Tag Archives: health care industry

Kirk McClure

McCarthy Building Companies Hires Kirk McClure As Director Of Business Development

 

McCarthy Building Companies recently hired Kirk McClure as Director of Business Development for the Southwest division. His primary focus will be on municipal, higher education and commercial construction projects.

In this position, McClure will play a key role, providing more than a decade of industry expertise with a diverse, well-rounded background in project management, commercial development and planning, and strategic planning.

He has been engaged in a broad range of business development and project management positions throughout his career, most recently as Vice President of Business Expansion for the Arizona Commerce Authority (ACA), the state’s leading economic development organization.

McClure, a LEED accredited professional, has a critical understanding of the commercial real estate industry. Prior to his position at the ACA, he worked in land planning,project management and business development for Langdon Wilson, Atwell-Hicks, Graef and The Brooks Companies.

“Kirk has a passion for the commercial real estate industry and is extremely active within business circles here in Arizona,” said Bo Calbert, president of McCarthy Southwest. “The relationships he’s built through his previous positions and his volunteer activities will serve him well in his new role at McCarthy.”

McClure serves on the board of directors for the Arizona Association of Economic Development (AAED), and is the chair for their annual golf tournament. He is also a member of National Association of Industrial and Office Properties (NAIOP), SouthwestChapter of American Association of Airport Executives (SWAAAE) and has been an active member of CoreNet Global, Valley Partnership, the U.S. Green Building Council (USGBC), the American Planning Association (APA), and the Urban Land Institute (ULI).

He is also the founder and organizer of the monthly A/E/C Golf Invitational at Grayhawk Golf Club,which includes a league of professionals that work and support the development industry. He is also a USA Hockey-Certified youth hockey coach and has been coaching for more than 13 years, most recently with Desert Youth Hockey Association (DYHA).

He earned his MBA from the W. P. Carey School of Business at Arizona State University (ASU) and also holds a bachelor’s degree in Urban Planning and Design, also from ASU.

 

rsz_ec

Main Event Entertainment Buys 6.4 Acres at Tempe's Emerald Center

 

Main Event Entertainment purchased a 6.4-acre retail site in Tempe for $2.05M and will build a new 57,000 SF indoor entertainment venue.

The property is located in Emerald Center near Interstate 10 and Warner Road in Tempe adjacent to IKEA and Dick’s Sporting Goods. Headquartered in Plano, Texas, this will be Main Event’s first building outside of Texas where it has 12 locations.

Construction is expected to start in 2Q 2013. The freestanding building will be located at the NEC of Emerald and Commerce drives and will have more than 400 parking spaces. It lies directly south of a future 74,000 SF retail showroom called Furniture Row that is being planned for 2014. Furniture Row purchased the site in 2011 and the two new buildings will share common parking and easements.

Main Event Entertainment will attract indoor corporate and family events and offers bowling, billiards, laser tag, glow golf, rock climbing, gravity ropes, arcade games along with food and beverage services.

Dan Gardiner and Greg Laing of Phoenix Commercial Advisors represented Main Event Entertainment in the site selection process. Rick Robertson and Chris McClurg of Lee and Associates Arizona represented the seller, First National Bank of Hutchinson, Kan., in the acquisition.

The new building was approved for a use permit by the City of Tempe in June 2012 and is being designed by Hunter Engineering.

Banner Estrella Mtn

Banner Estrella Recognized As An Energy Star Facility By EPA

Banner Estrella Medical Center is the first and only hospital in Maricopa County to be labeled an ENERGY STAR® certified building by the U.S. Environmental Protection Agency.

There are just four hospitals in Arizona and 150 hospitals nationwide have the EPA-certified ENERGY STAR label. ENERGY STAR certified buildings use an average of 35 percent less energy and are responsible for 35 percent less carbon dioxide emissions than typical buildings. Fifteen types of commercial buildings can earn the ENERGY STAR certification, including office buildings, K-12 schools and retail stores.

“We are excited to see that the dedication of our Facilities Department, and our relationship with our utility company, Salt River Project (SRP), has resulted in this honor from the federal government,” said Deb Krmpotic, Chief Executive Officer of Banner Estrella.

The hospital’s Facilities Department worked with SRP over a 12-month period to track key metrics in ENERGY STAR’s Portfolio Manager™, such as energy intensity and costs, water use and carbon emissions, to reach the required benchmarks for the ENERGY STAR label. The benchmarks take into account the number of staffed beds and workers and the types of services offered at the hospital to compare it with like facilities. Commercial buildings that earn the EPA’s ENERGY STAR label must perform in the top 25 percent of similar buildings nationwide and must be independently verified by a licensed professional engineer or a registered architect.

One of the major contributing factors to achieving this recognition was the energy savings the hospital realized as a result of its participation in the SRP Retrocommissioning Solutions program. This program enhances existing systems through a tuneup, rather than relying on major equipment replacement. SRP collaborated with Banner Estrella’s Facilities Department to evaluate the chiller plant, HVAC fans, air handlers and reheat components and get them back to running in tiptop shape. As a result of the findings, the hospital saved more than $100,000 in energy costs the first year.

“Banner Estrella is a leader in the health care industry when it comes to energy efficiency. We look forward to many more successful projects with Banner Estrella, as well as other Banner Health facilities, in the future. It’s wonderful to see the hospital recognized on a national level,” said Debbie Kimberly, Director of Customer Programs & Marketing at SRP.

Launched in 1992 by the EPA, ENERGY STAR is a market-based partnership to reduce greenhouse gas emissions through energy efficiency. This year marks ENERGY STAR’s 20th anniversary. Over the past 20 years, with help from ENERGY STAR, American families and businesses have saved about $230 billion on utility bills and prevented more than 1.7 billion metric tons of carbon pollution. Today, the ENERGY STAR label can be found on more than 60 kinds of products and more than 1.3 million new homes.

For more information on Banner Estrella Medical Center, visit Banner Estrella’s website at bannerhealth.com.

The idea of starting your own business can be frightening with the recession - AZ Business Magazine Nov/Dec 2010

6 Tips To Launching Your Own Business In A Down Economy

The idea of starting your own business can be frightening, particularly with the recession stubbornly choking the Arizona economy. However, by following a few tips for getting started, launching your own company doesn’t need to be scary.

In fact, there are a few advantages to launching a business during an economic downturn. Commercial space is available at extraordinarily good prices. Talented professionals are looking for work. Goods and services can be found at discounted prices. And, depending on your industry, competition may be scarce.

1. Practice Due Diligence
It’s critical to objectively evaluate your proposed venture. Asking yourself some hard questions may discourage you from pursuing your first venture, but that is not a negative or pessimistic approach. It’s a useful tool for evaluating your business. Start with these questions: Is there a genuine need for the product or service you are offering? Is that need already being met by established companies? If so, what improvement or unique feature are you bringing to the table? Do you have the necessary skills and resources to start your business? If not, are you prepared to bring in the people with the skills and capital that are needed, and possibly give up some ownership?

2. Prepare a Business Plan
Too often, entrepreneurs articulate a great idea and foresee success, but gloss over the hard work. That hard part is thinking through the idea for your business and writing it into a plan, including the steps you’ll need to take to implement your idea. Start with an outline and consult a book or online guide about writing business plans. It’s important that your end result is a completed plan that includes a budget for your business.

3. Determine Capital Requirements
Most small businesses are funded with the business owner’s own money and funds from family and friends. A venture capitalist or angel investor may provide the necessary capital in exchange for part ownership of your business. It’s critical to focus on the amount of money you will need to start and operate your business, including at each stage of the company’s development.

