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Online Chat, Part Two

By Dr. David C. Pate, News and Community
August 15, 2013


I want to thank everyone who participated in the online chat with St. Luke’s Health System Chief Financial Officer Jeff Taylor and me on Monday of this week at the Idaho Statesman and who were interested in the Statesman's recent reporting on our efforts. Great questions! 

We went long and still did not get to all the questions, so I promised that I would answer them on my blog. Here goes …

QUESTION FROM JAMES

Will St. Luke's continue to publish metrics showing community benefit? Will those metrics become more specific?

ANSWER

Thanks for your question, James! St. Luke’s is committed to transparency around our community benefit activities. We know it is an important way for us to share information and engage people in the work we are doing to serve our community.  

We have started publishing a Value Report to outline what St. Luke’s is doing to bring more value to the communities we serve. Here is the link to our most recent report.

We are also preparing to publicly release portions of our strategic plan, and we are going to make public all of the quality performance data from our early beginnings as Idaho’s only government-designated Accountable Care Organization.

QUESTION FROM ANTONIO

Historically, physicians have avoided taking Medicaid patients because of the low reimbursement rate. With the potential of the CAT fund being eliminated and Idaho Medicaid redesign, do you see this affecting your revenue or business practices?

ANSWER

Wow, Antonio! That is a very insightful question and there are several pieces to the answer. 

First, you are correct that Medicaid patients have a more difficult time accessing services because many physicians will not see Medicaid patients due to low reimbursement. They aren’t the only patients with problems accessing care. Patients who don’t have the ability to pay (charity care) and Medicare patients have similar problems. 

This is one of the problems that we are addressing through our St. Luke’s Clinics. All of our St. Luke’s Clinic sites accept patients, regardless of their ability to pay, as long as the clinic has the capacity to accept new patients.

Of course, we always make services available to any patient with an emergency medical condition, regardless of their ability to pay. St. Luke’s physicians are able to see patients regardless of their ability to pay because St. Luke’s compensates physicians based on caring for patients, not based on collected revenue. 

Without St. Luke’s and Saint Alphonsus providing this support to physicians, the community would have much more serious access problems. Without timely and appropriate care, we know that patients’ health will deteriorate, the costs to care for them will increase, and they will have no other place to go than our emergency rooms.

As far as Medicaid redesign, St. Luke’s is very active with the state, as are many other providers and organizations, in helping develop programs for Medicaid that include some of the features of accountable care. The redesign of the Medicaid program was mandated by the Idaho Legislature in 2011. Members of the Legislature should be congratulated for their foresight.

Frankly, I think the State of Idaho needs to continue down this path and fundamentally change the way health care is provided and funded for the indigent, uninsured, and low income populations. The County Indigent and Catastrophic Health Care programs need to be eliminated and replaced with a less burdensome, more efficient program. Eliminating the County Indigent Program would save county taxpayers $478 million over 10 years, and eliminating Idaho’s Catastrophic Program would save state taxpayers an additional $540 million over 10 years.

Eligible individuals should receive care and coverage through a redesigned Medicaid program that requires the patient to be engaged and reimburses providers based on value and outcomes. The redesigned Medicaid program’s additional beneficiaries would be funded primarily by the federal government.   

These will be critical issues in the upcoming legislative session. The action Idaho needs to take eliminates two government programs, one at the county level and one at the state level, and completes the redesign of the State/Federal program that the Legislature initiated in 2011. 

The benefits to the taxpayer are significant, and in today’s climate, Idaho needs to jump at any chance to reduce the cost shift placed on employers/employees and reform a system that is in dire need of reform.

That’s a long answer to your question. The short answer is that yes, these changes will affect our revenue. But doing the right thing for the state and the people of Idaho is also the best thing for St. Luke’s and both scenarios, short- and long-term, provide significant benefits to the health of our communities.

QUESTION FROM JULIE

If the lawsuit doesn't go in St. Luke's favor, are you still planning on the expansion of the Nampa facility into a working hospital vs. ER?

ANSWER 

Hi, Julie! We continuously evaluate our communities’ needs and our ability to serve them with our limited resources. A decision to expand our Nampa services will need to be evaluated in light of new circumstances if the court’s decision is adverse. It is not possible today to say whether or when we would expand St. Luke’s Nampa.

QUESTION FROM JOHN

How would you classify St. Luke's current relationship with Saint Al's? With West Valley?

ANSWER

Thanks for your question, John. I want to be clear. I think Saint Al’s is a very good hospital and the employees, nurses, and physicians there are very caring, hardworking people. 

Throughout our history, we have had a healthy degree of competition between our two organizations. I think this has driven us both to be the best organizations we can be.

And we have also collaborated in many meaningful ways. I am sincerely disappointed that they chose to file a lawsuit against us. I wish they had chosen a different path, but they didn’t.

We have a wonderful relationship with West Valley Medical Center and their leadership. We work very collaboratively on a number of things, and St. Luke’s physicians work at West Valley on a dedicated basis. 

