As for-profits stumble, regional systems pick up the pieces.

Some regional not-for-profit systems see acquiring the hospital assets of struggling for-profit operators as a way to gain referrals, expand their provider networks and consolidate their regions.

'We asked what services ... could be better performed at centers of excellence throughout the system'.

After becoming CEO of the near bankrupt Mount Sinai Medical Center in New York City in 2003, Dr. Kenneth Davis led a notable financial turnaround with the help of a board filled with some of New York City's wealthiest businessmen. Now, as head of a financially robust system that includes seven hospitals, 7,100 employed physicians and a sprawling network of practices and ambulatory centers that stretches from Westchester County to Florida, he is attempting to lead Mount Sinai into the new era of population health management and affordable care. Modern Healthcare Editor Merrill Goozner asked him about key elements in that transition. This is an edited transcript.

Success factors for strategic change initiatives: a qualitative study of healthcare administrators' perspectives.

Success factors related to the implementation of change initiatives are well documented and discussed in the management literature, but they are seldom studied in healthcare organizations engaged in multiple strategic change initiatives. The purpose of this study was to identify key success factors related to implementation of change initiatives based on rich qualitative data gathered from health leader interviews at two large health systems implementing multiple change initiatives. In-depth personal interviews with 61 healthcare leaders in the two large systems were conducted and inductive qualitative analysis was employed to identify success factors associated with 13 change initiatives. Results from this analysis were compared to success factors identified in the literature, and generalizations were drawn that add significantly to the management literature, especially to that in the healthcare sector. Ten specific success factors were identified for the implementation of change initiatives. The top three success factors were (1) culture and values, (2) business processes, and (3) people and engagement. Two of the identified success factors are unique to the healthcare sector and not found in the literature on change models: service quality and client satisfaction (ranked fourth of 10) and access to information (ranked ninth). Results demonstrate the importance of human resource functions, alignment of culture and values with change, and business processes that facilitate effective communication and access to information to achieve many change initiatives. The responses also suggest opportunities for leaders of healthcare organizations to more formally recognize the degree to which various change initiatives are dependent on one another.

Using a social entrepreneurial approach to enhance the financial and social value of health care organizations.

In this study, a conceptual framework was developed to show that social entrepreneurial practices can be effectively translated to meet the social needs in health care. We used a theory-in-use case study approach that encompasses postulation of a working taxonomy from literature scanning and a deliberation of the taxonomy through triangulation of multilevel data of a case study conducted in a Taiwan-based hospital system. Specifically, we demonstrated that a nonprofit organization can adopt business principles that emphasize both financial and social value. We tested our model and found comprehensive accountability across departments throughout the case hospital system, and this led to sustainable and continual growth of the organization. Through social entrepreneurial practices, we established that both financial value creation and fulfilling the social mission for the case hospital system can be achieved.

Enhancing the revenue cycle experience for patients.

In 2013, Texas Health Resources began to record discussions with patients at each revenue cycle touch point, from scheduling through registration. The recordings give leaders insight on the accuracy and consistency of information communicated at each touch point and provide a tool for improving customer service. The initiative has improved patient satisfaction and increased point-of-service collections.

How satisfied are hospital systems with their ownership of retail clinics?

Retail clinics--while innovative--can no longer be considered a new model of healthcare delivery, as an increasing number of hospitals and health systems now own them. The purpose of this article is to explore the extent to which hospital systems are satisfied with their ownership of retail clinics. In terms of operational challenges, respondents to our survey, administered to representatives from 19 health systems, were relatively satisfied with clinic staffing and their relationship with the retailers regarding lease terms, store locations, and shopper demographics. They expressed mostly neutral levels of satisfaction with regulations and laws related to retail clinics and low satisfaction with insurance reimbursement and clinics' seasonal patterns. The two areas that received the lowest respondent satisfaction ratings were patient volume and response to marketing initiatives. When asked to share their perceptions of their organization's satisfaction with various strategic aspects of retail clinic ownership, respondents revealed that the clinics were achieving several important strategic goals, such as improved access, increased referrals, defense against competitors, and increased brand exposure. They indicated overall dissatisfaction with profitability and cost-reduction outcomes. We conclude that serious operational challenges and strategic threats must be overcome if retail clinics are to be a successful service line for hospitals and health systems.

