Hospital administrators address cost, care and choice issues
By Kay Falk, for SBT
While the hospital administrative landscape in southeastern Wisconsin has taken on a definite feminine look in the past two years, the business of health care remains one focused on consumer demands.
"In this area, health care costs are the No. 1 issue," says Debra Standridge, president of St. Francis Hospital, Milwaukee. "Hospitals, doctors and insurance companies are all trying to keep costs down as consumers grapple with insurance plans and ask what they’re getting for the money they spend."
Sister Marybeth Culnan, regional vice president for Hospital Sisters Health System and chairman of the board of St Nicholas Hospital, Sheboygan (and four other Wisconsin hospitals in Green Bay, Eau Claire and Chippewa Falls), says belonging to a group helps. "Our system belongs to a larger group purchasing organization so we can get reduced costs on supplies," she notes. "Our centralized information data center also reduces costs. While we have a few computer people at each location, it saves having one data center instead of full information services at each hospital in our system."
One of the cost drivers is new technology, which poses a real dilemma for hospital administrators. "There’s so much new technology in health care, and the national media gives every new advance so much press. It makes consumers want it. Some of the technology really helps people," Culnan notes. "Other equipment may be a fad, but it all costs a lot of money. It’s a challenge to decide where to spend our funds. We try to be realistic in meeting consumer expectations and still keep health care costs reasonable."
Standridge cites CT scanners as an example. "They started as four-slice or view scanners, and have advanced to 16-slice," she explains. "The new ones give a better ability to diagnose and highlight specific areas. The need for technology like this makes being part of the Covenant Healthcare system an advantage. The system can distribute equipment among the various locations and check to see that it’s correctly placed according to patient demands. This enables us to provide what’s needed without passing on the cost of having every new technology at every hospital in the system."
Norma McCutcheon, president of the Wisconsin Heart Hospital due to open in January 2004, agrees that networking and being part of a larger system are beneficial in keeping costs down. This hospital is also part of Covenant Healthcare. "Our hospital is an option for overall lower aggregated costs," she says. "One way we hope to achieve that is by networking with other resources in the community and not trying to be all things for all people."
She adds, "While cost is topmost in business owners’ minds, we were surprised to learn from consumer focus groups, people from 45 to 62 years old, that they don’t want to be bothered primarily with cost. They know that can be dealt with later, but they want to know about care and choice."
Care expectations are changing
McCutcheon says health care needs to be focused and convenient. "The market is driving health care desires," she says. "Look at the changes in the way we shop, fuel cars and travel, changes that occurred because of customer demand. In health care, we’re seeing a demand for accessible care."
McCutcheon and her staff have used Harvard Business School’s Regina Herzlinger’s literature and book, Market-driven Health Care, as way to zero in on focused care. "By looking at how the service industry is being transformed in America, Herzlinger says it’s driven by the baby boomers. Her theory is that if you put the control and decision-making power back in the hands of the consumer, not the insurance company, hospital or physician, health care will change. These ideas are the basis for what we’re creating at Wisconsin Heart Hospital. We don’t have to be a stand-alone hospital. We can specialize in cardiac and vascular care and offer the rest of what a patient needs in a seamless way through the rich integration with Covenant."
The focus for this new hospital is meeting the needs of the patient and family. "When patients check in, like a hotel, they will be assigned to one room," she explains. "If their condition changes, they don’t have to migrate through the hospital. Instead, they stay put and the nurse, physician and technical providers come to meet them. All hospital rooms can handle stable or intensive care support."
Standridge points out that St. Francis and Covenant are faith-based organizations founded by a Catholic order. Their mission, vision and values all reflect care for individuals’ well being. "For example, St Francis focuses on family-centered maternity care," she says. "We ask and listen to moms to see what they need to make labor and delivery smooth and as comfortable as possible, and we ask who they want at their beside, not restrict it to who we think should be there."
St. Francis, well known for cardiac services, has a women’s heart program. "Many people don’t realize that heart disease is the No. 1 killer of women," Standridge says. "Part of the program is a screening for heart health. If it detects anything, we refer the woman to her primary-care physician but stay involved to guide them through the care process."
She adds, "Each hospital has specialties in health care. Our cath lab is second to none. We’re pioneering the use of drug-eluting stents that deliver drugs right where they’re needed. We also have T-wave testing, which is like a combination EKG and treadmill test, that is a good predictor of sudden cardiac death."
Emergency departments (ED) are also key to health care in the 21st century. Standridge called the ED the front door to the hospital. "What happens there is an indicator of the care the hospital provides and makes an important first impression," she comments. "The St. Francis ED has had phenomenal growth in the past three years, going from 25,000 visits per year to 36,000. ED care is critical to a hospital’s success."
McCutcheon agrees. Even heart hospitals have gone to 24-hour EDs with board-certified physicians. "We’ll offer that as well, but also take all comers with a charity care policy similar to Covenant’s," she says. "We’ll give full coverage and stabilize any patient that comes to the ED, whether that’s a cardiac patient or someone with a broken arm. We’ll integrate with other Covenant facilities to see everyone gets the care needed."
The shortage of health care workers is related to patient care, and it has all three hospital administrators concerned. "The shortage is more than in nurses," Culnan says. "Right now we see a shortage of radiology technologists."
Standridge notes that while more people are enrolling in health care educational programs, the faculty teaching them is aging and ready to retire. "Colleges and universities are wondering where the next group of instructors will come from," she says. "In addition, doctors are concerned about their livelihood, as the cost of providing service to patients increases, reimbursement is declining and demands on them increase. Not long ago doctors saw 25 patients a day; now it’s more common to see 35 to 40 a day. These factors may contribute to a doctor shortage as well."
Because of the health care worker shortage, Wisconsin Heart Hospital is sensitive to other hospitals needs as it recruits employees. "Our intent is not to take big batches of employees from one provider and cause hardships," McCutcheon reports. "We’re trying to be creative about reaching people who want to make our model a part of their career track and offer something different."
Choice is important to consumers
The three administrators say there are options available today, and having choice is important to people. They advise business owners to become familiar with different providers and their approaches to health care.
McCutcheon emphasizes her hospital will offer efficient care that returns employees to work as soon as possible. "Our whole model is built on efficient, focused care that benefits the patient and results in lower aggregate costs," she says.
Culnan urges business owners to share options with employees as much as possible. "Employees are more satisfied if they can have a choice in health care providers, physicians and hospitals," she affirms. "When you buy into an exclusive network, you’ll make some employees unhappy, and if you change it three years later, it will make other employees unhappy."
She also advises business owners to share some of the cost of health care with employees. "Employees will be more conscientious in how they use the health care delivery system if they have some responsibility for payment through deductibles and co-pays," Culnan points out. "Even if it’s a small amount, it makes them think about their choices."
Standridge says that Covenant offers direct contracts with business owners, and emphasizes preventive services. "We encourage business owners to assess their employee population and see that they take advantage of preventive services to keep them well," she notes.
"Detecting a problem early can decrease costs and allow people more options for care," Culnan concludes.
After all, it’s all about cost, care and choice.
Aug. 8, 2003 Small Business Times, Milwaukee
