Hospital Focuses on Women’s Care

MediSphere delivers investors for $16 million local health care model

The women’s hospital planned for Johnson may become a model for similar facilities across the nation, says Brian K. Dixon, executive vice president for Nashville-based MediSphere Health Partners Inc.

MediSphere helped raise money from investors for the $16 million project and will manage the facility, which is expected to be completed late next year.

It is, says Dixon, “a real grand opportunity for Northwest Arkansas to be on the front end of what we see as a national trend.”

Still, regardless of their opportunity to be national trendsetters, the local physicians who have steered this project since its inception say they’re most interested in providing what’s best for their patients. And while they’re likely to face competition – Washington Regional Medical Center plans to build a 50,000-SF women’s center in Fayetteville’s North Hills Medical park – that wasn’t a big consideration either, they say.

“We’ve been in the business of taking care of women’s health for a long time and we are going to do what we need to do to provide the best for our patients,” says Dr. Scott Bailey, who practices at Parkhill Clinic for Women. “Competition brings out the best and that’s never a problem. … It makes both competitors better.”

Bailey says women’s specialty hospitals are becoming popular in metropolitan areas, and the physicians of the Parkhill Clinic and of Northwest Arkansas Ob/Gyn Associates in Springdale wanted their patients to enjoy that service. “We want to be the first to bring that to Northwest Arkansas.”

The trend Dixon referred to is for delivering one-stop shopping for women’s health care needs. For the still-unnamed Johnson hospital, that means more than obstetrics and gynecology facilities, Bailey says.

“We felt that there’s been a need for a complete, comprehensive health care facility,” he explains.

Bailey says the Johnson hospital will emphasize wellness and preventive care for women of all ages and at all stages of life. There will be an exercise facility, a biofeedback lab and areas for specialties such as plastic surgery.

MediSphere roots

The concept seemed logical to MediSphere. Founded in June 1996 by a group of experienced health care executives – Dixon and at least two other top executives were veterans of Surgical Care Affiliates, a pioneer in ambulatory surgery centers; and other principals came from Columbia/HCA and SunTrust Banks- MediSphere began as a women’s health company.

Early investors in the company included Warburg, Pincus & Co. of New York, New Enterprise Associates of Baltimore and Coleman Swenson Hoffman & Booth, local venture capital firm, Dixon says.

“We started out as a women’s health company,” he explains. Initially, the company began acquiring the assets of physicians’ practices but the ultimate goal “was to develop a network in a local community of physicians who primarily practice with women patients.”

Those physicians could include obstetricians, gynecologists, urologists and plastic surgeons, Dixon says. Currently, MediSphere has about 400 affiliated physicians.

The practices involved in the Northwest Arkansas venture – that of the six doctors of Fayetteville’s Parkhill Clinic for Women and the four physicians from Springdale’s Northwest Arkansas Ob/Gyn Associates – were already under management by CareSelect Group of Dallas, a MediSphere competitor of sorts, Dixon says. But while MediSphere limits its physicians’ practices to those who specialize in women’s care, CareSelect also works with cardiologists and orthopedists.

MediSphere entered the picture last October, Dixon says, and found that the physicians and CareSelect were already well down the road to developing a facility. The groups had even engaged an architectural firm -Davis Stokes Collaborative – and, coincidentally, it turned out to be the same Nashville firm that MediSphere uses.

“There aren’t many physician-driven facilities like this in the country,” Dixon says. “This is one of the first that integrates physicians’ practices … into one-stop shopping for women.”

The 100,000-SF facility, which includes physicians’ offices as well as 20 labor, delivery, recovery and postpartum suites, four operating rooms and six post-surgical suites, is similar in design and size to another MediSphere women’s health center currently under construction in Phoenix, Dixon says.

Population did not determine the building size, he says.

“We have spent a lot of time in the last two or three years analyzing markets, looking at what appears to be the magical size of a facility and the magical size of volume and the magical number of physicians to support something like that,” Dixon says. Noting that such facilities can be too large, he adds, “We believe the Fayetteville project and the one in Phoenix are the optimal size.”

He’s complimentary of the Arkansas physicians, who, he says, are “entrepreneurial and aggressive in a good way … in trying to be creative in looking at how they can help their patients. They’ve been studying this for several years … a lot of this initiative has been directed by the physicians locally.”

He says that “absolutely” the facility will provide care to patients regardless of their ability to pay.

“I want to clarify that right off the bat,” Dixon says. “When you provide health care, there’s got to be an open door.”

And although WRMC plans to build a 50,000-SF women’s center, Dixon says his company believes there’s room for all the players.

“MediSphere wouldn’t put their money or risk their capital on something we didn’t feel wouldn’t make a return. On the other hand, there is risk,” he says. “The question is can all these competitors survive? I think yes, and I think all will be fine.”

But Dixon says the group has made overtures to “several” local hospitals about possibly partnering with the physicians and groups in the Johnson venture. “I won’t say they’re not interested but I won’t say they’re interested,” he says, although there are ongoing discussions. He declined to say which hospitals might be involved in those discussions.

“We have always been willing to partner with the hospitals,” Dr. Bailey says. “There’s been an open invitation from the first conception of this idea, pardon the pun.”

He notes that the physicians have and expect to continue to play prominent roles with the hospitals. Dr James C. Romine and Dr. George R. Cole Jr., both physicians with Parkhill, have previously served as chief of staff at Washington Regional. Dr. Michael D. McMullin, who practices with the Springdale group, is currently chief of staff at Northwest Medical Center, Bailey says.

“We will still provide care at all three facilities,” he says.

But, “We naturally think that our facility is going to be the best.”

Chris Krueger, spokeswoman for Washington Regional, confirms that the groups have approached Regional. But, she says, Regional will proceed with its own project. Groundbreaking is expected this fall and construction should take twenty months.

Bailey also says that the physicians will continue their tradition of providing care, regardless of patients’ ability to pay.

“We have always done that and have never balked at that,” Bailey says. “We will continue to do so with our services as well as with our hospital.”

But with their own hospital, Bailey says, the doctors hope to operate more economically.

“We now have the say-so to trim waste and deliver a better product at a better price.”

Additional development

A limited-liability corporation, Interstate 540/Greathouse Springs Road Investors LLC, was formed to purchase a 40-acre tract on the west side of U.S. Highway 71 at the Johnson exit. According to filings with the state, about 10 acres is needed for the women’s facility.

Dixon says his group isn’t involved with plans for additional land development. “We hope it will be developed complementary of what we’re trying to do. … I think the physicians’ goal and ours as well is to develop a long-term medical park there.”

He adds, “I’ve been told there’s a lot of interest from other physicians and potential investors.”

Howard Flushman, senior vice president for CareSelect, says there have been inquiries from individuals about the land but that’s still preliminary.

He believes it will be attractive to physicians from a medical standpoint because it’s an opportunity to integrate various specialties.

And while the doctors of Northwest Arkansas Ob/Gyn Associates and Parkhill Clinic will give up their respective offices to move to the new location, Flushman suggests other physicians might want offices in the park on a part-time basis.