By Gwang S. Han • Guest Columnist
Simply put, I question if there is a problem with the current system at Harris Regional Hospital and Haywood Regional Medical Center, supervised by Carolinas HealthCare in Charlotte. Since retiring in 2007 after 33 years in Sylva specializing in obstetrics and gynecology, I paid little attention to the hospital’s future. Some old patients share their complaints of deteriorating quality care, emergency room problems, or the lack of good doctors; they never complain about the business structure established in merging two hospitals. However, I wonder why and how they arrived at this business model; what triggered it? Did local hospital management, boards of trustees, groups of physicians elect to merge, or did Carolinas HealthCare offer a deal too good to refuse?
The real problem appears loss of revenue for Harris Regional Hospital caused by a continuous drain of patients mostly to Asheville doctors, as stated by Steve Heatherly, Harris Hospital administrator. This has occurred since 2007 and increased almost 25 percent between 2007 and 2010, according to Becky Johnson of The Smoky Mountain News. Hospitals do not admit patients: doctors do. Patients are not stupid and can judge the quality of care they receive, especially women.
So what happened in those two years? Can identifiable causes explain the decline of the Sylva hospital? Did the “loss of a few doctors” cause the large migration of patients? Or was deteriorating quality of care at Harris Regional Hospital not the main reason for people to flee to Asheville for medical care? Was the hospital so poorly run that it needed outside help, or were the replacement doctors in certain specialties not providing the same quality of care people received from those few doctors who left?
The uproar from complaints by a few Sylva physicians appears confined to the business aspect of medical practice, as if recently implemented organizational system is the reason patients go to Asheville. Hospitals do compete; doctors also compete in providing quality medical care. Doctors are the main workhorses and hospitals play supporting roles for physicians to carry out their jobs. Healthy competition between hospitals and between physicians does not lead to a downhill path and death: to the contrary.
The two hospitals must have reasons to elect the “big daddy” approach instead of allowing two not-necessarily-close siblings to pool their energy and financial resources and use their combined synergy to retain their deserved market share instead of worrying about the eventual demise of one or both medical facilities. Size of business offers some advantage with its flexibility to maneuver, deep pockets, and ability to negotiate with insurance companies for remuneration. However, “big daddy” doesn’t have a reason to feel charitable toward these two ducklings (not necessarily ugly). It calculated its “take” by offering mighty financial power and business acumen, namely a bigger business market and bigger referral base. There is some truth in old saying that the friendship between two competing entities is inversely proportional of square of distance. This might have been the reason the hospitals chose Carolinas HealthCare instead Memorial Mission Hospital.
To me, the problem seems that the perfect picture doctors and hospitals have drawn is not what they expected to see and is not a perfect one. Is there someone or some organization to blame for the ugly picture or for the unfair deals as claimed by a few Sylva doctors? Let me remind you that these two hospitals have existed in two different business environments in a geopolitical-business sense and have two different doctors’ groups employing different business models. Perhaps Sylva has the advantage of being located in the bottleneck of two major highways and experienced an earlier introduction of medical specialties than in towns west of Sylva. Haywood has the handicap of being close to Asheville, the capital city of WNC.
The population and industry in Jackson County can’t support the hospital and the number of doctors in Sylva unless they are draw patients from surrounding communities. In fact, a lot of patients the Sylva hospital claims to have lost are not from Jackson County, but those from other communities who sought medical care in Sylva because they found better care than from doctors in their local community or it lacked specialists.
As the first board certified obstetrician and gynecologist west of Asheville, I witnessed on the ground level how people sought better care for their needs. Women are smarter, far more discerning, and more selective in choosing their doctors than men, in general, when looking for quality. The majority of medical decisions in the family are made by the woman in the house. They don’t mind of traveling distances seeking “better care.” Sixty five percent of my patients were not from Jackson County, but I doubt I could have attracted so many patients from different areas unless they thought it better. Most patients came by the word-of-mouth from other people, in fact more than 90 percent.
I think the two hospitals should maintain their separate identities and invest strength and financial resources in areas where they provide the best care: internal medicine, pediatrics, obstetrics and gynecology, and the surgical fields. Harris Hospital has taken many missteps wasting its resources with misguided objectives (one example is purchasing spine table so scarcely used). It would benefit from a modern Women’s Center, including a new labor and delivery room with modern, appealing décor instead of using the 1970s ugly, depressing facility. The year I arrived, about 250 deliveries occurred in the Sylva hospital; at its peak, close to 900 deliveries happened in one year (there were many fewer in Waynesville). I believe almost two- thirds of the deliveries were for people outside of Jackson County. Obviously, field of women’s and children’s health care can be a successful enterprise for this hospital.
In summary I don’t see a problem with the business structure since Harris Hospital has its own boss and administrative system with the help of Carolinas HealthCare. It should work with Haywood County in areas useful for both institutions. The key now is to regain the confidence and trust of people in this area. I kept the following message at the entrance of my office: “Please don’t come to see me unless you have trust in me.” It may take a long time for trust to return, but the two institutions have no other option but to try. Don’t underestimate consumers, clients, or patients and their ability to discern the quality of care or their knowledge of their health issues. Additionally, the residents of Jackson County should be concerned and become more actively involved in this effort. I wish them the very best.
Gwang S. Han, MD, FACOG, is a retired Jackson County physician.
MedWest leaders are struggling to hold a fledgling joint hospital venture together in the wake of recent physician turmoil, but there’s likely no easy fix for the identity crisis faced by Jackson County’s medical community.
Fearing the sanctity of Harris hospital is on the line, a group of Jackson County doctors went public two weeks ago with a litany of concerns. They aren’t alone. Doctors everywhere are desperate for solid ground, but instead have been caught up in the competitive turf wars playing out between hospitals.
Both MedWest-Harris and MedWest-Haywood have seen a troubling loss of patients to Mission Hospital in Asheville in recent years. Harris lost 10 percent of its in-patient business in just five years, most of it to Mission. Haywood lost 6 percent.
Indeed, both hospitals hoped the MedWest joint venture two years ago would shore up that erosion of patients. Both, however, seemed to have different ideas of how that would play out on the ground.
Was there enough business for both to stay the size they were, or would one ultimately evolve into the big kid on the block — and if so, who?
“Is there enough to go around for two? I don’t know the answer to that,” said Dr. Waverly Green, a pulmonologist at Harris.
It’s a troubling proposition for doctors who have married their livelihoods to a particular hospital — from building up their practice to raising their families here — to have their careers hinge on forces outside their control.
“It is challenging to know who is going to remain standing,” said Miriam Schwarz, the director of the Western Carolina Medical Society, a trade group for doctors in the region. “I think this jockeying for position is in response to the current climate.”
Schwarz said the “tumultuous times” have put everyone on edge.
“In this time of uncertainty, what we are witnessing across the country is heightened worries, anxieties and concerns about how health care will be delivered in the future,” Schwarz said.
When the MedWest venture was formed two years ago, Jackson’s medical community had little to fear from its neighbor.
“There has historically been very little market overlap,” said Steve Heatherly, the president of Harris.
Fewer than 5 percent of patients from Jackson migrated to neighboring Haywood or vice-versa.
“We said, ‘We’ve got enough to do, they’ve got enough to do and that’s the way it should be,” said Dr. Earl Haddock, a cardiologist at Harris for 22 years.
The result: two neighboring medical communities, largely happy to serve their own patient base and competing very little amongst each other.
“We’ve always had a collegial relationship. It has never been a competitive thing. They took care of their county and we took care of ours,” said Dr. Randy Savell, a gastroenterologist at Harris.
Haywood clearly had the tougher row to hoe, however. Just 25 minutes from Asheville, it was all-too-easy for patients who subscribed to the “bigger is better” theory to opt for Mission.
“It would be hard to survive in Mission’s shadow like that,” Green admitted.
Harris, however, had been largely spared from the specter of Mission. For decades, Harris acted as a net, capturing patients from the more rural counties to its south and west. It was far enough away that patients would only go to Mission if they really needed to, not just because they could.
And compared to the smaller, more rural counties around it, Jackson had a leg up simply by having a hospital at all.
“A lot of people west of here would stop at Harris because the roads to Asheville were bad, and there was at least a specialist here,” said Dr. Joe Hurt, a retired pathologist who helped build up Jackson’s medical community in the late-1970s and early ‘80s.
As a result, it had grown much bigger — both in the size of the hospital and the breadth of its doctors — than it ever could have been if drawing from just Jackson County’s population.
Patients from Swain, Macon and Graham counties plus the Cherokee Reservation accounted for nearly 50 percent of Harris’ total in-patient business. Only 45 percent of its in-patient volume comes from Jackson itself, according to market share data collected by the state.
It’s quite likely that Jackson’s medical community saw itself as poised to emerge as the epicenter of MedWest.
