My Facebook friend, Anne Zieger, editor of Fierce Health Finance, wrote a compelling piece the other day regarding the potential demise of hundreds of hospitals. Her prediction is based upon some very valid financial realities, and we are witnessing them locally as well as nationally. Not unlike the little banks in our area that seemed to have been insulated from Wall Street’s collapse, some of these national problems seem to be washing over some of the smaller hospitals with relatively minimal damage. Yes, many of us have seen as much as a 10% decrease in elective, outpatient procedures.

In fact, while visiting a really upscale mall for a photo session with my two year old granddaughter, Lucy, an employee engaged me in a conversation about the rotten economy. About five minutes into the conversation, she indicated that there are currently 150 stores in the chain for which she works, and that only five percent of them made budget last month. Portrait pictures must fall into the category of a luxury as their business is severely impacted by this economy. More directly, however, she indicated that she needed stitches removed the other day, and that, “she did it herself” rather than spend the $20 co-pay.

So, are we seeing decreases in important tests? Are we seeing patients avoiding emergency room visits? Are we seeing patients cutting their prescriptions in half? Yes, to all of these questions. Anne, however, seemed to be talking about the “big boys,” where their millions or billions in investments have recently tanked. If you are so big that your income from running the hospital is not a major source of protection, and your income from your investments is propping you up, then the problems begin to manifest themselves exponentially.

“Some hospitals are responding by digging into their investment income more deeply than usual, using it to finance capital projects, or even meet operational needs. Others are issuing bonds with the scary codicil that they’ll buy them back if finicky investors want to dump them,” states Zieger in her column.

She further goes on to explain that “both of these situations put a huge squeeze on hospitals’ long-term viability. One robs from their long-term assets to solve medium-term problems, while the other puts the hospitals at risk of being bled dry by investors who get spooked.”

Well, wouldn’t ya know? Yes, we are seeing a few challenges due to decreased electives, but not because we were living off of our investments. The other good news is that, because we froze our fixed pensions several years ago, we are seeing very little impact upon them from the huge drop in those investments as well. Unlike many of our larger peers, neither of these issues is similar. Between the drops in the market, the loss of pension funds, the decrease in electives, and the down-grading of their viability by the bond markets, their challenges look galactic in size compared to ours.

Sometimes smaller is just safer.

A Note from Nick Jacobs

On October 23, it was my honor and privilege to speak at the PATIENT-CENTERED CARE CEO CONFERENCE in Chicago with some very impressive CEO’s and Leaders. My topic was “Linking a Patient-Centered Approach to Quality Improvement and HCAHPS,” but my deeper theme was “Leadership with a Heart - Developing Love and Respect in the Workplace by Nurturing Staff, Physicians, and Patients.” For those of you who were able to attend, thank you for your kind words of encouragement and support.

As was explained during my introduction, I have made the very difficult decision to leave Windber Medical Center, but I leave with a commitment to spread the word both nationally and internationally about the journey to Patient Centered Care and how to achieve it.

Obviously, it is a risky time to attempt to begin this endeavor, but, because no time is ever completely safe, it was my decision to reach out to my peers and friends to offer my commitment to work with you with that same passion to help you achieve your goals regarding this effort.

Because Sunstone Consulting is an organization that has specialized in finding additional financial support for hospitals, we can bring you not only the formula for Patient Centered Care, but also the needed additional financial support to achieve your goals in this area.

Although I will not officially complete my assignment at WMC until December 31st of this year, my current schedule permits me two days per week to begin to develop new relationships with my friends and peers. Should you have interest in contacting us for a visit to Windber, or if you would just like to make inquiry regarding engaging us for work at your facility, please feel free to either respond to this letter by E-mail or to call me at the following contact address below.

Once again, thank you for the privilege of working with you on such a significant topic.

Warmest Regards,

Nick Jacobs

Nick Jacobs

F. Nicholas Jacobs, FACHE
International Director
SunStone Consulting, LLC
1411 Grandview Avenue Apt. 803
Pittsburgh, PA 15211
nickjacobs@sunstoneconsulting.com
jacobsfn@aol.com
Mobile: 412-992-6197
Fax: 866-381-0219

Yesterday afternoon the realities of humanism, mortality, and fear attempted to take me out for about the one millionth time in my life. A phone call came from a loved one casually explaining that the doctor had potentially discovered a problem that needed further examination. When the office called for an appointment to have the scan done, they were told that it would be approximately a week before there was an opening in the schedule.

