‘This shift to accountability and value is going to come up in any reform proposal’
On May 15, Mike Slubowski, currently CEO of the $2.7 billion SCL Health with a dozen hospitals in Colorado, Kansas and Montana, becomes chief operating officer of Livonia, Mich.-based Trinity Health, a system about six times larger. He will be serving CEO Dr. Richard Gilfillan, who has pledged to turn the nation’s second-largest Catholicsponsored health system into a proving ground for the value-based care models he helped shape while leading the CMS’ Center for Medicare and Medicaid Innovation. Editor Merrill Goozner spoke with Slubowski last week about the major challenges in his new role and the special challenges faced by exurban hospitals such as the ones he ran at SCL during 6½ years there. The following is an edited transcript.
Modern Healthcare: Why switch from being the top person at SCL to second-incommand at Trinity?
Mike Slubowski: Rick Gilfillan has been thinking for some time about how to organize his senior team at Trinity to put an emphasis on operational excellence. Trinity is in 22 states and has about $17 billion in revenue now. There’s a fair amount of complexity when an organization spreads that far.
Focusing on operational excellence across the score card—quality, safety, care experience, community benefit, improving the health of the communities they’re serving, financial stewardship and, of course, alignment with their people and clinicians—is critical. It’s an exciting opportunity.
MH: You previously worked at Trinity. What’s changed since you left?
Slubowski: I am entirely aligned with the shift to risk-based arrangements and the value they’ll provide. Trinity has launched an ACO in nearly every one of its markets early on as a result of Gilfillan joining the organization. They’ve gone beyond training wheels in that regard.
Regardless of where health reform goes, this shift to accountability and value is going to come up in any reform proposal. So the positioning they’ve done to align clinicians and the health system to deliver care that is the highest quality in a cost-effective way and also measure how they can improve the health of individuals and populations is spot on.
MH: Has SCL prepared you for wider adoption of value-based approaches?
Slubowski: We’ve done some of that work here at SCL Health. We have ACOs. We were early in the Medicare Shared Savings Program in our markets. We’ve got some well-developed physician group practices in each of our communities. We’ve expanded our continuum of services including home care.
We’re doing a lot of virtual health initiatives. In Montana and Colorado, we were the first to partner with Doctors on Demand for video visits, for example. I think Rick’s vision for transformation and mine are very much aligned.
MH: What are the issues affecting rural hospitals today, and how will the changes being proposed in Washington affect them?
Slubowski: We consider all our ministries in Montana rural, but Billings is more urban than our hospital in Miles City, which is a very large critical-access hospital. The things that are common to rural areas are the challenges, for both medical and technical staff, of attracting clinicians committed to those areas who will stay there.
Other issues are having a critical mass of volume to demonstrate proficiency in whatever clinical services
“Many rural hospitals have been inventive in converting many of their beds to nursing beds and in expanding their home care programs.”
you’re offering, as well as the ability to spread fixed costs over a larger base of revenue.
Developing a continuum of care can be more challenging in rural markets because people prefer to have their primary services in their own backyard. But it is not costeffective to produce the specialty services in every market or every hospital. So dealing with issues such as transportation and continuity of care is a huge challenge.
We’re doing a lot now with telehealth as are many providers in rural communities: from eICUs and consults on video visits to having teleradiology and interpretation services transmitted electronically. Those will all be tools that will help rural communities import some of the special services we need without people having to actually be in those communities.
MH: How do you fund these services?
Slubowski: Critical-access hospitals have been getting special, cost-based reimbursement for many years. They are just like the rest of the healthcare system was years ago. That can provide perverse incentives. The more you spend, the more you get. The flip side is because it is service-based reimbursement, it doesn’t generate capital for investing in operations for the future.
There’s a lot more aging populations, largely Medicare, Medicaid and uninsured, in those communities. In some states they use provider fees, where the state taxes hospitals to achieve additional federal funding. That will run into challenges as we revisit the ACA. A lot of those rural hospitals are very dependent on getting provider fee payments because of their disproportionately high share of Medicaid patients.
Some critical-access hospitals have funding from their communities. A lot of those communities are challenged financially. Many of those hospitals can’t make it on patientcare revenue. They’ve depended on those subsidies for many years. So there are a lot of challenges.
On the flip side, many rural hospitals have been inventive in converting many of their beds to nursing beds and in expanding their home care programs. Those are ways to provide needed care in those communities that aren’t necessarily inpatient or traditional outpatient services at hospitals.
But the biggest issue is how do you create a critical mass of medical and technical staff. It’s not only trying to attract people to those markets, but having enough volume to generate revenue and maintain competence in doing procedures and providing service.
MH: Immigrants help staff many rural hospitals. Has the debate in Washington affected your ability to recruit physicians?
Slubowski: Many of the grads who come here for additional training and placement are very concerned about what’s going on right now. It’s definitely going to affect the supply and demand equation, not just for urban centers. Many rural hospitals have depended more on foreign medical graduates and immigrants who come here to train.
MH: Are you seeing a chilling effect on their desire to come here?
Slubowski: I don’t know what the final outcome will be on the immigration question and how much recognition there will be for needs like special labor forces. For me, the jury is still out. But it has got a lot of people concerned.
You’ve seen the anecdotal examples of people who were turned away during the first immigration ban, who had simply traveled back to see families. It definitely creates barriers.
The flip side is if there is a way to support bringing them, there’s still a lot of interest for medical graduates and candidates to come to the United States for training and placement in medical roles.
MH: How do you view the possible shift to Medicaid block grants?
Slubowski: I’m not excited about block grants. If it were going to move to shipping money to the states, I’d rather see a per capita approach or an innovation grant approach to figure out how to help people who are poor and underserved. But if the per capita rate is too low, or it doesn’t deal with exogenous costs like drugs, it’s a problem. They should be part of the equation.
We believe very strongly in the original principals of the ACA that healthcare is a fundamental right that every American ought to have access to a basic level of health coverage. Medicaid is an important part of that equation.
MH: What issue do you think isn’t being adequately addressed by healthcare leaders or the healthcare media?
Slubowski: What there has not been a lot of discussion about is how to engage consumers about how to have more skin in the game. Whether we live in an environment of poor socio-economic circumstances and health disparities, or we’re fortunate not to be in those circumstances, everybody has a role in some way to improve their own health or take responsibility for their chronic conditions.
That’s an area that needs more discussion— about how we engage each of us in every way possible. Obviously people with means have more ways to do that. But everybody can do it and that has to be part of the equation.
“I’m not excited about block grants. If it were going to move to shipping money to the states, I’d rather see a per capita approach or an innovation grant approach to figure out how to help people who are poor and underserved.”