric specialty office on the north side by mid-January. Riley Children’s Health and Riley Hospital for Children are under the IU Health umbrella.

Riley’s 6,000-square-foot leased space at Coldwater and Cook roads will include 12 exam rooms and be wired for telemedicine consultations. But the emphasis will be on in-person visits.

A possible location for the primary care office has not been disclosed.

IU Health isn’t a stranger to northeast Indiana. Indiana University has trained doctors at its local medical school for almost 40 years, Murphy said. The new primary care office will provide another venue for clinical training.

Until this year, Fort Wayne’s health care market has been primarily a tight, two-provider race between nonprofit Parkview Health and for-profit Lutheran Health Network.

But a falling out between some physicians and Lutheran’s parent company, Community Health Systems, has resulted in some doctors choosing to resign and others not having contracts renewed by CHS.

In May, the corporate board rejected the effort of 10 local doctors to persuade CHS to sell its share of the network to an investment group approved by the doctors.

CHS said the 1 billion too low. The doctors said the real reason CHS doesn’t want to sell is that Lutheran’s network makes 300 million in annual profit, and CHS needs to continue siphoning off that money to prop up its failing corporation. The corporation’s debt is about $15 billion.

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The doctors contend CHS hasn’t invested adequately in Lutheran’s eight-hospital network. Although the company promised in May to invest $500 million in the Lutheran system, they haven’t been satisfied.

Disgruntled local doctors were among those who contacted IU Health officials, asking them to stem the potential flight of valued physicians, Murphy said. Others who reached out to IU Health were elected officials and local business leaders.

Mayor Tom Henry released a statement Friday afternoon.

“We’re looking forward to IU Health having a presence in Fort Wayne. Fortunately, for northeast Indiana, IU Health has recognized and understands the need to ensure our citizens continue to have access to the goods and services they require and the amenities they deserve,” he said.

“I continue to be encouraged by the economic growth, new jobs and investments we’re experiencing in our community,” Henry added.

Indiana Senate President Pro Tem David Long, R-Fort Wayne, also issued a statement soon after the news broke.

“The decision by IU Health to enter the Fort Wayne marketplace is great news for northeast Indiana,” he said. “IU Health has a stellar national reputation, and will be a welcome and high-quality addition to our region’s strong health care presence.”

Long also praised Bauer as “a talented and experienced hand” as a health care administrator.

It’s unclear, however, whether Bauer’s participation could complicate the new primary care practice’s relationship with Lutheran and Parkview. Bauer was fired by CHS.

Dr. Randolph expects IU Health’s primary care patients who need to check into a hospital will be welcomed by either competitor.

“We intend to work in a partnership with the other two systems,” he said in an exclusive interview. “Our expectation is the other two systems will be ready and eager to care for our patients.”

Parkview spokesman Eric Clabaugh provided the following statement: “Parkview Health has little to comment on. We have not spoken to IU Health about their announcement and have no insights beyond what was announced today.”

Lutheran spokesman Geoff Thomas said, “We have a longstanding history with IU Health on a number of initiatives and we expect that to continue.”

Murphy isn’t sure how IU Health’s presence will evolve. The next steps would likely be the addition of a multispecialty practice and then more primary care offices, which will include lab and imaging services, he said.

But the first priority is successfully launching the Riley and primary care offices and gauging community response, Murphy said.

Despite unconfirmed reports circulated by competing media that construction of new local IU hospitals is imminent, Murphy wasn’t ready to commit.

“I think it’s a long stretch,” he said, “to go from where we are right now to contemplate hospitals.”

sslater@jg.net