Tag Archives: hospitals

Sun Health

Scottsdale Lincoln Health Network affiliation finalized

Scottsdale Healthcare and John C. Lincoln Health Network, two of the Valley’s most respected locally-based non-profit health systems, have completed the closing documents for a system-wide affiliation to improve the health of communities served by the respective organizations.

The affiliation creates a new non-profit corporate entity, Scottsdale Lincoln Health Network, which will oversee the Scottsdale Healthcare and John C. Lincoln hospitals, clinics, outpatient centers and related services. A Letter of Intent to affiliate was approved by both organizations in April, followed by customary regulatory review processes after a definitive agreement was reached by both organizations in August.

The affiliation does not include the combination of assets and thus is not considered a merger. However management of the affiliated assets will now be vested in a board made up of Scottsdale Healthcare and John C. Lincoln directors.

Both Scottsdale Healthcare and John C. Lincoln Health Network have long histories of high quality care and innovation, are financially sound and now will move forward to create the healthcare organization of the future. What this means for the communities served by John C. Lincoln and Scottsdale Healthcare includes:

·         More convenient access to acute and preventive care.
·         Increased coordination of medical care.
·         An expanded network of high quality primary care and specialty physicians.
·         Creation of a single electronic health record that can be accessed at all levels of care throughout the affiliated health network.
·         Shared best practices.

The new Scottsdale Lincoln Health Network encompasses five acute care hospitals with approximately 10,500 employees, 3,700 affiliated physicians and 3,100 volunteers, an extensive primary care physician network, urgent care centers, clinical research, medical education, an inpatient rehabilitation hospital, an Accountable Care Organization, two foundations and extensive community services.

Tom Sadvary is chief executive officer and Rhonda Forsyth is president of Scottsdale Lincoln Health Network. Steve Wheeler is chairman and Frank Pugh is vice chairman of the Scottsdale Lincoln Health Network Board of Directors.

“Our communities will still receive the same world-class patient care you’ve come to expect from Scottsdale Healthcare and John C. Lincoln Health Network. Our goal is provide excellent, cost-effective care and a patient experience that exceeds your expectations,” said Sadvary.

“The shared vision for our new system is to become a fully integrated, locally controlled, world-class non-profit health system that works effectively to improve our community’s health,” added Forsyth.

Completion of the agreement to affiliate creates a geographically dispersed non-profit healthcare system positioned to             successfully deliver high quality, cost-effective healthcare, according to network leaders.

“Scottsdale Healthcare and John C. Lincoln Health Network both share a commitment to continuing their longstanding support of community health services, health education, disease prevention, screenings and other services,” explained Wheeler.

The combined health organizations are well-positioned to thrive in a rapidly changing healthcare environment, and to embrace the transformation of healthcare delivery that transcends the traditional acute care-centric orientation.

“The affiliation adds value to our ability to serve our patients, and allows us to develop a clinically integrated system of care where physicians, hospitals and other clinicians work in partnership to ensure that patients receive the services they need for the best outcomes,” said Pugh.

Integration planning for the new Scottsdale Lincoln Health Network will continue during the next several months to develop an outline of key priorities, noted Sadvary. The board and senior leadership of the affiliated organization will take a thoughtful and methodical approach to integration planning.

Medical Technology - AZ Business Magazine January/February 2012

Del Webb Gives $500,000 to cut John C. Lincoln readmissions

Love, they say, makes the world go round. Apparently, at John C. Lincoln Hospitals in Phoenix, love also reduces hospital readmissions by frail Medicare patients.

A program that hires military combat medics and corpsmen to care for discharged elderly patients like beloved grandparents has slashed the John C. Lincoln Hospitals’ Medicare patient readmission rates to an astonishing 6 percent.

It’s not that the rates were bad to begin with. Before the program started last October, the Medicare readmission rates at John C. Lincoln Hospitals hovered around a respectable 18 percent – the national average is 20 percent. Those readmissions cost the federal government more than $17 billion annually.

The Centers for Medicare and Medicaid Services (CMS) launched a campaign to encourage hospitals to do whatever necessary to maintain the health of discharged Medicare hospital patients with congestive heart failure, heart attacks or pneumonia, so fewer of them would be readmitted within the first 30 days after leaving the hospital. Financial incentives for readmission rate reduction and penalties for readmission rate increases were built into the CMS campaign.

