The healthcare industry continues to face challenges involving access to care, physician shortages and coordination between providers in the Silver State. A group of Nevada’s healthcare leaders recently met at the Las Vegas offices of City National Bank to discuss these issues and new opportunities on the horizon for the industry.
Connie Brennan, publisher and CEO of Nevada Business Magazine, served as moderator for the event. These monthly meetings are designed to bring leaders together to discuss issues relevant to their industries. Following is a condensed version of the roundtable discussion.
Has access to healthcare changed in Nevada?
DR. BARD COATS: I still think the biggest issue for us in Nevada is getting access for expanded populations, whether they’re health insurance related, exchange or medicaid expansion. Access is our biggest challenge.
TODD SKLAMBERG: The highest utilizer of healthcare services is the medicaid population. We went from a population that, somewhat, self-regulated themselves to the highest utilizer of services with a network that is inadequate and does not provide access. We have seen utilization of the emergency room (ER) skyrocket. Last year, we saw 167,000 patients in the emergency room at Sunrise. A percentage of those absolutely did not have an emergency condition. It’s the same thing, I believe, for all of our hospitals. There’s inadequate primary care. The volume is coming to acute care facilities for non-emergent needs, clogging up all of our emergency rooms. Then there’s a lack of primary care upon which to refer those patients back and it becomes a circle.
BRIAN BRANNMAN: We’ve got a major shortage of primary care providers here. There’s been an access problem to primary care. So, what you’re seeing is [patients] going to an ER for primary care. We’ve all gone through some sort of variation of medical group or operating clinics to provide more primary care access. We’re still living in a state that has the lowest proportion of primary care providers per capita than just about anybody in the country. Also, the lowest availability of nursing staff per capita. What’s naturally evolved is the emergency department has become the safety valve.
MASON VANHOUWELING: I can validate our volumes on the ER side of the business have gone down. But when I talk to my colleagues, they’re seeing an explosion in their ER volume. That’s really because UMC has always been the safety net, and now that you’ve got access, this population is seeking care closer to their home versus driving into the urban core of Las Vegas. With increased access, getting providers to participate in the plans has been a challenge which has become a strain on the emergency departments. We don’t have enough providers in the community to serve double the amount of patients that are on some type of exchange product.
DR. LINDA JOHNSON: You’ve got that population to take care of, so how do you do it? It’s thinking outside the box. We’re two to three years into our telemedicine journey and part of what it required was the regulation part. We were able to easily offer it with the insurance partner that we had, but we had to get state regulation changed so we could offer it to medicaid patients. We’ve been able to do that for the past year and we’re seeing an uptick. Medicaid patients have smart phones and they can do that virtual visit. Now it’s the first year we can do it for senior patients. Again, we had to wait for regulatory changes so we could offer the product. We are struggling. We got a beautiful, state of the art mobile clinic we drive to the neighborhoods where the population needs are. They won’t come to that even when we’re in their neighborhood. Continuing that outreach and education is very important.
How big an issue is provider recruitment?
LORETTA MOSES: Our physician shortage is really a huge issue. It’s one of the bigger problems because there are so many other things that it leads into: [healthcare] pipeline, workforce, recruiting, retaining and those things.
JOHNSON: The biggest challenge is having enough workforce for the number of patients we have and being able to recruit and retain the type of physicians and providers that we want in taking care of our patients. What I mean is, we need to be a part of changing how healthcare is delivered. It’s not going to be viable to do it the same old way we did it a century ago. So it’s thinking outside the box on how we train the next generation of physicians to be able to operate in the type of environment we want.
SKLAMBERG: The problem is the aging workforce. You look at your nursing staff and some of our physicians. They are five to seven years away from retirement. While there will be a net increase from the schools of medicine, we also need to be certain that we have all the residency programs in place and be able to keep the medical school students here once they graduate. Right now, there are three pediatric surgeons in Las Vegas. This town should have seven pediatric surgeons. You look at all the pediatricians and what they get paid because 65 percent of pediatric healthcare is medicaid. The state cannot blink and generate another $100 million to help.
