The 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.
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.”
By Steve Heatherly
At the April 16 Jackson County Commissioners’ meeting, a physician stated his concerns about the future of MedWest-Harris and MedWest-Swain. While some of the observations are correct, we disagree with the assertion that MedWest-Harris and MedWest-Swain have only two options in its future, failure or joining Mission Health in Asheville.
Since the summer of 2010, members of MedWest management, CHS and some members of the MedWest-Harris and MedWest-Swain medical staff have participated in a dialogue that has resulted in changes that address concerns raised by physicians. Specifically, a management team dedicated to operations at MedWest-Harris and MedWest-Swain was appointed in February 2012. While no change in management structure can magically fix the challenges faced by most rural hospitals in America, and those specific challenges at MedWest-Harris and MedWest-Swain, our recent change has generated a favorable reaction by the vast majority of staff and physicians.
As a bit of history, by 2010 Harris and Swain had experienced a four-year trend of losing market share, driven by the natural the ebb and flow of physician departures, resulting in constrained access to care within the communities we serve. Patients increasingly began to seek care outside their local medical community. In 2008 and 2009, WestCare made a significant investment in the recruitment of more than 10 additional physicians which is likely responsible for arresting the descent of market share loss from 2010 to present. Now that we’ve had success in rebuilding our medical staff, we need more patients from our local communities using our local hospitals. Only then can we expect more positive financial results.
Our hospitals must confront the fundamental business reality that expenses cannot continue to be greater than revenue. In the short-term, there has been rigorous evaluation of cost with a focus on ensuring that our labor expenses match our volumes. Most position eliminations have come through attrition with the remainder coming through upward and downward flexing of staff to better match the number of patients in the hospital on any given day. These adjustments are being made in close consultation with the Medical Staff and with our Departmental Leadership, with patient care as the centerpiece of every decision.
No organization can cut its way to prosperity, especially not a hospital, where quality patient care is our business. Thrive-ability will happen when more patients come through our doors to see our brilliant doctors and caring staff. It will happen when patients experience processes that are easy to understand and utilize. It will happen when it’s evident that our commitment to customer service can only be described as fanatical.
At least seven new physicians are joining MedWest-Harris and MedWest-Swain in 2012. Even in this less-than-optimal economic environment, we have expanded services to our communities through newly-constructed medical office buildings in Sylva and Bryson City. MedWest-Harris opened a wide-bore MRI and the area’s first urgent care center in August 2011. In addition, we have expanded upon our partnership with Western Carolina University with a presence in its new allied health facility which will open later this year.
We continue to seek physician input with respect to our future. Within the past two weeks, we embarked on a process with Medical Staff leaders to focus on a shared vision and strategy for Harris and Swain going forward. I am proud to report that there was unanimity around the idea that, whatever organizational structure within which our hospitals exist, our primary focus has been and must be to take great care of patients. That focus has created the enduring legacies of Harris and Swain and is critical to our success.
In an organization of the size and complexity of MedWest, there will be diversity of opinion regarding most any topic. This is no doubt the case in the present circumstance. I believe it is the intention of the more than 1,000 employees at MedWest-Harris and Swain, its Medical Staff and management to use this moment as an opportunity to synthesize our diverse perspectives into an action plan aimed at preserving our hospitals as assets for the communities they serve for generations to come. We look forward to an ongoing dialogue with the community, through a variety of forums, as we strive to accomplish the mission of our organization to provide high quality, compassionate, local access to health care.
(Steve Heatherly is the president of MedWest-Jackson and MedWest-Swain.)
When Dr. Bob Adams walked into a hospital-wide meeting of Jackson County doctors in early January, he believed he had finally mustered the critical mass to demand action, action that so far had been elusive despite a year of working internally to bring change.
But, he made a fatal miscalculation. The message doctors would ultimately send up the chain that night to the WestCare board of directors would be rejected.