John C. Lincoln’s innovative response to the CMS challenge mobilizes a cadre of veterans as transition coaches who provide designated Medicare patients with a personal touch along with support and guidance – to help them with follow-up medical instructions, prescription drugs, doctor appointments, nutrition and costs of care.

In the long run, reduced readmissions generated by the transition coaches produce significant savings for John C. Lincoln that far exceed program costs. But initial assistance to maximize the program’s effectiveness was needed.

The Del E. Webb Foundation stepped into that gap and awarded a $500,000 two-year grant to John C. Lincoln Health Foundation to support and expand the Health Network’s transition coach services. The grant will provide $250,000 this year to hire an additional five coaches, plus an additional $250,000 in July 2014 to hire five more, bringing the total number of John C. Lincoln transition coaches to 14.

The additional coaches make it possible to provide transition services not only to designated Medicare inpatients, but to all frail elderly patients being discharged from both hospitals, regardless of Medicare status or membership in John C. Lincoln’s Accountable Care Organization.

“But our primary goal is not to chase statistics,” says Transition Coach Program medical director John Lees, DO. “It is to reduce readmissions by helping at risk patients.

“Our first goal is to take care of discharged patients the way their own children or grandchildren would take care of them . . . to love on them and make sure their food, safety, medication, follow-up doctor visits, transportation or other everyday needs get taken care of, so their health is maintained, so they don’t relapse for preventable reasons,” Dr. Lees said. “Our goal is their optimal health.”

A key component, Dr. Lees said, is hiring transition coaches from the pool of trained military medics and corpsmen returning from active service in the Mideast. In spite of their rigorous training and experience, these soldiers are considered unqualified for most civilian health care positions. John C. Lincoln is providing employment relevant to the work they did in the field while harnessing their abilities, knowledge and disciplined initiative to address the needs of discharged Medicare patients.

Using the strategic, creative and responsive skills learned during military service, the transition coaches work with patients in the following major areas:

·         Medication self management – Making sure patients have access to pharmacies, can afford to their prescriptions, know how and when to take their medications, and understand the drugs’ purpose and potential side effects.
·         Physician follow-up – Making sure the patients know when to see primary or specialty physicians for follow-up care, that such visits are scheduled and that the patient has needed transportation.
·         Patient-centered health records – Teaching the patient to use a personal health record with a computer or smart phone to facilitate communication and continuity of care.
·         Nutrition and home safety – Making sure the patient and pets have adequate healthy food so that malnutrition doesn’t impair recovery; checking the home for hazards that can lead to falls or other injuries.
·         Red flags – Making sure the patient recognizes symptoms that indicate his or her condition is worsening and knows what to do to get help.

These services, none of which involve medical care, are essential to the preservation of patients’ health, Dr. Lees said.

“Many have asked why our program is so much more successful than other hospitals’ efforts to maintain the health of their discharged Medicare patients,” Dr. Lees said. “We’re still evaluating our experience to find out why.”

However, some factors the transition team believes are crucial to their success include:

·         Veterans relate well with patients.
·         Veterans are geared to recognize and solve problems, traditionally or out-of-the-box, creatively and immediately.
·         Transition coaches with access to John C. Lincoln’s electronic health records system don’t have to rely on their patients for health history, medication review or other information, because all that can be accessed on a computer, laptop, tablet, iPhone or Android. Follow-up doctor appointments or prescription refills can be made expediently online.

“We are enthusiastic about our initial success,” Dr. Lees said, “and we hope that our program, the national winner of the 2012 White House Healthcare Policy Challenge, will be recognized as a best practice that will become a model for the nation.

“There are currently more than 20,000 military combat medics and corpsmen returning from Iraq and Afghanistan who need jobs and who could help preserve the health of Medicare patients released from hospitals across America,” Dr. Lees said. “Wouldn’t it be ideal if they could do what our transition coaches are doing?”

Banner Good Samaritan Hospital

Health department unveils hospital compare tool

State health officials are launching a new online tool that will let patients and their families compare the costs and results of health care at hospitals across the state.

AZ Hospital Compare is managed by the Arizona Health Services Department and will be accessible beginning Monday. The searchable database will allow patients to compare the costs of specific care types like a knee replacement at hospitals in their area.

They’ll also be able to compare and review discharge rates and get a quality indicator score. The site uses both federal and state data.

A link to the AZ Hospital Compare site will then be available on the department website at http://www.azdhs.gov/ .

