Case 5 Essay

13654 Words Feb 25th, 2014 55 Pages


Can This Relationship Be Saved? The Midwestern Medical Group’s Integration Journey


On a snowy January evening, the Midwestern Medical Group (MMG) management team held a retirement party for Judith Olsen, MMG president. During the evening, Olsen reflected back on the years she had worked for MMG with mixed feelings about her experience. Over the course of their eight-year integration
This case was written by Rhonda Engleman and Jisun Yu under the supervision of Professor Andrew H. Van de Ven of the Carlson School of Management at the University of Minnesota. We also appreciate the editorial assistance of Julie Trupke and useful comments of Gyewan Moon and Margaret Schomaker. We gratefully acknowledge Stuart
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ed a study to evaluate the appropriateness and value of MMG referrals to Midwestern hospitals; the study demonstrated appropriateness and significant financial value of MMG referrals to Midwestern hospitals Johanson announced planned retirement in summer 2001; Novak promoted from president of Midwest Health Plan to Midwestern COO to prepare to take over System CEO position

Spring 1999 Mid-1999 Summer 1999

Fall 1999 Spring 2000

Spring 2000

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Exhibit 5/1: (cont’d)
Date May 2000 June 2000 Event Johanson requested Erickson’s resignation in aftermath of conflict between Midwestern hospitals and specialists Midwestern executive council reviewed options to restructure MMG, including status quo, establishing MMG as a separate MBS, full divestiture, partial divestiture, and hiring outside management; council ruled out divestiture and separate MBS options, but deferred a decision on other options Midwestern initiated a national search for a new MMG president MMG management team presented list of demands to Midwestern board, including demands to maintain a single MMG, increase MMG representation in System leadership, acknowledge contributions of MMG to the System, and clarify expectations and accountabilities of System members Erickson officially retired; Olsen selected as interim MMG president Novak commissioned Deloitte & Touche to evaluate hospitals and MMG to identify potential costs savings and revenue enhancement; Deloitte &

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