Not only did Haywood have the geographic conundrum of Mission to grapple with, it was still trying to rebound from a damaged reputation after failing federal inspections in 2008. It was an unfortunate turn of events blamed more on bureaucracy and bad leadership than a reflection of its health care, but a PR crisis nonetheless.
But, there were other forces at play. Chiefly, Harris was no longer immune to the siphoning effect of Mission.
While losing patients to Mission was a long-standing struggle for Haywood, Harris was not used to fighting that battle, and the hospital for the first time found its bottom line in jeopardy.
Harris is now in its third round of layoffs in four years. A wing of the hospital has been closed simply because there aren’t enough patients to fill it. Cash on hand had been dwindling, and finances got so bad the hospital could barely keep up with bills it owed, from medical supplies to the Red Cross blood bank.
Fear that it could now lose patients to Haywood — if suspicions are true that Haywood has been anointed as the flagship of MedWest — proved too much for Jackson doctors to bear. It’s entire model had been thrown into uncertainty, and a sense of panic set it.
“What Carolinas did was put us in competition with Haywood inside MedWest. Harris has to keep every patient it can to survive itself,” said Dr. Bob Adams, a hospitalist at Harris for 36 years who has decided to leave the hospital.
Not everyone shares that view, however.
“I certainly don’t get a sense of significant friction between the two,” said Steve Heatherly, the president of Harris.
For its part, the Haywood medical community doesn’t feel that way either.
“There is no friction, no competition,” said Dr. Marvin Brauer, the chief of staff at Haywood and a hospitalist there.
But, Brauer does think the two neighboring medical communities could do more to bridge the county line between them.
Every hospital has regular monthly meetings of its doctors. Since uniting under the MedWest venture, the doctors in Haywood and Jackson had not taken steps to hold periodic joint meetings of both hospitals, something that may change now.
“I think we should start to try to integrate the medical staffs even more,” Brauer said.
MedWest leadership sees one way out: buckle down and reclaim market share it has lost to Mission.
“The whole goal for us to join together was to take back some of the market share in our communities,” Dr. Chris Catterson, an orthopedist at Haywood, said.
That alone could solve everything.
“If we were each getting a reasonable market share, about 70 percent, there would be no problems,” Brauer said. That would mark about a 10 percent gain over the market share they have now.
Dr. Richard Lauve, a national health care industry consultant and analyst, questioned whether the strategy jives with the unstoppable reality that health care is consolidating.
“You can’t win back market share in a consolidating marketplace. A growth strategy is not one that wins,” said Lauve, with L&A Consulting based in Louisiana.
Granted, community hospitals have arguable advantages that resonate with patients, even when going head-to-head against the big guy next door.
“These are neighbors taking care of neighbors. The services are closer. You don’t have the cattle call mentality you get at the bigger facilities. Those are all advantages you can work to improve your position,” Lauve said. “But, they don’t move 10 percentage points of market share.”
That said, from a purely objective view, something has to give, Lauve said. Lauve was recently a guest speaker at a roundtable hosted by the Western Carolina Medical Society, attended by doctors and hospital CEOs from a dozen or so counties in the region.
Lauve’s answer was short and sweet when asked whether both Haywood and Harris could keep up their historical model: “No.”
Two mirror-image hospitals of that size simply can’t exist in neighboring rural communities 20 miles apart.
“You can’t repeat services that close together and make them both work,” Lauve said. “One of them will either fail completely and the other survive — or they need to sit down and make decisions about what makes sense for each community to have.”
In Lauve’s view, it’s time for those tough choices. And that might mean each hospital won’t have everything it had before.
“It is a political process — the interaction of human beings trying to figure out how to divide a pie,” Lauve said.
That’s one reason some Jackson doctors believe the right thing for their community is to get out and get out now. If one of the two hospitals is destined to get smaller, why keep heading down a path that is setting up their hospital to shrink?
Adams fears that die has already been cast.
“Harris devolves, and Haywood grows. It is not that they have anything against Harris. (Carolinas HealthCare) has an interested in right-sizing their components,” said Adams.
But, Jackson doctors say any strategy to make Haywood the new net to capture health care business from the rural western counties is flawed, because of the same long-standing geographic conundrum Haywood has always struggled under.
“You aren’t going to get most of the people in Western North Carolina to stop 25 miles short of Asheville to go to Haywood,” Hurt said. Once in the car and on the road, they’ll go the extra miles, he said.
Adams said it would take years to change the historical patterns of patients. If their own community hospital can’t do it, they will just go to Mission rather than the community hospital in another county, which patients would see as merely a lateral move.
“It is not a suburb of Atlanta or Charleston or Charlotte where a whole bunch of people who are moving in from somewhere else without a history or tradition can be influenced by marketing where to go,” Adams said.
In recent months, Adams and a group of Jackson doctors have advocated walking away from MedWest and instead partnering with Mission.
A mercenary stance perhaps, but they hope Harris would be built up by Mission as a go-to hospital for the western counties, a catch-all for health care from the rural west.
Adams said he understands why Haywood’s medical community would see Mission as simply too close for comfort.
“I think the medical community in Haywood County would be very concerned about Mission because I think they would feel more threatened,” Adams said. “Clearly, because of the proximity, it is a bigger concern for the Haywood community than for Harris.”
But, Jackson should look out for Jackson first, he said.
“For each hospital and each community who is the best partner for that individual community? I think that the communities may have different perspectives about that,” Adams said.
Not all Jackson County doctors are sold on Adams’ line of thinking, however. Several voiced their trepidation toward Mission at a hospital-wide meeting of Harris doctors in January. Adams’ camp had called on their fellow doctors at the meeting to send a message up the chain to Harris’ board of directors: they were unsatisfied with MedWest and wanted to vet Mission as a prospective new partner.
A few doctors were not swayed, however.
“The people who voted against it were concerned about their perception of Mission’s behaviors over the past 20 years where they had been aggressive and wanted everything to come to Asheville,” Adams said. But,“We felt that Mission’s attitude had changed significantly.”
The game-changer, in Adams view, is the new CEO who took over at Mission two years ago, Ron Paulus.
The former CEO, Joe Demore, was seen as an empire builder, one who was interested in grabbing up smaller hospitals in Mission’s net to promote an Asheville-centric model. Demore was ultimately forced out after a vote of no confidence by doctors practicing at Mission.
When Paulus came on board, he immediately began touting a collaborative regional view of health care, with small community hospitals across Western North Carolina working together under one system.
Paulus maintains Mission doesn’t want to compete with the smaller hospitals but genuinely wants to let them keep their own patients except when Mission’s services are truly needed.
The claim has been taken with a grain of salt, however, particularly in Haywood where there’s evidence of Mission planting its own doctors in Haywood’s backyard to steal patients. Mission has also made offers to buy out existing doctors’ practices in Haywood.
Adams said MedWest is so obsessed with competing against Mission — even paranoid — that patients’ interests aren’t being put first.
“At some point the region has to decide whether they want a competitive or collaborative health care system,” Adams said.
What might look like collaboration to Mission might look like undermining local health care to others, however.
Ultimately, the board of directors for both Harris and the MedWest system have thrown their support behind the current model.
“The boards have essentially said the organization of MedWest is the structure they are committed to at this time,” Heatherly said.
Haywood doctors agree it is the best route forward.
“We think the best thing for our communties is to be under one umbrella serving our communities of Haywood, Jackson and Swain,” said Dr. Chris Catterson, a Haywood orthopedist.
While the call by Jackson doctors to withdraw from MedWest seems like a shot across the bow to their neighbors in Haywood, Jackson doctors said they didn’t intend it that way. They aren’t questioning the quality or caliber of health care at Haywood’s hospital or by Haywood doctors.
Simply, they don’t think Carolinas HealthCare — the major hospital network managing MedWest — truly has their best interest at heart. Carolinas, as the new variable in the equation, has born much of the criticism from the group of Jackson doctors.
Carolinas has 34 hospitals in its network. Some it owns outright. Others, as with MedWest, pay Carolinas an annual fee for its management services and the benefit of being part of a larger system.
Carolinas’ interest in MedWest goes beyond that annual fee, however.
The more patients it represents, the more leverage it has when bargaining for better reimbursement rates from insurance companies and the federal Medicare and Medicaid programs. Those reimbursements have been dwindling, and what insurance and Medicare are willing to pay often no longer cover the actual cost of providing the health care. Ultimately, that’s the driver in the consolidation of healthcare and jockeying for market share.
“They are playing the corporate practice of medicine,” Adams said. “I don’t want to be a pawn in somebody else’s power struggle and be used as a widget in a big business’ plan for their benefit.”
But that’s the reality, said Lauve, the health care industry analyst. Things won’t go back to the way they were.
“Be a part of the change instead of resisting or ignoring it,” Lauve said, encouraging physicians to engage in the process.
“If you believe the fundamental driving forces are not going to go away, the peaceful coexistence of yesteryear is not an option. You are ignoring the elephant in the room. You are saying ‘I just want to get in another five years until I retire,’” Lauve said.