Some doctors had become disillusioned with the Charlotte-based management firm that had been at the helm of the MedWest venture since its inception two years ago. They voted 31 to 3 to ask the board of directors to go to Mission Hospital, hear what it had to say and consider whether it would be a better partner.
It’s rare for the majority of doctors at a hospital to make a formal and pointed request to their board of directors. The issue had been escalating for months by then, and as the community would later learn, had not yet reached its climax.
A core group of concerned doctors began meeting in early 2010, discussing their perception of problems at Harris, which was struggling financially and had lost 10 percent of its inpatient business to Mission. Initially, they took their issues up directly with MedWest CEO Mike Poore. Unsatisfied, however, they opened a line of communication with the hospital board of directors, sitting down with key members in one-on-one meetings.
By summer, however, the airing of concerns became a standing topic at the monthly meetings of all the Harris’ physicians, marked by a heated exchange or two with Poore before the roomful of doctors.
Eventually, Poore knighted the core group of concerned doctors with an official title — the “kitchen cabinet” committee — in an apparent attempt to address the issues.
Meanwhile, doctors ramped up their line of communication with the hospital board, a rather brazen move to go over Poore’s head.
“We go in and sit down and talk and start expressing our concerns directly to the board,” said Dr. Randy Savell, a long-time gastroenterologist at Harris. “They were surprised. They suggested they had no idea how things were.”
The meetings with the board continued for several weeks, and while the board members were willing listeners, the doctors couldn’t spur them to take action.
“We never got anywhere, but they were being very surprised and shocked and concerned,” Savell said.
Some in the core group oscillated between caring about the management structure and just going back to doing what they did best: caring for patients.
“After a while, you get worn out. You get tired of fighting,” said Dr. Earl Haddock, a pulmonologist at Harris.
Two of the doctors in the “kitchen cabinet” had been on the hospital board themselves but had resigned earlier that year after growing disenchanted.
“The thing that struck me is nobody asks questions,” Dr. Waverly Green said of why he resigned from the board. “If it was a place where there would be honest discussion and be about the future of the hospital, I am happy to be a part of that. but I am not going to sit in a room and rubber stamp things that to me make no sense.”
The group of concerned doctors decided to take matters into their own hands. In December, some of them drove to Asheville for a behind-the-scenes meeting with the CEO of Mission, Ron Paulus. It was a renegade move, unauthorized by the rest of the medical community at large, but they liked what they heard.
So in early January, they called a meeting of all the doctors under WestCare and asked them to take a stand. Discussion dragged on for more than an hour.
Getting out of the MedWest partnership wasn’t an easy proposition. There was an escape clause built in at the three-year mark, but it could only be exercised by a three-fourths majority of the MedWest board, which was comprised equally of seven members each from WestCare — comprised of Harris and Swain hospitals — and Haywood Regional.
But, there was a little-known loophole. A clause in the MedWest contract allowed either side to pull out if the financial viability of one of the partners was at risk. It just so happened there was bad financial trouble brewing next door in Haywood. The Haywood hospital was running so low on cash, word on the street was it might not be able to make payroll.
To solve the short-term cash flow crunch, Haywood had gone up the chain to Carolinas for an emergency loan. Harris, however, was being asked to co-sign for the loan, putting its own revenue stream on the hook should Haywood default.
In realty, Harris would never be asked to cough up the money. Haywood’s revenue stream — about $100 million annually — along with all its equipment and its hospital building were also on the hook as collateral and would be tapped first before Harris would ever have to ante up. Essentially, there was more than $250 million guaranteeing a $10 million loan.
But, Carolinas was outside its comfort zone. This marked the first time it had ever loaned money to any of the 34 hospitals it manages. So it wanted the kitchen sink as collateral.
The Jackson doctors theorized the financial straits at Haywood were grave enough to exploit the loophole and engage in talks with Mission.
Little did the doctors know, however, that the WestCare board faced a grave choice — co-sign the loan to help bail out Haywood or comply with their own doctors’ request to meet with Mission. Doing both, it turned out, would not be an option. There was a catch to the loan with Carolinas. As long as MedWest owed Carolinas, the hospitals were prohibited from negotiating with a new partner.
