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Health Care & Life Sciences / Life Science & Biotech

Want Cliffs Notes on health reform? Look at Wishard

July 10, 2013

So much is changing in health care, it’s hard to have a sense of where things are going.

So here’s the quickest shortcut I know: Look at Wishard Health Services.

I was reminded of Wishard’s usefulness as a Cliffs Notes-type guide to the future while listening Tuesday to a presentation by Dr. Lisa Harris, who has been CEO of Wishard since 2004.

Soon to change its name to Eskenazi Health, the county-owned hospital system in Indianapolis continues to stand out because it is actually implementing a model that tries to promote patients’ health, rather than merely treat their diseases.

And that model is made possible by significant public support.

The future of health care under Obamacare and the demographic challenges produced by retiring baby boomers is exactly that—and is exactly opposite of how most hospitals operate now.

Wishard is already a big user of comparative-effectiveness data about drugs and medical devices. Harris said its formulary includes all the pharmaceuticals shown to be clearly better than competitors.

“The me-toos are not," Harris added. The result has been that Wishard's annual spending on drugs has been flat at about $30 million for the past decade.

Because the 339 beds at Wishard’s hospital downtown are filled 95 percent of the time—an occupancy rate about 50 percent higher than most of Indianapolis’ private hospitals—Wishard tries to treat patients as much as possible in its 10 clinics spread around Indianapolis.

Wishard is building a $754 million hospital, which will open in December. But unlike most hospitals built around Indianapolis in the past three decades, this one will replace an existing facility.

The new hospital will be 30 percent smaller and yet be designed better, so it can accommodate 20 percent more patients, Harris said.

It even has been reaching into patients’ homes. Wishard purchased apartment buildings to serve as transitional housing for homeless and mentally ill patients, so they make fewer visits to the Wishard ER. For the same reason, Wishard works with local lawyers to get landlords to clean up mold-infested housing units, to prevent asthma attacks and other maladies.

Also, Wishard’s GRACE program sends nurses and social workers to the homes of low-income seniors to check up on their health and habits. The program was shown to reduce hospitalizations 44 percent.

Reducing hospitalizations will be the name of the game for all hospitals as new payment models being adopted by both government health plans and private health insurers make any growth in reimbursement payments hinge on how well hospitals reduce medical spending.

“Everything we do in health care affects pre-mature mortality by only 10 percent,” Harris said in her presentation to the Employers Forum of Indiana. “We’re going to be getting very serious about the other 90 percent.”

Wishard does preventive screenings. For example, Harris said, it screens every patient for depression and substance abuse because those factors have been shown to make it far harder for a patient to control an expensive chronic disease, such as diabetes.

And Wishard uses electronic medical records to manage a specific population of patients. The hospital launched one of the nation’s first digitized record systems back in the 1970s and in conjunction with the Indianapolis-based Regenstrief Institute Inc. has pioneered several uses of such records to improve care and lower costs.

I gave a detailed rundown of the Wishard-Regenstrief accomplishments in this article.

The reason Wishard does all these things is the same reason the rest of health care is moving toward it: It has no other financial option.

Of Wishard’s patients, 40 percent have no insurance—a rate nearly 10 times as high as experienced by Indianapolis’ privately run hospitals.

Nearly half of Wishard’s patients are on either Medicare or Medicaid—patients that privately run hospitals say they lose money on.

Only 12 percent of Wishard’s patients have private insurance—and most of those are its own employees.

In that kind of financial environment, Harris said, “you develop a system that works to put resources to best advantage.”

Indianapolis’ other hospitals are now starting to do the same. Their challenge, however, is to make this model work without the special public support Wishard enjoys/requires.

Wishard relies on special payments ranging from $15 million to $40 million from the Medicaid programs and $25 million a year in taxpayer support, to make its model work. Also, special governmental revenue from the bevy of nursing home licenses it owns brings in $155 million a year, which helps offset Wishard’s losses and helps pay the debt services on Wishard’s new hospital.

All told, these special payments are $200 million, paying for a huge chunk of Wishard's annual expenses of $520 million.

Can other hospitals adopt the Wishard model and still survive financially? That’s the question for the future of health care.

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