There’s two strategies left: compete head-to-head or collaborate.
“If you compete, one loses and one wins, but even the winner is worse off five years later than all the systems you compare it to that chose to collaborate,” Lauve said, citing a case study by the Voluntary Hospital Association.
Or, “You can figure out a way to collaborate and be part of the system that rationalizes how care is delivered,” Lauve said.
Miriam Schwarz with the Western Carolina Medical Society said physicians would much rather be taking care of patients but have found themselves trapped in a microcosm of a much larger national debate.
“I think the fact that physicians are so isolated and don’t have the opportunity to communicate across county lines, that has exacerbated the polarization that has been created by the institutions,” Schwarz said. “All they know is what their institutions are telling them but haven’t talked to their counterparts to get the whole story.”
Schwarz said physicians across the region need to come together — rise above it all so to speak — and work collaboratively, something the Western Carolina Medical Society hopes to serve as the mechanism for.
Previously, the organization was known as the Buncombe County Medical Society, but a year ago, it changed its name to reflect its regional mission. It has 900 members, with 125 now from outside Buncombe County.
“One of the goals we have as a regional medical society is to cultivate physician-to-physician dialogue in a safe setting,” Schwarz said. “Hopefully, physicians can put aside the politics and institutional affiliations and the pressures that are put upon them by those institutions and really focus on excellent patient care.”
Two months ago, doctors from more than a dozen hospitals in the region came together for an all-day summit at a country club in Haywood County in hopes of bridging the divide. Schwarz said it gave her hope.
“When they are sitting across the table from each other, the posturing that happens when people are really afraid or concerns about how to practice medicine in this chaotic world melt away,” Schwarz said.
When a team of moving men showed up in the surgery suite of MedWest-Harris two years ago and rolled a specialized spinal surgery table out the door, down the hallway and into a truck, acting on orders to haul the half-million operating table back over the mountain to the hospital in Haywood County, news that Harris’ equipment was being raided by its sister hospital on the other side of the mountain spread like wildfire through the halls of doctors’ offices in Jackson County.
“That was one of the first inklings we had that Haywood was going to get preferential treatment,” said Dr. Randy Savell, a Gastrointerologist at Harris. “‘We’re taking from you and giving to your big brother.’ That’s how it came across.”
The hospitals in Haywood and Jackson were a mere three months in to a joint venture at the time. The premise: working together the two hospitals would be stronger than going it alone.
But, stripping the spine table from Harris’ operating room quickly became a large-than-life symbol of the struggle for Jackson County doctors to hang on to their autonomy under the new MedWest banner.
“That was a big dust up,” said Dr. Waverly Green, a pulmonologist at Harris. But he didn’t immediately climb on the anti-MedWest train.
“I think it hit different people at different times,” Green said. “Over the first year, it was like ‘Are they really trying to slight us and build up Haywood?’ Or are we perceiving a chain of events that way because of our own set of goggles we were viewing this from?”
From a different set of goggles, moving the spine table made sense. Harris didn’t do spinal surgery. It had no spinal specialists. Instead, neurosurgeons from Mission Hospital in Asheville would travel to Harris twice a month to see patients. If they needed surgery, the patient was almost always sent to Asheville — and Mission raked in the billing for the highly-lucrative procedures.
The spine tabled purchased by Harris aimed to change that, hoping that the right equipment in-house would convince the Asheville doctors not to merely hold office hours in Jackson County but to perform the big-bucks surgeries there as well. In reality, however, less than two dozen spinal surgeries were actually performed at Harris in a year.
Jump to Haywood, where two spine specialists had built a reputable practice during the previous five years. They performed 50 to 60 back surgeries a month.
After the joint venture, it only made sense to quit sending patients and money out the door to Mission and instead keep the business in the MedWest house. So the spinal surgery table was moved to Haywood where the equipment would be put to better use.
But for Harris, it cut off any budding aspiration that it, too, could perform spinal surgeries with regularity one day, not only for the revenue but to serve patients locally.
“That was a major product line we were trying to develop,” said Dr. Gilbert Robinson, an anesthesiologist with Harris for 10 years. “We were doing very valuable services for the community and they quit.”
To Jackson doctors, it begged the larger question: was Harris being set up as an ancillary hospital to Haywood?
For its part, the Haywood medical community does not perceive an underlying tug of war with Jackson but instead sees itself as equal partners.
“We want to have a great relationship with Sylva,” said Dr. Chris Catterson, an orthopedist in Haywood. “We want to help the whole system. That was our goal: to get bigger, to become more financially sound, and to grow. We want all of our hospitals to be successful. That is our goal for the future.”
While moving the spine table to Haywood became a metaphor for the issue, there were other perceived slights as well.
Faced with dwindling patient count, Harris had closed one wing of the hospital about three years ago, cutting down on staff and overhead to reflect the number of patients it was actually serving. But during spikes, when there were suddenly more patients on its doorstep than the reduced staff could care for, Harris had to turn them away.
Dr. Earl Haddock, a longtime cardiologist at Harris, said hospitals should be in the business of treating patients, not turning them away, especially in light of financial struggles at Harris.
“When someone calls to admit a patient, there’s two things you can say and that is ‘Yes, sir,’ or ‘Yes, ma’am.’ Not ‘We don’t have any beds,’” Haddock said.
In reality, Harris had the beds but had maxed out its nurse-to-patient ratio for the night.
“There was no ability to flex. They had cut the staff back to the point they couldn’t take another admission,” Green said.
Meanwhile, it seemed Haywood always had plenty of beds, and the business was sent over the mountain.
While unfortunate, MedWest didn’t intentionally undersize staff at Harris so it could then divert patients to Haywood, according to Steve Heatherly, the president of Harris.
“Are there times when you get an influx of patients at a moment in time and don’t have the staff to handle it? Of course, that is an issue for every hospital,” Heatherly said. “There probably were times when patients were diverted from here to Haywood, and also patients diverted from Haywood to here due to availability of staff or physicians, but that is not part of any master plan.”
Harris now has a contingency plan in place to ramp up staff when need be.
Allegations of ulterior motives aside, there’s an inescapable fact: Haywood’s medical community offers certain services Harris doesn’t. That was the case even before the MedWest venture.
• One of those areas is spine surgery.
• Another is advanced cardiology services, particularly diagnostic heart catheterizations. The procedure is advanced, but two heart specialists in Haywood perform them routinely. Harris doesn’t.
• A third service line Haywood has but Harris doesn’t is certain types of interventional radiology.
Historically, Harris referred patients needing any of these to Mission.
“People who were sick but not sick enough to need Mission we would handle. Anything we couldn’t handle, we would send to Mission,” said Green, a doctor at Harris.
Under MedWest, however, the question was raised: why not send them to Haywood?
“It was, ‘We don’t want you sending this to Mission if we can keep it in the system,’” Green said.
Legally, hospitals can’t tell doctors where to refer patients. They can ask, suggest and perhaps even gently implore, but they cannot strong-arm doctors into referring patients to a particular hospital or advanced specialist.
MedWest administration indeed asked Jackson doctors to give referrals to Haywood. According to some doctors, MedWest administration went a step further by tracking the referral patterns of their physicians, keeping spread sheets on the number and type of patients a particular doctor referred to Mission for things that could have been treated in system.
On the surface, it rightfully should be the administrator’s business to know where his corporation was losing market share and figure out ways to get it back. Jackson doctors, however, saw it as further evidence they were being asked to help prop up Haywood.
The Haywood doctors likewise asked their counterparts in Jackson — colleague to colleague — to send patients to them if it was something they could treat.
It’s possible the Jackson medical community couldn’t accept the notion that Haywood doctors could treat patients Harris couldn’t, and subconsciously, that’s why they bucked the idea.
That is not the case, however, according to Jackson doctors.
“If we are going to be true to our patients we want them to get the best they can get,” Savell said
Simply put, specialists at Mission do more of the procedures, and in the highly rare event something went wrong, the patient was closer to the emergency intervention they would need. And besides, after refering to Mission for years, they were simply used to working with the particular doctors on the other end of that radiology report or heart diagnosis.
As Jackson County doctors began scrutinizing management, attempting to detect whether favoritism was at play, it didn’t help that Jackson’s own CEO was let go when MedWest formed, and the staff at Harris began answering to the CEO from Haywood, Mike Poore. Poore had been promoted to oversee all hospitals under the MedWest system — both Haywood, Harris and Swain. Poore’s finance officer, chief operating officer and chief nursing officer from Haywood also took the reins over the entire system.
Poore’s home base was clearly Haywood, but he regularly made the 25-minute trip over Balsam to work from Harris, parking himself behind the desk of Harris’ departed CEO.
Accounts differ on exactly how much Poore and the other top leaders from Haywood actually made it over to Harris. Some say Poore was there at least two days a week. Whether its was merely their perception, Jackson doctors felt like they were being managed from afar, relegated to the status of a satellite hospital.