RICHARD BODAGER: From a payment standpoint, this market is significantly below most major markets. Attracting and retaining quality physicians, we constantly have turnover because they’re getting better deals in other cities. To be quite frank, Las Vegas has a bit of a stigma associated with it, so it’s been difficult. Our number one challenge is attracting and retaining quality physicians to provide the access that we need for the patients.
MOSES: [Compensation for physicians] is definitely something the state needs to look at. And increasing the reimbursement rate.
How do reimbursement rates impact Healthcare?
SKLAMBERG: With the expansion of medicaid in late 2013, we’ve basically doubled the enrollees from 325,000 to now 650,000 enrollees. Medicaid reimburses hospitals about 53 percent of cost, not charges, and reimburses physicians at a sub-par level. As we look at providing care for an expanding population with about 25 percent of the state on medicaid, it poses a challenge when a good portion of your business is being reimbursed at only half your cost. We look at some of the sub-specialists in the community and primary care physicians, some of those reimbursements are at relatively low levels which makes it difficult to attract and retain physician talent for the long term.
BODAGER: I have to say, though, we’ve given up on the idea that reimbursements are going to go up. What we are doing is focusing on how can we do more with less. That’s continuous quality improvements. We’re going through a major initiative right now. If we can reduce one, two or three clicks or minutes in a process, that’s our focus. That’s where it’s a tech process, a doctor process, the scheduling process. That’s the kind of thing where we can improve efficiency. That can only get you to a certain point, but we have to capitalize on that so, hopefully, we’ll get the organization to a point where we take better advantage of opportunities that are down the road.
DR. DAVID STEINBERG: The problem is the way we get reimbursed is so archaic. We get reimbursed by episodes, by doing procedures. If we’re really talking about taking care of a population, we should look at being reimbursed on how healthy that population is and how we affect it. By the time I see someone and they have a bad disease, you really need to go back decades to really affect any change. Unfortunately, we’re not at that point yet. But you’re looking at changing behaviors when they’re teenagers or younger and intervening in households where you’re going to affect drinking and smoking and chronic disease like adult diabetes. That’s really the majority of healthcare cost at this point, many of them are related to lifestyle.
How are regulation and new laws affecting healthcare?
HEATHER KORBULIC: There are two bills about reimbursements that I think might be of interest, specifically about medicaid reimbursements for long-term care facilities, but also hospitals. There are actions happening at the legislative level.
COATS: The regulations are not going to stop. The state’s not going to get a lot more money. This is just the way in which we live. Those of you who have lived and practiced in other places, it’s the same comments everywhere. I feel the sorriest for state government. You go meet with the DHHS (Nevada Department of Health and Human Services) and the commissioner and you look at the way they try to find healthcare for people who are uninsured or in the medicaid population. The funnel of patients we need to manage, that’s where the issues are.
BRANNMAN: I don’t feel sorry for us, but I [also] don’t feel sorry for the DHHS. They’re doing the job they have to do because, as a citizen of Nevada, we’ve decided how much we want to pay for stuff and they’re doing the best they can with what they’ve been given. But I’m telling you, it’s not sustainable. If you looked at any other industry metric for a sustainable, non-for-profit hospital system, operating margins ought to be in the 4 or 5 percent range. I’ve got negative operating margins in two of my hospitals. I have a positive margin in one of them and that is spread across the hospitals. It is not something you can do for the long haul.
How does health insurance factor in?
TY WINDFELDT: Whether you’re a provider, customer or an insurance company, you look at the cost increases year over year and it’s unsustainable. What I continue to see from the insurance plan is, employers are continuing to offer benefits for their employees but they’re increasing their cost sharing. If you look at the number of deductibles and how they’re going up over the last five years, individuals who have deductibles have gone up about 65 percent. You see that skyrocketing deductible and the hospital is having to take on that debt because individuals don’t have $5,000 or $10,000 to pay out of pocket. When the providers’ accounts receivables continue to go up, they turn to the insurance company and say, “I need to have a higher rate of reimbursement because I need to cover my costs.” It’s just a vicious cycle. So the insurance company continues to raise their rates and passes it on to employers who pass it on to the employees.