4. Create a Board of Advisers
Creating a network of advisers can be a tremendous asset to a start-up business. It’s helpful if that board consists of advisers with a diverse array of professional backgrounds. That diversity will ensure you receive insights from a wide range of perspectives. Good choices for advisers may include your attorney, accountant, suppliers, customers, bankers and realtors.

5. Tap Into Available Resources
There are myriad advisers, consultants and nonprofit agencies that will assist you in developing your business — marketing it, creating websites and raising capital — who work for free or a nominal fee. The Small Business Administration (SBA), for instance, is a valuable and cost-effective resource. Moreover, SCORE: Counselors to America’s Small Business, provides free advice and mentoring for small business owners. If you pay for a similar service, be sure to get recommendations from a trusted adviser. Then, check that company’s references.

6. Listen
The more you listen — the more you truly hear an adviser’s ideas — the more advice you will be able to translate into actionable plans for your company.

Still, while these recessionary times may present a good opportunity for entrepreneurs, there are several considerations to keep in mind.

Select an industry that is doing well, despite the recession. The health care industry, senior care and information technologies are financially better off than many other industries.

Choose a business sector with a bright future — Businesses that tap into growing consumer demand for green or sustainable products may be an avenue worth pursuing. There was a 41 percent increase in consumer purchases of green products and services from 2004 to 2009, according to the research firm Mintel. Moreover, there may be federal or state subsidies or tax credits available for green companies.

Select a company with low capital requirements. Home-based businesses with low start-up costs may be good choices, notably because the ongoing credit crunch will likely make it tough to get a loan to cover these expenses.

If you are considering starting your own business, you will be in good company. More than half the companies listed on the Fortune 500 in 2009 were launched during a recession, according to the Ewing Marion Kauffman Foundation.

Moreover, in 2009, an average of 558,000 new businesses were launched each month in the United States.

The trick to joining these ranks is to get started. There’s no better time than now, recession or not.

“The critical ingredient is getting off your butt and doing something,” Nolan Bushnell, founder of both Atari and Chuck E. Cheese, once said. “It’s as simple as that. A lot of people have ideas, but there are few who decide to do something about them now. Not tomorrow. Not next week. But today. The true entrepreneur is a doer, not a dreamer.”

Arizona Business Magazine Nov/Dec 2010

AzHHA’s New President And CEO Laurie Liles - AZ Business Magazine Sept/Oct 2010

AzHHA’s New President And CEO Is Ready To Tackle The Industry’s Challenges

A familiar face has been named the new president and chief executive officer of the Arizona Hospital and Healthcare Association (AzHHA). Laurie Liles assumed her new role on Sept. 7, succeeding John Rivers, who will be available as a consultant until his retirement becomes official in January.

Selected by the AzHHA board of directors on June 3 after an extensive national search, Liles is a natural for the position, having most recently served as senior vice president of public affairs for the organization. In that role, Liles was the association’s chief lobbyist, putting her in charge of legislative and regulatory advocacy, and making her a familiar face at the state Capitol.

In fact, when she joined the association in 1991, Liles already was well known and respected at the Legislature. She was an intern at the Arizona House of Representatives in 1985, and in 1986 joined the House research staff. It was her first real job coming out of college, where she had majored in political science at Northern Arizona University.

The years at AzHHA that Liles spent lobbying lawmakers have given her a solid foundation for the tasks ahead. She also worked closely with the chief executive officers of AzHHA-member hospitals throughout the state.

“My role as chief lobbyist has given me a great deal of exposure to the challenging issues our members face,” Liles says. “It also enabled me to advance their interests with the regulatory entities they interact with.”

While she savors the experience and knowledge she gained as a lobbyist, Liles doesn’t plan on visiting the Capitol on a regular basis anymore.

“As the head of an advocacy organization, I will be ultimately responsible for accomplishing our advocacy goals,” she says, adding she will work closely with her staff and her replacement, who will tend to the day-to-day duties of lobbying.

Myriad challenges lie ahead, but No. 1 on Liles’ list is not unique to hospitals or the health care industry: the economy.

“The recession has been hard on everyone, and hospitals are no exception to that,” Liles says. “Our members continue to provide high-quality care, and the challenge going forward is to maintain that quality as resources become more and more precious.”

Arizona’s fiscal crisis is expected to continue for the next few years, Liles says, and as the state slowly recovers hospitals will be particularly vulnerable to any government-imposed cuts to Medicare and the state’s Medicaid program, the Arizona Health Care Cost Containment System (AHCCCS). The question remains how the state will pay for ever-expanding AHCCCS rolls. Enhanced federal matching funds, which faced some opposition in Congress, would ease the burden.

A close second in priorities is implementation of the new federal health care reform law. Fortunately, Liles has maintained a close working relationship with Arizona’s congressional delegation, particularly staff members who deal with health care issues. In addition to e-mails and phone calls, Liles has made it a practice to meet in Washington, D.C., with congressional members a couple of times a year.

Norm Botsford, chairman of the AzHHA board of directors, cited the federal health care law when he announced Liles’ appointment.

“The state’s health care community and citizens will be well served by Ms. Liles’ leadership as we begin the process of implementing the historic health care reforms signed into law by President Obama.” he stated.

But one of the challenges facing Liles and hospital administrators throughout the state does have a silver lining. Asked what good news hospitals can expect in the year ahead, Liles took a long pause before saying: “The really positive news for health care is the increased coverage that the federal health reform legislation brings. Having 32 million more Americans who previously had no insurance be covered is a positive development, but with it comes challenges of providing care for them.”

http://azbigmedia.com/tag/september-october-2010-2

AzHHA’s 2010 Annual Membership Conference - AZ Business Magazine Sept/Oct 2010

AzHHA’s 2010 Annual Membership Conference Is Aimed At Helping Members Prepare For Change

With the health care field on the brink of a major upheaval, the Arizona Hospital and Healthcare Association’s (AzHHA) 2010 Annual Membership Conference offers members information on what to expect in the future.

The theme, Bringing the Future into Focus, incorporates a mix of topics and speakers intended to appeal to a diverse hospital audience. Attendees will hear from leading economists, patient safety experts, health care visionaries and others.

LeAnn Swanson, vice president of education services for AzHHA, says the conference is the ideal venue to bring the new health care reality into full focus.
“Some of the best minds in the industry will be providing hard-hitting education and thought-provoking commentary,” she says. “This conference is intended for the entire hospital family, including the C-suite leadership team, hospital trustees, legal counsel, operations, quality, patient safety, human resources, and marketing officers.”

This year’s conference, Oct. 14-15 at The Buttes Resort in Tempe, kicks off with a keynote session featuring Lowell Catlett, Ph.D., regent’s professor, dean and chief administrative officer at New Mexico State University’s College of Agricultural, Consumer and Environmental Sciences. He will speak on the present and future of the economy.

Catlett notes that economic downturns are common — with 14 recessions during the past 80 years — and provide a means for society to re-balance what it deems to be important.

“Every recession leads to a spurt in new business starts, reformulation of business practices and new technological adaptations,” he says. “This current pause is no exception as we focus on what we value most. Get ready for phenomenal growth in health care, energy and lifestyle markets. For those willing to embrace the opportunities, the next decade will be successful beyond any in history.”