“All of a sudden we were saying ‘Gee, where is our representation here?’ The concept was ‘We’ll all be one big happy family, but that medical model didn’t work,’” Haddock said.
Likely, Poore was there more than they realized, based on accounts from one former employee who worked in a nearby office, but as far as Jackson doctors were concerned, their administration wing at Harris seemed empty more often than not. More than merely being irked by it, however, it actually made a difference on the ground, they said.
“If the person you need to ask a question of are in another county and have shown themselves to be unresponsive or aggressive, you don’t seek out help,” Savell said.
Push back from the Jackson medical community ultimately led to Poore being stripped of his position as CEO over MedWest and over Harris in February. Harris was given its own president, namely Steve Heatherly, who had served in various leadership roles, including chief operating officer, chief finance officer and chief strategist for Harris during the past 15 years.
Jackson doctors have responded well to Heatherly’s new leadership role and largely say they have confidence in him to help turn things around. Even Dr. Bob Adams, a spokesman for the disgruntled Jackson doctors, has given Heatherly his blessing.
“I think the WestCare board and Steve Heatherly are doing their best to work with medical staff now,” Adams said.
But, some doctors fear that the move is temporary and that once the Jackson medical community has been placated, Carolinas will return to the ultimate game plan: creating one flagship hospital with the other relegated to a supporting role.
“What does that mean three years or five years from now under MedWest?” Adams asked. “No one will ask the strategic question. Where are we going, how are we getting there and what does it mean?”
Meanwhile, Poore has resigned completely, announcing in early April that he would step down from his role. He has already landed a new job as a hospital administrator in Texas.
The Haywood medical community was dismayed by the news, believing Poore had done a good job and put the hospital on a trajectory for success and primed for a turn-around.
Since Poore’s departure, Carolinas has sent in its own John Young, the vice president of its western region, in a acting role as the CEO of MedWest. Young said few hospital affiliations are seamless.
“To bring different cultures together is always very difficult,” Young said. “But as sticky and difficult as these times are, we know that we will get through it. Organizations do work through these issues.”
A movement to rein in the dominance of Mission Hospital in Western North Carolina’s healthcare landscape has hit a critical juncture.
A legislative committee studying whether smaller hospitals are suffering from aggressive, monopoly-like tactics by Mission will unveil its recommendations this week. Based on a preliminary report, the committee will recommend new restrictions to help level the playing field for Mission’s competitors.
But, there is early indication the recommendations won’t garner the necessary support in the General Assembly.
To pass, it would need the support of heavy-hitter Sen. Tom Apodaca, R-Hendersonville, who chairs the Senate rules committee. Apodaca has told fellow legislators he won’t support it.
“The senator assured me it would be dead on arrival in the Senate,” said Rep. Ray Rapp, D-Mars Hill.
Without Apodaca’s backing, new restrictions on Mission have “zero” chance of passing, according to Sen. Jim Davis, R-Franklin, even though Davis himself personally supports them.
Another nail in the coffin: Sen. Martin Nesbitt, D-Asheville, doesn’t support new restrictions either. Between Apodaca and Nesbitt — the two senators who represent territory at the heart of the Mission Hospital debate — it’s unlikely senators from other parts of the state would feel strongly enough to go over their heads and push it through anyway.
Smaller hospitals and doctors in the region are fearful that Mission is exploiting monopoly-like power to gobble up market share, causing the slow-but-steady decline of smaller community hospitals by eroding their patient base.
But while Mission’s competitors lobbied for more restrictions, Mission was lobbying for fewer restrictions. It currently is subject to anti-trust oversight dating back to the merger of Asheville’s only two hospitals in the 1990s.
Mission claims those existing regulations handcuff its ability to navigate the rapidly changing dynamics of healthcare and should be lifted.
“It has been 16 years. There has to be a way of gracefully ending this,” said Ron Paulus, CEO of Mission.
The upshot, however: neither may get what they want. If lawmakers buck committee recommendations and decide to leave well enough alone, the status quo will stay in place.
“If it ain’t broke, don’t fix it,” Rapp said.
Rapp said the state shouldn’t do something that could hurt Mission’s role as a life-saving hospital in the region.
“The health and well-being of our citizens should be first and foremost,” Rapp said. “ We can’t put our premier health care institution in jeopardy.”
But, Davis said Mission’s unfair advantage is jeopardizing smaller hospitals.
“I just don’t want any hospital to be preyed upon by a large hospital,” Davis said.
Davis said the anti-trust oversight Mission is subject to was put in place for a reason.
“Whenever you endorse a monopoly, whatever government body blesses that, has an obligation to keep an eye on them,” Davis said.
Paulus said Mission has a critical responsibility in the region as the largest and only tertiary care institution. “I hope you don’t need us but I want to be here if you do,” Paulus said.
It’s doubly hard given the demographics: poorer, sicker, older and less insured.
“The issue is how do we care for the patients in our region when the demographics are so much worse,” Paulus said.
Mission wants to work collaboratively with all the hospitals and doctors in the region toward that goal rather than get bogged down in turf battles no one can afford to wage, Paulus said.
The state committee considering whether to strengthen or weakened the anti-trust regulations governing Mission released preliminary recommendations last month.
Among them: a buffer zone that would stop Mission from setting up certain types of clinics within 10 miles of an existing hospital and a cap on the percentage of doctors Mission can employ in a community.
In Haywood County, MedWest-Haywood hospital has been in a race with Mission to buyout private doctors’ practices and put physicians on the hospital’s payroll as in-house employees.
The trend of doctors working directly under a hospital instead of private practice is a national one, driven largely by economics. Doctors have been getting squeezed by declining insurance and Medicare reimbursements and see employment under a hospital as an easier route.
The fear, however, is that whichever hospital employs doctors can control where they send their patients.
“If Mission buys a practice, the default for that practice would be to send those patients to Mission Hospital, and I am concerned about how all these little hospitals in the western part of the state will survive if that happens,” Davis said. “I don’t think anyone wants our community hospitals to become emergency clinics that feed to Mission Hospital.”
Paulus countered that Mission would not dictate which hospital a doctor should admit and refer patients to.
Nonetheless, Mission’s competitors would like to see limits on how many doctors it can employ in surrounding counties. Currently, Mission’s anti-trust regulations cap the number of doctors it can directly employ in Buncombe County to 30 percent, but there are no caps for other counties.
Mission has come under fire for courting physicians in Haywood County. Mission has also set up a competing medical office complex in Haywood.
But, Paulus said Mission’s motives in extending employment offers to Haywood doctors are not sinister.
“The goal is not to have a single monolithic hospital in the middle of Asheville,” Paulus said, adding “it would never work, parking is terrible.”
Paulus said WNC has historically not been able to recruit enough doctors to serve the population.
“The ratio of doctors to population is well below the state and national average,” Paulus said.
Their salaries here are lower because of the higher number of poor, uninsured patients. By employing doctors, hospitals essentially subsidize their practices to get them to stay here.
Mission simply wants to ensure a stable of doctors for the region, he said.
“Our core concern is the ablity to attract and retain quality physicians in the community,” Paulus said.
Haywood doctors who are critical of Mission for its forrays in their home territory questioned why, if Mission’s goal was building the physician base, did it try to buy exisiting practices that are already here.
Paulus said the existing practices are the best route for recruiting more doctors.
“It is much easier to recruit into an existing group than create a new group,” Paulus said.
MedWest-Haywood got particularly irked, however, when Mission tried to court Mountain Medical Associates, a key practice in Haywood County with eight doctors across four critical specialties.
Realizing it had stepped on an ant hill, Mission actually withdrew its offer to Mountain Medical Associates, Paulus said. Before doing so, it extended an olive branch inviting MedWest-Haywood to form a three-way partnership with the practice and the two hospitals working together. That way MedWest-Haywood wouldn’t have to shoulder the entire financial burden of adding all the doctors to its payroll, Paulus said.
Paulus said the offer attempted to “reset the playing field and get past old emotions” between Haywood and Mission, but the opportunity was squandered.
Whether perception or reality, MedWest-Haywood had to counter Mission’s offers to buy local physician practices, despite not really having the money to do so.
“They in a sense have been forced into a bidding war with Mission for their own doctors and have had to pay more for those physicians as a result,” Fields said.
That was partly to blame for landing the MedWest-Haywood in a financial quagmire. It barely had enough cash on hand to make payroll and had to get an emergency line of credit to bail it out of a cash flow crunch.
But, those who defend the move say it was critical.
“If you don’t have physicians in your community pushing people toward your hospital, you aren’t going to have a hospital in your community,” said Kirk Kirkpatrick, a Waynesville attorney and Haywood County commissioner who has been active in hospital affairs.
Kirkpatrick said billboards for Mission in Haywood County are a testament that Mission is actively going after patients in Haywood County and trying to pull them away from MedWest-Haywood hospital.
