Laura Kaiser required over as Chief executive officer at SSM Health in May 2017 and immediately set her sights on harnessing the strengths of each one of the Catholic health system’s four major markets. In Wisconsin, which means expanding around the organization’s only integrated delivery system, which Kaiser calls an incubator of sorts. Kaiser formerly was chief operating officer of Intermountain Healthcare and Chief executive officer of Ascension Health’s Sacred Heart Health System. Modern Healthcare Managing Editor Matthew Weinstock lately spoken with Kaiser about SSM Health’s future and challenges. This is an edited transcript.
Modern Healthcare: How do you manage promoting value-based care and risk-based contracts across different markets?
Laura Kaiser: I’d state that each one of the markets wish to move toward value-based care, but each one of the markets is a touch bit different. So in Wisconsin there exists a little more—I’m supporting my fingers in quotes—control, for a moment, due to Dean Health Plan. In Illinois, we are inside a couple of smaller sized communities. They aren’t as far along in value-based care, but it is coming along. In St. Louis (where SSM Health is headquartered), we work with a variety of health plans and also have a hazard-based contracts through our medical group, and this is also true in Oklahoma.
MH: Have you set a goal for how much of your revenue you want to have in risk-based contracts?
Kaiser: After I what food was in Intermountain Healthcare, I did previously believe that the need involved 60% value-based and also the balance fee-for-service. I figured there’d continually be an excuse for some fee-for-service as you have individuals who need care that is not obtainable in their market and could walk out network, which most likely wouldn’t be a part of a danger-based contract. Despite the fact that with fee-for-service with risk, you will find fundamentals that apply regardless of what. You have to be fiscally responsible. You have to be as cost-effective as you can be. Individuals are true regardless of what the payment structure is. And So I still think the 60/40 split is most likely right, but there is no science behind that.
MH: So Wisconsin is testing some ideas that you think you can carry through to other markets lower the line?
Kaiser: Yes, I believe so. We are in some transition at this time. We are hunting for a new president and Chief executive officer for Dean Health Plan. That individual, and also the regional president that has responsibility for Wisconsin, can help drive that charge. Let me see us keep growing the Dean Health Plan. There exists a mixture of commercialized, Medicare Advantage and State medicaid programs. I believe Medicare Advantage can grow. In Missouri, Let me still push our virtual visits reaching people where they’re. Millennials who’ve developed mounted on their smartphones will need more later on. We are a little farther ahead with that in Missouri than we’re in Wisconsin, however i believe that plays in each and every market across the nation.
MH: But what about reimbursement? Kaiser Permanente states that 50% or more of their visits are virtual now, but they own the plan and the hospitals, so they are able to do that.
Kaiser: First, we all do possess a plan. Next, some employers are writing contracts that need health intends to bring that within their products. State medicaid programs in various states has become covering telemedicine, to ensure that barrier is declining. With more high-deductible plans, more patients will be having to pay up front. But that individuals will end up even at ease with it after they have recently attempted it. There’s some a hurdle of thinking, “Well, shall we be held really likely to just speak with my physician on the watch’s screen?” It labored very well for i and me expect others will discover exactly the same.
MH: What are your plans for growth?
Kaiser: Our board of trustees and senior leadership team is going to be refreshing our proper plan in 2018. SSM is dedicated to growth and it has been growing pretty considerably in the last couple of years. But we don’t have to own everything. I see lots of chance in partnerships. We do not have the knowledge of everything. We do not have the deep capital reserves of a few of the other gigantic forces within the medical industry, nor don’t let. So i will be partnering with other people which have expertise that aids patients. You consider the big tectonic moves in the market at this time using the insurance coverage and pharma and i believe it can make for interesting occasions. There are plenty of individuals thinking about healthcare at this time and that is great for patients. We want some good players to assist all people have good use of healthcare. Many people are frightened about this, but I am positive. I am looking forward to getting new partners while dining.
MH: Intermountain lately announced a restructuring that moves away from a regional leadership and aims to establish consistent stewardship over quality and safety. What are you doing to bring continuity across the states you are in?
Kaiser: This is among my personal favorite things to speak about. Many, a long time ago, SSM, with the farsighted leadership of Sister Mary Jean Ryan (Chief executive officer from 1986 when SSM began to 2011) was the very first healthcare organization to generate the Baldrige Award for quality. That’s a part of who we’re. Almost always there is been a devotion to quality and patient safety and just what Used to do lately after my listening-and-learning tour would be to move us to become more clinically driven and also to have clinicians involved with care redesign. I produced a brand new role known as the main clinical officer who’ll pull the senior quantity of a organization to systemically approach patient safety, quality, experience and access. And That I possess the chief medical officer, the main nursing officer, the main medical information officer along with a chief quality officer all reporting for this leader. There exists a chief operations officer, a chief strategy officer so we just hired a chief transformation officer—a former friend from Intermountain, who will also work carefully using the chief clinical officer. Personally i think really strongly about getting that synergy in the senior-most quantity of a organization. And I wish to develop more clinical leaders faster. There is a real requirement for that.
MH: How will they balance the individuality of your markets?
Kaiser: Until lately, we’d dyad leadership reporting. We’d regional leaders reporting directly into St. Louis towards the COO and also to an old physician leader for that medical group operations. We’d a health care provider leader as well as an administrative leader jointly accountable for the neighborhood markets that people had reporting to 2 differing people in the system management level. I have seen dyads work very well for such things as service lines. Things I wanted ended up being to simplify the dwelling. And also the best example I can provide you with is, should you consider kids playing softball or baseball, for that early years, should you consider the outfielders—the left and center fielder—and somebody hits a pop-up plus they both run toward the ball and they take a look at one another and also the ball drops . . . that typically happens with dyads, despite the very best of intentions, and thus we have to exercise nimbly and much more intentionally when it comes to, “I’ve the ball,” like a anchorman of responsibility for confirmed reason. So there’s now just one reason for responsibility for a complete region. We have Epic as our electronic health record and we’re searching at getting common order sets for various kinds of care. So with sepsis, for instance, you will find standard order sets wherever you’re, since the proper care of sepsis is identical wherever you’re. That will permit us and to share information over the system, to ensure that peers can study from one another.
MH: You’ve put a financial improvement plan in place that incorporated a reduction in staff. Where are you feeling the most financial pressures?
Kaiser: They are in 2 buckets: Payments are reducing through the us government, through condition governments with State medicaid programs and thru commercial payers. Everyone is ratcheting lower. There’s growing customer sensitivity around the high-deductible health plans. There’s lots of scrappy, disruptive innovators which are raising your competition and that is growing and compressing some revenue. Around the expense side, we are dedicated to having to pay market rates for the team, and that is growing with inflation. Our second-greatest expense category is pharma. Last I looked, it had been growing yearly of 13%. Some niche medicine is within the four-digit increases. There’s lots of pressure originating from every direction, pressures on downward revenue and increases in expenses also it creates a hard formula.
MH: How can you combat individuals cost increases?
Kaiser: There’s a couple of ways. One of the ways would be to control the formulary, do you know the drugs that you simply offer and that are offered in your internal formulary, and also you negotiate using the different suppliers for the greatest set you back can. This is a small lever, but it is a lever and it is not so effective, as you can tell. There’s, regrettably, a very strong lobby with pharma. I understand there’s purchase of R&D and I am absolutely in support of that, however the average profit for pharma is up to 30%, so there’s some room there. Let me see what concrete things are going to together, since the next million-dollar drug is originating and you will see some patients who won’t be able to pay for that. That isn’t OK.