Business-wise, it made sense. Carolinas didn’t want to prop up MedWest only to have it walk away still owing money. But to the unhappy physicians, it played out like a game of Mousetrap — and they were the ones sitting under the cage.
The WestCare board ultimately had faith in the MedWest venture and co-signed Haywood’s loan.
“We believe the future is bright for all three hospitals, even though the challenges are many. It is time to look forward, assuring the full potential of MedWest-Haywood, MedWest-Harris and MedWest-Swain is realized,” the MedWest board said in a statement this week. “Is this a short-term process? No, it is not. It will take months of hard work. But, we are confident in the expertise of our medical staffs and in the skill and dedication of all our employees.”
The doctors, however, felt ignored in their pleas to consider other options.
“We said ‘We aren’t telling you to dump Carolinas.’ We are just saying go talk to Mission and see if we made the best choice,” said Dr. Waverly Green, a pulmonologist at Harris. “Two days later, they signed documents that tied us up even tighter to Carolinas. That told me the board didn’t want input from the medical staff.”
One of the board members, Bob Carpenter, resigned from the board a few days later in a show of solidarity with the doctors.
“The bottom line is our hospital is in serious shape, and our trustees need to be looking at alternatives,” Carpenter said. “The community needs to keep pressure on the board to seek alternatives and do the right thing for this community.”
It turns out Harris was not merely hamstrung by Haywood’s loan. Harris was beholden to Carolinas for its own financial security as well. Carolinas had pulled strings to help Harris out of a pinch over an outstanding $15 million loan with BB&T, dating back to hospital construction projects a decade ago. Under terms of the loan, BB&T required Harris to have 75 days cash on hand.
Last year, Harris wasn’t able to maintain that balance and dipped below the cash-on-hand threshold that BB&T required. Carolinas tapped its relationships in banking circles, essentially putting in a good word for Harris, and convinced BB&T to temporarily relax its cash-on-hand requirement.
Harris currently has 56 days of cash-on-hand instead of the mandated 75. If Harris sent Carolinas packing, it could jeopardize the leniency BB&T had extended on the loan terms.
The door had been closed on any escape hatch Harris may have had, Savell said.
To be clear, the concerned doctors don’t believe in a conspiracy by Carolinas to make the hospitals financially dependent as a way of keeping MedWest intact. Adams thinks Carolinas just wasn’t paying close enough attention to the day-to-day operations, which after all is the expertise Carolinas was supposed to be providing in exchange for its management fee.
“They would never have allowed them to spend what they spent at Haywood without having the resources to back it up,” Adams said. “They would never have allowed Harris to be run in the ground even if that was a planned maneuver because it created a huge backlash. You don’t poison the components.”
John Young, a vice-president for Carolinas’ western hospitals, said that Carolinas doesn’t tell MedWest what to do — it’s the other way around.
“We work for the local boards. We have no control mechanism,” Young said.
It’s rare to find physicians and hospital management in lockstep on everything. Now, however, the WestCare board must find a way to rebuild the fractured relationship with physicians.
“For every member of the medical staff that has talked to the board, to walk away feeling like nothing was going to be done was a difficult thing for us,” said Dr. Earl Haddock, a cardiologist at Harris.
It marked a departure from an amicable relationship the Jackson medical community had always had with its board of trustees.
“There was never any adversarial relationship. It was collaborative across the spectrum. We all worked together for the same goals. I think the thing that has been particularly uncomfortable for the medical community in these last two to three years is that relationship no longer applies,” Adams said.
A saying by a patriarch of the Harris medical community has been reverberating in Jackson County for nearly 40 years, handed down through practices and still preached to new recruits today.
“Sylva is where you can practice contemporary medicine in the old-fashioned style,” so the saying goes. It was coined by Bill Aldis, an internal medicine specialist who came to Harris in the mid-1970s.
