Healthcare Check-Up: Meeting the New Challenges

There’s no shortage of uncertainty swirling around Nevada’s healthcare industry: from the challenges of the local and national economies to insurance regulations and the implications – even the contours and very existence — of Obamacare.

The outlook, however, is decidedly optimistic. And with good reason.

“One of the advantages of healthcare is that it’s been projected to be the one sector in our economy that will have lots of job opportunities for the next decade and beyond,” said Rod Davis, President and CEO of St. Rose Dominican Hospitals. “It’s going to attract a lot of people.”

“We all should be very proud of the healthcare environment here in Nevada,” says Todd Sklamberg, CEO of Sunrise Hospital and Medical Center and Sunrise Children’s Hospital, a 700-bed campus that is the largest in Nevada and serves Southern Nevada and the surrounding region. “We have come a long way in the last 10 years as a community. When we look at the new technologies that have been brought to this marketplace, we are on par with any large metropolitan area, any large academic medical center. And that has to do with the close working relationships we have with our physicians.”

“In Nevada you’ve got healthcare providers working diligently to try and meet the new demands that are coming out,” says Jim Miller, president and CEO of Reno-based Renown Health, Northern Nevada’s largest integrated health network serving a 17-county region comprised of Northern Nevada, Lake Tahoe and Northeast California. “Everywhere I go, to hospital association meetings and meeting with peers, there are wonderful ideas, great attitudes towards trying to make it all work in an era where Medicare payments are declining under Obamacare, the state budgets are limited because of the economy, and Medicaid can only pay about 53 cents of every dollar we spend to take care of Medicaid patients. For the most part you see hospitals stepping up; they’ve managed to find ways to reduce costs while keeping jobs in our community.”

“There has been kind of a new future set in motion for Nevada,” says Mark Crawford, CEO of Northern Nevada Medical Center (NNMC) in Sparks, a progressive acute care hospital serving residents of Sparks, Reno and the surrounding areas of Nevada and California. “There is, I guess, a dissatisfaction with these lists that continually place us toward the bottom. I don’t want to call it Obamacare; it’s not what I’m talking about. I’m talking about a new future for healthcare and communicating among providers. The bottom line is we’re not a sustainable industry. We cannot continue to spend as much as we spend on healthcare, so we’ve got to be the re-inventers of healthcare. Nevada was forced into this position given the economic decline. It’s forced all of us within the industry to focus together to find a new future.”

The future is where Union Village in Henderson may well prove a big part of the medicine that should help Nevada to health in the healthcare industry, according to Managing Partner David Baker. Billed as the first integrated health village in the world – complete with a world-class hospital complex and health center, residential, entertainment and specialty retail space, a senior retirement community and a civic and cultural arts center integrated into a master planned community – it is viewed as a possible antidote to what some see as the state’s looming healthcare crisis. It is set to open for business in just under four years.

“Nevada, which has a lot of great things going for it, is ranked 47th [in overall healthcare] according to the Commonwealth Study,” Baker points out. “It is 51st, or dead last, for children amongst all 50 states and the DC. I believe it is 48th in the number of hospital beds per one thousand residents. It is 50th in the number of nurses per one thousand residents – and those last two statistics don’t even take into account the 40 million people a year who visit Las Vegas.”

St. Rose’s stake in Union Village is in both the center’s acute care hospital as well as forming partnerships with several of the other players on the project.

“Union Village has the potential to be a state-of-the-art health delivery center where the center anchor, so to speak, is an acute care hospital,” said Davis. He goes on to add that the complex can be a “model for an ideal structure in the future to really promote better health, more efficient delivery of services, better outcomes long-term and a fully-integrated electronic health record system.”

The first of the three phases of the architecturally aesthetic, technologically innovative and environmentally sustainable village to be developed on 228 acres, will include Union Centre, featuring a state-of-the-art hospital and healthcare complex; Union Plaza, a specialty retail center with medical offices, residential apartments, entertainment and a mid-range all-suite hotel; Union Place, home to a Senior Village; and Union Park, serving as the village’s cultural center complete with a space and science center and a possible performing arts theater.

According to Davis, the complex is estimated to cost one and a half billion and could create up to 17,000 direct and indirect jobs.

