Bay Clinic and West Hawaii Community Health Center will consolidate operations next year to form a new health care organization serving patients islandwide.
The merger is effective July 1, 2022, just one year after Bay Clinic CEO Kimo Alameda proposed the idea to Richard Taaffe, CEO of WHCHC.
On that date, according to a news release, Bay Clinic as a nonprofit will cease operations and be dissolved, with WHCHC remaining as the surviving entity.
The yet-to-be-named new organization will provide medical, dental, pharmacy, behavioral health services and enabling services at locations islandwide.
“I’ve always tried to figure out how to connect the communities and always looking for opportunities to collaborate,” Alameda said Thursday. “And our favorite collaborator has always been West Hawaii Community Health Center. So to me the, highest form of collaboration is consolidation.”
Alameda pitched the idea to Taaffe, who wanted to take time to explore it with his leadership team.
“The things just kind of snowballed in a positive way since then,” Alameda said.
The boards of both organizations each approved the merger late last month.
“Because we’re both nonprofit organizations, our basic mission is to provide health care to the low income, uninsured and provide access to all,” Taaffe said. “We have common missions, we have common purpose, our structures are similar.”
The two boards recently met and had a “great conversation,” he said.
“… There’s a huge synergy between them because they see the potential,” Taaffe said. “They understand there’s a lot of work, and those are some of the fears. Let’s be honest, there’s fears, but there’s hopes and dreams and visions for providing service throughout the island through an integrated system of care.”
According to Taaffe, the newly created organization will be a $50 million entity serving 40,000 patients.
“That’s 20% of the population of the island, and that’s only going to grow,” he said. “We’re going to be able to serve more because of economies of scale and ability to leverage other resources. It’s a huge benefit, we think, and our boards think … to the community and to the patients and to the economies of each community.”
An integrated system will benefit residents who travel from one area of the island to other, and can offer services that one clinic might have but the other does not.
Alameda said having a $50 million operating budget is beneficial because “now you’re the big cheese. Now you can go after big grants, you can negotiate with payers. And then, because we’re a nonprofit, revenues that come in through grants or patient fees gets diverted right back into our community for more services, better services, greater access.”
And if the clinic grows to 45,000 to 50,000 patients, Taaffe said it will be able to bring new specialists aboard, which is “a huge benefit to the community.”
Founded in 1983, Bay Clinic is the largest nonprofit community health center on Hawaii Island. The West Hawaii Community Health Center was founded in 2005.
Each organization has about 200 employees.
Alameda said no one is expected to lose their jobs because of the merger, and new positions might be added.
Taaffe will continue in the CEO role of the newly formed organization, while Alameda will be a part of the leadership team.
“It was very easy for me, and you know, of course, that’s one of the big hurdles … which CEO is willing to step down,” Alameda said. “And I don’t see it as a step down at all. I see this as a step across into something bigger and better.”
“And I appreciate that,” Taaffe responded. “Thank you. Because otherwise it can’t work. If there’s conflict at board level or at the leadership level, then the merger doesn’t work. But this is because we all see it as a community. … That’s what it’s about, improving our community islandwide and making sure that people have equal access regardless of where they are.”
A new board of directors — led by the chairs of the WHCHC and Bay Clinic boards, Mike Matsukawa and Haidee Abe, respectively — will be formed with equal representation from both organizations. The new board will decide on a name for the new entity.
“We are excited to begin this new journey and to work together,” Matsukawa said in the news release. “Both organizations are about the same size in sites and employees. We have begun the process to build trust internally with staff and employees and most importantly with the community.”
“We have the same mission to enhance the quality of life for the community with improved health care access. Both entities truly understand the unique characteristics of their local communities. It’s a win-win for Hawaii Island,” Abe said.