State board OKs Northwestern acquisition of KishHealth

BOLINGBROOK – A state regulatory board Tuesday approved Chicago-based Northwestern Memorial HealthCare’s acquisition of KishHealth System in a deal that could transform the health care landscape in DeKalb County.

The Illinois Health Facilities and Services Review Board voted unanimously to allow Northwestern Memorial to take over the two-hospital KishHealth System. The DeKalb-based health system is the largest private employer in DeKalb County and was valued at more than $329 million.

"With your approval today, KishHealth System will be integrated into Northwestern Medicine, an integrated academic health system operating in close affiliation with Northwestern University's Feinberg School of Medicine, our primary teaching affiliate," Dean M. Harrison, president and CEO of Northwestern Memorial HealthCare, told the board. "By joining Northwestern Medicine, KishHealth patients will have a seamless pathway to access advanced specialty care and clinical trials across our health system.
"If approved, we look forward to the opportunity to work closely with the community to identify and develop plans to meet health care needs for the residents of DeKalb and the surrounding area."

KishHealth System runs two hospitals – 98-bed Kishwaukee Hospital in DeKalb and 25-bed Valley West Hospital in Sandwich – and more than a dozen other area clinics and health facilities. This fall, KishHealth also acquired nonprofit behavioral health provider Ben Gordon Center.

Northwestern’s acquisition of KishHealth, which grew out of talks that started in May, would create a six-hospital system that stretches from Chicago to Sandwich. Industry experts have said the deal would benefit both systems. Northwestern Memorial stands to gain market share and a new pipeline for patient referrals to its specialists. In return, KishHealth would have better access to advanced specialists.

The state board’s decision came after several residents and local law enforcement officials raised concerns about access to mental health care in DeKalb County. They asked the deal be contingent on Northwestern agreeing to bring inpatient mental health care facilities to the area, something Northwestern doesn’t plan to do.

Northwestern officials have said those who need inpatient mental health care would be transferred to the recently expanded Central DuPage Hospital in Winfield.

At Tuesday’s meeting, KishHealth officials reiterated the system’s commitment to mental health services, but said inpatient facilities weren’t needed in DeKalb County.

Much of the opposition came from DeKalb County Citizens for Better Mental Health Care, which had previously opposed KishHealth’s decision to close its six-bed acute mental illness unit in 2009. KishHealth officials said the unit was underused and the review board ultimately gave the health system permission to shutter it.

“The sole purpose of our board’s decision was to improve health care for the communities we serve,” KishHealth System President and CEO Kevin Poorten said. “There has been some recent public commentary addressing the perceived need for inpatient behavioral health services in DeKalb. The decision of our board to close the Kishwaukee Hospital inpatient unit in 2009 was a difficult one, but necessary and appropriate given our low utilization, lack of dedicated physician coverage and resulting inability to provide consistent quality of care to the patients we served.

“While those limitations prevent us from operating an inpatient unit, we have been and remain committed to meeting our community’s behavioral health needs through expanded outpatient services and capital investment.”

In response to questions from Illinois Health Facilities and Services Review Board members, KishHealth officials said that from October 2014 to September 2015, there were 297 transfers of patients with mental health issues to inpatient facilities. Nearly 75 percent of those patients were transferred to facilities that were further away than Central DuPage. In comparison, the hospital admits about 5,500 patients annually.

“If it was really about benefiting the patients with better comprehensive health care in our county and in our DeKalb and Sandwich hospitals, then returning our behavioral health six-bed unit to Kishwaukee Hospital would be a priority, not what they are proposing to do once the sale is completed,” said Barry Schrader, co-chairman of DeKalb County Citizens for Better Mental Health Care. “Nothing will convince them otherwise unless you, the state board, hold up their application until they come up with a better plan for providing health care to DeKalb County.”

Several others echoed those comments.

“Moving these patients to DuPage is not the answer,” said Donna Bennett, a DeKalb resident and mother of a son with a mental illness.

DeKalb County Sheriff Roger Scott and DeKalb Police Chief Gene Lowery didn't attend Tuesday's meeting, but had sent letters to the board with concerns of mental health care.
"I do support this merger," Scott wrote in a letter that highlighted more than 100 suicide attempts in the county through October of this year. "However, the purpose of my letter is to encourage, as part of the transfer of ownership plan, that on-site mental health services including patient beds be a responsibility of Northwestern Memorial HealthCare should the transfer of ownership be approved."

Lowery had sent a similar letter that highlighted the tragic consequences of the dearth of mental health care options in the area.

Neither the DeKalb City Council nor the DeKalb County Board took a formal position on the deal.

"The DeKalb County Board has not taken a position in favor or against this proposed merger despite any unauthorized correspondence you may have received," DeKalb County Board Vice Chairman Tracy Jones told the review board.
He called KishHealth "a tremendous supporter" of the DeKalb County community.
Following the vote, KishHealth said in a statement that it would begin more detailed discussions with Northwestern about next steps.

“We are pleased with the Illinois Health Facilities and Services Review Board’s unanimous decision to approve the application for KishHealth to join Northwestern Medicine,” the statement said. “With this important approval, both organizations will continue to work together to finalize this agreement with the anticipation of KishHealth becoming a member of Northwestern Medicine before the end of this year.”