“We expect it to be a huge shot to the economy of Southern Nevada at a time when the economy needs the major construction and additional jobs that this project will create,” said Davis. “There’s a tremendous amount of support for a project of this magnitude to take place in Southern Nevada.”

Obamacare

Even before the Patient Protection and Affordable Care Act, or Obamacare, was signed into law on March 23, 2010, it had American businesses scrambling to understand its implications.

During the first presidential debate, President Obama pointed to a slowdown in health insurance costs as proof that Obamacare is working. Romney countered that projected premium growth indicated just the opposite, that the program will raise families’ health costs.

“The concern you have with a very broad-based, comprehensive plan like the Accountable Care Act is there are always unintended consequences,” said Davis. “Something will fall out that is dysfunctional. I think as it continues to roll out and those dysfunctional portions of the bill come to the surface, then the bill will be readjusted. Some of the aspects of healthcare reform are probably reaching too far. Once that becomes obvious in our healthcare system, it’s going to start to come back into a more equilibrium position.”

“I don’t know exactly where Obamacare is going to end up,” Crawford confesses, “but what it has done is helped us clearly see how we can better focus on the quality of care we deliver, and the cost in which we use to deliver it. That’s where it’s at right now: being able to partner up, be it physician-hospital partnerships or others, so that you can drive the costs down in the system. That’s what it’s going to do for Nevada; at least, that’s what it’s doing for Northern Nevada.”

“I think it’s still a little early to tell,” Sklamberg suggests. “One of the challenges we have as a community is the increased number of uninsured patients that we’re seeing. Twenty-five percent of Nevadans are uninsured. Uncompensated care here at Sunrise is up 25 percent this year, so we’re being challenged. Part of it is to see how the state is going to react to the expansion of Medicaid. I think that will occur post election.”

“To date, only very limited portions have been implemented,” Miller points out. A handful of insurance reforms — like that calling for coverage of children up to age 26 on parents’ plans, and free preventive care — affect only “a fairly limited number of people. Young people don’t use a lot of healthcare.” What also happened early on has been cuts in payments to hospitals and other providers. “We expect $155 billion in cuts to Medicare. I think in our hospital alone we expect $165 million in cuts to Medicare payments over the first 10-year cycle, which is fairly substantial.”

“We can expect probably five to eight years of chaos in the delivery system as we’re restructuring, reorganizing and developing new care delivery models to provide that service,” said Davis. “Then, when we get to that point, I think there will be an overall stabilization of the sytem for the years following that.”

Baker quotes a colleague who told him that everything he is doing in Union Village stands with or without Obamacare.

Staffing and Other Challenges

Staffing shortages continue to be an area of concern. According to Crawford, the state’s deficit is most acute in primary care physicians, “and that’s not going to change.” But a transition in care location is seeing more Nevadans going to clinics and fewer to hospitals, “and people being more ill when they’re coming to the hospital versus accessing us for every headache they might have.” He believes Nevada will “probably be okay longer term” in the specialties. “There are a few sub-specialties that we’re lacking that we probably will have to address.”

“Probably the biggest challenge we’re working with in the state is to help people understand that we are leaving a lot of federal funding on the table,” says Miller. “We’re telling people in Nevada they’re covered under Medicaid, but then the government is only paying for 53 cents of the cost of that care.”

Crawford is convinced major amounts of money can be saved merely by reducing redundancy in testing and procedures, and by promoting office treatment instead of ER visits. “We’ve kind of gotten used to using the emergency departments and the things that are the highest cost. We’re using ambulances as taxis instead of driving ourselves or using a taxi to get us to the hospital. I know that’s a hard call for a lot of people; it can be a challenge for them to know when it’s really important and when it’s not so important.”

Miller believes any discussion about healthcare in Nevada should end on a positive note, calling the quality of care here “excellent. We’ve been able to recruit wonderful physicians in the state. It’s been improving very rapidly, especially over the last six to 10 years. There are new services being offered all the time in Nevada. We’ve got some fantastic programs in robotic-assisted surgeries, cancer treatment and children’s health services. I know we’ve got some hospitals in the state that are in the 99th percentile nationwide as far as quality, so that message would be very positive.”