Immediately after Catlett’s presentation on Oct. 14, the general session will feature Ron Galloway, director of the documentary “Why Wal-Mart Works and Why That Makes Some People Crazy,” and the newly released “Rebooting Healthcare.” His topic, Wal-Mart and the Future of Healthcare, covers in-store health care clinics that offer everything from eyeglasses to flu shots to urgent care.

Galloway says the discount retailer aims to leverage its 4,000 stores into the largest force in American health care.

At the Oct. 15 breakfast meeting, sponsored by the American College of Healthcare Executives (ACHE), Chris Van Gorder, president and CEO of Scripps Health in San Diego and ACHE 2010-2011 chairman, will offer a look at Scripps’ medical response team. Van Gorder will describe the team’s efforts in the Hurricane Katrina-ravaged Gulf of Mexico, San Diego after its massive wildfires and quake-stricken Haiti.

Concurrent breakout sessions will look at the key drivers of physician behavior and the natural tension that exists in doctor-hospital relationships; trends and technologies that are “re-forming” health care in unexpected and beneficial ways; and the notion of being in a health care bubble with a high potential for a correction over the next five years.

The closing session will feature John Nance, author of “Why Hospitals Should Fly,” which was named the 2009 book of the year by the ACHE. Based on his book, Nance offers some solutions to the patient safety and quality-care crises that resonate deeply with all health care audiences.

The conference also will feature AzHHA’s annual awards luncheon, and a president’s reception that will give attendees an opportunity to say goodbye to the organization’s longtime president and CEO, John Rivers, as he nears retirement. The reception also will serve to introduce AzHHA’s new leader, Laurie Liles.

Along with the conference, during the upcoming year AzHHA also will offer a series of webinars and other events of interest to members of the hospital and health care industry, as well as representatives of the business community, Swanson says. The emphasis will be on compliance-related topics, including rules and regulations of the Centers for Medicare and Medicaid Services, the Health Insurance Portability and Accountability Act (HIPAA), and the Federal Emergency Medical Treatment and Labor Act, also known as EMTALA.

To learn more about upcoming education opportunities from AzHHA and to register for conference events, visit www.azhha.org/educational_services and click on education events.

    Arizona Hospital and Healthcare Association’s
    2010 Annual Membership Conference

    Oct. 14-15
    The Buttes Resort
    2000 Westcourt Way, Tempe
    www.azhha.org

Arizona Business Magazine Sept/Oct 2010

Pat Walz VP - AZ Business Magazine Sept/Oct 2010

Electronic Health Records And Cancer Care Are On Pat Walz’s Radar For Yuma Regional Medical Center

Pat Walz
President and CEO
Yuma Regional Medical Center
www.yumaregional.org

As the new president and CEO of Yuma Regional Medical Center, Pat Walz is looking to the future. Walz, who was named to the top spot at Yuma Regional in June, has several plans to make the hospital a leader in the health care industry, including implementing an electronic health record system throughout the community, creating a residency program and strengthening the hospital’s cancer care.

He says he wants Yuma Regional to “be leading edge for the whole state of Arizona” in 10 years.

“We don’t want our patients to feel like they need to go to Phoenix or Scripps in San Diego or Tucson,” he says. “We want to provide the same level of service in this community.”

Walz, who has been in the health care industry throughout his career, has been with Yuma Regional for five years, adding that he’d like to stay “as long as they let me. I think this is where I’m going to end my career.”

During his time at Yuma Regional, Walz served as chief financial officer, and the financial stability he attained for the hospital is one of his proudest career achievements.

“We have a very healthy balance sheet, a double-A bond rating and a lot of financial support that makes us able to invest in technology,” which allows Yuma Regional to provide the best health care to the community, Walz says.

In addition to providing a stepping stone to his current position, Walz says one thing he has learned from his background in finance is to always speak the truth.

“From a finance standpoint, one thing I’ve always prided myself (on) is providing accurate information,” he says. “I think when you establish that with physicians, staff, community — anybody — then when you talk people believe you.”

Another way the hospital serves the community is by being a member of the Arizona Hospital and Healthcare Association (AzHHA).
“I think having that connection is really important,” Walz says. “It’s kind of a venue (for) when we have issues out in the rural areas.”

Speaking to the Legislature with AzHHA’s backing gives rural communities a louder voice that can compete with urban areas, he adds.

“(My job is) exciting to me in that we have a good medical staff, an excellent leadership team and some really committed employees,” Walz says. “(Yuma Regional) commits to the employees as well. We have a very good benefit plan. We stay competitive with the areas we have to recruit from … It’s a pretty exciting place to be and the board has a commitment to quality and patient safety.”

Arizona Business Magazine Sept/Oct 2010

St. Joseph’s And Phoenix Children’s Announce A Strategic Alliance - AZ Business Magazine June 2010

St. Joseph’s And Phoenix Children’s Announce A Strategic Alliance

Two major forces in the Valley’s health care industry are joining together to ensure the future of quality pediatric care in Arizona. St Joseph’s Hospital and Medical Center and Phoenix Children’s Hospital are in the process of negotiating a strategic alliance that will make Arizona a medical destination for young patients with complex and acute health care needs.

“Phoenix is the fifth-largest city in the country and it deserves to have a children’s hospital that is top tier in the country with the same breadth of programs, depth of resources and reputational scores for quality as children’s hospitals in other major markets,” says Robert Meyer, president and CEO of Phoenix Children’s Hospital (PCH).

Under the proposed alliance, St. Joseph’s will transfer a substantial portion of its pediatric service line to PCH. The collaboration will result in a full-service pediatric hospital, bringing together the best both hospitals have to offer. If an alliance is reached, much of the two hospitals’ pediatric medical staff, nurses and other staff will be united by mid-2011. At that time, the construction on PCH’s new 11-story hospital tower is expected to be complete, making Phoenix home to the second largest children’s hospital in the nation.

Under a current, non-binding memorandum of understanding, St. Joseph’s would continue to operate its neonatal intensive care unit and treat pediatric patients in its trauma unit, as well as patients age 15 and older. In addition, St. Joseph’s would be a minority member of Phoenix Children’s, with limited representation on PCH’s board of directors.

“When we brought our strengths to the table we became a tremendous force in the care of kids in this country,” says Linda Hunt, service area president of Catholic Healthcare West Arizona and president of St. Joseph’s Hospital & Medical Center. “We have leaders in pediatric care, advocacy and research that we can bring together to make this incredible force and improve kids’ care in the Southwest.”

Along with creating a powerhouse pediatric hospital, the shifting of services will enable St. Joseph’s to fulfill its strategic plan to become a destination hospital for patients from across the nation and around the world. To that end, Hunt says St. Joseph’s is expanding specialty programs such as neurosurgery, neurology, cardiology and pulmonology.

The two entities already have collaborated on specific programs, including physician cross-coverage for the Children’s Heart Center and a National Institute of Health grant that’s part of PCH’s Heart Center, housed at the Barrow Neurological Institute at St. Joseph’s. In spite of the various joint programs, no large-scale alliance had ever been attempted. PCH initially approached St. Joseph’s about a wider-ranging alliance, and the timing proved to be just right. Due to state budget issues, capacity constraints St. Joseph’s is facing, and the expansion already underway at PCH, the collaboration seemed like the natural progression.

“When I approached Linda Hunt in 2008 about revisiting a formal collaboration, we agreed to discard the baggage of failed collaborations of the past and brought fresh thinking to the discussion,” Meyer says. “What we found is that we are more alike than different. We share a common vision and very similar values. We are equally committed to excellent medical care, (and) both need to grow.”

