By Karin Maake

You’re more apt to find the latest John Grisham novel on most of America’s nightstands, than the 449-page tome Landmark: The Inside Story of America’s New Health Care Law and What it Means For Us All, penned by the Staff of the Washington Post. But this is the exact title that healthcare providers are buying in bulk in effort to gain a better understanding of what the landmark health care legislation means for individual Americans and them.

In many ways, Texas is a progressive state where healthcare is concerned. The MD Anderson Cancer Center in Houston and Central Texas, the Houston Medical Center, and an emerging interest in Accountable Care Organizations put Texas out front in many areas. But there are problems, too. A widely-quoted New Yorker article on medical costs cited McAllen, Texas as the most expensive place in the United States for healthcare. The article laid the blame for the situation on the rampant overuse of medical procedures that may not be necessary. These procedures cost businesses in the state millions of dollars for employee healthcare. The New Yorker concluded that many people in medicine don’t see why they should work on cutting waste and improving quality if it means a loss of revenue.

If this happens, then employers will be the biggest losers, which is exactly why Texas CEO Magazine gathered a roomful of the most influential players in the Houston healthcare market for a truly rare meeting of the minds, which included Spencer Berthelsen, MD, FACP Chairman and Managing Director of Kelsey-Seybold Clinic; Thomas W. Burke, MD, EVP & PIC of MD Anderson Cancer Center; John Cassidy, MD, CEO & CMO of Nexus Health Systems; Osama Mikhail, PhD., Sr. VP, Strategic Planning of University of Texas, Health Science Center at Houston; and Ben Raimer, MD, Sr. VP of Health Policy & Legislative Affairs of University of Texas Medical Branch – Galveston.

Moderators Texas CEO Editor-in-Chief Jason Myers and Mike Cress, CEO of healthcare advisory firm MD Cress & Associates, posed a series of questions to the panel ranging from the importance of IT infrastructure to the growing physician shortage as well as the role of tele-medicine and social networking in today’s healthcare operations. But the overall purpose was to help frame the discussion for the business community about the complexities involved in gaining control over our healthcare system both pre- and post-reform.

From a business perspective, even the experts don’t really have the answers yet – but they have lots of questions, too.

Moderator: Healthcare providers were touted as being one of the “winners” in reform because they’ll be getting paid for those that have been uninsured in the past. At the same time everyone knows that reimbursement will continue to ratchet down. Advocate Healthcare President and CEO Jim Skogsbergh was recently quoted as saying, “We’re all scared to death of healthcare reform.”  Do you feel you’re a winner, and are you equally scared?

Cassidy, Nexus Health Systems: It’s too early to declare winners and losers. Most of the provisions in the healthcare reform act have not been mandated this year, and there’s obviously a lot of work that needs to be done between now and 2014 that will ultimately determine how things are going to go. From the provider side, much or our uncertainty lies in the preparation for an increase in the number of insured placing demands on the system.

Berthelsen, Kelsey-Seybold: Health care reform is actually a response to a different problem that existed long before our current system. The discussion largely centers around escalating costs, and when viewed from that perspective, healthcare reform was inevitable. Over the long term, it’s going to be a positive–we may not like some of the changes and mandates, but it’s the start of an active process that will ultimately mold our healthcare system into something that is better than what we have today. It’s definitely better that we start now, rather than 10 years from now. Ultimately, value will be rewarded, and it’s a simple ratio: quality over costs. So as providers of healthcare, both before and after reform, we have to concentrate on improving the level of our services and taking out unnecessary costs wherever we can find them.

Raimer, UTMB-Galveston: I agree. It’s a first step largely about payment reform and it sets the tone for general guidelines about payment. But those guidelines are still at a 30-thousand foot level. Those of us that work in health systems must be very active in the creation in those rules and regulations that are going to govern how they work, including patient advocacy groups. There are not any winners or losers yet, but the clear losers will be those that fail to get involved and shape the future of medicine. And the winners will be those who step up and say that the first step is about payment reform, so what can we do within the healthcare delivery systems now to create the delivery system of the future.

Burke, MD Anderson Cancer Center: The devil will be in the details, and how these discussions at a national level then get translated at the local level. I agree there are no winners and losers at this point—it’s all about a micro process development that will really determine what we end up with.

