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Category: Hospitals

“You’ve Gotta Shoot Some Sacred Cows:” MSU Health Care’s CIO On Health Systems & Tech Transformation

By JESSICA DAMASSA

If I continue to hear how difficult it is for hospitals to make money, I would like for them to see what it’s like to operate a real business. They are overstaffed…they are overpaying…they are not responsible for quality or outcomes…there are no guarantees on their services…they can block competition from entering their markets…they can buy up market share – that’s not a real business.

Well, lesson learned. If you ask Roger Jansen, Michigan State University Health Care’s Chief Innovation & Digital Health Officer, how he think things are going in US health systems when it comes to digital transformation and the integration of technology and value-based business models in hospitals, be prepared for a blunt conversation about how US healthcare model is failing and how the lack of incentive for change is keeping us all stuck in the same-old, same-old.

From digital health and telehealth to EMR and value-based care business models, we cover a lot of health innovation ground in this chat and get a reality check on whether or not things are really evolving inside health systems – and which stakeholders Roger believes hold the key to driving that change. (Hint: He identifies them as those who are already “footing the bill for the lavish lifestyles that healthcare administrators live that are probably well out-of-balance with the value that they actually bring to their corporations.”)

Roger on digital health? There’s better adoption and receptivity when it’s combined with “a service component that doesn’t add additional burden to the clinical component.” On virtual care and telehealth?

Down 70% since the pandemic’s lockdown days and more of a “behavior change problem” at this point than anything else.

When we get to EMRs around the 19-minute mark, things get extra spicy and we take a turn into “all this gibberish about volume versus value” and how value-based care models aren’t gaining meaningful traction either. It’s a big, bold reality check on the state-of-play of health tech, virtual care, and healthcare payment model innovation in health systems… watch now and let us know what you think!

Matthew’s health care tidbits: Is Covid over for the health care system?

Each week I’ve been adding a brief tidbits section to the THCB Reader, our weekly newsletter that summarizes the best of THCB that week (Sign up here!). Then I had the brainwave to add them to the blog. They’re short and usually not too sweet! –Matthew Holt

I am beginning to wonder, is COVID over? Of course no one has told the virus that it’s over. In fact infection rates are two to three times where they were in the post-omicron lull and new variants are churning themselves out faster and faster. We still have 300 people dying every day. But since we went past a million US deaths, no one seems to care any more.

For the health care system, COVID being over means a chance to get back to normal, and normal ain’t good. Normal means trying to get rid of that pesky telemedicine and anything else that came around since March 2020.The incumbents want to remove the public health emergency that allowed telemedicine to be paid for by Medicare, re-enforce the Ryan Haight act which mandates in-person visits for prescribing controlled Rx like Adderall for ADHD, and make sure that tortuous state license requirements for online physicians are not going away. This also means restrictions on hospital at home, and basically delays any other innovative way to change care delivery. Well, it was all so perfect in February 2020!

But there is one COVID related problem that doesn’t seem to be going away. People. They’re just not going back to work and nurses in particular are resisting the pull of the big hospitals. I don’t know the end game here, but there is a clue in the “return to office” data. Basically every large city is below 50% of its office space being occupied and companies are having to figure out a hybrid model going forward, no matter how much Elon Musk objects.

Hospitals aren’t going willingly into the night. The big systems still control American health care, and are prepared to fight on all fronts to keep it that way. But like office workers, nurses and doctors want a different life. The concept of virtual-first, community-based, primary care-led health care has been around for a long while and been studiously ignored by the majority of the system.

If hospitals can’t get the staff and keep losing money employing the ones they have, there will be new solutions being offered to clinicians wanting a different life-style. We just might see a different approach to health care delivery rising phoenix-like from the Covid ashes.