The challenges facing these two health care leaders are daunting. Phoenix is one of the fastest-growing regions in the nation, and medical centers and hospitals must be prepared to face a large influx of young patients in the future. However, with both noted hospitals banding together, incredible progress can be made.

“By combining our pediatric programs, we can achieve a level that would be on par with the leading children’s hospitals in the country more quickly and efficiently than doing so alone,” Meyer says.

Among other things, the alliance will improve access to higher quality pediatric health care services in a cost-effective manner, enhance recruitment and resources for services and programs, accelerate the development of research programs, maintain and improve medical services for the under-served and more, Meyer adds.

The process of finalizing the proposed alliance is ongoing. At this time, presentations outlining the plans for the alliance have been made to physicians and staff at both hospitals. In addition, feedback programs have been created to field any questions or concerns employees may have. The process of assembling work groups with representatives from both hospitals participating in the integration plans also has begun.

“We believe this strategic alliance with CHW/St. Joseph’s will enable us to achieve our bold vision to be recognized as a national leader in pediatric health care,” Meyer says. “This community benefits from the strength of two of the leading providers of children’s medical care, because we’re better together than alone.”

www.phoenixchildrens.com | www.stjosephs-phx.org

Arizona Business Magazine June 2010

Tawil in front of Kmart

First Job: Mark El-Tawil, President of Arizona Market, Humana Inc.

Mark El-Tawil
President, Arizona Market, Humana Inc.

Describe your very first job and what lessons you learned from it.
My first job was as a pre-opening stock clerk at Kmart. It was in the small town where I grew up and went to college, and Kmart was about the only place an unskilled worker like myself could get a good job! That job paid 30 cents over minimum wage, the shift started at 7 a.m. — or earlier — daily, we could be scheduled for any day (weekends and holidays included), and we were considered the bottom of the Kmart totem pole — but it was a great first job. I learned the value of money, the importance of working hard and of having a good attitude about work, and that everyone wins when you try to deliver great customer service, as well as the power of positive reinforcement through my Employee of the Month awards (I don’t usually gloat, but that was “awards” — three of ‘em!).

Describe your first job in your industry and what you learned from it.
My introduction to the health care industry came in my first professional position after moving to Arizona. I was an auditor with Deloitte predecessor, Touche Ross, in Phoenix. That was a great first professional job. It introduced me to many industries, one of which was health care, while working among an incredibly talented group of highly motivated, fun-loving individuals. From Deloitte, I left to help build a financial analysis team at a health care client of mine, and after some time advancing through finance roles, including CFO, I moved into the lead general management role. In that position I gained a broader perspective of the industry and the companies in it, and ultimately decided to make the move to Humana in 2008.

What were your salaries at both of these jobs?
Kmart paid $3.65 an hour to start, with a raise to $3.90 an hour after 90 days if you had a favorable review of your probationary period (which I did, thankfully!). As an auditor at Touche Ross, my starting salary was $25,000 a year, and I got company-paid health insurance benefits for the first time.

Who is your biggest mentor and what role did he or she play?
My parents, grandparents and in-laws all played crucial roles in my development as a person, which has enabled me to be a good businessperson. Beyond mentors though, I believe that I have learned, and will continue to learn, from everyone for whom I have worked, as well as from everyone who has worked for me.

What advice would you give to a person just entering your industry?
Be open to and ready for change! This is a dynamic, fast-moving industry in a constantly changing environment, so the ability to foresee changes, the impact of change and to adapt to new environments is critical.

If you weren’t doing this, what would you be doing instead?
I’d either be playing basketball full time (for love or money — this is a fantasy question, right?) or be deep(er) into wine, either as a winemaker myself or … as a buyer for an international beverage conglomerate.

The Valley’s Health Care Industry Held Its Own During The Recession And Looks Toward Expansion In The Recovery

In an economic downturn that has plunged Arizona into its worst financial crisis in decades, one sector of the state’s economy that remains vibrant and growing is the health care industry. Consider recent developments driven primarily by population growth: the Creighton University partnership with St. Joseph’s Hospital and Medical Center; the newly opened Cardon Children’s Medical Center, a Banner Health facility in Mesa; the M.D. Anderson Cancer Center scheduled to open in Gilbert in late 2011; and a major expansion of Phoenix Children’s Hospital.

The academic affiliation between Omaha-based Creighton and St. Joseph’s will bring nearly 30 percent of Creighton’s medical students to Phoenix for two years of clinical studies. Since 2005, Creighton has sent relatively few medical school students to St. Joseph’s for one-month rotations. Under the new agreement, 42, third-year Creighton students will arrive at St. Joseph’s in 2012 and in 2013, for a total of 84 students on the new campus, to be known as the Creighton University School of Medicine at St. Joseph’s Hospital and Medical Center. Creighton will provide an associate dean and several administrative support staff, but faculty instructors will be St. Joseph’s doctors and other medical personnel.

Linda Hunt, service area president of Catholic Healthcare West Arizona, president of St. Joseph’s and chair of the Greater Phoenix Economic Council’s Healthcare Leadership Council, says the goal is to retain many of the students in Arizona for residency and eventually have them set up practices here.

“We’re a large population and when you compare us to the rest of the country we have to import our physicians,” Hunt says. “We need the capacity to educate and to care for more of the population.”

The Cardon Children’s Medical Center, which opened Nov. 9, provides comprehensive pediatric care for children. The facility has 248 beds and works with 225 physicians. Top specialties include cancer, neurology, emergency services, surgery, and a level-III neonatal intensive care unit.

“Children often need special help coping with acute and chronic illness,” says Peter Fine, Banner Health president and CEO. “We know Cardon Children’s Medical Center will make a difference in the lives of countless children and their families. Its opening will offer a new option for outstanding pediatric care that is clearly needed by the Valley’s growing population.”

Meanwhile, the University of Texas M. D. Anderson Cancer Center joined forces with Banner Health on Dec. 1, launching construction of a facility intended to deliver an unprecedented level of cancer care to patients in Arizona. Along with treating cancer patients, M. D. Anderson, based in Houston, also offers access to therapeutic clinical research exploring novel treatments.

Fine calls the relationship with M.D. Anderson “a major milestone in the vision of our two organizations to provide access to a new level of cancer care in Arizona.”

The $107 million, 76-bed center will be a 120,000 square foot, three-story building focusing on outpatient services, including physician clinics, medical imaging, radiation oncology, infusion therapy and many support services. Inpatients will be treated on two floors inside Banner Gateway Medical Center.

“M.D. Anderson is not and will not be something similar to what exists in the Phoenix market today,” Fine says. “We are bringing the No. 1 cancer center in the country to Arizona and to have them run it as closely as is possible. There will be significant amounts of automation tying in all their clinicians in this marketplace to clinicians in their Houston campus. For research purposes, protocol purposes, they will in essence be one clinical business on two campuses.”

In 2008, Phoenix Children’s Hospital broke ground on a $588-million expansion that includes an 11-story patient tower scheduled for completion by 2012. As of December 2009, Phase I marked its halfway point, was on-budget and on-schedule. The project will increase the number of its licensed beds to 626 from 345.

Bob Meyer, president and CEO of Phoenix Children’s Hospital, says research indicates Maricopa County has more than 1 million children today and by 2025, an additional 500,000 to 700,000 youngsters will be living in the Greater Phoenix area.

“If you believe those numbers,” Meyer says, “deficits in pediatric capacity are astounding. Estimates are that we will be short 800 pediatric beds by 2025, and short about 400 pediatric specialists.”

