Com­mit­ted to pub­licly reporting both the good and the bad

Modern Healthcare - - Q & A -

Dou­glas Hawthorne has served as CEO of Texas Health Re­sources since that sys­tem was formed in 1997.

It’s one of north­ern Texas’ leading health­care providers, with 17 hos­pi­tals, over 21,000 em­ploy­ees and nearly $4 bil­lion in an­nual rev­enue. Named eight times to Mod­ern Health­care’s list of 100 Most In­flu­en­tial People in Health­care, Hawthorne an­nounced in Jan­uary that he would step down from his post at the end of 2014. Mod­ern Health­care Edi­tor Mer­rill Goozner re­cently spoke with Hawthorne about his sys­tem’s de­ci­sion to pub­licly re­port its qual­ity mea­sures, its ACO ex­pe­ri­ences, what his board will be look­ing for in choos­ing his suc­ces­sor, and his per­sonal plans af­ter he steps down. This is an edited tran­script.

Mod­ern Health­care: What is the board look­ing for in a new leader?

Dou­glas Hawthorne: An in­di­vid­ual who ap­pre­ci­ates that people will make things hap­pen or not, that’s re­ally what is No. 1. We need folks who un­der­stand how we bring to­gether the var­i­ous clin­i­cal com­po­nents of what we do so that we have con­sis­tency in out­comes of our per­for­mance op­er­a­tionally, fi­nan­cially and clin­i­cally. So the big­gest el­e­ment for the search is to find some­one who un­der­stands the clin­i­cal side of the en­ter­prise and can match it with the other el­e­ments of fi­nan­cial and op­er­a­tional per­for­mance.

MH: One of the more in­ter­est­ing ini­tia­tives you’ve launched in the past year is you’ve be­come one of the first hospi­tal sys­tems to post its qual­ity data on its web­site for pub­lic in­spec­tion. Why did you do that?

Hawthorne: We be­lieve con­sumers should know how we are per­form­ing and to have bet­ter in­for­ma­tion about the qual­ity and safety of health­care in north­ern Texas. We be­lieve trans­parency drives con­tin­u­ous per­for­mance im­prove­ment through ac­count­abil­ity. It’s the right thing to do. As you wrote in your re­cent ed­i­to­rial, “the fu­ture of mean­ing­ful health­care com­pe­ti­tion lies in en­sur­ing full trans­parency on pric­ing, qual­ity and out­comes so that all of the par­tic­i­pants in the health­care mar­ket­place have the in­for­ma­tion they need to make in­formed de­ci­sions and choices.” That cer­tainly is at the top of our list.

Pub­lic reporting will help us doc­u­ment our own care more care­fully and drive per­for­mance im­prove­ment. We think it stim­u­lates people when they see the in­for­ma­tion to make im­prove­ments. So we’ve com­mit­ted to show it all, both the good and the bad. We will be able to see where we need to drive our ef­forts to make those im­prove­ments as swiftly as pos­si­ble.

MH: Are you get­ting any feed­back from the pub­lic?

Hawthorne: It’s still new. But we’ve had re­mark­able re­sponse to the an­nounce­ment that we will be do­ing this, with a lot of ap­plause from the pub­lic want­ing to be able to see data for the first time that they can un­der­stand. There are so many reporting ef­forts around that of­ten­times don’t give clear out­comes.

MH: Early on you were en­thu­si­as­tic about form­ing ac­count­able care or­ga­ni­za­tions. You joined the Medi­care Pioneer ACO pro­gram, but then you dropped out af­ter a year. What went wrong in your view?

Hawthorne: We had one physi­cian group that was more aligned with what was re­quired to achieve this, and we did ex­tremely well. When we added an­other physi­cian group that did not have that same kind of dis­ci­pline and per­for­mance prior to their in­volve­ment, we had a lot of teach­ing to do. Be­cause many of the pa­tients were not within the Texas Health Re­sources sys­tem, they used emer­gency fa­cil­i­ties and other fa­cil­i­ties out­side our sys­tem where our physi­cians tried to fol­low them. Un­for­tu­nately, it didn’t work as ef­fec­tively as it did with the first group. So we felt we needed to step back, do more en­gage­ment with the sec­ond physi­cian group and im­prove our own process be­fore we con­tin­ued on.

