Physician engagement: The most vital component of hospital cost-cutting initiatives

Health systems across the nation are looking for ways to reduce costs, and physician engagement is a key to achieving that goal.

During a panel discussion at the Becker's Hospital Review 4th Annual CEO Roundtable + CFO/CIO Roundtable in Chicago, Molly Gamble, editor-in-chief at Becker's Healthcare, asked panelists to discuss ways their organizations have successfully cut costs.

Stacy Goldsholl, MD, executive vice president at UNC Regional Physicians, a subsidiary of High Point (N.C.) Regional Health, emphasized the importance of tying physician engagement into cost initiatives. "Without physician buy in, you're really running an uphill battle," she said.

As the leader of a physician-owned hospital, Dayton, Ohio-based The Medical Center at Elizabeth Place CEO Alex Rintoul understands how critical it is to get physicians on board. "Physicians are very attached to their patients and the care they provide, so it's not just about the dollars and cents," he said. When looking at cost-cutting initiatives, he said it can be a bit of a struggle to get everyone on the same page.

To show how physician buy in can make or break attempts to shrink costs, Neeraj Kanwal, MD, president of ProMedica Flower Hospital in Sylvania, Ohio, provided an example at his own hospital. "Our failure has been to prevent the diffusion of old drugs in new forms," he said. The physicians at Flower Hospital see a 1 percent advantage on a drug and want to use it, which has presented a challenge to cost control efforts, according to Dr. Kanwal. "I would give ourselves a D- on drug management," he said.

Flower Hospital is not alone in its struggles to control drug costs. Thomas C. Royer, MD, partner at Royer-Maddox-Herron Advisors and CEO emeritus at CHRISTUS Health in San Antonio, Texas, said he encountered similar issues when he was with Detroit-based Henry Ford Health System in the mid 1990's. "Because of our pharmacy costs, we wouldn't allow any of the pharmacy vendors to come in," he said. Although the system thought that would help keep costs down, the move had "toxic side effects," according to Dr. Royer. Henry Ford wasn't the only system kicking pharmacy vendors out, so the vendors got creative. Instead of going through physicians, vendors began to advertise more aggressively and directly to patients, leading them to request specific medications from their physicians.

Although cutting costs is a priority, and it can be difficult to get physicians on board with the process, hospital and health system leadership and physicians both have one common goal — providing high-quality care. Because of that, Dr. Royer said it's important for healthcare organizations to "support the finding that good quality is good finance."

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