Hoag Memorial Hospital Presbyterian and St. Joseph Health have settled on a name for the new company they are forming to operate a regional healthcare network: Covenant Health Network.
“We think the name Covenant means a lot and says a lot,” said Richard Afable, Hoag’s chief executive, during a break from the Newport Beach-based hospital operator’s annual healthcare forum held at the Hyatt Regency Irvine last week.
“Covenant is a promise, a sacred promise to work collaboratively and together to accomplish certain common goals,” Afable said.
The two hospital operators announced the creation of what will be known as Covenant in August.
Deborah Proctor, chief executive of Orange-based St. Joseph Health, referred to it as “a new kind of structure that you probably haven’t seen before.”
State Attorney General
Covenant’s next step is to file paperwork to get regulatory approval from California Attorney General Kamala Harris’ office, which is required to create the nonprofit corporation. That filing is pending and could take place this week.
A decision from Harris’ office is expected in several months. Officials have said they hope to have regulatory approvals, management and a board of directors in place to start operations in early 2013.
Covenant has had in-house legal teams from each hospital operator and “a host of consultants, legal and otherwise, who are assisting us in this filing,” Afable said.
One regulatory hurdle was cleared last month when St. Joseph and Hoag received clearance from the Federal Trade Commission.
Covenant will start operating at Hoag and St. Joseph facilities, and other area hospitals could become part of the network later on.
“Most Important”
“The most important thing for us to do first is to get Covenant Health Network up and operational and delivering on its promise,” Proctor said.
Covenant won’t know the “appropriate partnerships to create” until it’s “better designed,” she said.
Afable and Proctor have said both Hoag and St. Joseph retain its own identity.
“Hoag will continue to be Hoag—the name won’t change; the organization will continue to be led by the same people,” Afable said in August.
St. Joseph is a $4.4 billion Catholic hospital operator. Its Southern California facilities include St. Joseph Hospital-Orange; St. Jude Medical Center in Fullerton; Mission Hospital, with campuses in Mission Viejo and Laguna Beach; and Apple Valley’s St. Mary Medical Center.
Hoag, a $1 billion not-for-profit hospital operator, is made up of its main Newport Beach hospital and a second campus in Irvine.
Beyond Hospitals
Covenant also will deliver healthcare services outside beyond hospitals, said Darrin Montalvo, St. Joseph Health’s executive vice president, chief financial officer and regional executive vice president for Southern California, in an interview with industry newsletter Becker’s Hospital Review.
“We are taking services historically centered in an acute-care campus out to the community so we can provide services where people live and work,” Montalvo told Becker’s.
St. Joseph and Hoag have been focused primarily on laying the groundwork for Covenant’s operations and getting their work forces ready for the new company in the weeks since the plan was announced.
“A lot of focus had to be on getting the actual definitive agreement done,” Proctor said.
Cultural Aspects
The operators are starting to look at the cultural aspects of Covenant with an eye on “what’s the culture we want for the future rather than how does the Hoag culture compare to the St. Joe’s culture,” she added.
A focus on selling Covenant’s healthcare services to businesses is expected to come once regulatory approvals are in hand.
Afable noted at the time the new venture was announced that some employers were moving toward buying their healthcare benefits from what he said were “networks of care.”
