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Wednesday, 01 August 2012 13:10

Jackson physicians want out of MedWest affiliation

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fr medwestThe medical community in Jackson and Swain counties has renewed its call to part ways with Haywood Regional Medical Center less than three years after forging an alliance under the MedWest banner.

The roots of an uprising took hold in the Jackson County medical community almost a year ago and came to a head in April when several doctors announced they were leaving, citing concerns with the hospital’s direction as part of the MedWest trio.

Specifically, Jackson doctors feared that Haywood would slowly usurp their own hospital’s role. They claim their hospital had lost local control and that its best interests weren’t being looked out for by MedWest as a whole.

The board of Harris and Swain hospitals, known collectively as WestCare, appears to be receptive to doctors’ concerns and may follow suit by telling MedWest it wants out. Steve Heatherly, the CEO of WestCare, said a formal decision has not been reached, however.

“Last fall the medical staff first started asking some pretty tough questions about the MedWest management structure, and the WestCare board has been paying attention to that and remained in a dialog amongst itself and the medical staff about what the best future of the organization is,” Heatherly said.

Since forming a partnership with Haywood in 2010, Harris has lost both money and patients. MedWest leaders say the partnership has nothing to do with that trend, but that the struggles faced by Harris are no different from those faced by hospitals in rural communities all across the country right now.

“The environment in general is making it difficult for any rural hospital to be successful,” said John Young, a representative of Carolinas HealthCare System, a network of 34 hospitals that MedWest became a part of when it formed.

Some doctors, however, do see a direct correlation.

“A big issue we have had is that our community has not warmed up well to us being MedWest,” said Dr. Randy Savell, a gastroenterologist. “Our trademark is gone. It was something people liked and used. We are now perceived perhaps as a vassal of Waynesville.”

Savell said WestCare would be better off charting its own course.

“Rather than working to gain acceptance of MedWest, we can polish up something people had known and loved,” Savell said of WestCare.

Ultimately, the Jackson medical community claims it has failed to see any real benefits from being associated with Haywood.

“The medical staff has arrived at a conclusion that probably the creation of MedWest has not produced the results that anyone would have hoped it would have produced two and half years later,” Heatherly said.

Bunny Johns, chairman of the WestCare board of directors, said they don’t dislike Haywood. Haywood is an excellent hospital with excellent doctors, she said.

“They are a good bunch. This doesn’t have anything to do with that,” Johns said.

The WestCare board of directors now faces a major decision: whether to formally declare that it wants out of MedWest. A decision could come as early as next week at a meeting of the WestCare board of directors to be held Tuesday, Aug. 7.

Mark Tyson, a WestCare board member from Swain County, said the board still has some soul searching to do.

“In general there are pros and cons to the relationship,” Tyson said. “There is a lot of stuff in one column, but there is a whole lot of stuff in the other column as well.”

However, both Johns and Tyson said it could be unwise to ignore the clear wishes of doctors.

“One of the realities we have to deal with is our medical staff. It is a big part of who we are and they are sending a message,” Tyson said. “They have given us a clear direction for where they want to go.”

Savell said the Jackson medical community had been discouraged until recently that their concerns weren’t being heeded. But now it appears they have the WestCare board’s ear.

“My understanding is they have continued to study it and continued to discuss it and come to a more clear understanding of what we tried to present to them earlier in the year,” Savell said. “I think the seeds that were planted are coming to fruit.”

Unfortunately, several doctors departed in the intervening months, but perhaps that was the fuel that was needed to make the board realize the intensity of their concerns, Savell said.

 

Haywood happy with MedWest

The Haywood medical community doesn’t seem to share WestCare’s sentiment. Haywood’s leaders seem to think their hospital is more or less on a good track.

“I am happy with the way our hospital is going right now,” said Cliff Stovall, chair of the Haywood Regional Medical Center board. “We aren’t making tons of money but we are making a little bit and a little bit is good.”

Haywood, by the numbers, is doing better than Harris. It is a bigger hospital — bigger in size, in patients, in revenue and in doctors.

“We have a good physical plant. We got good doctors. We are actually making money,” said Kirk Kirkpatrick, an attorney and Haywood County commissioner who previously served on the MedWest board. “I would hope that this situation works out, but if it doesn’t work out I am certain Haywood will be fine.”

Haywood has almost twice as many doctors as Harris. Five new doctors are joining the Haywood community this month and next, including a urologist, cardiologist, neurologist and ophthalmologist.

“It is a big staff and it is a very good, well-trained staff,”

said Dr. Marvin Brauer, the chief of staff for MedWest-Haywood. “Because it has a good staff it is easier to recruit. There is a lot of momentum.”

That said, those on the Haywood side certainly hope

Jackson’s medical community can be brought back to the table.

“Harris and Haywood would be better together,” said Brauer. “We have much more in common that we have differences.”

