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Caregroup

In: Business and Management

Submitted By jess456
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The health care market in Massachusetts was an intense competitive environment. The two largest and most prestigious hospitals, Massachusetts General Hospital and the Brigham and Women’s Hospital, had agreed to a merger. The merger brought heavy pressures to many of the surrounding hospitals. The other hospitals realized that they needed strong negotiating power to push back against the health maintenance organizations to survive. Meanwhile, others were unable to fill the hospital beds which led to closures of many hospitals. Therefore, Massachusetts hospitals realized to keep afloat they would need a strong balance sheet in the perceived future price war. It was under these circumstances CareGroup was formed in 1996 through a three-way merger. The merger brought $1.6 billion of revenues to them and made it the second-largest group hospital in eastern Massachusetts. The Beth Israel Hospital and the Deaconess Hospital integrated into a single hospital, while the Mount Auburn Hospital reported to CareGroup as a separate entity. CareGroup consisted of health-care professionals who were devoted to provide high quality personalized health care to their patients. They offered community-based primary care and provided specialty services close to where their patients lived or worked. CareGoup’s mission was to develop integrated services across the hospitals, improve the quality of care, and cut down the cost. Their hospitals and physicians participated in nearly all managed care and health insurance plans which allowed them to continue to deliver the same outstanding, personal care that their patients have come to appreciate and expect. One significant strength of the IT environment created at CareGroup before the collapse, was its ability to streamline the three main hospitals information into one system. When Mr. Halamka, a doctor and a Unix genius, took...

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