Value-based care delivery, since former President
Barack Obama signed the Affordable Care Act into law in 2010, is the
standard of the healthcare industry. Reimbursements continue to drive
medical technology advancements and a greater emphasis on
outpatient care delivery, including preventative care.
The move to reduce the duration of hospital stays isn’t new,
but increasingly healthcare providers are looking for ways—leveraging technology as well as non-healthcare community entities—to
tailor patient wellness outside of hospital settings.
The Business Journal’s Sherry Hsieh asked some Orange County hospital executives to address how the care providers navigate the paradigm.
Here are edited excerpts of their responses:
Barry Arbuckle
Chief Executive
MemorialCare Health System
Fountain Valley
At MemorialCare, we are committed to revolutionizing value in healthcare. We are profoundly different than what we were decades ago. This is most evident in our transformation into a community-
based, outpatient care and fee-for-value model.
We have five hospitals, and we have expanded our ability to serve physician-based consumers in Orange County with over 200 sites of care––outpatient physician locations and urgent care, imaging, kidney dialysis and surgery centers.
We are uniquely positioned to provide consumers with high-value health, wellness, prevention, chronic disease management and treatment in the right location, with the right services and at the right price. Unlike most health care systems across the county, our ambulatory centers are intentionally not operating under the hospital license as a hospital-based outpatient department, but instead are operating as ambulatory care centers. While hospital-based programs result in higher reimbursement rates, our approach offers considerably more value with high quality and lower prices for employers, health plans and consumers.
Thanks to technological advances, for example, many surgical patients who spent days in a hospital now receive care easily accessible in outpatient centers without an overnight stay.
The biggest change with physicians is not how much but how they are being paid. An increasing amount of reimbursement is tied to patient satisfaction and quality outcomes. You want to measure, but you also want to improve overall wellness so you can reduce cost, improve care outcome and reduce readmission.
And we are unveiling even more new health care centers, innovative programs, progressive partnerships and comprehensive services located near where people live and work.
We have wellness care programs in all our locations that include fitness facilities, Weight Watchers challenges. Employees participate in challenges and are rewarded with prizes if they meet that. We’ve seen in our own employees that we, as a healthcare provider, are able to provide programs and incentives that help them navigate the system, set a healthier trajectory and maintain high compliance.
Robert Braithwaite
Chief Executive
Hoag Memorial Hospital Presbyterian
Newport Beach
The core of the business is changing. For the last five to seven years, we have seen the shift from the inpatient to the outpatient model, and the shift continues, driven by lower reimbursement, as well as advances in technology––it’s sometimes more about providers training physicians to learn more skills.
The [Hoag] Orthopedic Institute, which performs more total hip and knee replacements in California, can do joint replacement surgery in a day. This is less expensive compared to the prior five-, eight-day recovery time. You can come to a clinic in the morning and be done with surgery in the afternoon. We also do a lot of gynecologic surgeries, and the da Vinci robot is very precise in making small incisions. The surgery used to take three to four days, but now you can go home on the same day the surgery was performed.
Sometimes you need hospitalization, but we are also seeing technology helping to reduce recovery time. Every day you are not staying in the hospital, that is a lot of cost saved.
But our goal is to provide good care that produces good outcomes with maximum efficiency, not reduce costs.
We are one of the most advanced in terms of technology. We have the Surgical Navigation Advanced Platform from Surgical Theater LLC that uses virtual reality to allow neurosurgeons to fly through a patient’s brain to get a better look at tumors, nerves, blood vessels and tissue prior to surgery. We are one of only 10 nonacademic hospitals to have this technology in-house. That’s pretty impressive for a community hospital like ours.
In terms of the technology we are investing in within the hospital’s four walls, we are doing telehealth and digging deeper into technology to do with understanding human genomes.
How you think about healthcare should come from communities that you serve, how [this community] thinks about healthcare and what they need from it. When we first opened Hoag Hospital Irvine last year, we needed to hire about 900 employees. About 400 of them were transferred from Newport Beach, but the new hires, we were looking for people who can understand Irvine residents’ culture and language. We hired talents who are fluent in Mandarin, Korean and Farsi [among others].
You have to be very thoughtful about taking care of the population.
Mark Costa
Executive Director
Orange County service area
Kaiser Permanente, Anaheim and Irvine
Across the country, how care is paid for has changed from per-visit to value-based. Kaiser is able to provide the highest quality care at the most affordable cost to our members because we pay one entity to provide all of your care.
