When families are looking for a place to call home, do they ask themselves, "Is there a hospital?" For most Americans, asking that question is about as absurd as asking "Is there a school?" or "Is there a fire department?" But for this economically challenged region of coastal Carolina, simply asking the question "Is there a hospital?" for the better part of a year has perplexed, consumed, even haunted most everyone who lives here.
I wish I was a better communicator, because if people knew what I know, how much potential there is, if we right-size that hospital, and then wrap this ACO around it, I think we could be onto something. We have a sense of urgency and a sense of commitment to try to communicate that, not in legalese, or not in technical jargon, but into plain English. If that information could be understood by the decision makers, the tenure of the debate and the direction would change, frankly.
Rural health care providers are the heroes of American health care. Doctor Charles Boyette is one of my personal heroes. I've always loved what I do for a living, to help good people help people. When Doctor Boyette calls me with an issue, I give it my all. So he called me about this and asked, “Would an ACO keep the hospital open and web together the medical community and the delivery system to provide health care?” I think there's not a single physician, for example, in Hyde County. “Can we bring that health care out to these regions better?” I said, “Yes, sir, we can.”
Would it be fair to ask you if you could speak to the possible impact if the sun does set on this hospital and there is no future? Can you speak to the impact that might have on this rural community?
I don't want to talk about it. To me, it's not an option. People - they said, “Why do you keep going to Belhaven?” I said, “I got to. People are going to die if we don't do this.” There are people in this area that will have to drive 84 miles in an ambulance to get acute care, emergency care. That to me is unacceptable.
If someone gets sick, how far are you from the closest health care? For an elderly person or for a child, that's a big question. If you want a community to continue to thrive, to continue to grow, people are going to go to places where they have health care.
Mark Beamer is the youngest of three doctors in Belhaven. Like the other two, Doctor Beamer sold his practice to Vidant Health two years ago, when Vidant bought the hospital.
We have three doctors that have entertained coming to this community that we have talked to. They're not going to come. Knowing that you're in a rural community, somebody comes in with chest pain, and you don't have a full emergency room, and you don't have somebody there to treat that patient, what are you going to do?
The new clinic that's being proposed is really a primary care clinic and not a multi-specialty clinic. It will not have any emergency room capabilities. Urgent care is not emergent care. Urgent care would be just sorting out situations like a sprained ankle or a foot...
More or less run by physicians' assistants instead of doctors?
We had an incident the other day where a fellow was involved in a wreck. His spouse had gotten run over. He knew that she was bleeding internally. He thought the quickest thing he could do was go ahead and load that patient up, take them to the hospital. We got fluid resuscitation in, we got her stabilized, and we got her into Greenville. That's going to happen. The reason that she made it alive to Greenville was because we had the resources available to stabilize her.
But Vidant's argument, and the argument from the LLC and some other people who are against retaining the hospital, is that if you keep the hospital and it's unsustainable, then if you therefore prevent Vidant from opening up this clinic, you're going to end up with nothing.
Well, if they're going to call three doctor's offices that are highly successful nothing, then we're going to have nothing. They say they're going to have a state-of-the-art medical center, but what this is going to be is basically a doctor's office. We're not going to have colonoscopy. We're not going to have mammography. We're not going to have ultrasound. We're not going to have CT. We're going to have rudimentary X-ray. So basically, what do you have at that clinic other than a doctor's office? Our ability to recruit MDs is going to be severely hampered.
I've delivered over 2500 babies in this area. I have been involved in doing many major surgeries and lots of emergency surgeries. I received additional training following my military experience with a very fine physician/surgeon, Doctor J. T. Wright, who was the only physician at Belhaven when I came into Belhaven. So we both worked together and covered each other.
J. T. took comfort that he knew that when he retired, Charlie was going to be there. He could look over his shoulder and know that his patients were going to get taken care of because there was Charlie. Greg could do the same thing. I started out with Greg and we worked together - a very collegial relationship. Greg can look over his shoulder at me and go, “Yeah. Mark is going to be there.” I look over my shoulder and there's nobody. I don't know who are going to take care of my patients. I have no glimmer of hope that there is going to be another MD to follow, unless this situation changes.
We spoke this morning about an interview that I would dearly love to have with you and let you offer your comments about the hospital here in Belhaven and the possible future of that hospital. I’ve tried to call you back again about 4:00 this afternoon and got your voice mail. So I'm trying one more time to offer you the opportunity to voice your opinion. We would very much appreciate it. It would be a chance to get all sides of the story out there before we complete this project.
The question that would come to my mind is why wouldn't someone want this to work?
Well, I want to be respectful of different viewpoints that people have...
There's no question that running a hospital is a business, and a business has to make money in order to survive. There are obviously different ways to run that business. People have to make those hard choices. I believe that the town has put together a plan by which they can run that hospital using a new model that might be more successful. I believe they're entitled to that chance, and I think the citizens of that community are entitled to the chance of maintaining access to health care that they deserve.
I do a lot of work around the country and Accountable Care Organizations, ACOs. I love the rural model of smaller… You can get your arms around it. You think about a hardworking physician in Belhaven Primary Care has somebody stop smoking, has somebody avoid a heart attack. There's very little compensation. But if that patient has the heart attack, then it might be $100,000 by the time you count up all the anesthesia, cardiology, hospital bills and everything else. We’re going to change the incentives here. We will reward you for better quality and lower cost.