Aldis was part of a dynamic trio of upstart internal medicine specialists who sought out Sylva after medical school as a place to make their mark, perhaps even a social experiment of sorts. Their mission: to take a rural hospital with a smattering of primary doctors and see how far they could take it.
“They were at John Hopkins together and decided they were going to find a place where they could make an impact,” said Dr. Joe Hurt, a retired pathologist who came to Harris in 1978. Hurt came partly because he was impressed by the three young internists who had thrown themselves headlong into building up a rural medical institution.
“There was a tremendous amount of potential,” Hurt said.
The energy was infectious. Each new specialist who came on board joined the recruiting crusade, putting their best foot forward as a medical community to build up their own ranks in partnership with the hospital.
“A lot of the recruiting parties and events were actually held at my house,” Hurt said. “Some of the contracts between partners were worked out at my house.”
In the decade from 1975 to 1985, the number of doctors practicing in Jackson County more than doubled, bringing in the county’s first orthopedists, pathologists, radiologists and surgeons. More by fate than design, the community attracted a certain breed of physician — those who didn’t care about the lack of a country club or golf course, Hurt said.
Those early efforts set Harris on a track that still persists.
“Harris has had a long-standing tradition of attracting very good physicians. Part of the attraction was for a small hospital, this had an exceptional medical staff. Well-trained physicians, very community-oriented. There was a rapport between the physicians and community that didn’t exist elsewhere. The hospital just had a very good reputation,” Green said.
There’s one thing both sides in the debate agree on: keep going to your local hospital.
“In terms of the services, we can and should provide in our local hospitals, we are as good as anyone in the country,” the MedWest board of directors said in a statement this week.
Undermining Harris is indeed the last thing those speaking out want to do.
“There are those who felt the community deserved to know. Hopefully, there will be enough of a outcry to have an impact,” Savell said.
But, the 2,000 employees of MedWest in Haywood, Jackson and Swain counties have surely felt the sting of the negative publicity during the past week.
“I care for every single patient with every ounce of my being,” said Heather Sheppard, a nurse at Harris and director of ICU. “I stand by the care that we deliver to every single patient at Harris.”
In Haywood County, a letter was signed by 29 doctors this week reinforcing their strength and resolve to provide excellent health care.
“We believe and have substantial data to corroborate that the care at Haywood hospital is, like the care at Harris hospital, something the community can take great pride in,” the letter states.
Dr. Joe Hurt, a retired pathologist at Harris, said going public was clearly a last resort for Adams after months of working through internal channels that got him nowhere.
“I don’t think any of them wished ill against the hospital,” said Hurt.
Savell agreed that’s not what this struggle is about.
“Good care is still there. Good people are still there,” Savell said.
Even those who have publicly stood beside Adams plan to stick with Harris to the end.
“I love what I do. I love the patients. I love the hospital, and by golly, we provide excellent care, and we want to get back to that,” Haddock added.
When the Med-West venture was coined two years ago, the premise was an easy sell. Together the hospitals would be stronger than going it alone.
Both Harris and Haywood hospitals had witnessed a troubling loss of patients to Mission — a loss so troubling in fact neither hospital could afford to continue as it was. They faced a cold, hard reality: turn the course, and fast, or they would be faced with financial insolvency.
Indeed, both hospitals hoped the MedWest joint venture would shore up the erosion of patients to Mission. 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 under the MedWest umbrella — and if so, who?
Before the merger, and even now, Haywood and Harris competed very little. Fewer than 5 percent of patients from Jackson migrated to neighboring Haywood or vice-versa.
But with the future of their medical community on the line, 1 percent here and there suddenly seemed to matter quite a lot.
While the call by some 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. Instead, it seems desperation amidst a shifting health care landscape has seized the day.
Next week: Read more about the specific concerns raised by Jackson doctors, an analysis of hospital market share, a snap shot of finances, and philosophical view points on the MedWest venture.
Four long-time physicians in Jackson County are leaving C.J. Harris hospital after becoming disenchanted with the direction of MedWest — and even more so with Carolinas HealthCare System, a giant network of 34 hospitals that MedWest is affiliated with.