Health Insurance

Scottsdale Healthcare, John C. Lincoln form affiliation

Scottsdale Healthcare and John C. Lincoln Health Network have endorsed a letter of intent to form a system-wide affiliation to better meet the healthcare needs and thus improve the health of the communities they serve.

The nonbinding agreement between the two non-profit organizations allows both to pursue an exclusive negotiation during a due diligence period in order to create a combined health system. Discussions are anticipated to be complete by July 31.

The new non-profit system, which would be called Scottsdale Lincoln Health Network, would include five hospitals with approximately 10,500 employees, 3,700 affiliated physicians and 3,100 volunteers. Scottsdale Lincoln Health Network would also include an extensive primary care physician network, urgent care centers, clinical research, medical education, an inpatient rehabilitation hospital, an Accountable Care Organization, two foundations and extensive community services.

Both John C. Lincoln and Scottsdale Healthcare have a strong reputation and history of providing high quality care for the residents of Phoenix and greater Scottsdale. The non-profit health systems share similar visions and cultures, and both are Magnet organizations, a national recognition of providing the highest standards of patient care.

“This affiliation will provide resources to further develop the current high quality care in the hospitals and community healthcare facilities, enhance our geographic presence and honor the legacy of each organization. Our shared vision is to become a fully integrated, locally controlled, world-class health system,” said Scottsdale Healthcare President & CEO Tom Sadvary.

John C. Lincoln Health Network and Scottsdale Healthcare are financially strong, operationally successful and committed to meeting local health needs. Both organizations have been developing integrated delivery systems to expand services beyond acute care.

“Each of our organizations is known for quality and collaboration with community partners to promote the well-being of the communities we serve. The combined Scottsdale Lincoln Health Network will allow us to provide more cost effective healthcare and to thrive during this period of rapid change as a result of national and local health reform as we continue to develop a full continuum of  services beyond acute care,” added John C. Lincoln Health Network President & CEO Rhonda Forsyth.

Upon completion of the affiliation agreement, the Scottsdale Lincoln Health Network governance will be focused on their shared vision which includes:

·         More convenient access to acute and preventive care.
·         Increased coordination of medical care.
·         An expanded network of high quality primary care and specialty physicians.
·         Creation of a single electronic health record that can be accessed at all levels of care throughout the affiliated health network.
·         Improved patient outcomes through shared best practices.

“This affiliation will attract top medical talent by providing opportunities for physicians and other providers to lead the transformation of care delivery, and will enhance our leadership role in medical education and clinical research,” said Scottsdale Healthcare Board Chair Steven Wheeler. “Together we can provide a more comprehensive array of services by applying our combined resources to strengthen our clinical capabilities.”

Forsyth added that maintaining Magnet designation of the system hospitals provides a work environment that attracts top talent.

“As major provisions of the Affordable Care Act continue to take effect, we have the opportunity to shape the future of healthcare in the Valley by cost effectively using our respective resources to enhance our impact in the communities we serve,” said Forsyth.

“We want to maximize our ability to improve the health of our community and create more access to care. A more robust health network with primary care physicians, specialists and partnerships with other healthcare organizations will add capabilities for providing patients with a full continuum of coordinated healthcare services,” said John C. Lincoln Health Network Board Chair Frank Pugh.

 

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 Baywood Medical Center

Arizona’s Health Care Providers Are Working To Eradicate On-Site Infections

Hospital-acquired infections — illnesses that attack patients after they have been admitted — have health care officials taking myriad steps to combat, control and prevent this insidious enemy.

One of those steps is a name change courtesy of the U.S. Department of Health and Human Services. They now are called healthcare-associated infections, or HAIs.

Jessica Rigler, HAI prevention coordinator at the Arizona Department of Health Services, explains the reasoning behind the terminology change: Health care infections occur not only in hospitals, but in all health care venues, including long-term care, assisted living, and urgent care centers. In addition, Rigler says, these infections are brought into a hospital by an ailing patient, and not necessarily acquired there.

Nevertheless, whatever term applies, HAIs present a serious challenge for hospitals in Arizona and throughout the country. In 2007, the Centers for Disease Control and Prevention estimated the number of HAIs in U.S. hospitals was 1.7 million, resulting in nearly 99,000 deaths each year.