Mikhail, UT Health Science Center-Houston: I’ve found that all too often, organizations use the uncertainties and ambiguities of healthcare reform as an excuse for not doing anything and waiting to see how it’s going to play out. Regardless of how the reform takes shape, there are three operational considerations that must be attended to under any circumstances. These are: improving efficiency (cost), quality and access.

Moderator: What are the top three strategic imperatives that you are focusing on in the next year?

Burke: I think we absolutely need to know how much treatments are costing, and it’s tough to get to that level of granularity. Ultimately, we’re going to have to put patients, providers and payers in the same room, and figure out how we make that work financially. Understanding your costs, understanding what outcomes you’re expected to deliver, and how we develop a system to support that type of interaction is really critical. From the provider side, if I don’t really know that, I can’t really be a legitimate participant.

Cassidy: The other thing that we have to consider is end of life care, which is one of the most expensive aspects of our current system. And as a practitioner and a CEO, everyone wants to have great end of life care for their mother, but they don’t want to pay for anyone else’s mother. I suspect that we will come to some sort of national guideline that is going to have to determine how much end of life care is included.

Berthelsen: We spend twice as much as the average industrialized country on health care, and we aren’t getting double the value. In fact, because of the maldistribution that we have, we’re actually last out of 19 in terms of medically preventable mortality. If you have insurance, you’re fine. If you don’t that’s what draws the overall aggregate down. It’s our belief that there’s enough money in the system, it’s just that we need to spend it more wisely, and take out the part of medical care that doesn’t produce as much benefit. Most of the public believes that the relationship between cost and benefit are linear. In other words, you get what you pay for and that the more you spend, the better care you’re going to get. But those of us that are in healthcare have a better understanding that it’s not linear and much more complicated.

Mikhail: And to that end, another trend we see accelerating is physician consolidation and integration with hospitals. Three models that may see growth are: multi-specialty groups, hospital employed physicians and medical school practice plans.

Moderator: Leaders in healthcare (like Mayo Clinic or Cleveland Clinic, have started to embrace wellness as a key differentiator. What is your view?

Raimer: I think there’s some potential for hope in this healthcare legislation because there is money designated for prevention and wellness activities, as well as education of providers of primary care. There are also dollars allocated to increase the number of federally qualified health centers, which should contribute to the overall public health infrastructure. This emphasis should lead us to more awareness in the general public about disease prevention.

Moderator: Given the current environment of reform, do you feel that information technology is now in the driver’s seat? What are you working on relative to IT?

Raimer: Technology is important not only as a competitive strategy but to improve quality and efficiency of care. At UTMB, we have implemented an electronic health record which makes the patient’s health history more readily accessible, eliminates unnecessary duplication of tests, helps in preventing medication errors and supports population research.

Cassidy: We are also pursuing electronic medical record technology at Nexus Healthcare. Whatever the future holds, it will certainly include electronic access to health records.

Moderator: These same leaders are also starting to embrace social media strategies and tools to drive connections to “others like me” that want to share their experiences and, in turn, drive patients to their institutions.  Do you have a social media and mobile application strategy?

Burke: At MD Anderson, we have embraced many social media strategies. For example, we have a system called MyMDAnderson, and it’s password protected so we don’t incur any HIPAA violations. Patients can log on and view their clinic schedules, and they have the opportunity to interact with their caregiver team. They can also view their own medical records, so if they happen to be in a remote location, the patient can share their medical records with the treating physician. We’re also working on an MD Anderson application where patients and visitors can get a map of the institution, parking locations, and search for area hotels. We’ve also put our educational materials on iTunes U so patients can listen to information about their disease and treatments.

One of the biggest cost savers for us has been the shift from telephone referrals to electronic. We guarantee a 24-hour response time to the electronic request. We’ve seen a dramatic increase in patient satisfaction because of these initiatives and a decrease in staffing needs because of automated scheduling.

Cassidy: We’ve experienced a lot of success using an internal blog rather than a newsletter. We’ve had an enormous improvement in employee participation and been in better touch with employee concerns, and our ability to address those issues.

Moderator: What is your view about tele-medicine and its potential to curb costs?