As an insider, I knew that a certain number of slots were held each day for emergency or unscheduled procedures. Not unlike the hotel that holds back a room or two from the 1-800 reservation list, just in case a preferred guest or luminary comes through the doors, flexibility is something that hospitals have to embrace at some level.

Once again, as an insider, a call to the department resulted in an immediate invitation to come in for the test the very next day.

My route to health care management was a particularly unique and circuitous route, and it left me asking the question, “why does it have to be this way?” I’ve personally done everything that I can to make it humane, patient centered, and sensitive.

If you or your loved one wants to know the inside story on how hospitals work, take a look at my new book, “Taking the Hell out of Healthcare.” It really can help. It is a simple “how to” book aimed at the everyday person who is having to deal with this complex and sometimes difficult world of health care.

My passion and personal commitment has always been to patient advocacy, transparency, and human kindness. Find out how to make the system work for you.

Back in the 70’s, competitive marching bands came into vogue in Western Pennsylvania. Let me explain the before and after of this phenomenon: Before there were competitions, bands were made up of nearly 10 times more students than they typically have today. My bands ranged in size from 120 to 185 students. Once competition came into play, the borderline students were not able to survive. Consequently, it is not unusual now to have 20 students or less in a band.

What’s happening in medicine and in health care overall? The Government is taking a three-pronged approach to improve quality in health care:

1. They are pushing quality through public reporting. (Check a website near you.)

2. Enforcing quality through the False Claims Act. (Check a prison near you.)

3. Incentivizing quality through payment reform. (Check a checkbook near you.)

Senator Chuck Grassley is quoted as saying, “Today, Medicare rewards poor quality care. That is just plain wrong, and we need to address this problem.”

HMO’s are currently embracing “pay for performance” plans for physicians and hospitals. Medicare is introducing value-based purchase plans. Medicare is proposing the linking of quality outcomes to physician payments.

As I have written before, hospitals will no longer be paid for hospital acquired conditions. That seems like a rather simple fix, but to appropriately determine if the condition was not acquired at the hospital, extensive testing must be added pre-admission at considerable costs to the hospitals.

James G. Sheehan, Medicaid Inspector General of New York said, “We are reviewing assorted sources of quality information on your facility to see what it says and if it is consistent. You should be doing the same.”

Except for the financial implications, not unlike my competitive band story, the goal was to work toward perfection. The public reporting of quality of care is intended to:

1. Correct inappropriate behavior

2. Identify overpayment’s

3. Deny payments

The False Claims Act, on the other hand has different goals. When asked how he viewed the False Claims Act, Kirk Ogrosky, U.S. Deputy Chief for Health Care Fraud said, “You will see more and more physicians going to jail.” I guess the prisoners will be receiving better care.

Where’s it all going? Competitive band. Will it improve health care delivery? Probably, for the patients who can find the few docs and hospital that will be left? I recently had a conversation with a young computer specialist who took care of physician practices. He said, “Doctors and hospitals haven’t figured it out yet, but they are simply becoming data entry centers for ‘Big Brother’ as the facts and figures are accumulated to be used against them any way the payers decide to move forward.”

Looking back at the school year that included gym class twice a week for the entire year, rich courses in music and art, and remembering a time when priorities included those classes intended to make every student well rounded, we have to ask, “Is education today better?”

Maybe this is all too complicated to get our arms around, but if there are 78 million Baby Boomers, and the Medicare Trust Fund is heading toward bankruptcy, then we probably will see every rule in the book being applied to keep from paying out money, because there is simply not enough money to go around.

Will health care improve? Once we understand that technology is not the end all and cure all that creates healing; once we endorse prevention, wellness, optimal healing environments, and systems approaches to health and wellness, health care will improve. I’ll bet you that it will have very little to do with the rules that are unfolding right now and much more to do with the creation and acceptance of a National Health Policy.

With the passing of Tim Russert, we are all made critically aware of the fragile nature of life and our need to embrace every moment as a gift.  Obviously, within a split second, every aspect of our lives can change, and, as in Mr. Russert’s case, can end.  This is not a blog about instant death, and it is not just about recognizing our mortality.  It is about preparing for our passing carefully.