In April 2008, Banner Baywood Medical Center in Mesa was thrust into the spotlight following an HAI outbreak. The staff launched an aggressive program to deal with the situation, such as correcting air-pressure problems in some of the 10 operating rooms, and firing an overnight cleaning crew that was found to have missed germs on operating room floors, equipment and operating tables.

The hospital also limited the number of students and observers allowed in operating rooms, switched to thicker surgical wrap, and directed surgeons to wear only hospital-laundered scrubs.

Seven months after numerous changes were implemented, Banner Baywood, a general, acute-care hospital that performs about 10,000 surgeries each year and serves many senior citizens, detected just one surgical-site infection, according to Chris Halowell, director of perioperative services at the hospital.

Arlene Gimbel, chief nursing officer at Banner Baywood, says some infections are the direct result of overuse of antibiotics.

“We have dealt with this for quite some time, and we will continue to do so,” she says. “Our rate (of infection) has improved over the last couple of years due to our infection prevention program.”

While the hospital’s goal is to have zero infections, Gimbel says, “It’s almost impossible to be at zero, but it’s something we strive for every day. An area we can control is personal hygiene.”

A key element in preventing the spread of HAIs is to identify patients with an infection upon admission and take appropriate precautionary measures, Gimbel says. Every single patient found to have an infection was treated successfully, she adds.

Rigler says the problem is not as serious as it was some months ago because of infection prevention and control measures taken by health care facilities. Each hospital tracks its own data, but Arizona does not require public disclosure of infections that occur in health care facilities.

“We’re continually moving in the direction of preventing infections,” she says.

Early this year, ADHS established a new healthcare-associated infection advisory committee to follow up on recommendations of a legislatively created HAI panel in 2008. The original committee issued a report last December concluding that “strategies other than public reporting would be more successful in preventing healthcare-associated infections,” Rigler says. Four subcommittees, which Rigler calls the workhorses, focus on prevention strategies, surveillance, public education and provider education.

“The prevention strategies subcommittee is working to synthesize HAI prevention, gather the best practices and guidelines recommended from institutions nationally, and pull together a tool kit of information to help health care organizations decide on costs, how to implement programs, and how sustainable interventions are going to be,” Rigler says.

The surveillance panel is exploring how health care facilities are monitoring infections, what data they are collecting, and will then work closely with the National Healthcare Safety Network, which is run by the CDC.

Regarding the need for more transparency, Rigler says ADHS has an excellent relationship with its partners throughout the state. If ADHS notices an increase in infections, it contacts local health agencies, which then provide expertise and assistance.

“We have an obligation not to disclose certain pieces of information about one’s health condition,” Gimbel says. “It’s true that the public has a right to know, but one of the reasons health care facilities are reluctant is because of our responsibility toward patient privacy.”

To provide guidelines for other hospitals facing an outbreak of infections, Banner Baywood published an extensive article on its outbreak and plan of action in the March 2010 issue of AORN, a publication of the Association of periOperative Registered Nurses.

“We wanted to share our experience with the rest of the community,” Halowell says. “We included a timeline of what we did. They can use that as a check list if they have an outbreak. We’re proud of our infection prevent program and feel very good about our patients being safe when they come to Baywood.”

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.

A New Study Provides Lessons On Enhancing Hospital Board Effectiveness

A New Study Provides Lessons On Enhancing Hospital Board Effectiveness

It’s no secret that nonprofit hospitals, which account for the majority of hospitals in the U.S., are under growing scrutiny from legislators and regulators. In exchange for being exempt from paying taxes, nonprofit hospitals must provide benefits to their communities, including charity care. As health care reform efforts are beginning to get underway, an increasing emphasis has been placed on tax-exempt hospitals, and legislators are questioning the level of benefits actually provided to the local communities. At the core of this debate is how these hospitals are governed. Consequently, effective health care governance has never been more important.

So, what should health care systems be doing to maximize governance effectiveness? And what can these organizations learn from the governance practices of the most-effective community health systems?

According to a recent study, “Governance in High-Performing Community Health Systems: A report of trustee and CEO views,” which Grant Thornton co-sponsored in collaboration with the University of Iowa, College of Public Health and the American Hospital Association, there are a number of important lessons to consider. The study examines the governance of community health systems based on feedback from 123 hospital CEOs, and follow-up visits and onsite interviews with CEOs and trustees of 10 “high-performing” systems. The “high-performing” systems were selected from a set of performance and governance metrics.

