EVERETT — The 250 doctors who own the Everett Clinic are deciding Sunday to accept or turn down DaVita HealthCare Partners’ offer to buy the independent medical care provider.
Two-thirds of the shareholders have to approve the deal for it to pass. The results of Sunday’s vote are expected to be made public within a few days.
If approved, the Everett Clinic would keep a large degree of independence as an operating division within the publicly-traded company, said Joe Mello, a senior executive at DaVita.
The Everett Clinic would keep its name and continue to be led by a physician board. CEO Rick Cooper declined to say how much the group’s shareholders stand to benefit from the proposed sale.
The terms of the deal would still need to be finished, hopefully by March 1, he said.
The Everett Clinic’s financial projections prompted it to look for a buyer, he said.
Within five years, the clinic’s costs are expected to exceed revenues, if nothing changes, Cooper said. “We knew doing nothing was not a viable option.”
Everett Clinic leaders plan to grow their way to a better financial future. They have adopted an ambitious strategy to expand into Seattle and double in size by 2020.
Growth, and becoming part of a Fortune 500 company, would give the Everett Clinic more clout as it shifts its business model from the industry standard fee-for-service to value-based healthcare.
Fee-for-service care pays providers each time they perform an operation, run a test, do a checkup, or provide some other service. Value-based care focuses on keeping patients healthy.
“We’ve been disappointed in our ability as an independent operator in Snohomish County to influence the market more quickly to adopt value-based care,” Cooper said.
The Everett Clinic is the state’s largest independent medical group and, with just over 2,000 employees, it’s Snohomish County’s fourth-largest private employer. Everett Clinic had revenue of $360 million in 2014.
DaVita has 65,000 employees and operates physician groups in six states. It also runs 2,210 outpatient kidney dialysis centers nationally, including one in Everett. It had net revenue of $12.8 billion and a profit of $723 million last year.
In the past year, the company paid $800 million in two settlements with the federal government for alleged wrongdoing. DaVita paid $450 million to resolve claims that it knowingly billed the government for costs that could have been avoided. It paid another $350 million to settle allegations that it gave doctors kickbacks for patient referrals.
“We were both embarrassed and disappointed,” Mello said.
As a result, the company has changed its practices to make sure it follows federal rules, he said.
DaVita believes in value-based care, and it plans to invest in the Everett Clinic, he said.
“Healthcare is a very local business,” Mello said. “It’s almost folly to think you can pull the strings from far away.”
Dan Catchpole: 425-339-3454; dcatchpole@heraldnet.com; Twitter: @dcatchpole.
Talk to us
> Give us your news tips.
> Send us a letter to the editor.
> More Herald contact information.