According to Union Village’s Baker, the healthcare financial equation can be improved significantly with vision and planning. One of the things that most negatively impacts people, especially in Nevada, is stress. “We’re number one in unemployment, and number one in the rate of home foreclosures. Clearly, we think that this is an opportunity to cure the economic health of Nevada.”

The integrated health village concept is designed to keep dollars from escaping. “It is really a healthcare complex that is surrounded by a senior complex that is held together by support retail that has a civic and cultural center at one end and what we’re told is the largest church in Nevada at the other.”

Do the math: the various venues, it is projected, will bring between 20,000 and 30,000 people there every day. In addition, says Baker, the projects means 17,000 jobs — 5,000 to 7000 in construction and about 10,000 to 12,000 permanent one. A Brookings Institution study done at the behest of the governor found that for every healthcare job that is created another job is created to support it. “So, a lot of those jobs in that 17,000 are healthcare jobs,” Baker added.

Baker sees Union Village as an economic driver, as well by becoming a healthcare destination. “We have spent a lot of time studying Southern Nevada, as you might imagine, and we think that there is great potential there, some of which is because of what’s happening in California.” But Baker’s vision goes still further, all the way to the Pacific Rim. “We’ve had a lot of interest from the Chinese, frankly.”

Toward the Future

Healthcare in Nevada is rapidly getting better. Much better.

In March, Sunrise invested about $4 million in a hybrid operating room (surgical theatre equipped with advanced medical imaging devices) becoming, according to Sklamberg, the first hospital in Nevada to have one. It gives Sunrise access to a brand new technology called Trans Aortic Value Replacement (TAVR). “Basically, through technology we’re able to do new heart procedures here in Las Vegas that we weren’t able to do before.”

Sunrise Children’s Hospital does all of the state’s pediatric cardiac work. Says Sklamberg, “We’re going to do over 200 open-heart cases on kids, which is greater than most of the freestanding children’s hospitals in California. And we do the most complex cases here. That’s why I’m saying that, with technology and with the physician partnerships, we’re delivering world class care right here in Las Vegas.”

Crawford sees one of the challenges ahead as being the need to “create a system that is easier to navigate, reduces the expense and the redundancy in the care, and shares information. That will be one of the first steps.” Essential, he adds, is the ability to get a patient’s records from his doctor to an emergency room should they show up in one, or for the doctor’s office to get the ER records or x-ray or lab results that they need. “There is a need to get (information) into everyone’s hands so it’s not in these silos and unavailable to everybody. That’s a big first step right there, and we’re working on it in Nevada right now.”

Efficiency is high among the priorities at Union Village, Baker stresses. “Generally if you’re discharged from a hospital and you need long term acute care, it takes a half day to discharge you. You’ve got to get in an ambulance, they get you across town to some other facility, and it takes another half day to admit you. Well, here they’re going to roll you down the hall into a new wing, with the press of a button. We refer to it as a full continuum of care; from womb to tomb, if you will.”

In addition to having the first children’s and cancer hospitals in the state, Baker continues, he hopes to offer the full continuum of eldercare, as well, from skilled nursing to independent living and assisted living and memory care, all on campus. “Healthcare traditionally is so piecemeal.”

“People talk about Nevada’s aging population,” says Crawford. The areas in which he and his people are focusing – including orthopedics, cardiology, and stroke – “are also the illnesses that strike the senior population. We’re kind of addressing all of those issues in that overarching strategic plan.” NNMC had always been an orthopedic facility. “We continue to move down that road through our accreditations and partnerships with orthopedic surgeons and pain management physicians.” A couple of the areas that NNMC had been short in historically it started to address about three years ago, he says. “We have become a primary stroke center, so we can treat the toughest of brain injuries in the market. We’ve also expanded into cardiology, and we’re an accredited chest pain center now.”

“We have to be more efficient in terms of how we deliver care,” says Davis. “It would happen even without the [healthcare reform] Act because of the incredible costs in our healthcare delivery system and the challenges we face to continue to improve that system,” he adds.

The prognosis for Nevada healthcare then?

The need is great.

The advances will continue.

And the dedication is obvious.