Dr. Bob Adams, a hospitalist who is leaving Harris after 36 years, fears Carolinas plans to build up Haywood as a flagship to compete with Mission. He didn’t like where that would lead.
“Harris devolves and Haywood grows,” Adams postulated. “They are playing the corporate practice of medicine. 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.”
The president of Harris, Steve Heatherly, laments the loss of the four doctors — and the circumstances.
“It is unusual in the history of this organization to have physicians leave because they were not satisfied with the strategic direction,” Heatherly said.
Making matters worse, another seven doctors in the Jackson-Swain medical community have either already left or plan to leave — for a total loss of 11.
“It is unusual to have that level of turn over,” Heatherly said, even though only four of the 11 actually chalk up their departure to “dissatisfaction with the hospital.”
Lessening the blow somewhat, seven new doctors are moving to Jackson and Swain in coming months. They had already been recruited and were intended to bolster the physician ranks.
Now, however, the hospital will see a net loss instead of gain and a gap in a few key specialties.
Dozens of doctors, of course, aren’t going anywhere.
“We must not forget that we still have an extremely skilled and dedicated medical staff of nearly 230 physicians who are choosing to stay in our communities and work in our hospitals to take care of our patients,” Dr. Robin Matthews, an ob-gyn in Haywood County who chairs the Physician Leadership Council of MedWest.
Many of the 2,000 employees of MedWest have rallied to their hospitals’ defense during the past week.
“The hard decision is to stay here and fight for this place to succeed,” said Dr. Casey Prenger, the medical director of the hospitalist group at Harris. “We believe in our hospital and our community, and it is our privilege and honor to take care of you.”
There are huge challenges, however, facing Heatherly and MedWest: hold MedWest together, turn the corner financially, recapture market share from Mission, quell the doctor uprising, and recruit new doctors to fill the holes.
For the group of Jackson County doctors who went public with their concerns last week, the decision wasn’t an easy one nor was it taken lightly.
“They aren’t trying to hurt anything. They are trying to fix something,” said Dr. Gilbert Robinson, an anesthesiologist at Harris for 10 years.
Even those who spoke out aren’t certain now was the right time, or if it will do any good.
But, the ball was in Adams’ court. When he decided to go public, the core group who had been fighting alongside him during the past year to bring about change internally weren’t going to leave him on a limb by himself, so they reached out and grabbed on as well.
“I decided I wanted to let the community know what was happening to their hospital. The only thing that is going to change is if the community starts standing up for itself to Carolinas and the WestCare board,” said Dr. Waverly Green, a pulmonologist at Harris who is leaving as well.
Adams hopes the issues he raised aren’t construed as a parting shot or chalked up to sour grapes.
“They are portraying those of us who had concerns and discomfort about where we are as being disgruntled and outliers,” Adams said.
But in fact, hospital administration has gone out of its way to praise Adams and the others who are leaving.
“It is regrettable. They will be missed in this community. They are outstanding physicians who have provided years of service to this community,” Heatherly said.
Even doctors in neighboring Haywood, who rightfully have reason to be miffed by Adams’ shot across the bow at MedWest-Haywood, have been complimentary.
“He is a great doctor and wonderful human being. I just happen to disagree with them completely,” said Dr. Marvin Brauer, chief of staff at MedWest-Haywood and a hospitalist like Adams.
While Adams will soon be gone, others who support him will still practice at Harris and will continue carrying the torch to fix perceived problems.
Some of them are even on Harris’ payroll. Technically, the entity they are speaking out against writes their paychecks, putting them in an uncomfortable position at best, a vulnerable one at worst. Normally, few doctors would be willing to take a career gamble like that.
The difference at Harris likely comes down to their new president, Steve Heatherly. Heatherly has been with Harris since the 1990s, part of that time as a physician liaison and serving in a variety of vice president roles and as chief operating officer.