“It is an extremely competitive business, extremely competitive,” Kirkpatrick said. “If you want a hospital in your community that can provide the kind of care you expect then you need to utilize your hospital. If you go over to Mission and you vacate your hospital and don’t utilize it, it won’t be here anymore.”
Finding a new leader to replace the outgoing MedWest-Haywood President Mike Poore could take months and will be handled by Carolinas HealthCare Network rather than the local hospital board.
Carolinas HealthCare System, a Charlotte-based network of 34 hospitals that MedWest-Haywood joined two years ago, will conduct the search and vet applicants. The MedWest-Haywood board will make the final pick from among two or three finalists.
Finding a replacement who can navigate the complicated structure of MedWest may take time, according to John Young, the vice president for Carolinas HealthCare’s western region.
MedWest-Haywood is one of three hospitals under the MedWest banner, along with MedWest-Harris in Jackson County and MedWest-Swain.
Until recently, Poore had served as the CEO of all three hospitals plus the overarching MedWest partnership — in effect four organizations.
“He has taken on multiple roles in a complicated situation,” said Dr. Benny Sharpton, a member of the Haywood hospital board.
Poore had to balance the wishes of three medical communities, answer to the individual hospital boards plus the joint MedWest board — all the while reporting to his primary boss of Carolina’s HealthCare.
“This is not the place for a new CEO,” Young said.
Earlier this year, however, Poore was reassigned. He was stripped of his CEO status over all of MedWest and pulled back to his former role as president of MedWest-Haywood only.
Meanwhile, MedWest-Harris and Swain were given their own president in Steve Heatherly, who had been in Harris management for 15 years.
The management shuffle was aimed at placating dissention among some Jackson County doctors who felt Harris was not getting the attention it needed from Poore under the new MedWest venture. Harris has been faring worse financially than MedWest-Haywood and had seen a growing loss of patients to Mission, while Haywood’s market share has inched back up.
Failure to fix concerns raised by the Jackson medical community could potentially threaten the MedWest joint venture. When the joint venture was launched, an escape clause was built into the contract at the three-year mark, which comes up next year.
Young said dissolving it would be bad for both hospitals.
“The real issue from my perspective is simply we are better together,” Young said. “When you put the hospitals together, you have enough market share and enough demographics to be able to compete for primary and secondary care with Mission way better than any hospital could by itself.”
The hope is that MedWest-Harris and MedWest-Swain would get more attention under their own CEO than they could have gotten from Poore as CEO of the entire system.
How long the hospitals will remain under separate leadership isn’t clear. Ultimately, there needs to be a CEO over the entire MedWest venture, Young said. Having a president for each hospital plus a top CEO results in a “pretty hefty salary load,” Young said. So ideally, the president of either Haywood or Harris would serve in a dual role as CEO over the whole entity.
But, it is unclear when a return to joint leadership may occur. And, that complicates the hiring of a replacement for Poore.
“This is not the best moment for us to be looking for someone because we have this bifurcated approach,” Young admitted.
Young said there is no easy way to get through this “awkward moment.”
Given the complexities, an interim president will most likely be appointed while a permanent one is found. If the interim leader proves their mettle, they could be asked to stay, however.
“So we need as robust a search for an interim leader as a permanent one,” Young said.
For now, Young will serve in a transitional capacity while a search is conducted for an interim president.
“This organization has had enough change,” said Young.
The president of MedWest-Haywood hospital suddenly stepped down this week after three-and-a-half years on the job.
Mike Poore’s tenure at the helm of MedWest-Haywood was marked by an aggressive strategy to restore a crisis of community confidence, rebuild plummeting finances and compete head-to-head with the much-larger neighboring Mission Hospital in Asheville.
The news that Poore was resigning came as a surprise to the medical community and hospital’s board of directors, who met for two-hours Monday to digest the news.
Dr. Benny Sharpton, a long-time surgeon in Haywood County, said the medical community is going to be disappointed at the loss.
“The medical staff was not only comfortable but optimistic with his leadership,” Sharpton said. “He opened up lines of communication that had been broken it he past. He had an open door policy. Not all CEO’s have good rapport with their medical staff.”
Poore will be best known for rescuing the hospital after a tumultuous period when it failed federal inspections and was forced to essentially shut its doors for four months in 2008. The previous CEO, David Rice, who had become a lightning rod of controversy even prior to that crisis, stepped down and Poore stepped in — not only filling a leadership void but also putting the hospital on a path to recovery.
“Within a relatively short period of time, we had regained the market share we had lost. That is not a small feat,” said Dr. David Markoff, an ophthalmologist in Haywood County. “I have enjoyed working with Mike. I am sorry to see him leaving.”
Poore’s family man persona and regular presence at civic and social functions not only built rapport for the hospital but made him generally well-liked around town as well.
“Mr. Poore is one of the finest men I have ever known,” said Dr. Charles Thomas, an oncologist in Haywood County and a hospital board member. “He has done us a wonderful job. We accepted his resignation with deep regret and lots and lots and lots of thanks and platitudes.”
While Poore’s departure seems amicable, many in the medical community are left asking “why now?”
Poore, 47, does not have another job lined up. Depending on where he goes next, his family may stay in Haywood a while before joining him to avoid being uprooted. His son, a football player for Tuscola High School, will be a senior year next year, while his daughter will be a sophomore. His wife is involved in various community civic groups.
Poore is receiving a severance package but the terms aren’t public for now.
Poore said he will look for another hospital CEO position.
“I am a hospital administrator. That is my animal,” Poore said.
There wasn’t any detectable tension between Poore and the Haywood medical community or hospital board.
But, Poore technically had another boss as well. He answered to Carolinas HealthCare System, a network of 34 hospitals based in Charlotte that MedWest joined two years ago.
Carolinas didn’t have a problem with his performance either, according to John Young, the vice president for Carolinas HealthCare’s western region who Poore reported to.
“This moment is Mike’s choice. This is not because of anything,” Young said. “It is just a certain period of time when it is time for somebody else to come in.”
By all accounts, Poore was dealt a difficult hand when he took the job.
“We will always remember his great leadership in getting Haywood Regional Medical Center back up and running,” said Fred Alexander, the chairman of the full MedWest board of directors.
With no patients to speak of, the hospital’s cash reserves had plunged so low that it had less than a month of operating revenue left when it reopened its doors. Patients who had turned elsewhere for medical care during the closure had to be lured back. And, the historically robust medical community in Haywood County, which had rallied around the hospital, needed reassurance they still had a future in Haywood County.
“He has worked so hard in the past several years to bring this entity, our hospital, upright again,” said Jean Burton, chair of the MedWest-Haywood board and a Cooperative Service agent in family and consumer sciences. “We were so knocked down a few years ago, and Mike worked tirelessly around the clock and has really stuck to the priorities he set.”
With the crisis in the rearview mirror, Poore led the hospital into a new partnership with neighboring hospitals in Jackson and Swain counties. The three hospitals formed a joint venture under the new MedWest banner. At the same time, MedWest joined the Carolinas HealthCare Network.
“I came to the hospital at a time of transition. We have gone through that transition during the last three-and-a-half years. It is just time for me to move on to other things,” Poore said.
Poore’s tenure isn’t uncharacteristically short for a hospital CEO. While the average time at one hospital for a CEO in North Carolina is longer, nationally it is 3.8 years, Poore said. Poore’s time at Haywood was just under that.
“It is not unusual for that turnover, but especially in a circumstance where you have a transition of bringing two organizations together to form MedWest,” Poore said.
There are always rivalries, even if friendly ones, between neighboring hospitals, Poore said. Bringing together two medical communities to act and think like a single entity can be difficult and challenging, he said.
As is sometimes the case in corporate mergers or turn-arounds, the person to affect change does not stay on as the long-term leader, Young said.
“Mike was the man to move the ball,” Young said of Poore’s role during the past three years.
Poore’s total compensation package was $444,000 a year.
Poore’s tenure wasn’t without snags, however. His honeymoon period began to fade in recent months, as the financial recovery initially witnessed under Poore began to backslide.
Despite a workforce reduction of 52 employees last year, MedWest has embarked on another round of cuts — 120 positions will be eliminated by July 1.
“It is what we need to do to right-size our organization with the reality of the revenue coming in today,” Poore said. Poore said MedWest is operating under austerity measures until the tide turns.
The layoffs amount to about 5 percent of the 2,100 employees across MedWest, including all three hospitals plus the 16 doctor practices now owned by MedWest.
In the midst of the financial troubles, MedWest-Haywood has seemingly been on a building and spending spree during the past year — from the very necessary replacement of a broken down generator to the very optional construction of a new surgery center.
In the end, MedWest-Haywood saw its cash-on-hand dip so low it had to turn to Carolinas HealthCare for an emergency $10 million line of credit. It was the first time Carolinas has ever loaned money to any of the 34 hospitals in its network.
While Poore defended the loan as no big deal, as Haywood has no other debt on its books, getting bailed of a cash-flow crunch by Carolinas clearly wasn’t ideal.