Another key reason for the expansion, Meyer says, is that the existing hospital building, which was built in the late 1960s, does not have the floor-to-ceiling height to accommodate today’s newer technology.

Dr. William Crist, vice president of health affairs at the University of Arizona, says the ongoing expansion projects in Greater Phoenix really are thoughtful plans for growth and development of service for a city that’s expanding markedly — even though that growth has leveled off because of the recession.

Crist cites the aging baby boomer generation as the reason for an increasing need in expanded adult medical care.

“Potentially, most cancer occurs in older individuals,” Crist says. “The aging of our population is made possible by advances in health care. It keeps you alive long enough to develop chronic illnesses.”

www.creighton.edu | www.stjosephs-phx.org | www.bannerhealth.com | www.mdanderson.org | www.phoenixchildrens.com | www.arizona.edu


Arizona Business Magazine

February 2010

healthcare onsite for large employers

Healthcare Solutions Center Provides Onsite Health Care To Large Employers

Time and money are two things few people can afford to waste, especially these days. In an effort to save both, people often put their own health concerns on the backburner. After all, who wants to take time away from work or family to go to the doctor, wait around to actually see the doctor, and then get a diagnosis and a prescription that has to be filled for a hefty fee (not to mention the cost of the visit)?

But Frances Ducar is changing the way health care is handled in the workplace and making it much more convenient for people to confront their health concerns. As founder and director of Healthcare Solutions Center, she strives to save Arizona employers and their employees money. And she’s saving lives along the way.

Ducar spent more than 20 years in the health care industry in various positions, including first assistant to some of the country’s top surgeons and as a family nurse practitioner.

“I’ve worked with some really amazing specialists, and a little piece of each of them is what makes me who I am today,” she says of her mentors.

In her experiences over the years, she saw how companies were being “eaten alive” by insurance companies. She knew she wanted to find a way to help employers offer their employees quality health care and help employees afford the health care they deserve. With that, Healthcare Solutions Center was born in 2003.

Healthcare Solutions Center offers large companies (with 500 employees or more) an onsite health care clinic staffed by a family nurse practitioner. With HCS onsite clinics, employers save money on their overall health care costs. Employees save money because HCS eliminates co-pays and deductibles and reduces prescription costs to as little as $4. Employees also receive confidential and top-notch care from a nurse practitioner. In addition, HCS has a relationship with a network of some of the state’s finest specialists. If a patient needs further examination beyond what the nurse practitioner can provide, HCS can arrange a timely appointment with a specialist — sometimes even the same day.

“A company is only as healthy as its employees,” says Ducar, adding that people are much more likely to visit an onsite clinic because it eliminates the need to take time off work to travel offsite to a doctor’s office.

Employees don’t just see the nurse practitioner if they are sick. HCS onsite clinics also offer wellness programs to help patients quit smoking and lose weight.

“Knowing you are helping everyone you see in one way or another, seeing a person change their lifestyle, and seeing companies save money and put it back into their wellness plans — these are just a few of the immense rewards of this business,” Ducar says.

She feels good knowing that employers are saving millions on their health care costs and that HCS is helping employees appropriately utilize every avenue and benefit of the company’s wellness plan, including counseling and beyond.

But there are challenges as well. Ducar personally selects her family nurse practitioners, and she admits that placing the right nurse practitioner with the right company is one of the hardest and most important, parts of her business.

“My nurse practitioners are a reflection of me,” she says. “They become the advocate for their patients who just don’t know where to go.”

Ducar must have a knack for placing her nurse practitioners because she says she’s never had a dissatisfied patient.

“The patients trust (the nurse practitioners), and they are all happy to have us there,” she says.

The entrepreneur predicts huge growth for the future of her company, but she says her business will remain in the state for the long haul.

“Love of medicine and the desire to help Arizona companies afford their health care is what drove me to start this company,” Ducar explains.

AH Endovascular OR Suite

Executives From West Valley Hospitals Assess The Impact Of The Current Economy

The need for health care services continues to grow across the state, including the West Valley. And under the current recession, hospitals are being asked to do more with less.

Jon Bartlett, CEO of Arrowhead Hospital, says the health care industry is not immune to the impact of the bad economy, but he remains optimistic about the current and future state of the market.

“There are plenty of challenges, but we remain focused and disciplined,” he says.

In fact, he believes West Valley communities are home to some of the finest hospitals around, and the members of the community wouldn’t have it any other way.

“Today, people expect the very best health care outcomes, but they also demand world-class service,” Bartlett says. “It is our responsibility to meet their expectations.”

Arrowhead Hospital has been recognized with three stars in the Society of Thoracic Surgeons’ national database in 2007 and 2008 for its superior cardiovascular surgery outcomes.

Tom Dickson is CEO of Banner Thunderbird Medical Center, a 413-bed acute care hospital that specializes in cardiovascular care, neurology care, pediatrics, obstetrics and emergency medicine. He says the slowing economy has actually allowed West Valley hospitals to catch up with their demands.

“Generally, the West Valley has been underserved in terms of acute care beds,” Dickson says. “Now that the economy has slowed and several hospitals have added additional beds, we are not in as critical condition as we were in recent years.”

With a recent expansion of the South Tower, which can grow to accommodate 600 beds, Dickson says his biggest challenge is retaining existing employees and recruiting additional workers to staff the additional beds and programs and services that are growing as a result of the tower.

“The most critical area of need is registered nurses,” he says. “We also have an acute shortage of physicians and other medical professions, including physical therapists, respiratory therapists, pharmacists and medical technologists.”

Jo Adkins, CEO of West Valley Hospital, says the West Valley currently has an adequate amount of hospital beds, but that may not be the case for very long.

“As growth returns to the West Valley, we will need to look at growth of both beds and services,” she says. “We need to stay in touch with the communities’ needs and grow the services so that we can remain a hospital of choice.”

Meanwhile, West Valley Hospital is already very strong in a number of specialties, including its heart and vascular center, chest pain center, emergency room, electrophysiology and obstetrics. But Adkins doesn’t mince words when it comes to the challenges facing the health care industry.

“(It has) taken a large hit,” she says.

Naming two recent 5 percent budget cuts, she adds, “That has had a $3.6 million impact on West Valley Hospital alone.”

Beyond working to overcome the challenges facing the industry as a whole, the leaders of these hospitals are 100 percent dedicated to providing the superior service they believe their community members deserve.

Bartlett notes that the emergency department at Arrowhead Hospital is making a concerted effort to decrease wait times, promising that patients are seen in less than half an hour.

“Our average wait time is 19 minutes,” he says.

And while Arrowhead Hospital does have plans to expand from 220 beds to 260 within the next 18 months, Bartlett explains that he doesn’t just want to grow, he wants to make sure the hospital is getting consistently better.

Lee Peterson, CEO of Sun Health Services (formerly Sun Health Properties), which recently merged with Banner Health, agrees that providing the utmost services and results for its patients is the hospitals’ top priority.

“Banner has a best-practice strategy that is very much in line with our passion for making a difference in people’s lives,” he says.

Boswell and Del E. Webb medical centers are now Banner Boswell and Banner Del E. Webb.

“By coming together with Banner we were able to bring some immediate technologies, such as electronic medical records, in addition to research institutes, which are such a major part of Banner Boswell and Banner Del E. Webb, to the West Valley,” Peterson says.

With the economy putting a freeze on growth for the most part, West Valley hospitals stand poised for continued expansion. All the while, they are not taking their eyes off their mission — to provide the residents of West Valley communities with first-class services administered by highly trained and compassionate health care providers.