Six principal factors emerged from the study as critical to effective governance at high-performing systems:

Strong values-based CEO leadership and effective management teams
Effective CEO leadership is vital to achieving and maintaining a high level of health system operating performance. Among the specific attributes mentioned by interviewees were a commitment to the system’s mission and values, excellent communication and relationships with the board and medical staff, expertise in financial management and cost controls, a passion for improving the system and its patient care, and strategic vision. They also cited the importance of a strong, effective management team with expertise in the full range of management functions.

Well understood systemwide mission, vision and values
Interviewees emphasized that key internal and external stakeholder groups must understand and support a meaningful systemwide mission statement, a compelling vision for the system’s future and a clearly stated set of core values. These expressions of organizational mission, vision and values can be powerful in unifying the stakeholders and galvanizing energy toward established goals and standards, but only if they are consistently reinforced by organizational leaders throughout the system. Interviewees also recognized that building the understanding and support of key constituencies within the system, and in the communities the system serves, requires continuous attention by the board and management.

A highly committed and engaged board of directors
Trustees commented that a highly committed, well informed and proactive governing board is extremely important to achieving and maintaining organizational success. The board should work collaboratively with the CEO and physician leadership. In addition, many board members stressed the importance of well organized and staffed board committees, the leadership role of the board chairperson and a mutually supportive relationship between the board chair and the CEO. They also noted the need for trust-based relationship between the board of directors and its CEO.

Strong clinical leadership and capabilities
The majority of interviewees underscored the need for committed, competent clinicians as a critical determinant of operational performance. They commented that without strong physician leadership, no hospital or health system can achieve enduring success. A number of interviewees also noted the importance of excellent nursing leadership. Also critical were strong, mutually beneficial partnerships between the system and physicians.

Clearly defined organizational objectives, targets and metrics
Interviewees stressed the importance of working toward well defined organizational targets and evidence-based metrics. These enable the board, management team and clinical leadership to monitor actual performance in relation to established standards in key aspects of system operations. Metrics should include the health systems’ community benefit program, financial performance and quality of patient care.

Healthy organizational culture
Interviewees frequently mentioned the importance of organizational culture. They commented that the prevailing culture within their systems included broad-based commitment to excellence in patient care and operating performance.

In addition to the importance of these six factors, there is ample room for improving board performance, particularly related to boardroom culture, board evaluations and community benefit programs. We recommend the following:

Devote time and energy to serious reflection and dialogue about the board’s fundamental role, responsibilities and the overall caliber of its performance in recent years. Then, develop a concrete strategy for creating a better, more proactive and more effective board.

Reexamine the organization’s current board size and composition. Consider adding greater racial and gender diversity, as well as respected and experienced nursing leaders as voting members. Keep in mind that large boards can be unwieldy; nine to 17 members is considered ideal.

Take a hard look at existing board-development programs. On that basis, adopt a strong commitment and a concrete plan for improving them.

Initiate an overall review of the present board evaluation process. Objectively assess the value it has provided for the organization and determine how to improve its effectiveness. Board evaluation must not be a pro forma exercise with minimal value.

Give careful attention to the boardroom culture and determine steps to make it healthier and more effective. Board members must feel free to express their views and constructively challenge each other and the system’s management team. Directors should actively engage in discourse and decision-making.

Devote attention and resources to meeting emerging benchmarks of good governance for community benefit responsibilities. Establish formal measurable policies and measurable objectives for community benefit plans, with regular reporting on the achievement of those objectives. It’s also important to collaborate with other organizations in ongoing community needs assessment and to provide thorough reports to the communities served regularly at least once per year.

Current and emerging benchmarks of good governance for nonprofit hospitals and health systems should be reviewed, refined and compiled into authoritative, consolidated documents to provide guidance for trustees and CEOs as they strive to meet these benchmarks.

With growing attention from the IRS, Congress and the media, forward-looking health care organizations are taking steps to examine their governance and identify opportunities to strengthen it. Organizations that are committed to continuous improvement not only will enhance their performance, but also improve their systems’ contributions to the communities they serve. The time has never been better to apply these lessons learned.