Matthew’s health care tidbits: Hospital shooting reveals so much

Each week I’ve been adding a brief tidbits section to the THCB Reader, our weekly newsletter that summarizes the best of THCB that week (Sign up here!). Then I had the brainwave to add them to the blog. They’re short and usually not too sweet! –Matthew Holt

In this edition’s tidbits, the nation is once again dealing with an epidemic of shootings. Now a hospital joins schools, grocery stores and places of worship on the the recent list. I was struck by how much of the health care story was wrapped up in the tragic shooting where a patient took the life of Dr. Preston Phillips, Dr. Stephanie Husen, receptionist Amanda Glenn, 40; and patient William Love at Saint Francis Health System in Tulsa.

First and most obvious, gun control. The shooter bought an AR-15 less than 3 hours before he committed the murders then killed himself. Like the two teens in Buffalo and Uvalde, if there was a delay or real background checks, then these shootings would likely have not happened.

But there’s more. Hospital safety has not improved in a decade or so. Michael Millenson, THCB Gang regular, has made that plain. And that includes harm from surgery. We know that back surgery often doesn’t work and we know that Dr Phillips operated on the shooter just three weeks before and had seen him for a follow up the day before. Yes, there is safety from physical harm and intruders–even though the police got there within 5 minutes of shots being heard, they were too late. But there is also the issue of harm caused by medical interventions. Since “To Err is Human” the issue has faded from public view.

Then there is pain management. Since the opiate crisis, it’s become harder for patients to get access to pain meds. Was the shooter seeking opiates? Was he denied them? We will never know the details of the shooter’s case, but we know that we have a nationwide problem in excessive back surgery, and that is matched by an ongoing problem in untreated pain.

And then there are the two dead doctors. Dr. Husen, was a sports and internal medicine specialist. Obviously there are more female physicians than there used to be even if sexism is still rampant in medicine. But Dr. Phillips was an outlier. He was black and a Harvard grad. Stat reported last year that fewer than 2% of orthopedists are Black, just 2.2% are Hispanic, and 0.4% are Native American. The field remains 85% white and overwhelmingly male. So the chances of the patient & shooter, who was black and may have sought out a doctor who looked like him, having a black surgeon were very low in the first place. Now for other patients they are even lower.

The shooting thus brings up so many issues. Gun control; workplace safety; unnecessary surgery; pain management; mental health; and race in medicine. We have so much to work on, and this one tragedy reveals all those issues and more.

Matthew’s health care tidbits: Digital Health is dead (well, not quite)

Each week I’ve been adding a brief tidbits section to the THCB Reader, our weekly newsletter that summarizes the best of THCB that week (Sign up here!). Then I had the brainwave to add them to the blog. They’re short and usually not too sweet! –Matthew Holt

For today’s health care tidbits, the elephant in the room has truely come home to roost, and now it’s landed on the phone wire, it’s close to breaking it. OK, I have stretched that metaphor to death but you’ll get my point. Writing on THCB earlier this month Jeff Goldsmith and Eric Larsen picked up on something I’ve been saying for a while –the fall in valuation of publicly traded digital health companies will have a knock effect on private companies

It took a while–those public companies stock prices started falling from their heights 14 months ago–but in the last month the venture capital scene has gone quiet. The days of sub $20m ARR companies getting mutli-hundred million dollar valuations are over for now. They will be back at some point in the future, as that’s how Silicon Valley has always worked, but it’ll be a while and in the meantime everyone is going to have to figure out what to do in the new world.

The “What to do?” question is getting harder as the data starts to come in, and it’s getting ugly. On the one hand the two fastest growing digital health companies ever have both had their comeuppance. Livongo was a tremendous exit for its investors and ended up trading at 20 times future revenue before it got acquired by Teladoc for $18bn mostly in stock. This quarter Teladoc wrote off much of its investment in Livongo and the whole company is now only worth $5bn. Clearly those “synergies” between telehealth and chronic care management didn’t work. The other rocket ship was Cerebral, which went from nothing in Jan 2020 to by Jan 2022 having over 100,000 patients and thousands of providers on its system as it raised over $300m from Softbank et al. Its aggressive & expensive customer acquisition costs, with its controversial controlled medication prescribing patterns, brought it way too much controversy. Its young CEO is gone, and it’ll be a slow climb back with bankruptcy and collapse the likeliest of outcomes.