KORBULIC: I think that the uncertainty surrounding rhetoric, not governance, under the Affordable Care Act and under this new administration, has created some instability in our marketplace for consumers and our carriers and for state budgets. It’s very difficult to navigate a state agency through the troubled waters of budget-making when you have no idea what the future holds. My colleagues at medicaid, welfare and support services would agree.
COATS: The folks who were for the access to affordable care lost the dialogue. They have no ability to explain the tremendous value of this system. They couldn’t get the dialogue in front of the populace, and it sells somewhere that this is the worst thing that’s ever happened in our world. It needs to be fixed and repaired, not done away with. It’s a shame if we lose this traction and progress.
WINDFELDT: It’s interesting with the Affordable Care Act. We’re regulated nowadays, so we don’t have the ability to make any more money than what the federal government tells us we can make. About 15 percent of our revenue has to go for everything. You talk about efficiency and trying to be able to make more money. We can’t just go out and raise rates and pass it on to employers because I have to justify that. For us, the reality is, if you want to make more money, you have to cut cost on your administration side. The medical costs are your medical costs. Whatever those are, they stand on their own. So for an organization, for profit or not for profit, you have to cut your admin. expenses and do things more efficiently in order to increase your margins.
How coordinated is patient care in Nevada?
STEINBERG: The big problem in Las Vegas is the coordination of care. It’s very possible that someone could have three different exams in three different places and none of the people know about it. Quality care and population health really needs to be coordinated care. There’s lots of pieces that are quality, but unless it works together efficiently like a timepiece, it’s not quality. There was some promise early on when we were going to share common electronic medical records between all providers. If [a patient] has a study that was done early in the morning, then they come over to our place for a biopsy, often it’s a tremendous amount of work to try to find those results. Then they can be at UMC in the afternoon and at Sunrise the next day, and other than some shared narcotic records that was instituted in the state, it’s very difficult to get that information. Unless we all work together to coordinate, which up until now has not really happened, we’re eluding the prize.
BODAGER: We’re still, for lack of a better term, pushing a lot of paper around. [Patients] could be in two different places on the same day and records just don’t move that quickly. There’s been a lot of conversations about health information exchange (HIE) in Nevada. There’s other states that have a much more robust systems. There’s also a lot of conversation about population health. There’s population health activity going on within certain silos, but as Dr. Steinberg eluded to, outside of those silos with the exception of a few plans, that kind of gets lost. Many times, the patients don’t even know what test they had or where they had it. Oftentimes, we find things have been repeated.
JOHNSON: What I would add is, we did put an HIE in place. But one of the things that hinders us is how it got regulated by the state, opt-in versus opt-out. Now it’s very cumbersome. You have to get permission from the patient to be able to pull data down. It almost put a handcuff on the ability to use that as smoothly as we need to use it. Part of it is not just that we don’t have it, but we handcuffed ourselves.
STEINBERG: It’s opt-in, but also very few of the large providers have actually signed up to participate. Even if you opt-in, the chances of moving that data to the right places is very limited.
COATS: We didn’t opt-in because it’s too expensive. The cost involved in doing it wasn’t reasonable.
VANHOUWELING: I agree that it’s very fragmented. It’s very difficult to navigate. If we do get to a robust health exchange, we’ll drive down the cost, but we’re just not there. We know it will provide better outcomes and reduce overutilization for Nevada.
What can be expected moving forward?
BRANNMAN: I thinks it’s realigning how we use our resources. There’s going to be a supply and demand, to some extent, in that we have primary care providers that are going to be most in demand and the lowest end of the compensation scheme. We tend to be heavily skewed on the specialty end and probably pay a little more than we ought to in some specialty cases here. Those resources will be redistributed by the way we’re paying for healthcare in the future. We go toward more bundle payments and sharing risk as a provider, then I’m going to be shifting compensation from people at the front end. We’re going to keep people healthy and manage them, and we’re going to need fewer of the specialists. Their salary per capita may not go down, but I may not have to have quite as many of them. It’s a matter of leveling it out a little bit.
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