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
Hidden Tax Revealed Chart

Hidden Health Care Tax Hits Workers

The Arizona Hospital and Healthcare Association (AzHHA) and the Arizona Chamber Foundation are joining forces to stop what we call a hidden health care tax on businesses and consumers. According to a study released by the Arizona Chamber Foundation, which is associated with the Arizona Chamber of Commerce and Industry, Arizona employers and the state’s 3.5 million privately insured consumers pay 40 percent above cost for hospital services, primarily because the state and federal governments significantly underpay hospitals for those same services.

“This study shines a light on what Arizona business and health care leaders refer to as the hidden health care tax,” says Suzanne Taylor, executive director of the Arizona Chamber Foundation. “The study demonstrates that when state or federal lawmakers reduce hospital payment levels to below their costs, Arizona businesses and consumers pick up the tab in the form of higher health insurance premiums.”

The study, An Analysis of Hospital Cost Shift in Arizona, was conducted by the nationally recognized Lewin Group. It found that in 2007, private insurance payments for Arizona hospital services exceeded costs by $1.3 billion in order to offset underpayment from:

  • State government — The Arizona Health Care Cost Containment System (AHCCCS), Arizona’s Medicaid program that paid 79 percent of hospitals’ costs for providing services, underpaid Arizona hospitals by $407 million.
  • Federal government — Medicare, which paid 89 percent of Arizona hospitals’ costs for delivering services, underpaid Arizona hospitals by $481 million.

Uncompensated care — Arizona’s hospitals absorbed $390 million in 2007 — 4.4 percent of their total costs — for services they delivered, but for which they received no compensation.

Public insurance programs such as AHCCCS and Medicare are the primary drivers behind the hidden health care tax, paying hospitals below what it costs to treat patients. To cover these costs, hospitals shift the burden to private health insurers by negotiating higher rates to provide coverage.

“In this downturn, the hidden health care tax is particularly harmful to the economic well-being of our state,” Taylor says. “Employers throughout Arizona are grappling with incredible challenges ranging from declining revenues to shrinking credit. The hidden health care tax is another weight on businesses that want to continue providing employer-based insurance to their employees.”

Arizona employers and their employees typically share the cost of health insurance coverage, with employers paying an average of 81 percent of a single policy and 75 percent of a family policy for workers enrolled in their respective health plans. According to the study, in 2007 inadequate payment by AHCCCS and Medicare, as well as uncompensated care, increased private health insurance premiums in Arizona by 8.8 percent or $361 for every privately insured person.

The study revealed that public program underpayment in 2007:

  • Added $1,017 — $324 of which is due to AHCCCS underpayment — to the annual price tag of a typical family health insurance policy, bringing the cost to $11,617.
  • Increased by $396 — $126 of which is due to AHCCCS underpayment — the annual cost of a single health insurance policy, bringing the price tag to $4,519.

Underpayment by public insurance programs for hospital services exacts a steep price on employers, their workers and private purchasers of health insurance. In 2007, the cost shift due to AHCCCS, Medicare and uncompensated care cost: employers an additional $941.7 million, $301.3 million resulting from AHCCCS underpayment; employees an additional $292.8 million, $93.7 million of it due to AHCCCS underpayment; and private purchasers of health insurance an additional $41.4 million, $13.2 million of it resulting from AHCCCS underpayment
AHCCCS payment rate freeze.

  • Five percent AHCCCS payment rate reduction.
  • Disproportionate share hospital payments.
  • Graduate medical education.
  • AHCCCS payments to rural hospitals.
  • State savings of  $95 million.
  • Lost federal funds of $250.4 million.

Total dollar increase in private insurance premiums due to the cost shift of $1.48 billion in 2009 and $1.63 billion in 2010.
Individual increase in premiums of 19 percent for privately insured Arizonans due to the cost shift.

Healing Powers

New Product By Valley Company Offers Innovative Way To Treat Wounds

Bandages have changed very little over the years, but a new wound-care treatment called Prosit, developed here in the Valley, is shifting that paradigm.

Prosit is a single-layer polyester fabric dressing that covers a wound like a bandage. But when moistened, it generates a micro-electric current that kills microbes — bacteria, viruses, fungus, mold, yeast — and stops them from penetrating skin. It also diminishes pain, speeds healing and can be cut to fit any size wound. Prosit was approved by the U.S. Food and Drug Administration in 2006 as an antimicrobial barrier to infection. Last year, the FDA cleared Prosit for use in the care of all types of wounds, the number of days it can be used and for over-the-counter sales. Consumers can expect to see Prosit on store shelves later this year.