Raimer: UTMB is one of the world’s largest users of telemedicine, and we’ve definitely seen the potential, especially in rural and other medically underserved areas. We also use technology extensively in our educational programs in simulation labs, distant education and other hybrid approaches to educating tomorrow’s healthcare workforce.

Moderator: Do you believe we have enough physicians in Texas to accommodate the increase in anticipated patient volumes?

Raimer: We already have a physician shortage in the state of Texas. Everyone’s aware of the nursing shortage. We do, however have more licensed vocational nurses than any other state, but we severely limit their scope of practice, and they are not as employable. I can’t stress enough how potentially big our physician shortage can become. There was originally a promise in the legislation that said we would see a redistribution of unfilled graduate medical education slots (residency programs) from programs across the country into other states, but we were a blatant loser and we’ve been left out of this health reform plan when it comes to graduate medical education. We can only do so much ourselves here.

As a whole, we do not have enough graduate education slots in the state of Texas to accommodate the number of students that graduate. So we pay to educate physicians, but when they want a residency, they go out of state. Only half of them return to Texas to practice. There is absolute furor for everyone to build a medical school in their city. But unless we build some graduate medical education programs, we’re just educating those doctors to go practice in another state.

California figured this out a long time ago. They have six times the number of graduate medical education slots as they have graduates in medical schools. So they attract residents from other states and they stay there.

Burke: And not only do we have the problem of educating new physicians, we have problems at the top as well. If the transition becomes too onerous, we have a real fear that a lot of these experienced physicians will retire, and others may look for other lines of work. The lead time to bring people on at the front end of the workforce is probably a decade, and fewer people are going into the medical profession because of the complexity and diminished expectations of pay and benefits.

Mikhail: The scope of practice battle is a huge issue, and it’s going on between physicians and nurses, nurses and paramedics and in a slightly different way between physician specialties within the hospital. For example, paramedics are authorized and licensed to do all sorts of procedures in the street and in an ambulance, but once they set foot in the hospital, they can’t do anything because of licensing restrictions often driven by competing professional interests. There are similar issues between nurses and physicians.

Raimer: We’re heading towards a day of reckoning where we have to take a look at all healthcare professionals and their scope of practice so that we can provide the quality of care that the public demands for the cost that they want.

Moderator: So is that a legislative issue or a cultural issue?

Raimer: There have been very little restrictive instructions from the legislature about scope of practice issues, but we don’t want them to step in either because it then becomes an issue of who’s got the best lobbyists.

Moderator: What state does it right?

Raimer: Colorado. They removed the control from the licensing boards and structured a scope of practice mediation group that isn’t owned by the legislature or licensing boards.  They make decisions based on evidence-based data and what’s best for the patient. The results are clear–for example, they allow dental hygienists to practice independently and not under the scope of a dentist. So you can go to any shopping mall in Colorado and get your teeth cleaned. They can’t fill a tooth, but they can refer you. And in instances like this, scope of practice is a huge public health benefit, and we’re not doing that right here in Texas. It’s another example about how evidence-based medicine would really help us.

Moderator: Overall, what are your biggest concerns about the future of Texas healthcare?

Raimer: We have the fastest growing population, the highest fertility rates and one of the highest immigration rates, not to mention we’re a leader in obesity. We simply do not have enough resources in our state to accommodate the growth of our population from births and immigration in addition to the number of the population seeking healthcare that were previously uninsured.

Cassidy: People need to be aware that the health reform legislation does nothing to address the illegal immigrant population, and they account for almost 50 percent of the uninsured in Texas. Overall, I think the US is going to find out what Massachusetts did when they went to universal access, which is that we do not have enough primary care doctors, and that access to care does not address the cost issue. The primary care physician shortage is a huge problem and the only way to address that is to adjust the compensation inequities that exist between primary care and specialties because without that we’re going to have an imbalance. Most physicians opt for specialties since the opportunity for compensation is so much higher. Since most PPOs are largely based on primary care physicians as gatekeepers, it potentially undermines the entire system.

Conclusion:
At the end of the roundtable, the Who’s Who of healthcare CEOs unanimously agreed healthcare reform is at a crossroads, and realized the onus falls upon them to help shape the type of healthcare system that ultimately works for patients, healthcare providers and businesses too.

What can business leaders do to control healthcare costs?