Liz Szabo, a writer with USA Today described in a recent article the cancer patient experience by saying, “Patients with advanced cancer often don’t know how long they have to live or how chemotherapy will affect their lives.”  According to a study by the Journal of the American Medical Association, many physicians either don’t give patients that type of information or the patients only “hear what they choose to hear, or very often misunderstand what is said to them.”

This situation often leads to patients requesting incredibly disruptive and sometimes painful therapies that have no hope of succeeding.  According to the study, more than 20% of Medicare patients who have advanced cancer begin a new chemo regimen two weeks before they die.  Many times patients are admitted to hospice days or hours before they die.

What has been observed in cases like this was that the patient often misses the opportunity to repair relationships, get their spiritual house in order or even prepare the necessary documents such as advanced directives.

Where is this going?  Sarah Harrington, an assistant professor at Virginia Commonwealth University School of Medicine in Richmond, co-author of the quoted article, indicated that “in the last few weeks or months of life, a lot of good work can be done.”

One of the points brought up in the article was that only about 37% of physicians told patients how long they had to live. This fact was not surprising to us because we have seen dozens of patients who were admitted to hospice over the years return home and live several more months or years. This particular prediction is not always dependable. The other fact quoted in the article, however, was that many patients learned more about their cases from other patients than from their physicians.

The article concluded with the suggestion that “patients and their families may have to take the initiative in finding answers to important questions.”  Thomas Smith, co-author and Chairman of Hematology and Oncology at VCU’s Massey Cancer Center suggested that the following questions should be asked by any patient in this situation:   What are my options?  Can I be cured?  Will I live longer with Chemo?  Should I consider Hospice or Palliative Care?  Who could help me cope?  What do I want to pass on to my family to tell them about my life?

Palliative care is not limited to cancer.  All end-of-of life diagnoses qualify patients for hospice and palliative care.  Tim didn’t need or have this opportunity, but for those who do, embrace it. The primary thing that can be delivered to the patient and their family is the comfort of having caregivers dedicated to helping you move through your transition.  It is what they do.  These amazing people, volunteers, employees and physicians are dedicated to “paying it forward.”

So, as we eventually face our own mortality, as we evaluate what it is that we want to share with our families, as we consider the legacy that we wish to leave, having a clear mind and looking to those professionals who can help us is not only necessary, it is imperative. This transition can come in the blink of an eye.

“Money doesn’t make you happy.  I now have $50 million, but I was just as happy when I had $48 million.”
–Arnold Schwarzenegger

According to an article in Internal Medicine News by Mary Ellen Schneider, spending on health care in these United States is projected to reach 20% of the gross domestic product on the one hundredth anniversary of my father’s birth, 2017.  Of course that projection is only an estimate made by CMS, the Centers for Medicare and Medicaid Services.  That estimate is, of course, based upon a continued escalation of nearly 7% each year for the next nine years.  In lay terms, that escalation would mean that the total dollars spent on health care would hit $4.3 trillion…Whatever a trillion is? I still can’t fathom a billion of anything.)

We all should realize by now that this spending in the public sector, Medicare and Medicaid, will increase due to the first wave of Baby Boomers entering the Medicare system in 2011.  My 78 million peers, like the lemmings, are working their way toward the proverbial wall, and for those of you who will have to carry the load until we are wearing our wings, that is not a pretty financial picture.

The same economists from CMS are predicting a decrease in reimbursements to physicians over the next several years while Home Health will likely grow faster than most other sectors except perhaps prescription drugs.

What does it all mean?  We are spending more on health care in the United States than any industrialized country in the world and, truthfully, our overall age of death is significantly surpassed by many of those “spending less” countries.  How can that be?  Well, for one thing, we have 47 million uninsured citizens in this country and no one really knows how many illegal aliens. Why so many uninsured?  They don’t vote.  The vast majority are young, single mothers with small children, and this does not take into consideration the illegal aliens who are also not insured.

Back to the answer. . . prenatal care is inadequate and infant mortality in the United States is still an embarrassment. A few of the countries that do better than us in the world in infant deaths per thousand are:  Australia, Austria, Canada, Czech Republic, Denmark, Finland, France, Germany, Greece, Ireland, Japan, South Korea, New Zealand, Norway, Portugal, Spain, Sweden Switzerland and the United Kingdom.  Hmmmmmm?  Could it be because we spend 30% of our annual health care dollars on the last thirty days of life, and less than 4% of our monies on preventative and wellness care?