The loan was precipitated by a series of unexpected costs. Namely, MedWest-Haywood spent more than $10 million to replace a broken generator, upgrade its electronic medical records system and pay out judgments in two lawsuits dating to the previous administration.
Like Poore, Young characterized MedWest-Haywood as a victim of circumstances. Nonetheless, it revealed just how critical the financial status had become.
While some costs indeed couldn’t be helped, Poore also oversaw an expansion campaign far more voluntary in nature.
A hospice center, a new surgery center and a new urgent care center are in various stages of construction, costing MedWest-Haywood a total of $2.35 million. The amount put up by the hospital is a fraction of the total cost — the lion’s share was paid for by the non-profit hospital foundation and a private group of physician investors.
MedWest also has new MRIs, a new diagnostic lab and new heart catheterization services.
“The hospital is very well positioned to serve patient needs and to grow and to prosper,” said Dr. Charles Thomas, an oncologist in Haywood County and former chief of staff of the hospital.
“Mike started us down a track. A lot is already in place,” Young said.
The attention Poore gave to MedWest-Haywood didn’t sit well with some doctors in Jackson County, who felt their hospital was being slighted in favor of making Haywood the flagship of the MedWest system, another bump in the road for Poore in recent months. Disatisfaction among the Jackson medical community led to Poore being replaced as CEO of MedWest-Harris and relegated to being over MedWest-Haywood only.
Perhaps the most expensive piece of Poore’s expansion campaign was buying out several Haywood doctors’ practices. The exact cost of the private transactions are not known, but up-front costs aside, the newly bought doctor’s practices will continue to be a drain on the bottom line for another year or two before turning the corner. The hospital has to foot the bill for salaries, equipment, and overhead before the billing for patients begins to pay off.
While costly and perhaps outside the hospital’s realistic budget, it had to be done, according to Dr. Benny Sharpton, a long-time surgeon.
Mission Hospital in Asheville was courting the same physician practices, and Haywood had to make a competing offer. So Poore acted swiftly despite perhaps not having the money to do so.
“It was done in an extremely short period of time primarily due to outside threats from Mission hospital trying to siphon the loyalty of our doctors off,” Sharpton said. “He took that on in a difficult time. It needed to be done. It had to be done.”
While Poore has taken criticism from some for overspending or failing to enact austerity measures sooner, others disagree. When faced with embattled finances and dwindling market share, MedWest-Haywood had a choice. It could retrench and scale back. Or it could move forward with guns blazing.
Rather than resigning Haywood to being a rural second-fiddle hospital in Mission’s shadow, Poore chose to push Haywood onto a bigger stage.
“He has already laid the foundation,” said Cliff Stovall, a MedWest-Haywood board member. “The person that does all the spade work doesn’t always get to enjoy all the glory.”
The track set in motion by Poore will hopefully continue by the leadership team still in place, said Stovall.
“As much as I hate to see Mike ago, we are glad to have the people he put in place,” said Stovall, a retired army colonel who now works in tax preparation.
Poore assembled a nearly all-new management team for the hospital after he was hired, bringing on board more than a dozen vice presidents and department heads within his first two years.
Poore gives credit to the entire team for the advances that have been made.
“I am so proud of the accomplishments the team has made,” Poore said. “I feel like I am leaving this in good hands on a go-forward basis.”
The pending merger of Angel Medical Center with Mission Health System could be sidelined, at least temporarily, by a state bill aimed at limiting Mission’s influence in the region.
Sen. Jim Davis, R-Franklin, said he introduced the bill to offer a check on what he sees as a monopoly by Mission.
It would halt an affiliation between Mission and Angel that has been in the works for more than a year and is now close to a final deal.
“Right now it is in Angel’s court. We are certainly hoping within the next month,” said Janet Moore, director of communications at Mission.
Angel CEO Tim Hubbs said the decision of who Angel will affiliated with should rest with the people of Macon County, not Raleigh lawmakers.
“I have spoken to dozens of long term residents in our area that are outraged by the bill and are very upset with Senator Davis,” Hubbs said.
Hubbs said the bill was a shock.
“We were blindsided by it,” Hubbs said.
Davis met with Hubbs and key hospital leadership a couple of weeks ago to hear their concerns.
“He said the last thing he wanted to do was hurt Angel,” Hubbs said. But Davis has not withdrawn the bill or altered its language.
It is unclear just how much traction the bill has. Mission and Angel may complete their deal before the bill has a chance to move forward.
Davis suggests Mission could exploit its monopoly status to hoard health care services, limiting care patients can get locally and making them drive to Asheville.
But Davis’ bill would cause exactly that to happen, Hubbs said.
Mission will bring more health care service to Franklin, not less, Hubbs said. And without Mission, Angel may actually have to scale back what it provides, having the limiting effect Davis’ claims he doesn’t want.
“I think he has good intentions but the bill ironically would have the opposite effect,” said Trentham. “What he is trying to do ironically will limit free market choice.”
A partnership with Mission will make it easier to recruit doctors, bringing more specialties to Angel. Specialists from Asheville already hold occasional office days in Franklin if the services can’t already be found there.
“Mission and Angel have partnered for a very, very long time. We have been able to bring specialists and subspecialists to enhance what the community already has,” Moore said.
Angel most stands to gain financially. It will get better rates from insurance companies, can get more competitive prices on medical supplies and equipment due to bulk purchasing power, and tap Mission’s expertise on the complicated world of hospital administration and regulations.
“We aren’t to the point where we can’t survive without it, but we are definitely stronger with an affiliation,” Hubbs said.
Davis agreed Angel should be able to align with Mission if it wants to.
“I am not trying to stand I the way of that,” Davis said.
Davis said he understands why small hospitals need to be tied to a larger institution. Angel has 25 beds, and has 16 patients a day on average.
“The small ones just can’t survive by themselves,” Davis said.
But Davis’ bill would halt the merger for at least a year until the issue of Mission’s monopoly can be studied.
Hubbs last month announced he would retire in the next six months, altering solidifying the deal with Mission. That may be delayed now, too.
“I will stay here until we get some thing on the right footing,” said Hubbs.
A state bill aimed at ensuring a balance of power between Mission Health System and smaller hospitals has placed lawmakers in the middle of a healthcare turf war.
As Mission steps up efforts to acquire smaller hospitals and doctors’ practices around the region, some fear the Asheville-based health system will siphon healthcare dollars away from local communities and limit the scope of medical care patients can get closer to home.
Meanwhile, patients don’t want business motives to drive the healthcare they receive. The medical community universally asserts that isn’t the case, even as hospitals jockey over market share and fiercely guard their territory from encroaching competition.
But Sen. Jim Davis, R-Franklin, who introduced the bill, isn’t so sure.
“Health care is a business, it is a huge business, and for Mission it is close to a billion dollar a year business,” said Davis, an orthodontist in private practice who represents the six westernmost counties in the General Assembly. “Just like any other business we have to guard against monopolies.”
If Mission’s dominance is allowed to expand unchecked, with more and more doctors and rural hospitals coming under its umbrella, Davis fears everything except routine medical procedures and basic care would be funneled to the flagship in Asheville.
“None of these hospitals in the western part of the state want to be an emergency care center and just shove everything to Asheville,” Davis said. “Local hospitals want to maintain care in the local communities.”
Mission leaders maintain they do not want to suck up business from smaller county hospitals — and if they tried, patients wouldn’t stand for it.
“The data has been very consistent that people prefer their local hospital for routine hospitalization,” said Janet Moore, communications director at Mission.
Mission plays a life or death role for patients across Western North Carolina as the only hospital in the state’s 17 westernmost counties where highly advanced medical care is provided.
It’s not in anybody’s interest to see that function undermined, Moore said. On that point, Davis agrees.
“It is essential that Mission hospital remain strong in the western part of the state,” Davis said.
Yet Moore said the freshman senator’s bill would hamstring Mission: it would bar Mission from affiliations or joint ventures with other hospitals and doctors’ practices until the end of the year, or until a study is completed.
“This bill says Mission has to compete with a different set of rules than everybody else,” said Moore. “We are a little perplexed by the bill. What problem is this legislation supposed to fix?”
Mission is already subject to anti-trust regulations, imposed when it merged with St. Joseph’s Hospital. The state dictates how much it can charge for procedures, sets a profit ceiling and limits how many doctors the hospital can employ.
“We basically operate under a microscope,” Moore said.
Davis questions whether the rules go far enough, however.
“I have heard of quite a few physicians that are concerned about the lack of competition in the medical field,” Davis said.
Davis’ bill would commission a study to determine if those concerns are warranted.
“I have no evidence Mission has done anything wrong,” Davis said. “The whole purpose of my bill is to start a conversation.”
Doctors in the region are divided on whether Mission is predatory in its business practices.
“There always will be a lot of paranoia in healthcare that the big, 800-pound gorilla is going to come in and steal your patients,” said Dr. David Mulholland, a family doctor in Waynesville who is affiliated with Mission.