In hopes of quelling dissension among Jackson doctors, Heatherly was promoted two months ago as the president of Harris. It gave Jackson doctors one of their own at the helm — rather than the previous hierarchy where they answered to a single CEO for the entire MedWest venture, Mike Poore, who they were acutely aware hailed from Haywood and still had his base office there.
Jackson doctors have hope that Heatherly will help right the ship.
“I believe Steve is at the place he needs to be to help turn WestCare around, due to his experience and background and skill set. I don’t know of anyone else that would be better at this point in time,” said Bob Carpenter, a former MedWest board member from Sylva who resigned in January over the same issues troubling the doctors.
Even Adams agreed.
“I think the WestCare board and Steve Heatherly are doing their best to work with medical staff now,” Adams said.
Many doctors — even those who are in near lockstep with Adams’ pointed assessment of the MedWest landscape — wish he had given Heatherly more time to fix things before going public.
Dr. Randy Savell, a gastroenterologist doctor at Harris, said Heatherly faces a difficult future.
“He is between a rock and a hard place,” Savell said.
Heatherly’s boss is technically Carolinas, and he answers to them daily. But, he must also answer to the hospital board of directors, all the while winning the good graces of nurses and doctors by proving he will address their concerns.
Heatherly doesn’t downplay the reality that a hospital lives and dies by its doctors. If the doctors are good, people will get their health care locally.
“That leads to more volume through the hospital, which helps solve the business dilemma,” Heatherly said.
That business dilemma — dire financial straits for both Harris and Haywood — looms large in the debate.
Harris has lost more than 10 percent of its in-patient business to Mission Hospital during the past five years.
As a result, Harris is struggling financially and has been losing money for at least three years. It’s now in its third round of layoffs in four years.
“Our hospitals must confront the fundamental business reality that expenses cannot continue to be greater than revenue,” Heatherly said.
If the financial picture was rosier, the paranoia among Jackson doctors that Carolinas is trying to siphon its patients off to Haywood could simply melt away.
For now, Heatherly is stuck in a Catch 22. Rather than shrink, Harris must find a way to regain the market share lost to Mission.
“No organization can cut its way to prosperity, especially not a hospital, where quality patient care is our business. ‘Thrive-ability’ will happen when more patients come through our doors to see our brilliant doctors and caring staff,” Heatherly said.
Harris’ financial problems are largely because it lost several doctors back in 2006 and 2007, Heatherly said. When patients needed a doctor’s appointment, they were forced to look elsewhere and ended up walking right into the open, waiting arms of Mission in Asheville.
Heatherly, who started at Harris in the 1990s, had taken a hiatus for a few years to work for a physician management firm. When he came back to Harris in ?, job No. 1 was recruiting physicians to fill the void.
“The organization was having trouble recruiting physicians to replenish the supply to the local community, and it created a constrained access,” Heatherly said.
In 2008 and 2009, WestCare brought in 10 new doctors. It also bought out several private practices in order to put existing doctors on the hospital’s payroll — reflective of a national trend by doctors who increasingly prefer to work directly for a hospital rather than run their own private practices.
Those moves came at a financial cost, but Heatherly said the influx of doctors stopped the bleeding of market share. Unfortunately, it hasn’t come back up yet either.
“Now that we’ve had success in rebuilding our medical staff, we need more patients from our local communities using our local hospitals. Only then can we expect more positive financial results,” Heatherly said.
Heatherly’s belief in doctors as a core business strategy for the hospital seems genuine. He stresses it even when discussing other topics, like when the long-awaited renovations to Harris’ emergency room will be re-started.
“As we move forward, we have to assess that we have the right medical staff in place to offer ongoing appropriate access to care, and then those opportunities to evaluate facility expansion will be driven by the ability to generate sustained financial results,” Heatherly said.
Heatherly was speaking off the cuff, not reading from a prepared statement. But, his hospital administrator’s version of Alan Greenspan’s famous Greenspeak can be boiled down this way: doctors must be shored up first, which will bring back patients, which will bring back money.