But the part of digital health that’s trying to replace the incumbents is not the only place showing ugliness. The technologies and services being rolled out are often not working. Exhibit A is a randomized controlled trial conducted a Univ of Pennsylvania. One set of heart patients was set up with connected blood pressure cuffs, a pillbox that tracked their Rx adherence and lots of coaching help. The others were sent home with the proverbial leaflet and told to call if they had problems. You’d assume many more deaths and hospital readmissions in the second group. You’d be wrong. There were no differences.

So digital health needs to see if it can produce services companies that move the needle on costs and outcomes. The advantage is that they are eventually competing with hospital systems whose DNA doesn’t allow them the ability to let them cross the chasm to the new world. The bad news is that those systems have huge reserves which they can use to subsidize their old world activities.

I’m hoping digital health’s impact in the next 2 years will be as big as it was in the past 2, It’s by no means dead or over, but I am pessimistic.

Matthew’s health care tidbits: Hospital System Concentration is a Money Machine

Each week I’ve been adding a brief tidbits section to the THCB Reader, our weekly newsletter that summarizes the best of THCB that week (Sign up here!). Then I had the brainwave to add them to the blog. They’re short and usually not too sweet! –Matthew Holt

For today’s health care tidbits, there’s an old chestnut that I can’t seem to stay away from. I was triggered by three articles this week. Merril Goozner on GoozNews looked at the hospital building boom. Meanwhile perennial favorite Sutter Health and its price-making ability came up in a report showing that 11 of the 19 most expensive hospital markets were in N. Cal where it’s dominant. Finally the Gist newsletter pointed out that almost all the actual profits of the big health systems came from their investing activities rather than their operations.

None of this is any great surprise. Over the past three decades, the big hospital systems have become more concentrated in their markets. They’ve acquired smaller community hospitals and, more importantly, feeder systems of primary care doctors. Meanwhile they’ve cut deals with and acquired specialty practices. For more than two decades now, owned-physicians have been the loss leader and hospitals have made money on their high cost inpatient services, and increasingly on what used to be inpatient services which are now delivered in outpatient settings at essentially inpatient rates. Prices, though, have not fallen – as the HCCI report shows.

Source: HCCI

The overall cost of care, now more and more delivered in these increasingly oligopolistic health systems, continues to increase. Consequently so do overall insurance premiums, costs for self insured employers and employees, and out of pocket costs. And as a by-product, the reserves of those health systems, invested like and by hedge funds, are increasing–enabling them to buy more feeder systems.

Wendell Potter, former Cigna PR guy and now overall heath insurer critic, wrote a piece this week on how much bigger and more concentrated the health plans have become in the last decade. But the bigger story is the growth of hospital systems, and their cost and clout. Dave Chase likes to say that America has gone to war for less than what hospitals have done to the American economy. That may be a tad hyperbolic, but no one would rationally design a health care environment where non-profit hospitals are getting bigger and richer, and don’t seem to be able to restrain any aspect of their growth.

Hospital Systems: A Framework for Maximizing Social Benefit

By JEFF GOLDSMITH and IAN MORRISON

Hospital consolidation has risen to the top of the health policy stack. David Dranove and Lawton Burns argued in their recent Big Med:  Megaproviders and the High Cost of Health Care in America (Univ of Chicago Press, 2021) that hospital consolidation has produced neither cost savings from “economies of scale” nor measurable quality improvements expected from better care co-ordination. As a consequence, the Biden administration has targeted the health care industry for enhanced and more vigilant anti-trust enforcement.

However, as we discussed in a 2021 posting in Health Affairs, these large, complex health enterprises played a vital role in the societal response to the once-in-a-century COVID crisis. Multi-hospital health systems were one of the only pieces of societal infrastructure that actually exceeded expectations in the COVID crisis. These systems demonstrated that they are capable of producing, rapidly and on demand, demonstrable social benefit.

Exemplary health system performance during COVID begs an important question: how do we maximize the social benefits of these complex enterprises once the stubborn foe of COVID has been vanquished? How do we think conceptually about how systems produce those benefits and how should they fully achieve their potential for the society as a whole?