Jeff Skiba, product inventor and chief executive officer of Vomaris Innovations (formerly Silverleaf Medical Products) in Chandler, says local doctors and hospitals have been using Prosit for more than a year to effectively treat chronic wounds, surgical wounds, diabetic ulcers, cuts, burns and pain from laser resurfacing and shingles. Shingles patients reported feeling no pain after covering the rash with the antimicrobial dressing, and after a week the shingles were gone.

Skiba himself had laser skin resurfacing to understand the pain level after the procedure and test Prosit on facial burns. Pain afterwards was an eight out of 10, he says, so he used the antimicrobial dressing to cover the wounds on his face. Prosit eliminated the pain and helped heal the skin in four days instead of a few weeks, Skiba says.

“The pain from this procedure was excruciating, so without Prosit I would have needed to take a narcotic to kill the pain,” he says. “Most doctors prescribe Percocet to calm it down.”

Sun Lakes resident Ed Foster, 66, met Skiba by chance one day when the inventor stopped in at Tolivers Carpet One in Tempe to buy flooring for his office. Foster says Skiba noticed the wound on the stump where he had a finger removed 20 years ago, and he said he had a product that might help it. Foster had surgery on the stump a few years ago to remove a piece of metal. Due to the way it was bandaged, bone pushed out the end of the finger and wouldn’t heal.

“I went to see the top hand surgeon in the Valley right before I met Jeff, and he recommended getting my digit removed down to my hand, which I didn’t want to do,” Foster says. “So I gave Jeff a call and started using Prosit. New skin grew over the bone that was sticking out, so now you really can’t tell what it is, and the wound closed completely. Prosit was simple to use and now I’m completely healed. I couldn’t be happier.”

Major military hospitals around the country are also seeing promising results from the wound-care treatment. Walter Reed Hospital in Washington, D.C., is treating seriously injured soldiers from Iraq. One particular soldier was scheduled for an amputation, but was able to cancel it after Prosit was applied to the open wound on his leg. The bioelectric dressing stimulated the skin around the wound and prompted skin tissue to start growing back and cover the bone and tendons. After two weeks, the entire wound was healed.

“We’ve tested Prosit on the worst of the worst wounds and we’re seeing remarkable results,” Skiba says. “The only thing it does not work on is cancer wounds. The cancer has to be removed first, and then it can be applied to heal the surgical wound.”

Tucson dermatologist and oncologist, Dr. Scott Sheftel, was so impressed with the results of Prosit after testing it on patients, that he got involved conducting research for Vomaris Innovations.

“No one across the board has ever addressed wound care like this,” Sheftel says. “Prosit is an amazing wound treatment that will one day show up on drugstore shelves as an option next to band-aids.”

Skiba raised $3.5 million in angel financing to pay for FDA approvals and product testing. Skiba is a graduate of Arizona State University and has degrees in both bioengineering and business.

Vomaris Innovations manufactures Prosit at its plant in Tucson. The company has 10 employees and plans to add 15 more this year between its Chandler office and the Tucson manufacturing facility.

“We already have a few big box retail chains that are interested in carrying Prosit,” Skiba says. “We’ll put it on store shelves so it’s available for simple things like bug bites, scraped knees and cuts. But we will continue focusing on chronic wound patients who have had nothing, until now, to help them.”

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

Blood Systems Inc

Blood Systems Inc. Succeeds With A Delicate Balancing Act

When donating blood, many people probably only have a vague understanding of how the entire process works. Most donors certainly don’t understand how complex the mechanisms are that take blood to its final destination, or about the people who make it all happen.

“The general public does not understand what goes on behind the walls of a blood bank,” says Susan Barnes, Vice President and Chief Financial Officer for Blood Systems Inc. “I actually had someone say to me, ‘Oh, you’re the guys who take my blood, don’t give me anything for it and then sell it to the hospitals and make a fortune.’ I said, ‘There’s a lot in between that you don’t know.’ ”

Founded in 1943 as the Salt River Valley Blood Bank, the nonprofit Blood Systems is one of the nation’s oldest and largest blood service providers with operations in 18 states. Blood Systems is also a high-tech, efficiently run company entrusted with a life-or-death mission.

“We budget very carefully to return to the bottom line just enough to allow us to re-invest in our facilities, in processes that the FDA requires, and to keep things state-of-the-art so we can make sure we always provide the quality of blood product that the community expects,” Barnes says. “Not everyone understands that we can’t have a zero bottom line just because we’re a not-for-profit. It’s important to make money to re-invest, because if you don’t re-invest in the organization, you can’t continue the mission.”