A group of Jackson County doctors say they want out of the two-year-old partnership with the hospital in Haywood County and instead would like to look toward Mission Hospital in Asheville as a future partner.
There have been murmurings for months that Jackson County doctors are dissatisfied with the pseudo-merger with the hospital in neighboring Haywood and might want out. But this week marked the first time a group of doctors went public.
“There is a common element of frustration with day-to-day operations, and concern about the financial viability of the hospitals,” said Bob Adams, the chief hospitalist at MedWest-Harris hospital.
Adams, backed by six other doctors, appeared at the Jackson County commissioners meeting Monday to get his message out.
Though the doctors say they ardently support Harris hospital, they are dissatisfied with the MedWest joint venture that united Haywood Regional, Harris and Swain County hospitals under a single umbrella. At the same time, the new MedWest entity signed on with Carolinas HealthCare, a network of 34 hospitals based in Charlotte.
Many doctors in Jackson and Swain now say that was a mistake — and that they don’t trust Carolinas or their own board of directors.
“MedWest is failing and needs to be dissolved. Carolinas is not an acceptable partner,” Adams said. “Mission is the only partner acceptable to the communities west of Balsam.”
Some doctors in Jackson County believe Harris has not fared well in the MedWest joint venture.
Harris is struggling financially. It has seen an outmigration of patients. Doctors, too, are leaving.
Adams said he is one of eight physicians leaving Jackson and Swain counties in coming months. The community already faces a doctor shortage, a factor partly to blame for the loss of market share in recent years.
Doctors in Jackson County also feel that the Haywood hospital is being groomed to become the flagship of the MedWest venture. They fear patients once cared for locally at Harris will be gradually siphoned to Haywood. They also feel Haywood has gotten a greater share of resources. A long-promised new emergency room remains on the back burner in Jackson — meanwhile Haywood used up MedWest’s borrowing ability by taking out a $10 million line of credit to stem a cash flow shortage.
Whether real or perceived, the Jackson medical community has long prided itself on its reputation and didn’t take kindly to the thought of their beloved local institution declining. That, along with a strong independent streak, has doctors questioning the corporate relationship they now find themselves in as culturally incompatible.
“It is clear to me that the hospital that I joined 10 years ago no longer exists, and is unlikely to rise again from its current ashes,” said Dr. Waverly Green, who is leaving the community in a few months. “I am saddened that it has come to this, and ultimately, I think the community as a whole will be left paying the price.”
Adams and Green both blamed Carolinas HealthCare System as duplicitous in bringing about Harris’ plight.
Adams said he does not trust Carolinas to look out for the interests of their local Jackson County hospital.
They say Carolinas pushed Haywood and Jackson together to advance their own long terms interests — namely to mount a competitive front in WNC against Mission, Adams said
After corralling the trio of hospitals under MedWest, Carolinas then began setting the stage for Haywood to be the lead player with Harris and Swain in supporting roles.
“Carolinas wants everything to funnel past us to Haywood and stop them from going to Mission,” Green said.
“It was Haywood-centric all along,” agreed Bob Carpenter, a former board member for WestCare and MedWest.
Carpenter resigned in a show of solidarity with the medical community.
In particular, though, Carpenter believed the board had not been given ample time to consider signing off on $10 million loan documents that encumber the entire MedWest venture for money borrowed by Haywood. Carpenter said board members were called into an emergency meeting in January and asked to sign documents they had not even had a chance to read.
“They said we had to do it to save the MedWest system,” Carpenter said.
Haywood allegedly didn’t have the funds to make payroll and needed the credit immediately.
The Jackson County medical community appealed to the management of MedWest and Carolinas as well as the hospital board of directors several times during the past six months to no avail.
“I realized we were being shut out,” Green said.
Adams has worked at Harris for 36 years and does not take lightly the decision to come forward with his views.
“Some people thought it may do more harm than good and may be more destructive,” Adams said. “A group of the physicians believe the information needs to be made public and our whole intent is to allow the community to make a decision to look further into what is going on and make their own decisions.”
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.