On the vanguard of thought. The future of healthcare requires nothing less.On the vanguard of thought. The future of healthcare requires nothing less.Reimagining Cancer Care

Planning Case Study

Barbara Ann Karmanos Cancer InstituteMcLaren Health Care

Detroit, Michigan

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Planning for partnership & cancer care success

Planning For Partnership & Cancer Care Success

In 2012, Dr. Gerold Bepler, CEO of the Barbara Ann Karmanos

Cancer Institute (Karmanos), began a search for a strategic

partner for the NCI-designated cancer center. Dr. Bepler

recognized the traditional fee for service reimbursement

landscape was passing away and that positioning Karmanos

for success would require thinking creatively about strategic

partnerships, organizational efficiencies and mechanisms to

reach a much larger clinical population.

Picking A Partner For The Future Of Cancer Care Delivery And Research

As part of this exploration, Oncology Solutions was engaged

to facilitate joint strategic discussions between Karmanos

and McLaren Health Care. Oncology Solutions had assisted

McLaren over a span of 20 years with strategic and facility

planning engagements, including establishing the cancer

tertiary cancer center in Flint, MI, and launching the Great Lakes Cancer Institute for system-wide oncology integration.

With this history, Oncology Solutions had a good sense of market dynamics and the key strategic issues that would need to

be resolved to form a meaningful partnership between the two entities. Both Karmanos and McLaren brought significant

interest and momentum into developing a sustainable model for the future. As McLaren and Karmanos began their strategic

exploration, the two parties agreed on guiding principles to govern the acquisition – including developing a superior value-

based cancer delivery network and protecting the funding for Karmanos’ 700 cancer research programs. Oncology Solutions

provided intensive analytic support and facilitated a series of joint planning discussions to address each parties’ goals – both

shared and divergent – to arrive at a model that could preserve their triple mission of clinical care, research and education.

The Barbara Ann Karmanos Cancer Institute is one of only 49

National Cancer Institute-designated comprehensive cancer

centers in the United States.

Oncology Solutions was jointly engaged by Karmanos Cancer

Institute and McLaren Health Care as they planned strategically

for their integrated delivery model.

Barbara Ann Karmanos Cancer Institute

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Planning for partnership & cancer care success

Integral to this process was the development of detailed financials supporting the long term financial sustainability of the

project and a determination as to whether each party secured a “return” on the investment in each other’s primary interest,

i.e., clinical care and research.

Market OpportunityMarket analytics and disease-

level cancer projections to

assess community need and

organizational opportunity.

Return on InvestmentDetailed five-year pro forma

financials and business case

outlining the impact of the

proposed strategic partnership.

Organizational ArchitectureConversion of strategy into

a binding letter of intent for

McLaren’s eventual acquisition

of Karmanos.

“I have had the privilege of working with the exceptional team at Oncology Solutions for the past five years and have seen first-hand their unprecedented level of passion, commitment and expertise when serving their clients while improving patient care delivery.”

Justin Klamerus, MD, MMM

Now, President, Cancer Hospital and Network Previous, President McLaren Cancer Institute

“By joining forces with McLaren, this agreement strengthens our ability to provide exceptional cancer care and furthers our commitment to cancer research and exceptional care across the state of Michigan.”

Joint planning and model development led to the successful signing of a letter of intent (LOI) between

Karmanos and McLaren in 2014. Broadly, this enabled the parties to achieve the following:

1. Integration of Karmanos’ clinical expertise into one of Michigan’s largest health networks.

2. Delivery of scale to both organizations as McLaren sought quaternary expertise and Karmanos extended

its clinical and research programs across the 10-hospital health system.

3. Preservation of financial vitality and growth in Karmanos’ robust research portfolio.

4. Extension of superior quality and access to clinical trials across McLaren’s six million person service area.

5. Provider compact to establish principles of professional practice for all members of the larger Institute.

6. Adoption of service line governance across the Karmanos network.

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Planning for partnership & cancer care success

The LOI was successfully developed into formal merger agreements and the two institutions are now fully

integrated in their delivery of cancer care and research. Collectively, the Karmanos Cancer Institute touches

~12,000 new cancer patients each year and continues to lead the way in advancing value-based care in the

state of Michigan.

As an extension of the planning and transactional work, Oncology Solutions continued its role as advisor for

Karmanos in a variety of capacities between 2014 and present. This included establishing an organizational

architecture to optimally align clinical and research activities, a full-scale clinical research program assessment

and a business planning effort for the expansion of the clinical trials office as well as exploration of additional

strategic affiliations.