Origins of Hospital Consolidation

In 1980, the US hospital industry (excluding federal, psych and rehab facilities) was a $77 billion business comprised of roughly 5,900 community hospitals. It was already significantly consolidated at that time; roughly a third of hospitals were owned or managed by health systems, perhaps a half of those by investor-owned chains. Forty years later, there were 700 fewer facilities generating about $1.2 trillion in revenues (roughly a fourfold growth in real dollar revenues since 1980), and more than 70% of hospitals were part of systems. 

It is important to acknowledge here that hundreds more hospitals, many in rural health shortage areas or in inner cities, would have closed had they not been rescued by larger systems. Given that a large fraction of the hospitals that remain independent are tiny critical access facilities that are marginal candidates for mergers with larger enterprises, the bulk of hospital consolidation is likely behind us. Future consolidation is likely not to be of individual hospitals, but of smaller systems that are not certain they can remain independent. 

Today’s multi-billion dollar health systems like Intermountain Healthcare, Geisinger, Penn Medicine and Sentara are far more than merely roll-ups of formerly independent hospitals. They also employ directly or indirectly more than 40% of the nation’s practicing physicians, according to the AMA Physician Practice Benchmark Survey. They have also deployed 179 provider-sponsored health plans enrolling more than 13 million people (Milliman Torch Insight, personal communication 23 Sept, 2021). They operate extensive ambulatory facilities ranging from emergency and urgent care to surgical facilities to rehabilitation and physical therapy, in addition to psychiatric and long-term care facilities and programs.

Health Systems Didn’t Just “Happen”; Federal Health Policy Actively Catalyzed their Formation

Though many in the health policy world attribute hospital consolidation and integration to empire-building and positioning relative to health insurers, federal health policy played a catalytic role in fostering hospital consolidation and integration of physician practices and health insurance. In the fifty years since the HMO Act of 1973, hospitals and other providers have been actively encouraged by federal health policy to assume economic responsibility for the total cost of care, something they cannot do as isolated single hospitals.

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Silence Can Be Deadly: Speak up for Safety in a Pandemic

By LISA SHIEH MD, PhD, and JINGYI LIU, MD

Jingyi Liu
Lisa Shieh

There have been disturbing reports of hospitals firing doctors and nurses for speaking up about inadequate PPE. The most famous case was at the PeaceHealth St. Joseph hospital in Washington, where Dr. Ming Lin was let go from his position as an ER physician after he used social media to publicize suggestions for protecting patients and staff.  At Northwestern Memorial Hospital in Chicago, a nurse, Lauri Mazurkiewicz warned colleagues that the hospital’s standard face masks were not safe and brought her own N95 mask. She was fired by the hospital. These examples violate a culture of safety and endanger the lives of both patients and staff. Measures that prevent healthcare workers from speaking out to protect themselves and their patients violate safety culture. Healthcare workers should be expected to voice their safety concerns, and hospital executives should be actively seeking feedback from frontline healthcare workers on how to improve their institution’s Covid-19 response.

Share power with frontline workers

According to the Institute for Healthcare Improvement, it is common for organizations facing a crisis to assume a power grab in order to maintain control. As such, it is not surprising that some hospitals are implementing draconian policies to prevent hospital staff from speaking out. While strong leadership is important in a crisis, it must be balanced by sharing and even ceding power to frontline workers. All hospitals want to provide a safe environment for their staff and high-quality care for their patients. However, in a public health emergency where resources are scarce and guidelines change daily, it’s important that hospitals have a systematic approach to keep up.

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Leadership During a Healthcare Crisis: Kaiser Permanente’s Response to COVID-19

A Conversation with Dr. Richard Isaacs, CEO of The Permanente Medical Group and the Mid Atlantic Permanente Medical Group

By AJAY KOHLI, MD

Organizations aren’t built in crises. Their mettle, their history and their leadership define how organizations adapt and succeed, particularly in difficult times. Of the three, the most important quality is leadership. In this regard, Kaiser Permanente is leading the way in healthcare delivery.