Both Kirkpatrick and Stovall were part of an exploratory committee for Haywood three years ago that weighed prospective partnerships and mergers — and ultimately settled on the MedWest model.

“I thought it could work. Maybe it can’t work the way we have it, or maybe it can’t work at all,” Stovall said.

Stovall, however, thinks it is too early to call. The kinks are still settling out.

“Anything like that takes time. The question is can it last long enough to give it that time?” Stovall said.

While a final verdict from WestCare could be a few days away, it could also be months away.

Heather Baker, a WestCare board member from Sylva, couldn’t predict what the board might do.

“It would be irresponsible to jump to a conclusion one way or another at this point,” Baker said.

Young, the representative with Carolinas HealthCare Systems and the acting CEO of MedWest, hopes to convince the WestCare board to stay the course a while longer.

“Our perspective is that we are better together,” Young said.

Young may be able to broker a compromise, one that offers a palatable alternative to the current structure without totally dissolving the system. Indeed, that could be in the cards.

“Basically, as I understand it, the medical staff, what they are asking is that we get out of MedWest as it is currently configured,” Johns said, suggesting some other configuration may be possible.

Young said he understands the concerns of the Jackson medical community but hopes they will give MedWest a chance to work.

“I think people are worried about the future and how it will all play out. Right now, there is so much potential for both organizations that don’t have to come at the expense of either operation,” Young said.

Dr. Henry Nathan, a gastroenterologist in Haywood, said the growing pains MedWest is experiencing are to be expected in any partnership.

“The first few years are challenging and people start questioning, ‘Gee was the best way to do it?’” said Nathan, who also serves on the Haywood hospital board. “That is kind of classic. That doesn’t mean we couldn’t have done better with the administration of MedWest over the first two years, but you also learn from your mistakes so we will do better.”

 

Seeds of discontent

Concerns within the Jackson medical community came to light in April when a group of physicians decided to go public.

At the time, the MedWest board of directors pledged to stay the course and committed to doubling down and doing what they all did best — namely providing excellent health care in their local communities.

Discontent continued to percolate, however. The WestCare medical community formally renewed their concerns at a meeting of doctors earlier this month by casting a unanimous vote calling on the WestCare board to pull out of MedWest. The meeting was attended by more than two dozen doctors — by no means the entire WestCare medical community, but clearly a critical mass.

While the MedWest board had previously avowed its support for keeping the partnership together, the separate WestCare board never formally weighed in.

“I don’t think we ever came out of our study mode.

It has come up at every single board meeting,” said Tyson.

MedWest operates under a somewhat cumbersome set up — with three boards overseeing operations. WestCare has its own board, Haywood has its own board, and there is a third overarching board for MedWest as a whole.

The MedWest board has 14 members — with seven members hailing from each of the other boards.

The set up was intended to give each hospital a semblance of local control, to focus on the specific needs and interested of their own home team.

But when those same board members convene as the overarching MedWest board, they have to switch perspectives.

“There may people appointed from both sides but once you get appointed you aren’t an advocate for your side. You are an advocate for the whole system and whole region,” Kirkpatrick said.

Heather Baker, a WestCare board member from Sylva, said the doubling up on boards does require members to wear different hats while sitting on the different boards.

“It is not always an easy thing to do, but the folks we have doing it do it well,” Baker said.

 

Reclaiming autonomy

A major complaint by the WestCare medical community is the loss of autonomy and local control that came with being part of MedWest.

“MedWest as an organization came out of the gates pretty fast trying to think with the mind of a system, while the focus in the shorter needed to be the health of the individual component parts,” Heatherly said.

That desire for autonomy, however, could be the very thing hampering MedWest’s success. By joining forces, the hospitals could save money on overhead by consolidating departments — whether it was sharing a single IT department or having just one CEO.

“Why have two billing offices? Why not have just one billing office?” Stovall asked.

But pushback has negated some of the benefits of partnering up in the first place. The hospitals ultimately consolidated just a handful of services — for the record, they still have two billing offices.

There was one area that saw an immediate consolidation, however. MedWest quickly set about bringing the hospitals under a single administration arm — sharing just one chief executive officer, chief finance officer, chief operations officer, chief nursing officer and other top brass — to save on the hefty salary load at the top.

“If you could have two hospitals sharing one set of execs, you’ve got to see benefits,” Stovall said.

The administrative team, however, was based in Haywood, creating the first of many slights perceived by the Jackson medical community, that when taken as a whole painted the picture that Harris was second tier to Haywood.

Indeed, not having their own administration team was one of the top complaints levied by the Jackson medical community. Harris was given is own CEO again in February in hopes of restoring the local control and attention Jackson doctors felt was missing.

“They obviously want local control and think it would be better for WestCare to do the things it needs to do to get back on its feet,” Johns said. “It’s about systems. The systems are so important and we are having a hard time having the system work for everybody across all the issues that a hospital has to deal with.”

