Hospitals’ collaboration on laundry operations positions Mississippi Healthcare Corridor for Growth
JACKSON – In a move that is expected to achieve $8-9 million in cost savings and advance the Mississippi Healthcare Corridor in the Jackson metropolitan area, Baptist Health Systems, St. Dominic Hospital and the University of Mississippi Medical Center are collaborating to utilize shared laundry services through an agreement with Crown Health Care Laundry Services, a nationally-accredited private-sector health care laundry processor located in Mississippi. UMMC’s five-year agreement with Crown Health Care was approved today at the State Institutions of Higher Learning regularly scheduled board meeting.
The five-mile Mississippi Healthcare Corridor links Interstate 55 and Interstate 220 and includes most of the area’s academic and medical institutions. Anchored by the Jackson Medical Mall Thad Cochran Center, the corridor is dedicated to providing the finest medical care and education throughout the Southeast while hosting a biomedical research enterprise that fosters innovations and enhances applied therapies nationwide.
According to the three participating hospitals, the laundry services agreement is expected to result in capital cost avoidance of approximately $8-9 million by eliminating the need to repair and replace aging laundry equipment.
This cost avoidance will position the hospitals to increase their focus on providing excellent health care, and their collaborative agreement increases the overall competitiveness and economic vitality of the Mississippi Healthcare Corridor.
“This new services agreement is an example of these major health care institutions working together to gain efficiencies and spur development,” said Gov. Phil Bryant, who is focused on increasing the role of health care as an economic driver in Mississippi. “This willingness to collaborate is vital to continued growth and development within the Mississippi Healthcare Corridor.”
Gov. Bryant’s interest in collaboration among the metro-area hospitals stems from his 2012 visit to the Texas Medical Center (TMC) in Houston. The world’s largest medical complex, TMC is comprised of multiple participating hospitals and academic centers that collaborate in many areas including infrastructure and support services.
Duane O'Neill, CEO of the Greater Jackson Chamber Partnership said, “Our health care institutions have proven that while they are very competitive, they also believe in collaboration. The shared laundry allows more financial resources to focus on patient care, which is of the utmost importance for each hospital.”
The hospitals’ laundry services will be processed at Crown’s industrial-scale facility in Columbia, Miss. Crown officials expect to hire 30 to 35 additional employees at their Columbia plant as a result of the increased workload from these three contracts.
This October, Crown also plans to open a Jackson-area laundry distribution center within the Mississippi Healthcare Corridor to distribute the consolidated laundry from the three hospitals. This distribution center is expected to employ 12-15 people, with employment levels increasing as dictated by laundry volume.
Although each hospital will have a separate contract with Crown, the group issued a joint request-for-proposals through the Greater Jackson Chamber Partnership and jointly negotiated the terms of their contracts.
According to the leaders of the three health care institutions, the timing of the agreement could not have been better.
Chris Anderson, Baptist Health Systems CEO, said, “Baptist has been pleased to work collaboratively with UMMC and St. Dominic’s to consolidate laundry services and in demonstrating that local health care providers are committed to working together to create efficiencies in a very complex health care environment. We are confident this will work well for each organization and its patients and look forward to other partnership efforts in the future.”
Lester K. Diamond, St. Dominic Hospital president, said, “After careful analysis, we determined that outsourcing our laundry services, in collaboration with other local hospitals, would free up physical space on our campus and allow for capital investment in new medical technology instead of replacing aging laundry equipment. It would also be an important step in creating greater collaboration for future development in the Mississippi Healthcare Corridor.”
Dr. Lou Ann Woodward, UMMC vice chancellor for health affairs, said, “The hospital’s laundry equipment is nearing the end of its useful life. By shifting laundry operations to a third-party, we can realize a substantial savings on capital investment in new equipment, and the space occupied by our laundry facilities on campus can be repurposed for other uses. By unifying our laundry services, UMMC, Baptist and St. Dominic’s can allocate more resources to patient care.”
The amount of laundry managed at each of the health care institutions’ respective on-campus facility is significant, and the costs of repairing or replacing laundry equipment, along with the service costs of processing clean laundry and linen for each of the institutions’ main campus and satellite clinics throughout the state, has rendered the provision of laundry services untenable compared to more efficient alternatives.
Baptist Health Systems processes 4 million pounds of laundry at its campus facility each year, while St. Dominic Hospital handles 2.7 million and UMMC processes 4.2 million. UMMC-Grenada maintains its own laundry facilities and is not included in this contract.
Aside from its industrial-scale facility in Columbia, Crown also boasts laundry processing facilities in Selma, Ala., Quitman, Ga., and Pensacola, Fla. In the event of an emergency disruption in service at the Columbia plant, laundry service would be managed at one of Crown’s other facilities, preventing any disruption of laundry and linen services to the three health care institutions.
About Crown Health Care Laundry Services
Founded in 1955 and accredited by the Healthcare Laundry Accreditation Council (HLAC), Crown Health Care Laundry Services, Inc. is an independent full-service health-care laundry that specializes in providing laundry and linen service to hospitals, ambulatory surgery centers, imaging centers and physician practices throughout the Southeastern United States. The company’s mission is to provide health-care laundry and linen services to customers who demand quality products and cost control through the best possible utilization of linen.