But, that’s not the case, he said.
“They have plenty of patients. They don’t need any more patients,” Mulholland said.
What Mission does need, however, is referrals for highly specialized care not available at local hospitals — such as neonatal intensive care, open-heart surgery or repairing aortic aneurysms. Mission needs enough volume to cover the cost of highly specialized doctors and equipment. It counts on smaller hospitals to send patients needing advanced medical care its way, Moore said.
But when the hospitals in Haywood, Jackson and Swain counties partnered up last year with Carolina’s Health System headquartered in Charlotte, Mission began fearing those patients could be sent out of the region to Charlotte.
“Hospitals have very small profit margins. If even a small percentage of that business was siphoned off to Atlanta or Charlotte, it would be a big thing. It would hurt access for everyone in Western North Carolina,” Mulholland said.
Mission had hoped the MedWest group of hospitals in Haywood, Jackson and Swain would partner with it. But when they chose Carolinas instead, Mission reacted.
Mission began actively recruiting doctors in Haywood to join its staff. It also set up an outpatient clinic practically next door to Haywood’s hospital staffed by rotating doctors from Asheville.
Critics fear such a toehold could allow Mission to steer patients to Asheville for services. But it could be Mission is merely protecting its interests.
“Would they have had an interest in Haywood County if it was still just Haywood Regional Medical Center? They probably would have said ‘No, it is a stable situation. We get the tertiary referrals and that’s what we need and that’s what we want,’” Mulholland said. But “hospital administrators know the history of what happens when other competing large health care systems come into your area.”
Perhaps the paranoia cuts both ways, however.
MedWest CEO Mike Poore said his hospitals are not sending patients to Charlotte rather than Mission.
“Our referral patterns have not changed at all,” Poore said. “Patients do not have to worry that if a physician is employed by whatever institution that healthcare decisions are made based on anything other than providing the best care.”
When Poore’s own son needed neurosurgery recently, he sent him to Mission, not Charlotte.
“The neurosurgeons at Mission are excellent,” Poore said. “There is no reason for anyone to go beyond there for tertiary care.”
Poore said there are a lot of fears, but they are nothing more than that.
“We are working very hard to work together,” Poore said.
Dr. Stephen Wall, a pediatrician in Haywood County, said Haywood is a great hospital with great doctors, as is Mission.
“I wish we could all work together regionally,” Wall said. “I wish we could do this without always feeling like we are cutting each other’s throats.”
While MedWest frets that Mission is trying to steals its local health care dollars, and Mission frets that MedWest will send patients to Charlotte instead of Asheville, competing hospitals are nothing new in major metropolitan areas.
“It is not uncommon to have surgery center, hospital, surgery center, hospital — all within a stretch of a quarter mile,” said Dr. Chuck Trentham, an anesthesiologist at Angel Medical Center in Franklin. “We just aren’t used to the big business of medicine.”
Trentham said both sides are off in their portrayal of Mission — as a predatory hospital on one hand, or a purely benevolent institution on the other.
“I don’t think they are as bad as they are portrayed, or as good as they portray themselves,” Trentham said.
Angel CEO Tim Hubbs said he does not resent doctors affiliated with Mission providing services in their territory.
“If I didn’t have them coming a couple days a week I may not have an oncologist. For us it is not competition, it is providing a benefit to our community,” Hubbs said.
Wall said the outpatient clinic being run by Asheville doctors could be driven more by doctors’ interests than Mission’s.
“There are probably too many doctors in Asheville,” Wall said. “It is a great area and doctors want to live there, so there is competition for a shrinking healthcare dollar.”
In Franklin, doctors are used to competition from neighboring counties. Several Sylva-based practices have satellite offices in Franklin, holding office hours there one or two days a week, and sending business out of the county to Harris hospital run by MedWest in Sylva.
“The same way Mission is encroaching on MedWest, MedWest is encroaching on us,” Trentham said.
While battle lines are being drawn over the bill, exactly how it came to be isn’t completely clear. Davis wouldn’t name names when asked who approached him about the bill or who helped write it.
“I have talked to a lot of people about this bill,” Davis said. “There were hospitals and physicians groups and individuals that encouraged me to file this bill.”
It’s no secret that Park Ridge Hospital in Hendersonville supports the bill, and many believe it was the instigator. Park Ridge has reportedly brought two lobbyists on board to advocate for the bill in Raleigh.
For now, it remains the lone hospital that has gone public in support of the bill.
Park Ridge is part of the Adventist Health System, with 43 hospitals in 12 states. While Davis is a Seventh-Day Adventist, he said he did not introduce the bill to help Park Ridge because of that shared connection.
Davis said there are a “plethora” of theories about motives behind the bill. But he said his primary concern is that “health consumers’ interests are protected.”
Despite tension between Mission and Haywood, MedWest is not for the bill.
“We just don’t feel like we have any standing to support that bill,” said MedWest CEO Mike Poore. “We don’t see legislation as how you deal with competition. We believe in providing good quality health care, strong access and a great patient experience as how we compete, and that legislation is not needed.”
Some in the medical community have accused MedWest of advocating for the legislation, however.
“There has been a lot of goings on behind the scenes and behind closed doors,” Moore said.
Dr. Peter Goodfield, an Asheville cardiologist, claims the legislation was “promulgated by Park Ridge Hospital and MedWest.”
Park Ridge in Henderson and MedWest-Haywood are the region’s biggest and likely strongest hospitals after Mission. Yet their close proximity to Asheville makes it easy, too easy, for patients to defect — and thus have the most to lose should Mission launch an all-out affront.
While MedWest’s official position is against the bill, individual doctors in Haywood County are supporting it.
Three former chiefs of staff of MedWest-Haywood have gone on record supporting the legislation and accusing Mission of predatory practices. They wrote to the state as part of the public comment period on the COPA.
“Taking patients from the local hospital and medical community undermines the strong rural hospital system we are trying to build,” Dr. Shannon Hunter, an ear, nose and throat specialist in Haywood, wrote.
Dr. Al Mina, a general surgeon in Haywood County, believes Mission’s “aggressive expansion” into surrounding counties should be halted while the issue is studied.
“I have seen them duplicate services here in an attempt to weaken the local hospitals and siphon care that can very easily be performed here to Asheville,” Mina wrote.
Dr. Charles Thomas, an oncologist with 21st Century Oncology in Haywood County, has been at war with Mission hospital for more than 15 years.
Mission has attempted to block 21st Century Oncology from opening new cancer treatment centers in the region, from Franklin to Murphy to Marion. Mission challenged state permits for the competing cancer services and filed lawsuits to the same end.
“Throughout these many battles Mission’s ‘mission’ was to prevent competition,” Thomas wrote in his public comments to the state. “Mission will continue to do everything in its power to dictate healthcare delivery in Western North Carolina – even if it means cancer patients have to travel hours to receive necessary care.”
In an effort to temper Mission’s dominance in the region, Davis’ bill aims to cap the number of doctors on Mission’s payroll.
Mission can’t employ more than 20 percent of the doctors in Buncombe County under its current anti-trust regulations. It is approaching that cap now.
Mission asked the state to increase the limit, which may have backfired by opening the door to the current debate. Davis’ bill would immediately stop Mission from employing more doctors during a study period, and would cap the number of doctors Mission can employ to 10 percent for the 18-county region. (The 20 percent cap now applies only to Buncombe.)
It’s not surprising that Mission wants to employ more doctors. It’s a national trend, driven by today’s generation of doctors who find the hassle of running their own office — the stress of being an entrepreneur on top of practicing medicine — isn’t worth the freedom.
It’s also financially attractive. Doctors are increasingly being squeezed by rising overhead and lower reimbursements from Medicare and Medicaid patients. As a result, doctors are gravitating toward a new model of being employed directly by hospitals. The hospitals keep the revenue generated from the patients, while providing a steady salary to the doctors.
But allowing Mission to employ more and more doctors will give them a lock on health care, Davis said.
“Where do you think the physicians are going to refer their patients if they are employed by Mission?” Davis said.
If Angel Medical in Franklin merges with Mission, Davis questioned whether doctors would start referring patients to Mission instead of the much closer hospital in Sylva.
But Mulholland in Waynesville said he does not steer them toward Asheville over Haywood.
“I let them decide where they want to go,” Mulholland said.
“I have no reason to stop using the local specialists. I still talk to and use our local physicians and trust them.”
Mission employs 150 physicians out of 700 who have privileges to treat patients at the hospital. Other hospitals employ a greater percentage of their doctors than Mission does. Angel employs 15 of the 40 doctors on its active staff while MedWest employs 75 doctors out of 230 — both more than one-third.
The majority employed by Mission are specialists. If they had to operate as a private practice, they wouldn’t be here, Moore said.
“There isn’t the volume of work here, for them to maintain their own practice would be financially very difficult,” Moore said.