MH: At the same time, you formed some ACOs with pri­vate in­sur­ers such as Blue Cross and Blue Shield of Texas. How is that work­ing out?

Hawthorne: Very well. It opened up some new doors for us to re­late to the pay­ers in the Dal­las-Fort Worth area to talk about how we can im­prove out­comes. These con­ver­sa­tions were dif­fi­cult to be­gin with. They got more com­fort­able with time. We talked about specifics in terms of pay­ing for per­for­mance and out­comes.

As a re­sult, we have seen ex­cel­lent out­come re­la­tion­ships with Blue Cross and Blue Shield and with Aetna, and we’re cur­rently work­ing with the other ma­jor pay­ers to see how we might ex­pand the ac­count­able care op­por­tu­nity.

MH: Are you con­tem­plat­ing get­ting into the busi­ness of in­sur­ance?

Hawthorne: We’ve been there. In the early years be­fore Texas Health Re­sources was formed, one of our founders, the Har­ris Methodist Health Sys­tem, had a very large in­sur­ance prod­uct. We watched how that evolved as a provider-spon­sored health plan and de­cided that we would rather not take on our own in­sur­ance group be­cause we felt like there was some pretty hard com­pe­ti­tion be­tween the provider side and the in­sur­ance side in­side our own or­ga­ni­za­tion. So at this point that’s not on our list. We will work with other or­ga­ni­za­tions but not in­vest in­de­pen­dently in our own health plan.

MH: Texas has the high­est rate of unin­sured of any state and yet it hasn’t ex­panded Med­i­caid. How is that af­fect­ing your bot­tom line?

Hawthorne: It’s hard to say how it’s af­fect­ing our bot­tom line. What it is af­fect­ing is the re­la­tion­ships that we have with the people of Texas. Be­cause we have a very sig­nif­i­cant Med­i­caid pro­gram al­ready in Texas, we’re con­cerned that we have di­vided a very needy pop­u­la­tion. We’re see­ing more people show up in our emer­gency rooms. But un­for­tu­nately, they wait too long to re­ceive care. As a re­sult, the amount of care nec­es­sary to get them back to good health is a lot more ex­pen­sive than it would be had they had the cov­er­age. So we’re con­cerned about the fact that we didn’t ex­pand Med­i­caid in Texas. We are cer­tainly ad­vanc­ing knowl­edge about this with the busi­ness com­mu­nity, which must be aligned with us to achieve the ex­pan­sion. We’re go­ing to take the is­sue up again when the Leg­is­la­ture meets in 2015.

MH: Do you think it will have a bet­ter chance in the fu­ture?

Hawthorne: We may need to re­frame it a lit­tle bit as some other states like Arkansas, In­di­ana and oth­ers have done. Med­i­caid is a light­ning-rod word. How do we bring more people into this cov­er­age be­yond just acute care or women and chil­dren’s ser­vices? How can we bring more preven­tion and well­ness into the equa­tion? So we will repack­age it this time a lit­tle dif­fer­ently than we did in the first round.

MH: What’s next for Doug Hawthorne?

Hawthorne: Re­tir­ing is not a word I can com­pre­hend. So for Doug Hawthorne, it’s re­fir­ing. How can I look at some of the things that have been on that bucket list for a while that I now can en­gage in? Health­care will al­ways be a part of my con­tin­u­ing life’s work but per­haps in just a lit­tle dif­fer­ent frame­work than the CEO seat. But I’m a com­mu­ni­tar­ian, I want to see more things hap­pen where we are ex­tend­ing our­selves out into the com­mu­nity to im­prove health for the people we serve. So there will be op­por­tu­ni­ties to do that in a va­ri­ety of ways. I’ll look back on this jour­ney with won­der­ful mem­o­ries and sto­ries about the people who have pro­vided health ser­vices to this com­mu­nity.

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