In response to a recent change in Federal law, the Board of Trustees of The Carle Foundation and the Board of Governors of Carle Clinic Association have independently agreed to initiate discussions concerning the current relationship between the two organizations. Leaders from both organizations assure that regardless of these discussions and possible outcomes, The Carle Foundation and Carle Clinic Association remain committed to providing excellent patient care.

The Centers for Medicare and Medicaid Services (CMS) recently finalized significant changes to the Stark Law last month that will dramatically impact many physician-hospital relationships in existence throughout the country – including arrangements that The Carle Foundation and Carle Clinic Association have with regard to the provision of radiology and laboratory services for patients of The Carle Foundation. These regulations become effective October 1, 2009, and do not permit this arrangement to continue after that time.

Currently, laboratory and radiology inpatient services are provided to Carle Foundation Hospital patients by Carle Clinic Association. The rule change will affect the operations and finances of both organizations and adds some urgency to the examination of the relationship.

“The major challenge for The Carle Foundation is to find a new arrangement for providing laboratory and radiology services to hospitalized patients after October 1, 2009,” says James C. Leonard, MD, president and CEO of The Carle Foundation. “The leadership of both organizations is committed to developing a solution that preserves the high quality of care we offer and meets the mandates of the new Federal regulations.”

“It’s to the benefit of all our patients that we continue to work in the collaborative manner that has served our communities well through the years,” says R. Bruce Wellman, MD, president and CEO of Carle Clinic Association. “Physician leadership at Carle Clinic Association is resolved to pursuing a course of action that is in the best interest of our patients.”

The Hospital and Clinic are working together to review the full impact of the Stark IV rules. Each organization would be required to replicate laboratory, radiology and some cardiovascular diagnostic services. This duplication of services would come at significant cost for the community, confusion for the patient, and would present standardization and quality challenges. Drs. Wellman and Leonard both emphasize the organizations will move quickly to analyze and identify all possible options, including various integration scenarios. “We understand that the uncertainty of this situation will generate questions and concerns and we appreciate the community’s trust and support as we move through this process.”