Roanoke Times
Copyright (c) 1995, Landmark Communications, Inc.
DATE: THURSDAY, July 19, 1990 TAG: 9007190073
SECTION: VIRGINIA PAGE: B-7 EDITION: METRO
SOURCE: CHARLES HITE MEDICAL WRITER
DATELINE: LENGTH: Medium
Carilion, the parent company of Roanoke Memorial and four outlying community hospitals, now employs 4,575 people in the Roanoke Valley with an annual payroll of nearly $100 million.
Throughout its system, Carilion has 7,665 employees from Richmond to Big Stone Gap and ranks as the 58th-largest multihospital system in the United States with 1,830 beds.
Obstetric and pediatric services will be consolidated at Community, freeing up space to expand other services or make renovations at Roanoke Memorial.
Wednesday's announcement of the formal merger brings to a close a nearly three-year legal battle that attracted national attention.
After hospital officials announced plans to merge in mid-1987, the U.S. Justice Department filed suit to stop the consolidation. Government attorneys claimed the joining of two non-profit hospitals would allow them to dominate their cross-town competitor, Lewis-Gale Hospital, and raise prices. It was the first time the government had challenged the merger of non-profit hospitals on antitrust grounds.
Hospital officials claimed the merger would help hold down health-care costs by allowing them to operate more efficiently and avoid duplicating expensive services.
After the hospitals won their case in U.S. District Court and in federal appeals court, the Justice Department announced in May it was dropping the case and would not seek an appeal to the U.S. Supreme Court.
"We believe a precedent has been established regarding the merger of non-profit hospitals," Thomas Robertson, president of Carilion, said Wednesday.
"I anticipate there will be more mergers across the country, especially where it can be demonstrated - as was here in Roanoke - that the affected communities will receive higher quality, more cost-effective care," he added.
The pediatric services of Roanoke Memorial and Community will be consolidated at Community by the end of this year. With this move, the only pediatric intensive-care unit in Southwest Virginia will be relocated.
After renovations are made to accommodate a greater patient caseload, obstetric services will be consolidated at Community within the next 12 to 18 months.
The hospitals' two sleep disorder centers have been relocated at Community and, within two weeks, separate laundries that serve the hospitals will be located at Roanoke Memorial.
Community Hospital will continue to operate under the same management and have the same relationship to Carilion that Roanoke Memorial and hospitals in Bedford, Pearisburg, Radford and Rocky Mount have as affiliates of the Carilion system. All hospitals will retain their names and be overseen by separate boards of directors.
William Reid continues as president of Community and will become senior executive vice president of Carilion. He is among 12 directors of Community Hospital who Wednesday became directors of Carilion.
Roanoke Memorial will continue to function as a regional tertiary-care center with emphasis on "high technology treatments for cardiac, cancer and neurological diseases and trauma care," Robertson said.
by CNB