Of course, Hospice would be a tremendous help.  We could reduce expenditures on end of life care, properly care for our babies with the excess funds, and ensure that our uninsured are properly covered as well, but what politician is willing to touch that electric third rail of the electorial subway tracks?

We could begin by putting in a network of sidewalks, bike trails, and walking trails.  We could actually walk once in a while and treat our bodies like a true temple, not the “Temple of Doom.”

One of the least often heard issues revolving around these expenditures is the continuation of our archaic hospital system.  It is based on the acute care model, and the vast majority of our diseases are chronic.  We rush the victim to the hospital, patch them up, send them home and then rush them back again without any commitment to behavioral modification.  I have seen individuals reverse their heart disease from diet, exercise, and stress management.  Why can’t we embrace this concept, reward these activities, and change our society?  The millions of bicycles in Europe are no accident.

So, as I’ve quoted in some other blogs, “Change or Die,” or just spend ourselves into oblivion as we attempt to prop up a system that should have gone out with the Industrial Revolution.  Good luck kids, your ole man needs you to keep working to cover my health insurance.

It’s 5:48 PM and my last meeting is over for the day. That’s actually not a bad time to begin the evening, but it’s not a normal Sunday evening because I’m in the Netherlands looking out over the North Sea. (At least that’s what they tell me this beautiful body of water is outside my window.)

Actually, the meetings started as soon as we landed on Friday morning and, except for some down time yesterday, will be nonstop until we fly home Tuesday morning. (This was one of those week-ends where it was great to be me.)

For those of you who are younger, this date may not be particularly meaningful, but my last trip here was in 1969. In fact, it was December of 1969, and we actually stayed on The Continent to celebrate the beginning of the 1970’s. Who could have known that it would take this long to get back to the Netherlands, but it has been well worth the wait.

I liked the Netherlands on my first trip, in fact, it was F-U-N for a 22 year old recent college graduate, but this time, I can honestly say that I have loved it here. The people have been wonderful. They are honest, straightforward, and very accommodating, and the towns: Utrecht, Rotterdam, The Hague have all been absolutely charming.

We are here to consummate our research partnerships with the various medical centers, and to establish a foot-hold in Europe.

In the past 50 hours, I have been exposed to art, antiques, museums, music and business as casually as I’m normally exposed to fresh air and mountain breezes back home. Each city has produced a special type of “drive by” entertainment that only a native of Western Pennsylvania can truly appreciate. The parks are filled with incredible musicians and the galleries are bursting with challenging new exhibits. The canals are lined with the most interesting and creative sculptures, and there is live music everywhere. The real beauty of it all is that it is just part of the landscape here, not a special event or a special week-end.

We’ve been meeting with our representatives from Taskforce Europe, with members of the Ministry of Economic Affairs, with leadership from Erasmus Medical Center, and TNO. So, Ron, Steef, Conchita, Emmie, Ronald, et al… thanks for the beginning of a wonderful scientific and business relationship.

And Jude and Nina, if you’re reading this, I’ve got the “magic shoes.”

Sometimes it really really helps to avoid the pack, to stand away from the herd, and to do your own thing; i.e. management from the gut.  Looking back over the past five million two hundred fifty six thousand minutes that have made up these last ten years, it is obvious that the primary strategy that has worked for us was not our focus on finance, but, instead, it was our focus on our patients, our people working here and on our processes.

A few blogs ago we lamented the budget process because of its obvious drain on positive energy.  We spend so much time in this business studying our financial history that it can cause us to lose sight of the real focus of our work.

During a post board meeting conversation with an old friend, mentor and brilliant strategist, we talked about our new pay for performance wage program and our attempts to inspire all of our employees to be all that they can be.  He turned to me and said, “The injection of meaning into human life should be your goal.  Once your people truly get it, the motivation takes care of the challenges.” Or something like that.  Anyway, the point was to bring meaning to their lives.

Once we knew our objectives, to become a model Planetree Hospital, we set our measurement scales, initiated targets, and determined our key actions required to achieve those objectives.

These accomplishments led to increased volumes, satisfied customers, and increased revenues that have allowed us to grow, to flourish and to ensure survivability.

Simple?  Absolutely, positively, NOT.  Is it common sense?  Yep, but lots of smart people have convinced me that common sense is really uncommon, and that, my friends, is the problem.

p.s. Thanks for the prayers. My brother did just great.