ACOs are one of those things that I think is going to be very beneficial to small hospitals like this. Currently, the medical system gives you credit if you admit people. It gives you credit if you spend money, if you order tests that aren't necessarily needed. It doesn't give you a break for saying you know this patient well. You know how to treat him. You know how to keep this patient out of the hospital. Or better yet, if they do get admitted to the hospital, you know how to get him out within a few days rather than keeping him there a week.
So you think prevention, wellness. It's not the people who self-select to your office. It's maybe the ones who should be there: the elderly at home, the people who need help with nutrition or exercise or a car ride, or to understand you don't go to the emergency room if your daughter is wheezing. You call the nurse triage. Emergency room volume goes down. Readmissions and things like that go down. People have grown up, if you will, in health care saying, “The more I do, the more I charge, the better I do financially.”
I say, “Isn't this exciting?” We're keeping people out of the hospital, out of your doctor's office. They're going, “What? I've been approached by the faith community in other parts of the country where they will get involved and help with the food, or help with the day care, or be those lay people that can bring this whole community health care system together. It's a wonderful thing when the light comes on and the patients are very loyal, very happy, because their quality of care...
That's half of the equation.
... has really gone up.
We're talking about the quality of health care. Now let's talk about the quality of what goes into the back pocket. How can an ACO potentially add more revenue to a hospital?
That's really why I think Accountable Care in an underserved area is probably the best hope for the renaissance of rural health care.
I want to introduce Doctor Gunby. He's an associate professor at the University of North Carolina in the health care business program.
Embedded in Obamacare was a provision to help rural hospitals. That is the saving grace for Belhaven and is the primary reason why our plan works. There were approximately 13,000 individual persons in Beaufort and Hyde County that had a Medicare charge in 2012. We're only operating as if 5000 of those folks in the first year are going to be part of our Accountable Care Organization. Medicare already expects to spend $45.4 million in Beaufort and Hyde County. This is only for 5000 people that would be in our ACO.
If we spend less than $45 million taking care of these residents, the difference - the government will give us half. So how much money can we save that goes back into the coffers of the hospital? First year, $908,000, of which we get half. If we only hit our bottom line of $908,000 per year across there, that's more than enough to make up the differences in what our shortfalls had been in any year of those previous 60 years. Don't let a big corporate entity come tell you you cannot have a hospital, because you can.
We've formed an LLC. That's the ACO. We've filed what's called a Notice of Intent to Apply on the Federal Medicare program in Baltimore. We have developed core legal documents.
It was a very accelerated timeframe. Trying to pull off a transition like this presented one of the largest challenges I've ever faced in my career. I would say we were very close to pulling that off when we hit a couple of snags here over the last couple weeks that have put that process on hold.
By mid-June, the transition team had their ducks in a row in every respect, except the $3 million. The Beaufort County Commissioners had voted to lend them $2 million, but Pantigo Creek LLC had blocked that loan by refusing to allow a lien on the hospital property. The Justice Department mediated a settlement, including a $1 million payment from Vidant. But Vidant had withheld that money and there were other complications that the Mayor and his team blamed on Vidant's unexplained delays in the sharing of important information. The transition team asked for more time. However, before Vidant could answer, just two weeks before the hospital was supposed to change hands, Pantigo Creek LLC announced that it would not allow extra time, even if Vidant agreed to it.
We need to be able to show financially why, going forward, this differs from Vidant. In detailing our plan, we have a list of what the transition model assumes going into the transfer. The first thing is that this hospital must be appropriately staffed and sized. There's been previous operations where there were more than 100 people on payroll. We believe that that was just way too much staff. Large corporate health care is designed to fill beds. If you have a 400-bed hospital, when the CEO comes in in the morning, they're probably looking at a dashboard, a suite of financials. The first thing they want to know is “What's the census?” If I have a 400-bed hospital, I want 399 people in that hospital.
What we've done that's different than Vidant - we can't show any of the 2014 numbers because of our confidentiality agreement. Of course, you see those blacked out.
I understand. Yeah.
But going forward into 2015 to 2017, utilizing pre-Vidant as a model for how to go forward...
So these are your projections for those two years.
Correct. However, we're incorporating the Accountable Care Organization which has a plethora of cost-saving mechanisms in addition to a shared savings program where, of that $45 million I showed you initially, if we save the government money that they would have spent of that $45 million, then the Pungo District Hospital ACO would get to keep half of that savings. Our ACO expert, a gentleman named Bo Bobbit - his estimates are a bit more robust than ours, but starting in 2016 when those first payments would be coming, Pungo District Hospital would see additional revenue of $450,000 and then $562,000. That kind of money would create sustainability into the intermediate and long-term for Pungo District Hospital. Our ACO expert estimates that those shared savings will be twice and thrice what we've estimated conservatively. So...
That's a good motivator.
It is. It is. We believe in local ownership and leadership. We want a CEO that's here that's not, if you will, a corporate type, that understands that we must be doing the right things and we must be doing them right. Our job is not to channel people and fill up our hospital and give everyone the most expensive surgeries and do all of the things. That's not what the ACO is about. The ACO is about treating people appropriately at the least expensive encounter site. We turn no one away. We spend enough money to treat everyone and we can do it smartly. We have plenty of smart people in our country. We can do this. It just takes a matter of will.There may be small errors in this transcript.