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Notes from April Breakfast with the CEO

29 May 2016

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Opening comments
The Compact Implementation Committee continues to work on strengthening the compact, including communication efforts such as the Common Ground newsletter. The compact is built upon the assumption of good intent and that people are doing their best work. We don’t always have to agree, but should discuss important issues.

Does Common Ground replace the physician website?
Yes. If you have a question, use the “Ask a question” button in the Common Ground newsletter and we will make sure it is answered.

Will Salem Health’s profitability continue?
On average, we have seen a 6 percent growth every year, with an aberration in 2012 when the census was down. Charity care has declined, however we gave $100 million in community benefit. This is primarily the difference between what we receive from payment programs like Medicare and what the cost of care actually is. The future is difficult to predict, but indicates our revenue will decline.

Is the Affordable Care Act a good thing?
It is good that people have some form of insurance. However, the ACA should have done more in the way of insurance reform. All insurance companies in Oregon lost money in the individual market, and now some insurance companies are taking themselves out of the individual markets because it’s just too expensive.

Is the state still involved with the management of Moda?
No. There was a short period where they stepped in, but Moda’s parent company provided the financing they needed.

Why does Providence want to come to Salem?
The short answer is they want to cover more lives. As insurance rates inevitably go up, they can spread increases over a larger geography. If Providence comes to Salem, they will ship patients to Portland like Kaiser currently does.

Moda and Providence seem to be trying to fund their mistakes by asking providers to take a cut in rates. Are insurance companies asking the same of hospitals?

How is the affiliation with OHSU going?
Very well. We continue to learn about each other and work to understand the different cultures in each organization. One example of something we are working on is how to establish gynecological oncology as a state-wide presence.

What effects will affiliation have on physician practices?
We are focused on filling gaps in service, such as inpatient pediatrics.

Is there the possibility of sharing credentialing services with OHSU?
Not at this time. Salem Health credentialing is very thorough and takes time. Credentialing is handled by the medical staff office, and not the hospital. If changes need to be made to the credentialing process, they are handled between the medical staff and the board.

As we move from fee-for-service to value-based care, how is Salem Health preparing?
We are in the early stages of value-based care. We have invested in Propel Health, along with seven other hospital systems. We are establishing population health services in order to bring the costs down. The ACO is participating in Medicare shared state savings, and we will be a part of this project next year.

Why are we getting so many transfers from smaller hospitals?
We provide services smaller hospitals don’t offer.

How many new beds will the ER have after upgrades?
We are in the master site planning stages currently. We are launching other ways we can shift to relieve emergency care volume out of the emergency room, such as longer convenient care hours and longer PCP hours.

Could we see volume drop off because of the ACA?
Anything is possible. However, we do live in a desirable retirement community, which means volume and an older population.

If we want beds as much at capacity as possible to make money, how do you flip to a value-based model?
It will be a gradual shift. That is much of the work that Propel and Salem Health are working on together.