Hospital publications: is this my link to a healthier life?

Hospitals use newsletters to reach their patient base. Within these newsletters, health narratives are communicated to inspire community members to choose that hospital for their health needs. Because health narratives inform our understanding of health care delivery, I employ Bakhtin's (1984) ideas on monologic and dialogic discourse to analyze newsletters published by a major hospital network. Results indicate a monologic rather than dialogic discourse, which excludes patient's unique experiences, advances normalization of medicine, and perpetuates hierarchical power dynamics. In summary, this study suggests practical implications for practitioners producing health knowledge for consumers of health information.

Competing for consumers. Coming coordinated-care squeeze prompts providers to push into insurance market.

Squeezed by coordinated-care initiatives, a number of hospital systems are looking to help fill beds and reap more revenue by offering insurance plans on the state exchanges set to launch this fall. Some will use narrow networks, a strategy that allows systems to create a captive customer base. "I think it's going to be a huge growth area in the exchanges," says Jonathan Gruber, left, a professor of economics at MIT.

When a health system develops its own road map.

Key considerations facing a hypothetical and typical health system as it transitions to value-based payment provide a guide for systems as they undertake this transition. The health system's first step is to review its current environment and strategies and the building blocks it has in place. Next, the system needs to add more building blocks, build a financial cushion, and revise targets and dashboards. Next steps include testing value-based payment contracting, realigning incentives, implementing new care management strategies, and communicating extensively. All of these steps will be unique to each organization.

Reducing pharmacy costs through improved utilization.

Strategies Trinity Regional Health System in Rock Island, III., used to reduce pharmacy expenses included: Leveraging benchmarking information to identify opportunities for cost savings. Implementing change management techniques, bolstered by well-presented and coherent data, to promote acceptance of change. Forming a multidisciplinary team of clinical and financial leaders to address quality, outcomes, and cost issues and collaborate on solutions.

Betting on change: Tenet deal with Vanguard shows it's primed to try ACO effort, new payment model.

Tenet Healthcare Corp.'s acquisition of Vanguard Health Systems is a sign the investor-owned chain is willing to take a chance on alternative payment models such as accountable care organizations. There's no certainty that ACOs will deliver the improvements on quality or cost savings, but Vanguard Vice Chairman Keith Pitts, left, says his system's Pioneer ACO in Detroit has already achieved some cost savings.

Engineering a fail-safe health system. Memorial Hermann wants to eliminate health care errors (really).

Memorial Hermann Healthcare System is on an all-out mission to eliminate health care-acquired infections. Despite a bit of physician resistance, the results so far are astonishing.

Estimated costs associated with improving influenza vaccination for health care personnel in a multihospital health system.

BACKGROUND: Health care personnel (HCP) are an important target group for influenza vaccination because of their close contact with vulnerable patients. Annual influenza vaccination for HCP is recommended to reduce the spread of influenza and decrease staff illness and absenteeism. UPMC Health System, the largest health system in western Pennsylvania, established a quality improvement project to increase influenza vaccination among its > 50,000 employees by implementing survey-informed interventions. At the completion of the intervention, estimates were prepared of the costs associated with implementing a multifaceted quality improvement intervention to improve HCP influenza vaccination rates in a large multihospital health system. METHODS: All 11 participating hospitals provided education and publicity regarding influenza vaccination and provided vaccine free of charge at mass vaccination clinics. Two additional strategies-mobile vaccination carts and incentives-were implemented in a factorial design such that the hospitals had either carts, incentives, both strategies, or neither. The minimum and maximum costs per vaccinated employee by type of intervention were estimated using cost data for vaccine/supplies, labor, incentives, and administration. RESULTS: The average costs per vaccinated employee ranged from $24.55 to $30.43 for incentives and carts, $20.66 to $25.57 for incentives, $23.24 to $26.54 for carts, and $18.03 to $20.60 for education and publicity only. Vaccination rates increased significantly but remained below ideal levels. CONCLUSIONS: Influenza vaccination rates among nonphysician HCP can be improved using various interventions at a low cost per vaccinated employee. The costs for these nonmandatory interventions were modest compared with the costs typically associated with influenza-related absenteeism.