I had the opportunity to speak with Dr. Richard Isaacs, CEO of The Permanente Medical Group and The MidAtlantic Permanente Medical Group, to discuss the strategic vision and granular details of Kaiser Permanente’s response to the global pandemic of COVID-19.

Kaiser Permanente has a strong foundation in the history of delivering care to the vulnerable. Founded in 1945 by a surgeon, Dr. Sidney Garfield, and an industrialist, Henry J. Kaiser, the organization grew from a single hospital in Oakland, California into one of the largest physician-led organizations in the world. Currently, it boasts more than 22,000 physicians responsible for the care of more than 12.5 million lives.

Many question how large healthcare organizations, like Kaiser Permanente, can adapt to a rapidly evolving problem, like the global pandemic of COVID-19, especially when cities and even countries are struggling under the burden.

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“Essential Oncology”: The COVID Challenge

By CHADI NABHAN MD, MBA, FACP

One harsh Chicago winter, I remember calling a patient to cancel his appointment because we had deemed it too risky for patients to come in for routine visits—a major snowstorm made us rethink all non-essential appointments. Mr. Z was scheduled for his 3-month follow-up for an aggressive brain lymphoma that was diagnosed the prior year, during which he endured several rounds of intense chemotherapy. His discontent in hearing that his appointment was canceled was palpable; he confessed that he was very much looking forward to the visit so that he could greet the nurses, front-desk staff, and ask me how I was doing. My carefully crafted script explaining that his visit was “non-essential” and “postponable” fell on deaf ears. I was unprepared to hear Mr. Z question: if this is his care, shouldn’t he be the one to decide what’s essential and what’s not?

This is a question we are all grappling with in the face of the COVID-19 pandemic. The healthcare industry is struggling to decide how to handle patient visits to doctor’s offices, hospitals, and imaging centers, among others. Elective surgeries are being canceled and advocates are arguing that non-essential outpatient and ER visits should be stopped. Ideas are flying left and right on how best to triage patients in need. Everyone has an opinion, including those who ironically consider themselves non-opinionated.

As an oncologist, these various views, sentiments, tweets, and posts give me pause. I understand the rationale to minimize patients’ exposure and thus prevent transmission. However, reconsidering what we should deem “essential” has made me reflect broadly on our method of providing care. Suddenly, physicians are becoming less concerned about (and constrained by) guidelines and requirements. Learning how to practice “essential oncology” may leave lasting changes in our field.  

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Infection Control for COVID-19 Imaging

By STEPHEN BORSTELMANN, MD

Occasionally, you get handed a question you know little about, but it’s clear you need to know more.  Like most of us these days, I was chatting with my colleagues about the novel coronavirus. It goes by several names: SARS-CoV-2, 2019-nCoV or COVID-19 but I’ll just call it COVID.  Declared a pandemic on March 12, 2020 by the World Health Organization (WHO), COVID is diagnosed by laboratory test – PCR.  The early PCR test used in Wuhan was apparently low sensitivity (30-60%), lengthy to run (days), and in short supply.  As CT scanning was relatively available, it became an important diagnostic tool for suspected COVID cases in Wuhan.

The prospect of scanning thousands of contagious patients was daunting, with many radiologists arguing back and forth about its appropriateness.  As the pandemic has evolved, we now have better and faster PCR tests and most radiologists do not believe that CT scanning has a role for diagnosis of COVID, but rather should be reserved for its complications. Part of the reason is the concern of transmission of COVID to other patients or healthcare workers via the radiology department.

But then someone asked: “After you have scanned a patient for COVID, how long will the room be down?” And nobody really could answer – I certainly couldn’t.  A recent white paper put forth by radiology leaders suggested anywhere from 30 minutes to three hours. A general review of infection control information for the radiologist and radiologic technologist can be found in Radiographics.

So, let’s go down the rabbit hole of infection control in the radiology department. While I’m a radiologist, and will speak about radiology-specific concerns, the fundamental rationale behind it is applicable to other ancillary treatment rooms in the hospital or outpatient arena, provided the appropriate specifics about THAT environment is obtained from references held by the CDC.

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