References for Oncology Solutions’ work with Karmanos Cancer Institute:

Justin Klamerus, MD

President, Cancer Hospital & Network

Barbara Ann Karmanos Cancer Institute

Philip Incarnati

President & CEO

McLaren Health Care

Gerold Bepler, MD, PhD

President & CEO

Karmanos Cancer Institute

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Planning for partnership & cancer care success

About the Authors

Richard B. Taylor, PhD

Director

Chartis Oncology Solutions

404.836.2000

rtaylor@chartis.com

Richard Taylor is a Director with the Chartis Group in the

Oncology Solutions practice. He brings more than 44 years of

experience in providing strategic direction to cancer programs across

the country. Mr. Taylor helps healthcare organizations solve their most

challenging business needs, including strategic planning, mergers

and acquisitions, business transformation, physician integration,

and system-wide cancer program implementation. He has also had

an influential role in shaping notable milestones in the evolution of

cancer care. As an advisor to the National Institutes of Health, Mr.

Taylor was instrumental in designing the evaluation criteria for the

NCI Comprehensive Cancer Centers Program, and co-founded the

Association of Community Cancer Centers.

Rhonda S. Mealor

Director and Practice Leader

Chartis Oncology Solutions

404.836.2000

rmealor@chartis.com

Rhonda Mealor is a Director with the Chartis Group and Practice

Leader for the Oncology Solutions practice. She offers more than

30 years of experience assisting healthcare organizations with the

alignment of current operations and strategic goals to improve

performance and achieve long-term growth. She has helped many

organizations reduce costs, improve resource utilization, enhance

the patient and physician experience, and provide more efficient,

coordinated care through the development of multidisciplinary, tumor-

specific programming. Ms. Mealor has facilitated multidisciplinary

tumor site teams for more than 60 clients and has facilitated more than

750 meetings helping to implement best practice, improve resource

utilization and provide more efficient care.

v

Kelley D. Simpson, MBA

Director

Chartis Oncology Solutions

404.277.6567

ksimpson@chartis.com

Kelley Simpson is a Director with the Chartis Group in the Oncology

Solutions practice. Ms. Simpson has a passion for helping hospitals and

physicians drive transformative cancer care delivery. Her strategic,

analytical, and operational skills and organizational experience

enable her to be a catalyst for change with physician enterprise and

ambulatory networks. Hospital and oncology executives, faculty

practice plan, and medical staff trust Ms. Simpson to work alongside

their care teams to enhance oncology service line performance. Her

27 years of experience with the full range of challenges facing

community hospitals/health systems and NCI/academic centers

allows her to identify high-impact opportunities while mitigating

the tendency to problem-solve isolated issues that may not lead to

sustainable practices.

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Planning for partnership & cancer care success

About the Authors

Ryan Langdale, MBA

Principal

Chartis Oncology Solutions

404.449.3730

rlangdale@chartis.com

Ryan Langdale is a Principal with the Chartis Group in the Oncology

Solutions practice. He has consulted for more than 60 cancer programs,

including some of the nation’s top health systems. His areas of focus

include hospital and health system strategy, delivery network design,

and mergers and partnerships. Mr. Langdale’s recent work included

design of an integrated delivery model for one of the largest health

systems in upstate New York; care design for the opening of a $400M

cancer center in south Florida; and strategic planning for the affiliation

programs at two of the top NCI cancer centers. Mr. Langdale is a

regular contributor to industry publications, including a recent article

“Integrating Cancer Care Isn’t Always Easy—But It Brings Results” in

Hospital & Health Networks.

Atlanta | Boston | Chicago | Minneapolis | New York | San Francisco

About Chartis Oncology Solutions

Chartis Oncology Solutions was established in January 2018 when Oncology Solutions joined The Chartis Group, a

comprehensive healthcare advisory and analytics firm. Chartis Oncology Solutions offers preeminent cancer care advisory

and analytics services to community hospitals, health systems, NCI-designated and academic cancer programs across the

country. With an unparalleled depth of expertise and experience, Chartis Oncology Solutions works collaboratively with

healthcare professionals to strategically and operationally implement cancer care programs that enhance patient experience,

improve provider performance and impact communities. Oncology Solutions was founded in 1973 as the first firm exclusively

dedicated to serving cancer providers. For more information, visit www.oncologysolutions.com.