How business intelligence can improve value.

Case studies of three healthcare organizations reinforce the premise that business intelligence--the ability to convert data into actionable information for decision making--is critical to demonstrating improved value.

Safety, efficacy, and cost-effectiveness of common laparoscopic procedures.

BACKGROUND: Laparoscopic surgery has been shown to offer superior surgical outcomes for most abdominal surgical procedures. However, there is hardly any evidence on surgical outcomes with patient risk stratification. This study aimed to compare outcomes of common laparoscopic and open surgical procedures for varying illness severity. METHODS: A retrospective analysis of surgical outcomes for six commonly performed surgical procedures including cholecystectomy, appendectomy, reflux surgery, gastric bypass surgery, ventral hernia repair, and colectomy was performed using the University HealthSystem Consortium (UHC) Clinical Database/Resource Manager (CDB/RM). The 3-year discharge data for the six commonly performed laparoscopic surgical procedures were analyzed for outcome measures including observed mortality, overall patient morbidity, intensive care unit (ICU) admissions, 30-day readmissions, length of hospital stay, and hospital costs. RESULTS: In this study, 208,314 patients underwent one of six common surgical procedures by either the open or the laparoscopic approach. Overall, the laparoscopic approach showed significantly lower mortality, reduced morbidity, fewer ICU admissions and 30-day readmissions, shorter hospital stay, and significantly reduced hospital costs for all the procedures. At stratification by illness severity, the laparoscopic group showed better or comparable surgical outcomes across all the illness severity groups. However, the observed mortality was comparable for the minor and moderate severity patients between laparoscopic and open surgery for most procedures. The 30-day readmission rate for major/extreme severity patients was comparable between the two groups for most surgical procedures. CONCLUSIONS: This study demonstrated the superiority of laparoscopy over conventional open surgery across all illness severity risk groups for common surgical procedures. The results in general show that laparoscopic surgery is safe, efficacious, and cost-effective compared with open surgery and suggest that laparoscopic surgery should be the procedure of choice for all common surgical procedures, regardless of illness severity.

An examination of contemporary financing practices and the global financial crisis on nonprofit multi-hospital health systems.

This study examines the impact of the 2008 global financial crisis on large US nonprofit health systems. We proceed from an analysis of the contemporary capital financing practices of 25 of the nation's largest nonprofit hospitals and health systems. We find that these institutions relied on operating cash flows, public issues of insured variable rate debt, and accumulated investment to meet their capital financing needs. The combined use of these three financial instruments provided these organizations with $22.4 billion of long-term capital at favorable terms and the lowest interest rates. Our analysis further indicates that the extensive utilization of bond insurance, auction rate debt, and interest rate derivatives created significant risk exposures for these health systems. These risks were realized by the broader global financial crisis of 2008. Findings indicate these health systems incurred large losses from the early retirement of their variable rate debt. In addition, many organizations were forced to post nearly $1 billion of liquid collateral due to the falling values of their interest rate derivatives. Finally, the investment portfolios of these large nonprofit health systems suffered millions of dollars of unrealized capital losses, which may minimize their ability to finance future capital investment requirements.

Creating a giant. Kindred, RehabCare deal would create largest post-acute healthcare services company in U.S.

Kindred's deal for RehabCare would create the U.S.' largest post-acute-care provider. Officials say the deal positions Kindred to benefit from Medicare's move toward bundled payments and will help accommodate patients whose needs are growing more intense. "There is an explosion of patients, unfortunately, that need multiple sites of service because they have very complex conditions," says Kindred CEO Paul Diaz, left.