Perhaps no other time period in healthcare has been as uncertain or as exciting as today, and expectedly, it will continue to be in the near future. Different kinds of hospitals, such as community safety-nets, specialized and general acute care hospitals, are all facing the challenge of transitioning from fee-for-service to a pay-for-performance system, yet each in different ways.
At Becker's Hospital Review's 6th Annual Meeting in Chicago, Scott Becker, JD, CPA, publisher of Becker's Healthcare and Igor Belokrinitsky, partner at Strategy&, moderated a panel discussion about the future of healthcare with José R. Sánchez, president and CEO of Chicago-based Norwegian American Hospital, Nancy Ann Vish, RN, PhD, CEO of Dallas-based Baylor Heart and Vascular Hospital and Tim Weir, CEO of Rochester, Minn.-based Olmsted Medical Center.
In the face of so much uncertainty, Mr. Sánchez said he is prepared each day to make adjustments based on the environment surrounding Norwegian American Hospital on a community, state and federal level. While he notes the future of healthcare is somewhat unpredictable, it is important, he explained, to keep key priorities such as the triple aim and population health top of mind.
"As a community hospital, it is clear that we must act as one to understand and address the needs of the community," he said. "We have developed partnerships with federally qualified health centers and urgent care centers as part of our efforts to do this."
Reactions to and planning for payment reform
In regards to implementing new payment systems, Mr. Weir said he believes federal and state actions will be impactful following HHS' overhaul of Medicare reimbursement. However, at this time, Olmsted Medical Center is still very much in a fee-for-service dominated organization. As it prepares for this transition, Mr. Weir said the hospital maintains its viability beside crosstown powerhouse Mayo Clinic by focusing on standing out in select key clinical service areas, as opposed to attempting to "being all things in all areas."
In announcing its plan to overhaul the Medicare payment system, Mr. Belokrinitsky said the government has "let the genie out of the bottle" on the consumer side.
"HHS told consumers they should treat healthcare the same as they treat other industries," Mr. Belokrinitsky said. "They want to shop around, have 24-hour access and compare their options. Employers and consumers will perhaps create even more pressure for health systems to demonstrate value."
At the same time, narrow networks that effectively reduce and, in some cases, eliminate choice are restricting consumers, Dr. Vish said. While the Baylor Scott & White Health system is an active "aggressor" in the Dallas market and it has not experienced significant patient loss due to increasingly narrow networks, the healthcare system as a whole in the Dallas area is being impacted.
Complex challenges lay ahead
According to Mr. Weir, the labor market is becoming more and more challenging, particularly with competing to attract and retain core staff, such as registered nurses. At the same time, Olmsted Medical Center is continuing its efforts to reduce costs — something that will be even more difficult with a smaller than desired workforce.
As healthcare moves toward value-based and standardized care, there is a greater opportunity to make care more efficient. For example, nurses can provide more of the care that is currently handled by physicians. However, many state laws prevent nurses from practicing at their full potential, thus limiting care teams from operating at the highest degree of efficacy possible.
"Nurses are handcuffed to their practice. It's a state-level issue — they can't practice as nurse practitioners at their full capacity so they can aid physicians and capitalize on mid-level practice," said Dr. Vish. "Payment structures also discourage physicians from utilizing the mid-level staff as far as they can. As we look at those macro challenges, they really are inhibiting our ability to drive big changes in care because there isn't reimbursement."
Additionally, according to Mr. Sánchez, one of the most critical strategies for hospitals to design and enact is how to create the infrastructure to manage care and improve connectivity and coordination.
Planning for the future
The very nature of goal setting has changed inside the walls of many hospitals.
"Truth be told, we have gone from creating three-year goals to one-year tactical goals," Mr. Weir said. "With the size of our hospital, we just rent core staffing. We don't have the flex to buy. Right now we are 80 percent outpatient, and we are continuing to move to outpatient services."
Indeed, the strategic planning process has shrunk from five-year to three-year to short-term tactical planning, Mr. Belokrinitsky explained. Specifically, discussions for planning have changed from focusing on the service line to determining ways to become a provider of choice rather than a last resort.
In terms of a strategy for being able to keep the power running while simultaneously planning for growth, Mr. Belokrinitsky said the key idea to remember during strategic planning is to keep the discussions pragmatic.
"For a lot of organizations these talks are extremely uncomfortable," he said. "The fear is if we choose to focus on X we will be letting down the community and not fulfilling our mission because we are letting down Y. But it's not about closing doors, but rather about where to spend the next dollar. If there is just one dollar left, will it go toward funding research or for an exotic condition or toward hiring a new nurse?"