We are seeing providers moving to capture population management information and integrating medical records from different system networks of care into an organized system. The biggest trend is how to use data from health records to drive best outcomes and lower costs.
We are using better technology innovation to stay connected with our members, and also for our members to connect with their own health.
About 35% of our membership populations within the entire health system falls within the Medicare, Medi-Cal or dual, meaning they are covered by both plans. The Affordable Care Act expanded healthcare coverage to these people, and they get to come to our primary care doctors to learn how to use the healthcare system. And we worry about these people; if they lose their insurance, they will go back to live their lives like before when they didn’t have insurance.
We need to go out to the community. We are not going to change people’s lives by going upstream. We work with schools in the community to support education in stem cell programs; we work with cities on issues such as violence and healthy food access.
Another really important trend is mental illness. Before, we used to put a separation between physical and mental wellness or badness. But usually people with depression don’t have good physical health. We are starting to see the importance of mind, body and spirit.
The long-term impact of healthcare has to get out of the silos of taking care of the sick and go out to communities and help with food, economic insecurity. If you look at our portfolio, we support other organizations in the community that do this work.
We are getting smarter at how we provide care. We have virtual video visits, email pharmacy, to name a few. One advantage that we have is our integrated model of medicine.
Kimberly Cripe
Chief Executive
Children’s Hospital of Orange County
Orange
CHOC is known for the way we care for our patients needing chronic, acute care. This will continue. But looking at the majority of Orange County children, they don’t have chronic healthcare problems, but we still want to be there for them as a health resource.
We are working with Rady Children’s Hospital in San Diego to build a primary care network. We plan a $17.7 million innovation plan, not all campus-based, to get parents information on how to raise healthy kids in our communities. Educating parents and kids about proper nutrition, obesity, as well as mental and physical health. Clearly a huge part is technology, and also a huge social media piece as to how you collaborate with your community and how you define community, really should be broader. In reality, kids touch a lot of community entities, religious, education.
We are the top regional center for innovations in pediatric care. Our emergency room will come close to seeing 150,000 visits last year. Add another 30,000 at Mission Hospital. To take care of a kid, say with cancer or open-heart surgery, that type of thing takes a large interdisciplinary team ranging from surgery, radiology to child and family counseling.
Something I am really excited about is mental health. We are building the first inpatient psychiatric beds in California.
The reason why we have so few psychiatric beds is that insurance doesn’t pay for them. You don’t want to put your organization at risk—it’s such a money loser, it’s not a good business plan—but we are doing it because that’s what you need to do to support this community (see related story, page 26).
Lee Penrose
Chief Operating Officer
Acute Care Services
St. Joseph Hoag Health
Irvine
The last 10 to 15 years led to the creation of partnerships that are different from the prior relationships. A lot of concepts have changed, including the concept of wellness, emergency room care, and the development of healthcare providers providing a network of care.
Reimbursement, if left alone, can be divisive for providers. If a hospital is succeeding financially, that means insurance is losing money. There’s a misalignment, and that might not be best for patients.
An important challenge would be in getting more efficient in terms of getting better patient outcomes while cutting down costs.
In my role, I am very close to the issue. There are many places you can go for healthcare, ambulatory, urgent care, emergency room … and depending on where you go, the cost spectrum increases or decreases.
Going to see your primary physician in [his or her] office is the more affordable [option], and more importantly there’s continuity of care. Your primary physician knows your family personal medical history and can therefore provide more comprehensive care. An emergency room visit is the most expensive.
I would never want to dissuade somebody who absolutely needs to go to an emergency room not to go, because that’s why we are there, fully-staffed 24/7. But if you can get the same comprehensive care at a setting that is less expensive, there’s no reason that you should go to an emergency room.
We know people get frustrated, especially now that it’s cold and flu season, when it’s hard to get a same-day appointment with your physician, and even urgent care can be frustrating because of the long wait time, so people may end up going to an emergency room. One thing we are trying to do in balancing the workload is to open up more urgent care centers and try to make them as accessible as possible.
There’s no perfect science to it. When a patient comes into an emergency room, we assign a code based on the level of acuity, levels one through four. We have noticed a drop in level one visits, pointing to the fact that there’s a good reason to do this. We are really freeing up capacity for the sickest of the sick.
I think every health system is different, different geography and a different demographic. What we have in common is every health system is trying to find ways to better coordinate their services both in ways we offer services to the community and how we run our facilities … I am excited about the opportunity to collaborate with all of the hospitals in our region to provide better care for Orange County.