QUESTION FROM STEVE

Speaking of the pending lawsuit, why would St. Luke's deliberately go against the FTC's warnings and complete its acquisition of Saltzer, knowing it could lead to a lawsuit and cost so much time and money?

ANSWER

Great question, Steve! First, I would not say that we went against any “warnings” from the FTC and the Idaho Attorney General. Both were looking into the implications of the relationship with Saltzer and both thought it would be best if we waited until they finished their review before completing the transaction. We were very cooperative and forthcoming through the entire process, and in fact closed the transaction as late as we felt we reasonably could. 

While we were working to provide the FTC and AG all of the information they needed, Saint Al’s hired seven surgeons from the Saltzer Medical Group, creating significant financial challenges for the group that threatened the group’s viability, which made it even more important that we complete the transaction by the year’s end in order for the group to retain its physicians and employees. 

It is important to understand that at no point did the AG or FTC indicate when they could complete their investigation, and we know from others’ experiences that these investigations could go on for years. So, we had little choice if we were going to ensure the survival of the Saltzer Medical Group and ensure that its physicians would continue to be there to serve the communities.

QUESTION FROM JOE

As a St. Luke's employee, I want to thank members of the Benefits Department and SelectHealth management for resolving issues I experienced with medical claims.

Myself and my wife have physical disabilities that require medical supplies to live. We first experienced the "standard" insurance claim denials and excuses from SelectHealth. Once we were able to discuss with the right people between St. Luke's and SelectHealth, they were able to communicate well and do the right thing for us as the patient and customer.

ANSWER

Hi Joe! Thanks for your comment. SelectHealth has been a good partner and I am glad that we are meeting the needs of you and your family. 

Of course, another benefit of our Healthy U program and our relationship with SelectHealth is that premiums for our employees only went up 3.5 percent for this year, while I am under the impression that the experience around the state has been double or even triple that. In fact, we have heard of proposed increases of 24 percent! 

QUESTION FROM TINA

What is St. Luke’s doing in regards to the Health Care Exchange with Idaho?

ANSWER

Thank you for your question, Tina. St. Luke’s is very supportive of the Idaho Health Insurance Exchange.  We are a participating provider in many exchange plans and our partner, SelectHealth, is offering quite a number of plans on the exchange.

QUESTION FROM VICTORIA

While it appears the discussions with insurance companies are proving fruitful, I have seen the cost for prescription drugs more than double from one year to the next in our family. Will pharmaceutical groups be another area to target to help address healthcare concerns and costs, and what would that approach look like. 

ANSWER

Victoria, you have certainly hit on a problem that is significantly driving up the cost of health care. I recently read an article that the costs of pharmaceuticals has gone up faster this past decade and the incremental benefit is less than in the prior decade. 

We have to try to maximize the use of generics and constantly reevaluate a patient’s medication regimen to see if we can simplify it or eliminate some medications (for example, there may be a medication that is taken two or three times a day that could be substituted with a different medication that only needs to be taken once a day), and we have to be guided by evidence-based practices. 

And, of course, if we can be successful in more effectively managing the health of people, those people will need less medication, so for example with weight loss, there are some patients that may be able to stop taking expensive antihypertensive and diabetes medications. 

QUESTION FROM STEVE

The limited competition in cable/DSL service and also in wireless providers has not led to better pricing or better services (compared to other countries). How can we feel confident that with essentially two health providers in our area, we will get better services and prices?

ANSWER

Excellent question, Steve. There are a lot of data points that should be reassuring. 

First of all, data is publicly available comparing insurance premiums across the country. Idaho has ranked among those states with the lowest premiums. 

Secondly, St. Luke’s pays to get data that compares our prices to our competitors and to selected health systems in the Pacific Northwest. Data shows that our prices are among the lowest. 

Finally, not only is care low-cost in Idaho (though not low enough), it is also high-quality, so Idahoans have high-value options for their health care.

As for your question related to service: Consumers have a choice when it comes to health care in our community. No matter how good we believe our service and quality to be, we continuously work to make it even better so that people will want to receive their services from us. We know they have other options, including another health system.

QUESTION FROM SARA

People are afraid of the concept of "Corporate Health Care," especially in a rural area that is not exposed to "big business.” What is being done to soften the image of St. Luke's, which in these rural areas is perceived as being too big and uncaring?

ANSWER

Thank you for your question, Sara. I have heard concerns about St. Luke’s being too big or run from the “great state of Ada,” but I have not heard concerns that we were uncaring. While we are a growing organization, each of our facilities is locally led and has a volunteer board made up of residents from the community where the facility is located. I think this helps to ensure that St. Luke’s remains a local community hospital, reflective of the local community’s needs. 

QUESTION FROM GUEST

In the article, two health systems are mentioned as examples of "... paragons of efficient, high-quality health care ..." To what extent does being a teaching hospital play a part in being models of efficiency and high-quality care, and do you think that one is needed in Idaho?

