LHP Hospital Group, Inc: Dan Moen, CEO

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Uncertainty surrounds the healthcare market these days, and healthcare facilities, as well as physicians, are looking at ways to adapt and remain profitable. Not-for-profit community hospitals face regular challenges to find capital for new technology, electronic medical records, facility upgrades, or new facilities. Many small hospitals are joining with large health systems to survive. Physicians are evaluating all of their options, including hospital employment.

One company was founded to help not-for-profit hospitals adjust and survive during difficult times. LHP Hospital Group, Inc. (LHP) is a privately held company that forms joint ventures with not-for-profit hospitals to own, operate, and manage acute-care hospitals. LHP’s collaborations with not-for-profit hospitals provide capital while still ensuring that the hospital’s leadership remains integrally involved in decision-making.

“Not-for-profit hospitals shouldn’t lose opportunities to implement a new initiative for lack of capital,” said LHP CEO Dan Moen. “We can bring equity capital to a joint venture with a not-for-profit partner, allowing our partner to take advantage of an opportunity they wouldn’t otherwise pursue.”


One of the core values of LHP is collaboration–with hospital partners, community leaders, and medical staff.

“At the joint-venture level, we share governance 50/50 with our not-for-profit partners,” said Moen.  “In addition, we form a local community board of trustees for each hospital that is made up of 50 percent physicians from the medical staff and 50 percent local community leaders.”

Collaboration also involves keeping physicians involved in the control of the environments in which they work.  Moen said all LHP facilities have a “Physician Roundtable” where key opinion leaders on the medical staff join with local administration and LHP administration to discuss issues affecting patient care, strategic issues, and ways to grow and improve services.

“We believe if you say you want to give physicians a seat at the table, you need to have a vehicle to listen,” Moen said.

LHP’s goal is to assist not-for-profit community hospitals with their capital needs through  joint ventures, not outright acquisitions. LHP has both an executive team and a board of directors who have tremendous experience and can provide tremendous expertise to the joint-venture facilities. LHP still recognizes, however, the role community hospitals have locally, and the organization actively encourages the involvement of the existing hospital staff and community leaders.

“Local hospitals are usually one of the community’s major employers,” Moen said. “It’s where key events happen to people in the community — births, deaths, treatment for serious illness, recovery from accidents. It is important for the local community to stay involved with the governance of the hospital. The hospital is too valuable as a community asset to just hand over.”

Capital Investments

In addition to joint ventures with existing hospitals, LHP also builds new hospitals in communities that have a need. LHP has recently joined with the Seton Family of Hospitals to build a hospital and medical pavilion in a growing community in central Texas. The hospital is scheduled to be completed in 2012.

Moen said the venture came about after LHP was approached by private physicians in the area. The major competitor in the community is a large not-for-profit facility that employees all its physicians. The private physicians were looking for an alternative to being employed by the hospital and “the process developed quickly.”

Moen described the most common ways LHP invests in hospitals. The most common structure is forming a joint venture to invest in an existing hospital that needs capital to expand or replace its physical plant or enhance its services. LHP will also assist hospitals that want to acquire another hospital or healthcare facility or expand their reach within the community. Finally, LHP partners to develop new hospitals such as the one in central Texas.

Founded in 2008, LHP is currently involved in three joint ventures, with another two pending regulatory approval. Moen, who was a founder of LHP, predicts the company will continue growing rapidly. He said he expects the company to have about 20 hospitals within the next five years.

-by Patricia Chaney

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