Initially, it wasn’t clear just how involved the separate hospital boards would be. Would they have the same decision-making power they once had, or merely be a rubberstamp?

Like WestCare, Haywood Regional Medical Center has recently reasserted a larger oversight role and reeled back in some of the authority it had ceded to the overarching MedWest board.

“We have become much more vocal,” Stovall said.

The stepped up role of Haywood’s board came in January, after the hospital found itself in a brief financial crisis — a crisis so dire it would not have made payroll had it not been for Carolinas HealthCare making an emergency loan.

The Haywood board was somewhat blindsided by how cash-strapped the hospital was.

“Surprises are not one of my fun things,” said Stovall, citing his military background. “My feeling is ‘Don’t spend our money without letting us know you are spending it.’ Frankly that is working out. We are very pleased with the way we are being included.”

 

Duplication good or bad?

Those who brokered the MedWest partnership saw another potential benefit — one that could make a very real difference to patients.

Neither hospital on its own has the patient base to support docs in highly-specialized medical fields, or to justify highly-specialized equipment, forcing the relatively few patients who might need those things to head to Asheville.

But by combining their markets, the hospitals together had the patient base to add those things locally after all.

“Because it was an area of less population, we felt we could provide more services by providing certain services at one hospital and certain services at another instead of trying to cram the same service into two different hospitals,” Kirkpatrick said.

Sylva doctors, however, feared that MedWest would slowly siphon away services to Haywood and that Harris would lose some of the specialties it has now.

“A lot of it comes down to general direction of where services are placed, and that is very important to the medical staff,” Tyson said. “That is their livelihood.”

Dr. Marvin Brauer, the chief of staff for MedWest-Haywood, said Haywood has had no intention of undermining Harris.

“As a medical staff, we would very much like to see Harris thrive and grow,” Brauer said. “The only way this works is if you build up both hospitals, make them both strong. Otherwise you are going to shrink and shrivel.”

 

Mission in the cards?

Several WestCare doctors have said they would rather partner with Mission Hospital in Asheville. Under MedWest, Jackson doctors fear Harris will be permanently relegated to the status of the little brother. Under Mission, however, Harris could be propped up as a go-to flagship for the far western counties.

Such a move by Harris could be bad for Haywood, however. It would be completely surrounded by Mission, which is already a formidable competitor.

Whether to join forces with Mission is not part and parcel to the current discussion, however, Heatherly said.

“There is no immediate desire to come out of one relationship and go into another one,” Heatherly said.

Somewhere down the line, however, WestCare would have to find a new partner if it leaves MedWest, Heatherly said.

Tyson agreed.

“To even hope you survive you have to partner with somebody,” Tyson said.

WestCare’s board could decide to pull out of MedWest but stay under Carolinas’ management umbrella.

When the MedWest partnership was formed, the hospitals simultaneously entered a management contract with Carolinas HealthCare System, a network of 34 hospitals in the Carolinas headquartered in Charlotte. Haywood and WestCare pay Carolinas a yearly fee to be part of the network. In exchange, the hospitals enjoy the buying power, economies of scale and management expertise of a large, sophisticated, highly-skilled hospital system.

“They have a staff as experts in these tiny little areas of health care that when you need them, you need them. And so far they have been a huge help to us,” Johns said.

 

What next?

As WestCare’s board weighs whether to stay in or pull out, it doesn’t really have the final say. As with any partnership, getting out isn’t as simple as shaking hands and walking away.

“We can’t magically say we are going to do this tomorrow,” Tyson said.

For starters, MedWest has to agree to let WestCare out. When MedWest was formed, a window for either side to get out was built into the contract at the three-year mark. That escape window begins in 2013 and remains open until the end of 2014, at which point it closes for good.

There’s a kicker, however. If one side wants out, 75 percent of the MedWest board must agree to it. Since MedWest’s board is comprised equally from both sides — seven each from Haywood and WestCare — WestCare would need at least some of the board members from Haywood to side with them in a vote to dissolve.

“It would require people other than the WestCare to make this happen,” Johns said.

If WestCare can’t garner the needed votes, there’s another escape clause it could trigger. Under the affiliation, either side could get out if the financial stability of either side was at risk. Heatherly said WestCare could make a case for that. But if the Haywood side of MedWest chose to fight it, that could mean an expensive and protracted legal fight on the finer points of contract law.

Heatherly said neither side would want to head down that path, however. Young likewise said that an adversarial departure would be in no one’s best interest.

Johns hopes whatever happens can happen amicably.

“I really want WestCare and Haywood to come out of this not having caused the other damage,” Johns said. “I hope we could this — whatever ‘this’ ends up being — in a way that costs everyone very little and is in everyone’s best interest.”

That seems to be something all sides agree on.

“I hope if it is the right thing for them that we stay together, but if it is not we don’t want to do something that is not worthwhile,” Stovall said. “I personally don’t think it is a good idea to force a whole county and a whole board to do something they don’t want to do.”

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