Blood Systems mission is “to make a difference in people’s lives by bringing together the best people, inspiring individuals to donate blood, producing a safe and ample blood supply, advancing cutting-edge research and embracing continuous quality improvement.”

To keep such a noble mission in these trying times is a difficult balancing act, says Blood Systems President and CEO Dan Connor.

“In this particular environment that we have now with the economy, we see many companies laying off folks, so there are fewer people available to donate blood and that makes our job more difficult,” Connor says. “Our hospitals are less able to withstand any new tests or new procedures or new costs that we might have to pass along. As a result, we are trying to do that balancing act between doing everything we can to ensure an ample and safe blood supply, while also understanding the limitations that hospitals face as far as paying a reasonable cost for the blood products that are provided to their patients. That’s particularly difficult right now.”

Thanks to Barnes’ financial acumen, Blood Systems has built up a strong bottom line in its cash reserves.

“These reserves allow us to proceed with projects and expenditures, as well as still give our employees a cost-of-living increase in those years that we are not going to generate as much cash,” Barnes says. “There are also those years that we know our customers (hospitals) cannot afford to absorb our entire increased costs, and these reserves allow us to hold some of these new costs without our usual reimbursement.”

Perhaps Blood Systems greatest strength to its bottom line is its diversification, which has helped the company create new and needed revenue streams. That diversification is centered on four main divisions.

The Blood Centers Division is a network of more than a dozen regional blood centers and about 70 donor centers stretching from the West Coast to the Gulf of Mexico and from the Canadian border to the Rio Grande. The centers are operated through United Blood Services and Blood Centers of the Pacific, and serve patients in more than 500 hospitals. Last year, nearly 700,000 people donated blood an average of 1.5 times through the Blood Centers Division.

The Blood Systems Research Institute in San Francisco has conducted scientific research into transfusion medicine for more than 50 years, studying infectious diseases such as HIV and the West Nile virus. A second institute is located in Tempe.

Blood Systems Laboratories operates two of the most highly rated and high-volume blood-donor testing and infectious disease reference laboratories in the nation. The labs in Tempe and the Dallas area tested about three million donations in 2007, with two-thirds of the blood coming from other nonprofit blood centers.

BioCARE distributes plasma derivative therapies available to patients 24 hours a day, every day of the year at more than 200 locations across the country.

Blood Systems is also extending its reach internationally. For about the last four years, Connor says Blood Systems has sent the plasma portion of blood donations to the United Kingdom in order to help that country reduce the risk of transmitting the human form of Mad Cow disease.

But diversification alone hasn’t made Blood Systems a company that just recently received an upgraded ‘A’ stable credit rating from Standard & Poor’s at a time when many other companies are being downgraded. Blood Systems has instituted performance-improvement efficiency standards such as Six Sigma and LEAN tools, which have resulted in the reengineering of processes in the Blood Centers Division and Blood Systems Laboratories. That in turn has improved efficiencies and ushered in cost savings of more than $2.5 million throughout the organization in 2007 alone.

Blood Systems is also investing in its human capital by developing its own program to produce specialists in blood banking.

“We were having trouble finding qualified blood banking specialists to staff our laboratories,” Barnes says. “We partnered with the University of Texas Southwestern Medical Center (at Dallas), and wrote the actual online modules to train the students and taught them through the University of Texas to become specialists in blood banking.”

Blood Systems graduated its first class of specialists in blood banking in 2007.

“It’s basically growing our own blood banking specialists,” Barnes says. “We have the opportunity to put our own staff through the course and allow them to earn the certification. This enhances their careers while staffing our laboratories with the most qualified specialists.”

Making such long-term investments in its employees’ futures has helped Blood Systems decrease turnover by more than2.5 percentage points from 2006 to 2007, with the average length of service now up to almost seven-and-a-half years. And then there’s the mission.

“When I interview a candidate for a job here at Blood Systems,” Barnes says, “one of the things I always make a point of telling them is it doesn’t matter whether you’re collecting blood from a donor, or volunteering to give the donor a cookie and juice afterward, working in our testing laboratory, or working in accounting and finance — everyone who walks in the door every morning understands and is proud of the fact that they’re helping to save a life that day.”

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.