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Ga. hospital CEOs see 'shift' coming

Wednesday, May 2, 2012 7:11 AM
Last updated Thursday, July 11, 2013 2:14 PM
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SAVANNAH, Ga. -- A “shift” is coming in the health care business model, and hospitals must evolve to remain viable, a trio of leaders from three of Georgia’s largest medical providers agreed Monday.

CEOs Maggie Gill of Memorial University Medical Center, Tim Stack of Piedmont Healthcare in Atlanta and Don Faulk of Central Georgia Health System addressed the challenges their organizations face during a series of “Future of Health Care in Georgia” forums held across the state.

The sessions started Monday morning in Atlanta, moved to Macon around midday and finished with an early evening discussion at Memorial’s Mercer Auditorium. The events were part of Mercer University’s Executive Forum series presented by BB&T bank.

“The main challenge ahead is to transition to a system that will have long-term viability, and it will be dramatically different than what we have today,” said Central Georgia Health System’s Faulk, whose group is based out of The Medical Center of Central Georgia in Macon. “We’re moving from a world where it’s pay-per-service to a world where we want to keep people out of the hospital, where the goal is for them to never darken the door to a hospital.”

Wellness initiatives have become increasingly popular with insurers and employers and will become even more so with the implementation of the Patient Protection and Affordable Care Act, more commonly known as Obamacare. Health care systems must adapt to the shift and also improve cost controls, the panel of CEOs agreed.

Hospitals are addressing costs through greater efficiencies but still face major hurdles, from competition for patients to payment collection models. The panel members all run hospitals where 30 percent of their patients are either uninsured or underinsured. Meanwhile, they must compete for the customers with the means to pay their bills.

“Anybody who doesn’t think consumer demand and expectations apply to health care is wrong,” Memorial’s Gill said. “Everyone wants the latest and greatest and the most specialized physicians, and if you don’t have it, they’ll go somewhere else.”

Health centers are also competing with what Piedmont’s Stack calls “strip mall” providers — privately owned surgery centers — that can offer retail prices on services like MRIs. An MRI conducted in a hospital can cost as much as four times as much as one done in a freestanding facility.

Insurers, including Medicare and Medicaid, and their payment processes are also handicapping medical centers. A health care center’s average wait for payment is 55 days, according to Stack, and physicians face a 30-day wait for insurer compensation.

Gill pointed out there are collaborative efforts, at both the hospital level and state level, to address these issues, but Stack said hospitals made a mistake in “letting the high ground go” in terms of collections.

“If you go to Publix and get a loaf of bread and tell the cashier ‘I want to take this bread home for a week and decide if its fresh and see if it tastes good before I pay for it,’ how far do you think you’ll get toward the door?” Stack said. “If I trip going out of here and break my leg, do you think I’m going to the front door at Memorial or the front door of an insurance company? We have to take the high ground back.”

Perhaps the most perplexing issue to the health center leaders is end-of-life care. Studies show 30 percent of the health care costs in a person’s lifetime are incurred in the six months prior to death. President William Underwood, who moderated the forum, lamented the plight of his mother. “Heroic” yet costly efforts extended her life but only for a short period of time.

The subject was clearly an uncomfortable one for the CEOs and the many health care professionals in the room. The CEOs admitted such conversations often get misconstrued as “death panel” discussions.

“The fact is a large chunk of Medicare spending — one-third — is spent in the last year of life, in the ICU and delivering high-level care,” Gill said. “Those are just the facts. And those facts demand that hospice and palliative care be better embraced.”


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