Specialists employed by the hospital include several children’s specialists, like pediatric cancer and surgery.
“Without those specialists here these families and their children would be driving anywhere from two to four to six hours to get care,” Moore said.
Rural hospitals that have affiliated with Mission in recent years were partly drawn by having a heavy-weight in their corner to help recruit doctors.
Once affiliated with Mission, Angel Medical may be able to attract doctors to Franklin that it couldn’t on its own.
“We have the resources to pay the competitive salaries,” Moore said.
Mission is better equipped to help set up their offices, to buy them the equipment and technology they need, and offer them a larger network of doctors to be a part of, Moore said.
However, Davis has heard that some physicians felt forced to give up their private practices and become employees Mission. State regulators who crafted Mission’s anti-trust regulations obviously thought a cap was necessary, but didn’t foresee 15 years ago that it would be necessary beyond Asheville’s borders.
“There is a reason that was there: to protect physicians’ practices and to protect patients,” Davis said.
But according to Dr. Peter Goodfield with Asheville Cardiology Associates, tightening the cap for Mission when the national trend is moving the opposite direction is ridiculous.
“There are going to be virtually no physicians remaining in private practice. None of us can survive,” Goodfield wrote in public comments submitted to the state.
Mission has already folded three smaller hospitals into its umbrella — those in Marion, Spruce Pine and Brevard. The hospital in Franklin is headed that way.
Mission is also close to a deal to build a $45 million outpatient center in conjunction with Pardee Hospital in Henderson County, seen as a threat to Park Ridge, which is also based in Henderson County.
Mission is not taking advantage of its dominance when it comes to pricing, Moore said. Its is the third lowest hospital in the state for costs, even though Mission has the highest percentage of patients in the state on Medicare and Medicaid — nearly 70 percent — who pay less than other patients.
While Davis talks about Mission’s unfair advantage, Moore said the bill actually stacks the deck against Mission.
Mission’s neighbors include Park Ridge in Hendersonville, run by Adventist Health System, with hospitals in 12 states, and Carolinas Health System in Haywood County, which has 29 hospitals under its umbrella.
“And they are claiming that we are a monopoly?” Moore said. “We don’t mind competing on cost and quality. We just want there to be a level playing field.”
Angel is a stand alone hospital, an increasingly rare status for small hospitals. It can’t continue that way indefinitely and has brokered a deal to merge with Mission in coming months. The bill would delay or even derail it.
Angel might then have to turn to MedWest for a partnership, which already has hospitals in Haywood, Jackson and Swain.
“That’s a de facto monopoly right there,” said Dr. Chuck Trentham, an anesthesiologist at Angel.
But given its market share of only 60 percent in Haywood and 57 percent in Jackson, it doesn’t come close to the definition of a monopoly, MedWest CEO Mike Poore said.
“The contrast to that is Mission’s market share in Buncombe and Madison is north of 94 percent,” Poore said.
While a bill circulates in Raleigh to limit the dominance of Mission Health System, a state regulatory process is already under way to examine just that issue, independent from the legislation.
Mission is governed by anti-trust regulations dating to its merger with St. Joseph’s 15 years ago. The regulations are up for review, prompting a flurry of debate in the medical community about whether Mission’s ambitions should be curbed or it should be given the freedom it needs to serve as the region’s healthcare leader.
Mission Health System: Memorial Mission merged with St. Joseph’s hospital 15 years ago to form a single, large hospital serving the Asheville area. It has three smaller hospitals under its wing, with plans to add a fourth.
Park Ridge Hospital: Based in Hendersonville and perhaps Mission’s fiercest competitor, Park Ridge is part of Adventist Health System with 43 hospitals in 12 states.
MedWest-Haywood, MedWest-Harris, MedWest-Swain: The hospitals in Haywood, Jackson and Swain counties recently united forming the new entity MedWest and adopting new names in the process. They are 18 months in to a three-year management contract with Carolinas HealthCare System.
Carolinas HealthCare System: As the state’s largest hospital network, the Charlotte-based system has 33 hospitals under its umbrella.
Angel Medical Center: A small standalone hospital in Franklin, Macon County. Angel plan to affiliate with Mission.
A group of emergency room doctors has been awarded $1.6 million in a lawsuit against Haywood Regional Medical Center.
Haywood Emergency Physicians was ousted by the hospital in 2006 and replaced with a corporate physician staffing outfit before the group’s contract had expired. The group sued for breech of contract, unfair and deceptive trade practices and conspiracy in restraint of trade.
The case was heard before a three-member panel of arbitrators in mid-January. Much like a judge’s ruling in court case, the decision was binding, meaning neither side had the option of accepting or rejecting the amount of the award.
At the hearing, the hospital failed to produce any evidence that it had a good reason for ousting the ER doctors. As a result, the hospital owed the ER doctors for 18-months of lost income, the arbitrators ruled. The award will come out of the hospital’s bottom line.
Attorney Bill Cannon, who represented the group of doctors, said they were pleased with the amount. The hospital offered to settle out of court two days before the arbitration hearing, but the physicians rejected the offer as too low.
Mark Jaben, one of the ER doctors with Haywood Emergency Physicians, said the reasons given by the hospital leadership for ousting the emergency doctors at the time were “smokescreens.”
“Why did he want us out? It is a really good question I think a lot of people would say it boiled down to wanting power and control,” Jaben said. “We were in the whistle blower position.”
The lawsuit dates back to 2006 when the hospital was under different leadership. The hospital has undergone a massive transition since then, including a nearly clean sweep of top leaders and the governing hospital board.
The hospital failed federal inspections in 2007, causing it to lose its Medicare and Medicaid status and triggering an exodus of private insurers as well. The hospital essentially shut its doors for five months except for the most basic services.
As a result, the hospital leaders who had ousted the ER doctors the previous year got ousted themselves. It became clear that many of the issues raised by the ousted ER doctors — issues hospital leadership tried to silence — were in fact true.
The ER physicians enjoyed an outpouring of community support as well from those urging hospital administration not to get rid of them. But a few who believed the accusations against the group espoused by Rice apologized after the unraveling of his administration.
“People said ‘You were telling the truth and we are sorry we didn’t listen to you,’” Jaben said.
Jaben said it is a shame the community had to go through such a cataclysmic event to realize there were problems at the top.
“The full cost is enormous, well more than just the amount of the award in this one case. We trust that this final action will free the hospital of any remaining vestiges of the old guard and conclude this sad tale,” Jaben wrote in a group statement from the doctors.
Jaben said the hospital board at the time was led down the wrong path by Rice.
“I think boards have a responsibility to verify their information, to verify that things are happening the way they are being told,” Jaben said. “Clearly did not do that.”
While the medical community overwhelmingly rallied to the ER doctors’ defense, the hospital board and administration summarily dismissed their impassioned pleas. The physician community came to the sinking realization of just how little they were valued by hospital administration, Jaben said.
“The physician community had been systematically cut out of the process over the course of many years,” Jaben said.
Jaben said the new CEO Mike Poore has embraced the medical community.
“If you listen to Mike Poore’s language, he understands quite well that there has to be collaboration and cooperation with the medical staff,” Jaben said.
If Jaben could go back and do anything differently, he would have worked harder to achieve that.
“Your success lies in collaboration. At the time we did as best as we could trying to help that happen, but I think there are yet other ways we could have done a better job,” Jaben said.
Yet the records show that Rice’s administration was trying to get rid of the ER doctors prior to their firing. During the course of the lawsuit, Cannon got copies of emails between the hospital and the corporate physician staffing outfit months before the hospital pulled the trigger on firing Jaben’s group. Other evidence shows Rice had the group in his sights long before that, including a phone call from him to one of the ER doctors pledging to get even after the doctors shared a report outlining areas where the hospital needed improvement.
Rice did not return a message seeking comment prior to press deadline.
Poore said the hospital is glad to have this issue behind them.
“We understand that good relationships with all of our 230 physicians are critical in providing the world-class health care our communities deserve, and we’re happy to close this chapter,” said Poore.
Haywood Regional Medical Center is now part of MedWest, an affiliation with the hospitals in Jackson and Swain counties, and has a partnership with Carolinas Medical System out of Charlotte.
Jaben said the team of 10 ER doctors had loved living and working in Haywood County.
“This has been gut wrenching for many of them,” Jaben said. Only four have remained in Western North Carolina. The rest had to move to find work. Even those who stayed are not on the permanent ER staff of a hospital, but either went into another field of medicine or travel for work.
The engineering, grounds and Behavioral Health Unit at Haywood Regional Medical worked together to brighten the hospital community by planting a rose garden.
Research has shown that hospital patients whose windows looked out at landscape scenery recovered from surgery quicker than those who faced a brick wall.
Marty Murray and the hospital’s engineering team prepared planting beds at the front entrance to the Haywood hospital. With the help and hard work of patients and staff of the Behavioral Health Unit, the team then transformed the space into a rose garden that will bloom throughout most of the year.