Who Wants an Empty Hospital?

If you don't, you should. A nearly empty hospital indicates you've achieved functional integration such that your continued existence doesn't depend on the hospital at all. It depends instead on how well you take care of people to make sure they seldom, if ever, end up there.

Who wants an empty hospital?

Most everyone, apparently.

That is, except, possibly those who work in hospitals.

As the most expensive site of healthcare delivery, an array of forces to keep patients out—unless absolutely necessary—is massing. Even you, a hospital leader, they argue, should want to see your hospital as empty as possible.

An emptier hospital would mean you have achieved functional integration, such that your continued existence doesn't depend on the hospital at all. It depends instead on how well you take care of people to make sure they seldom, if ever, end up there.

Corwin Harper wants an empty hospital, at least, in theory. In fact, the Kaiser executive coined what was arguably the most popular catchphrase of the 2014 American College of Healthcare Executives Summit in Chicago last month.

"Who is happy to have an empty hospital as readmission rates and hospital admissions are going down?" asked the senior vice president/area manager for Kaiser Permanente's Central Valley Area in California, to muffled laughter. (Few hands went up). "I am," he said, with a straight face.

"I consider it a system failure from a process improvement standpoint with respect to the entire continuum of care if we have someone who gets readmitted to the hospital after being discharged. How did we fail in that this patient needed to be readmitted into the hospital?"

Kaiser is perhaps the most-cited example of an integrated delivery system in history. Held up by many as the model of efficient healthcare delivery, the California-based system, from its inception, closed the loop on payer and provider battles over reimbursement rate increases through integration.

The point is, Harper and people like him have been operating under a truly integrated model for so long that it's second nature. He believes, and a lot of evidence would back him up, that it's a better, higher quality and more efficient way to deliver care. He's preaching the Gospel of Integration, and finally, people are listening.

No More Incentives to "Do More"

That doesn't mean Kaiser's way is perfect, but it does mean that its executives have unique perspective on how to deal with the basic model, which is rapidly proliferating across the US as employers, payers, and providers seek closer collaboration and shared risk/reward deals.

It boils down to this: The only way to really put a dent in healthcare costs is to have all sites of care working together to coordinate care. Perverse incentives to "do more" have been eliminated or at least significantly reduced by the practice of evidence-based medicine and the integration of data metrics that help providers make the best decisions.

Kaiser, effectively, is the original accountable care organization.

Against this backdrop, Harper notes the importance for health care organizations to maintain a wellness and prevention focus while ensuring that care is coordinated.

In other words, that means creating a system that ensures member loyalty well before more intensive and expensive healthcare interventions are needed. It also means expanding your notion of what your community needs for its healthcare, not only what will reinforce your organization's short-term bottom line.

Embedded within that transition is wholesale culture change around who the customer is (the patient, not the physician) and moves the dynamic far beyond volume-driven healthcare (which is what got us into this mess in the first place).

"At Kaiser Permanente, the member is at the center of our planning and care delivery," notes Harper. "In the past, most hospitals focused on the number of ED visits and admissions. We need to have more metrics that examine the entire continuum of care to look at the entire care experience."

The Big C
And that, essentially, is the crux of the transition most of healthcare will eventually face as the price for healthcare continues to outpace the rate of inflation–capitation. Whatever the mechanism, future healthcare survivors will be determined not by how many widgets they're able to produce, but by how much they save on producing as few widgets as are needed.

"Care has moved from the hospital to the outpatient setting and the reimbursement structure has moved along with it," Harper says. He notes that within Kaiser Permanente, for example, patients can email their physicians to get simple questions addressed without coming in for an office visit, and physician telephone appointments have become a key part of the delivery system, providing patients greater convenience.

This kind of innovation is much easier to incorporate in a capitated environment.

Harper went through some of the metrics to which he pays the most attention. Many of them were undoubtedly foreign to the executives attending his session, but he stressed that they need to become familiar with them.

"Does anyone know what 'days-per-thousand' means?" he asked, to silence. (Hint: it's an inpatient day utilization rate measurement over time.)

While you're thinking about that, what is your days-in-a-skilled-nursing-facility rate?

When you're capitated, you can focus on these things, because they represent expenses, and the name of the game is expense management, Harper says.

"We have a moral obligation to keep people healthy," he says. "We as healthcare executives need to collectively do a better job of moving from a sick care mindset to a health/wellness mindset."  

In Kaiser hospitals, he says, 70% of the time patients will be out of the ED in 60 minutes. "That's our goal," he says. "And into the ICU in 30 minutes. We have an ED doc early in the process to help with throughput."  

Harper notes his professional focus is to remove barriers from a process improvement standpoint.

"My job is to push down walls—moving patients to the right place of care with fewer hurdles to cross," he says. "For example, moving a patient from discharge directly to home care with no stop in a [skilled nursing facility] sometimes."

Being able to do that means that services have truly been aligned across the continuum of care. It's an example of patient customer service as much as it is about increasing efficiency or saving money, he says.

"We as healthcare executives need to do what is right for the patient," Harper says. "Since the cost of healthcare is not sustainable for many consumers and the businesses that are paying for it, focusing on affordability is key."