ANSWER

Thank you for the question. Technically, Saint Al’s and St. Luke’s are teaching hospitals, because we do train residents in our hospitals. However, I am sure your reference is to the major teaching hospitals that serve as the primary teaching hospital for a medical school, which we are not. 

There are different degrees of efficiency or inefficiency and quality even among these traditional teaching hospitals.

A medical school in Idaho would make no sense to me, and I think Idaho is doing exactly the right thing to expand medical education through our support of the WWAMI program (which provides “in-state” seats at the University of Washington School of Medicine for students from Wyoming, Alaska, Montana, and Idaho).

QUESTION FROM LAURA

Primary care physicians that have been practicing medicine for a long time are having to make a lot of changes in their practices, especially with healthcare reform, reimbursement, and technology. How are St. Luke's physicians doing with all the changes?

ANSWER

Hello, Laura. Thanks for your question. This is a stressful time for all physicians, primary care physicians included. Uncertainty is hard for everyone, and there has never been more uncertainty in health care. 

While some are choosing not to change, I am extremely pleased with the large number of physicians who know change must occur and have decided to work with us in various capacities to lead the change.  It is truly inspiring.

QUESTION FROM BILL

When do you expect the rate of increase in healthcare costs to begin to get under control with the creation of a more accountable health care system like what you see happening?

ANSWER

Bill, that is a really tough question. I think there is short-term change and long-term change. 

The short-term change will be dependent upon when the business model changes from fee-for-service to pay-for-value, so that we can eliminate low-value/no-value costly services. There are a lot of barriers to changing the business model of health care to support the needed change, but that is why we brought SelectHealth into the market.

We are gaining momentum, and as more people sign up for SelectHealth plans, we should be able to accelerate the change. And perhaps it will be accelerated with the start of the insurance exchange in January. The good news is that we are already having an impact on lowering insurance premiums in our market, and we intend to do more. 

The longer-term change will come through improving health so that fewer healthcare services and less expensive healthcare services are needed. We are working on that as well, but the results will take longer.

QUESTION FROM VERA

When will there be sufficient data and what data is being used to show changes are effective?

ANSWER

Outstanding question, Vera. The lack of data has been a major rate-limiting factor for change.   Insurance companies have been reluctant to share what they consider to be proprietary information.  We have made some progress with our local insurers, and this is another advantage of our SelectHealth relationship, because we are very aligned on this point. 

In addition, a big benefit of our participation in the federal Accountable Care Organization program is that we will receive data from Medicare. 

Additionally, we are investing significant resources  to develop our own data analytics capability, and this may be the biggest payoff of all. We have partnered with a local company, WhiteCloud, to generate physician-specific and other important data and it is already improving care. 

One of our physicians, for example, recently noted that he thought he was doing a great job on mammogram screenings until he saw his data. As a result of having the information, he has put a new process in place and believes there have already been several instances where women have needed biopsies that might not otherwise have been found.

QUESTION FROM GUEST

How can we bend the cost curve down when obesity continues unchecked? Can the healthcare system handle the large influx of new patients as a result of the Affordable Health Care Act? We seem to still be short of doctors.

ANSWER

Thank you for your question. We cannot be successful in the long term without addressing childhood obesity. I have said many times that while we have a healthcare crisis now, it is nothing compared to the crisis coming our way because of the epidemic of childhood obesity. St. Luke’s is already making a difference through our YEAH! Program, but there is much yet to be done.

St. Luke’s is preparing for the consequences of healthcare reform. We do not have enough physicians to meet all the needs under the current way of providing care, so we are working with independent physicians, adding physician assistants and nurse practitioners to provide team-based care, and working on ways to keep people healthier and make patients’ care more coordinated so that their diseases are better controlled.

QUESTION FROM DIANA

I felt the article was biased against St. Luke's in the words she used when talking about St. Luke's and then Saint Al’s. How did the article turn out in regards to the actual interview? Thanks, Diana

ANSWER

Well, certainly there was much more to be said, and we wish that the views of some of the employers that have already benefited from our relationship with SelectHealth could have been included in the article. 

On the other hand, our story is complicated, and we are grateful for the efforts the Statesman made to cover the story. We also are very pleased that the Statesman chose to give the story front-page exposure, despite all the other news going on in Idaho and our country. 

Though after any article, it is easy to say that we wish they would have included this or that, we understand that there are time and space challenges for journalists, and they have to make choices about what to include and what to exclude. They aren’t necessarily the same choices we would make, which may explain why we are in health care and not journalism! 

One thing we wish could have come out more in the article is the fact that we have placed the patient at the center of all our programs and initiatives. And I still find that people are surprised to learn that Saint Al’s had made offers to acquire Saltzer Medical Group, but Saltzer chose St. Luke’s, and are also  surprised to learn that Saint Al’s also is acquiring physician practices and growing their numbers of employed physicians.


About The Author

David C. Pate, M.D., J.D., is president and CEO of St. Luke's Health System, based in Boise, Idaho. Dr. Pate joined the System in 2009. He received his medical degree from Baylor College of Medicine in Houston and his law degree from the University of Houston Law Center.