Peter Fine President and CEO Banner Health

Peter Fine, Now CEO Of Banner Health, Drove A Taxi As His First Job

Peter Fine
President and CEO
Banner Health

Describe your very first job and what lessons you learned from it.
Once I got past delivering newspapers as a little kid, my first job with significant responsibility was driving a taxicab outside of New York City. I did this starting the summer after high school, and did it for each year while in college, plus the year after college. It was 12-hour shifts, 6 a.m. to 6 p.m., six days a week. Things learned included the value of hard work, and no matter what the job is you have a responsibility to do it right because someone is depending on you.

Describe your first job in your industry and what you learned from it.
My first job in the health care industry was working as an administrative assistant in a small hospital and I had responsibility for the admitting department. What I learned was that frontline workers know a lot about what is going on, all you have to do is ask them.

What were your salaries at both of these jobs?
As a cab driver, I would make about $50 a day and as an administrative assistant, I made about $13,000 per year.

Who is your biggest mentor and what role did he or she play?
I had three mentors who taught me lessons I actively use on a regular basis. Art Malasto was CEO of a hospital in Indiana, where I was an assistant administrator. He taught me that “visibility breeds credibility, credibility breeds trust, so if you wanted to be trusted, you have to be visible.” Gary Mecklenburg was a CEO at a hospital in Chicago, where I was a senior vice president. He taught me to “plan the work and work the plan.” In other words, you have to plan to know where you want to go, and you have to work the plan if you want to get there. It’s a simple concept that many times cannot be executed.Finally, Ed Howe, a health system president that I worked for in Milwaukee, taught me that to stay focused, you have to “tune out the static.” That lesson has helped me to stay focused on what needs to be done, no matter what else is going on around me.

What advice would you give to a person just entering your industry?
Make sure you have a passion for complexity and a high tolerance for ambiguity, and always remember that misery is optional.

If you weren’t doing this, what would you be doing instead?
I’d be coaching a 12-year-old soccer team or coaching a college lacrosse team.

nurses, healthcare, doctors

The State’s Health Care Industry Is Strong, But The Recession Is Taking A Toll

Although I have only been in Arizona 11 years, St. Joseph’s Hospital and Medical Center has been providing high-quality care to Valley residents since 1895. And for the past century, St. Joseph’s has been known for two primary missions: Service to the poor and underserved; and outstanding care, particularly in the neurosciences, driven by groundbreaking innovation.

In the past 25 years, the innovations at St. Joseph’s have been significant, and other hospitals in the state have seen significant growth and expansion of services, as well. We have had unprecedented growth in the Metro Phoenix area, and hospitals have tried valiantly to keep up with the demand for acute care services. In the past 25 years, we have seen many new hospitals built, particularly in the suburban areas, and central hospitals have continued to expand.

Arizona was the very last state in the country to adopt a state Medicaid program in the early 1980s, but the Arizona Healthcare Cost Containment System (AHCCCS) has since been considered a national model of cost effectiveness. We missed out on substantial federal funds for the Medicaid system by being the last state to join, but we have nonetheless run an efficient system with the public dollars Arizona has received.

The health care system has continued to evolve in very interesting ways during the past quarter century. We have seen a clear movement to reduce the length of hospital stays, and many procedures are done in outpatient settings that were once only performed in hospitals.

We have made extraordinary progress in diagnostics and minimally-invasive procedures, which help people recover faster and get treated earlier when disease occurs. In a past era, patients who needed lung surgery had to have their ribcage cracked open and had weeks of extended recovery; now they have it laproscopically and are up walking around the very next day. Cancer used to be a death sentence; now it is often a chronic illness that can be virtually cured. We are better at treating chronic illnesses such as diabetes and heart disease, and we now know how important prevention is to limiting the impact of disease.

But significant challenges still remain. We have evolved into a system of “sick care” not “health care,” and although we know prevention pays dividends, that is not what physicians and hospitals are reimbursed for. The system rewards us when we treat the sickest patients, but not always for keeping them well.

In America, the concept of employer-sponsored health care is considered foundational to our economy. Yet, more than 46 million Americans do not have health insurance, and many of them are vulnerable children. In Arizona, the majority of employees work for small businesses that are under a tremendous strain to provide affordable health insurance. When people transition to public insurance, the reimbursements are declining so much that community physicians are refusing to accept new Medicaid and Medicare patients, while safety-net hospitals struggle to treat all who present themselves at their doors.

The boom-and-bust cycle is hard on the economy, but it is also hard on health care providers. We face a physician shortage in the Valley and a dearth of key sub-specialists for a region this size. In a recession, more people turn to public assistance at the same time the state is trying to cut budgets to compensate for diminished reserves.

Still, I remain hopeful for our state and our industry. Health care continues to be a strong economic engine for Arizona; good paying jobs, great career paths for a wide variety of disciplines and many avenues for innovation. Catholic Healthcare West, of which St. Joseph’s is the flagship hospital, is actively working with the new president and Congress to help shape health care reform so all Americans can have affordable and accessible health coverage. I believe there has never been a time when so much good is possible, and that change can help all of us live better.

Rhonda Forsyth President and Chief Executive Officer John C. Lincoln Health Network

CEO Series: Rhonda Forsyth

Rhonda Forsyth
President and Chief Executive Officer
John C. Lincoln Health Network

How would you characterize the health care industry in the Valley?
When I think of health care for the Valley, for the most part we’ve been a growth industry. We have had incredible new facilities that have been built and new partners that have come into town. … But we’ve also been experiencing the downturn in the economy right now, so we are struggling like every other business, and it’s somewhat concerning. Hospitals in particular have been a safety net for our patients, for families, for our community for quite a long time and that is being threatened because of changes in the economy.

Is the health care industry recession-proof?
A lot of people think health care is recession-proof. From our perspective though, we find that we still have people coming in for services … but many people don’t have the ability to pay for their care, and that is why we’ve experienced a downturn; people can’t pay their co-pays, a lot more people are uninsured, so they still need our services and we are here to provide for them … So, I don’t think we are recession-proof. We’ve gone through changes, we’ve had to reduce expenditures, we’ve had to look very critically at some of the services that we provide and assure that they are still mission critical.

What are the major legislative and financial issues facing the Valley’s health care industry?
Well, it’s unclear right now from a legislative standpoint, both how health care reform is going to manifest itself and then on more of a local level, what’s going to happen … the (state) Senate has passed a bill that includes pretty dramatic payment cuts for hospitals, and also reduces accessibility for many people in our community. There are proposals right now to eliminate coverage for a number of children with KidsCare. So those things are really concerning. However, nothing is in its final form and we don’t know. I would just encourage our legislators and our congressmen to really look at what it is that health care provides in the community and be thoughtful about changes that are being proposed.

What are some of the new trends in health care delivery?
It’s an exciting time to be in health care. … one of the great things that has happened is really bringing biosciences and biotechnology to Arizona, and we have really benefited by having those kinds of partnerships with researchers and with some of our scientists in the community. So, when you look at health care out in the future, you really see the opportunity to treat you as a patient on much more of an individual level, so that, through biosciences, we understand you at a molecular level, rather than just say, ‘Well, you have heart disease and the standard treatment for heart disease is X, Y, Z.’ Now we’re saying … ‘We’re looking at you and molecularly this is how you will respond to this kind of drug or this kind of treatment and we know what will work and what won’t work.’

As baby boomers age, what type of competitive edge does that give local health care facilities?
It does concern me — obviously there’s opportunity — but it does concern me from the standpoint that we have people who have far more diabetes, we’re seeing more incidences of certain types of cancers and heart diseases, and many more chronic diseases. So when you look at baby boomers aging and the incidences of chronic disease, there’s opportunity in treating those people, there’s also concern about it potentially overwhelming the health care system. We’re going to need many more nurses, physicians, facilities, and we’re going to need to be smarter about how we take care of people.

How has health care evolved locally?
The most exciting thing that I’ve seen in health care in Arizona is that providers recognize … that we do a much better job of taking care of patients when we work more closely together. So a lot of our initiatives are really bringing a health care team together to look at you as a patient and say what’s going to make sense through an entire continuum of care, and make sure you get the right treatment at the right time. Also, that we work much more cooperatively with you to do preventative work.

To what do you attribute your success at the C-level?
I think I have a great passion for John C. Lincoln and a great passion for our mission. I feel so honored to come to work every day and to work for people who are really making a difference in people’s lives. … I think I’m also analytical, I like to think strategically, I try to think beyond what are the issues of today, but look to where do I want John C. Lincoln, where do I think we should be five years from now, 10 years from now. I also very much value getting the right person in the right job, and we just have some excellent, excellent people here at John C. Lincoln. While I can look to things where I really feel I’ve made a difference here at John C. Lincoln, I know I’ve done that in the context of a really fabulous team of people.

    Vital Stats





  • Appointed president and CEO of John C. Lincoln Health Network in April 2009
  • Joined the network in 1987
  • Held executive posts at both network hospitals
  • The network includes John C. Lincoln Deer Valley Hospital and John C. Lincoln North Mountain Hospital
  • Under her leadership, North Mountain Hospital was recognized for excellent patient care by U.S. News and World Report
  • Earned a Maser of Science in business administration from Arizona State University
  • Is involved with the Better Business Bureau, the Phoenix Boys Choir and the American Cancer Society
pill to swallow

Arizona’s Health Care Industry Must Adapt To New Compliance Procedures In 2009

The current economic downturn and the prospect of dramatic changes to the nation’s health care system under a new administration are making 2009 one of the most challenging years ever for Arizona’s medical industry.

If that weren’t enough, however, our state’s hospitals, clinics, and diagnostic and out-patient centers — and the physicians who serve them — are getting a crash course on how to administer sweeping new compliance procedures and regulations recently issued by the Centers for Medicare and Medicaid Services (CMS).

Last year, CMS posted the 2009 Final Hospital Inpatient Prospective Payment System (IPPS) rule, which is having an impact on hospital operations and policies, as well as physician arrangements. Included were several changes to the so-called Stark Law (named for U.S. Rep. Pete Stark, D-Calif.) covering Medicare and Medicaid.

The impetus for the new provisions was a worthy one — curbing physician self-referrals and stopping kickbacks. Nevertheless, Arizona doctors and health care entities are scrambling to alter their ways of doing business. The downside for not doing so: denied payments, or penalties, from Medicare and/or Medicaid.

Some of the provisions went into effect last October and others begin this October. They will result in the significant restructuring of many physician arrangements, particularly joint ventures between doctors and facilities. Some of the rules are providing more flexibility in these arrangements, while others have become more restrictive.

Stand in its Shoes
One area of flexibility is CMS’ decision, effective last October, to decline adopting tougher “stand-in-your-shoes” procedures. This would have mandated that when physicians’ organizations contracted with an entity such as a hospital, each physician in those groups would have been deemed to be part of that contract as well.

Under the finalized rules, only physicians who have an “ownership or investment interest” in such an organization will be considered to “stand in its shoes” for purposes of compliance with the Stark regulations.

Percentage-Based Compensation
Soon to be a thing of the past is percentage-based compensation arrangements for space and equipment rental lease arrangements. CMS initially proposed a broad prohibition for using percentage-based compensation formulas to calculate revenue from services performed or business generated in leased office space or from leased equipment.

This October, the final rules will take a more targeted approach, specifically addressing CMS’ concerns with percentage-based compensation regarding lease arrangements.

Per Click: Lease Arrangement Payments
Also this October, the new procedures will significantly limit the use of unit-of-service, or “per-click,” payments in the context of physicians’ space and equipment lease arrangements. This pertains to physicians leasing time on diagnostic equipment to perform tests on Medicare and Medicaid patients.

Specifically, CMS revised exceptions for such leases, determining fair market value, and for indirect compensation arrangements to prohibit “per-click” payments to a physician lessor where the payments reflect services on patients who had been referred to the lessee by the physician.

Furthermore, the prohibition applies regardless of whether the physician is the lessor or whether the lessor is an entity in which the referring physician has an ownership or investment interest.

CMS states that the new rule does not prohibit physicians from leasing equipment or space to entities on a per-use basis for services rendered to patients who were referred from others. In most cases, CMS will not prohibit time-based deals in which a physician rents time on a CT or MRI scanner.

Services Provided Under Arrangements
Entities, including physicians, that provide services to hospitals “under arrangements” (for example, when a hospital bills for services but arranges for another entity to provide the services), will now be considered DHS (designated health services) entities themselves for Stark Law purposes.

Previously, only the person or entity that billed for DHS was deemed to be “furnishing” the DHS. CMS’ new definition of entity, effective in October, is that a person or entity is considered to be “furnishing” DHS if it has (1) performed the DHS even if another entity bills for the services; or (2) presented a claim for Medicare benefits of the DHS.

As a result, physicians will be limited in their ability to refer patients to “under arrangement” service providers in which they have an ownership or investment interest. Restructuring of existing joint ventures between physicians and hospitals will be needed.

This is only the start. There are several other provisions — including malpractice insurance, physician retirement plans, disallowed referrals, compliance requirements and other hospital-physician agreements. Hopefully, this gives you an idea of the issues and challenges facing Arizona’s health care industry during the rest of 2009.

Susan Edwards - Banner Health

Susan Edwards – President Of The Arizona Region At Banner Health Systems

The health care industry remains a bright spot in Arizona’s dismal economic landscape, with Banner Health shining among the very brightest.

Headquartered in Phoenix, the not-for-profit health system has 12 hospitals in the Valley and is the second-largest employer in Arizona behind Wal-Mart with more than 26,000 full-time employees.

Banner’s Arizona region President Susan Edwards says the state’s growing population has enabled the company to expand and provide high-quality medical services to communities throughout the Valley. Since 2002, Banner has opened two new hospitals, started construction on a third, expanded a number of current facilities and purchased land for future growth.

“Banner has been in a growth mode for quite some time,” Edwards says. “And even though the population growth in Arizona has slowed down, we are committed to completing the projects on the table. We are a strong company and we run our hospitals very effectively. It’s not just about getting bigger and growing. It’s about continually improving how we structure our facilities and providing excellent patient care.”

Edwards maintains she is very optimistic about the future of the health care industry, despite the increasing costs of doing business, lack of health care workers and the government lowering reimbursements to health care providers.

“When the industry is challenged, we have to make major changes and adapt,” she says. “We also have to keep a close eye on operations so we get through the tough times.”

Banner is currently scrutinizing business practices at all levels of its hospitals to see where it can make improvements on the company’s bottom line. Employees working on the front lines were asked to provide feedback on making business practices more efficient, and in twoweeks Banner officials received 412 suggestions. A suggestion that has already been implemented is going to save Banner $100,000 annually, Edwards says.

Edwards, 52, has been president of Banner’s Arizona region since 2002. Prior to Banner, she served as both executive vicepresident and chief operating officer of St. John’s Health System in Detroit, and interim president and chief executive officer of St. John’s Hospital, a 600-plus bed tertiary hospital. Before that, she held health care leadership roles in Pennsylvania, Michigan and Ohio.

Edwards was born and raised in Sparta, N.C. She holds a bachelor’s degree in biology from Emory and Henry College, a master’s of health administration degree from Duke University, and a law degree from Wayne State University.

www.bannerhealth.com

Medical supplies

Applying Supply Chain Management Techniques To The Health Care Industry

Businesses in the 21st century frequently attribute success to the ability to tame their supply chains.

The business of hospitals, in comparison, is quite different. Hospitals are service organizations with diverse customers, including physicians who have strong commitments to given manufacturers and products. Patients, of course, are customers, and their treatment often requires costly items. Because their customer base is so diverse, and because the associated costs can be high, it is increasingly important for hospitals to purchase materials at the best price possible.

One of the distinguishing characteristics of the health care industry is the prevalence of national group purchasing organizations that leverage the purchasing power of many hospitals. In Phoenix, Premier provides Banner Health and St. Joseph’s Hospital and Medical Center with strategic procurement services. Mayo Clinic is a member of Novation, giving it access to services that support standardization for expensive clinical items. Amerinet assists Scottsdale Healthcare in managing purchasing costs and improving processes.

Escalating costs
Increased costs associated with health care represent a challenge, however, it is not always clear why or where health care costs are escalating. The escalation of supply costs, frequently at greater than 10 percent annually, means that supply costs are the second-highest area for hospital expenditures after labor.

Paul Carmichael, director of materials management at Phoenix Children’s Hospital (PCH), fears that manufacturers will not continue to absorb supply-cost increases on their own. In addition, an aging population that demands a high quality of life will also drive up overall costs.

Hospitals require significant supplies. Mayo Clinic Arizona, for example, itemizes more than 100,000 products. Banner Health, which operates 22 hospitals in Arizona, reported $2.2 billion in net revenue, with supply expenses estimated at $390 million. Of this, $190 million were expended for medical/surgical supplies and $90 million for pharmaceuticals.

Doug Bowen, Banner’s materials manager, points to the challenges associated with pharmaceutical costs that now consume almost a quarter of supply expenses. Banner very strategically employs centralized control and standardized processes to optimize its supply operations. Bowen believes that Banner’s data warehouse system will disseminate best practices across the system.

Ryan Kirane is materials manager for Mayo Clinic Arizona and points with pride to the integration of the supply chain organization across the Mayo network and the subsequent supply chain excellence. In Arizona, Mayo’s net patient revenue of more than $500 million is balanced against a supply expense of approximately $125 million — signaling supply-intense procedures such as implant surgery. With pharmaceuticals making up about $45 million in expenses, Mayo echoes Banner’s concern with the cost of medications.

Each hospital faces different challenges in managing the supply environment. PCH, whose patients range from infants to adolescents, requires up to a third more products due to patient-size requirements. PCH utilizes advanced supply chain management technologies, such as “just-in-time” stock replenishment, to maintain low levels of inventory, yet excellent access to products. It has also worked with its national distributor, Owens & Minor, to utilize activity-based management principles,leading to improved product access and efficiencies. With almost $360 million in total patient revenue, PCH reports more than $62 million in supply expenses for the thousands of different items necessary to deliver care.

Solving the problem
In 2004, the Health Sector Supply Chain Research Consortium was founded at the School of Health Management and Policy at ASU’s W. P. Carey School of Business. The consortium brings together U.S. firms to solve problems unique to the health care supply chain.

Eugene Schneller, Ph.D., is professor and Dean’s Council of 100 Distinguished Scholar in the W. P. Carey School of Business, School of Health Management and Policy. He can be reached at gene.schneller@asu.edu.

Calling the shots 2008

Calling the Shots

Many Americans are no longer satisfied with the U.S. health care system and want to exert significant control over their own medical care. They are no longer patients in the traditional sense, but consumers who are adopting a new, more active approach to making decisions about health care treatments, services and products. They demand greater access to information, online tools and services from their physicians. They want to explore alternatives to conventional treatments. And they want to share decision-making with their doctors.

calling_shots 2008

These changing dynamics are confirmed in the 2008 Survey of Health Care Consumers conducted through the Deloitte Center for Health Solutions. The survey reveals an increased desire to use technology to communicate with health care providers regarding records, appointments and answers to questions, and to gather health-related information. Findings in Arizona showed that 14 percent are willing to pay more for Internet access in order to make same-day appointments, and 22 percent want e-mail capability to ask their doctors health-related questions or treatment options. In all, consumers are interested in using in-home monitoring devices to allow them to be more active in their care; are open to new treatment approaches; and are increasingly comfortable with alternative therapies, retail health care clinics, and even traveling abroad for elective procedures.

The American health care market is far more complicated than previously thought, and is best interpreted through six consumer segments. These distinct consumer segments present opportunities — and risks — for all stakeholders in the U.S. health care industry.

The first consumer group is Content & Compliant, which accounts for 29 percent of the U.S. health care consumer market. These consumers report annual household incomes of $100,000 or higher and prefer traditional approaches to care. For this group, what the doctor says usually goes.

This is not the same for the Sick & Savvy, which make up 24 percent of the consumer market. Proportionally more consumers in this group, compared to others, report having one or more chronic conditions (52 percent). They also take greater charge of their care, are more self-reliant decision-makers and less dependent on their physicians.

Online & Onboard (8 percent) are frequent users of the system and prefer traditional approaches, but are receptive to care provided in non-conventional settings. They tend to rely more on themselves in making decisions, and use online tools and value-added services more than any other segment. They seek information and are sensitive to quality differences.

The smallest contingent — Shop & Save (2 percent) — tends to switch doctors, treatment and health plans, and make changes to their insurance more frequently than others. They are the most sensitive to the cost of health care services. They tend to prefer doctors who use traditional approaches, but are amenable to alternative and unconventional treatments. They’re more likely than others to purchase prescription drugs by mail order or online, use a retail clinic, and travel beyond their community and the United States for care.

Out & About (9 percent) are independent, preferring to make their own decisions. They use alternative approaches, consult alternative health care practitioners and substitute alternative or natural therapies for prescription medicines more than any other segment. They are sensitive to quality, seek information, use some value-added services and want to shop for and customize their insurance.

cover_october 2008

Casual & Cautious (28 percent) is the healthiest group — only 19 percent report having one or more chronic conditions. Younger than most segments, they are also the least-insured.

In broad strokes, consumers are seeking change in three main ways:

  • Mass personalization — Consumers want their health care and insurance customized to meet their needs.
  • Evidence-based care — Consumers believe payments to doctors should be linked to evidence-based practices.
  • Disruptive innovation — Disruptive health care innovations such as medical tourism and retail clinics are giving rise to new players, new delivery models, new ways of partnering and new value propositions.

The doctor’s role and the status quo are changing, and hospitals, physicians and health plans will need to quickly adapt to capture market success. Consumers are taking greater control of decision-making and they demand better value, better service, increased transparency and personalization of services. For these reasons, the players who take the unique attitudes and preferences of consumers into account as they make strategic decisions will have a huge opportunity to win the consumer market.

Paul Keckley, Ph.D., is executive director of the Deloitte Center for Health Solutions. Kevin Wijayawickrama is a principal at Deloitte & Touche’s Arizona practice.