Rural Hospital Alliance Wants Doctors in the AZ Desert

No money is being exchanged among the four hospitals that have agreed to form an alliance, but the members believe their combined scale will leverage savings and boost physician recruiting while preserving autonomy.

Four rural nonprofit hospitals in Southern Arizona have formed a hub-and-spoke alliance with Tucson Medical Center that they hope will allow them to remain independent while leveraging their combined scale to reduce costs, improve services, and bring more physicians into the desert.

The nonprofit Southern Arizona Hospital Alliance was launched this week and includes critical access hospitals in Benson and Bisbee, and community hospitals in Safford and Willcox, all are located east of the TMC hub. Combined, the hospitals serve about 70,000 people.

Susan Willis, TMC's executive director for network development, and president of SAHA, says the five hospitals have a longstanding relationship that had never been formalized, until this week. No money is being exchanged among the hospitals, but Willis says the members believe their combined scale will leverage savings and boost physician recruiting.

"There will be greater collaboration around grant applications, and we are using TMC's status with VHA to improve purchasing power," Willis says, "but the greatest benefit to the rural hospitals, and their biggest challenge, is recruiting and retaining physicians in their communities; both primary care, recruited directly to their communities as well as specialty and sub-specialty visiting professionals."

"TMC has been successful in crafting unique relationships with specialty physicians and we have put rural outreach as one of the key deliverables of our service line agreement," Willis says. "We think we can leverage the strong building of relationships with our specialists to find creative new ways to get specialists consistently rotating through those communities and helping those patients get their care closer to home."

Rich Polheber, CEO of Benson Hospital, a 22-bed critical-access hospital about 48 miles southeast of Tucson, is board chairman for SAHA. He says the member hospitals want to strike that balance between the scale that comes with a system and the autonomy that comes with independence.

"Our board has made a decision that we don't want to merge with anybody else," Polheber says. "We think healthcare has a local focus and we are going to work to provide pre-eminent and quality care and do so through various alliances."

"In healthcare there are so many unknowns," he says. "This is going to be a bit of a journey, but for us, it is going to provide several things that we can't do by ourselves without this alliance with a larger high-quality delivery system. We are excited about it."

Polheber says much of the resistance in Benson to an outright merger or acquisition comes from a feared loss of local control, which he says is not unwarranted.

"I have worked in two hospitals that have become part of a system," he says. "When you're part of a system, it can happen that you're at the end of the food line and you don't quite get the attention from the organization and some of the support services are looked down upon as the poor mission hospital."

"This alliance clarifies our continuation of our independence and our responsibility to continue to drive revision, to work with our community, to pursue a whole series of initiatives," he says.

SAHA is also non-exclusive, which means that any member hospital is free to work with hospitals outside of the alliance.

"That gets more complicated when you are part of a closed system," Polheber says. "The other problem is the corporate overhead that gets assigned and you see money leave the community for the headquarters. We want that money to stay in the community and the only time it should leave is if we want to buy a service from TMC."

As for metrics, Polheber says it should be relatively easy to determine whether or not SAHA is working.

Recruiting and Managing Physicians
"On the physician side, it's 'do we have more specialty doctors available to patients in the community and do we have primary care?' To me that is our number one agenda item. If we can accomplish that we know this is fruitful," he says.

Benson has only five primary care physicians and needs at least four more to serve a year-round population of about 12,500 people that grows to more than 16,000 in the winter. The service area has no OB-GYN and is in dire need of cardiology and pulmonary services.

"TMC has a very strong relationship with their specialists so they can engage in meaningful dialog to get specialists who for economic reasons have historically said they don't want to spend the energy or time traveling to Benson," Polheber says.

Benson and TMC are negotiating now to recruit primary care physicians who would be managed by TMC.

"It's subtle, but it eliminates me having to manage a doctor in Benson who is now seen as competing with the rest of the doctors in the community," Polheber says. "That is strategically important because I want to engage in partnership with all of our physicians. When you start to manage a subset of doctors, unless you manage them all, it can get unhealthy in the way you work cooperatively with the physicians in the community."

Other SAHA metrics will be easy to measure.

"If our costs per patient day begin to go down as a result of lower supply costs that is an easy metric we track now," Polheber says. "We'll also look at employee surveys and satisfaction levels about their opportunities. In about one year from now we'll do a survey to see if there's a buzz in the community that people are appreciative that this alignment exists and that there is a relationship with TMC that gets a good housekeeping seal of approval."

Emergency department visits should increase as the people of Benson learn of the affiliation with TMC for emergency services and admitting.

"If you have a diagnosis and we can't keep you here, we have a guaranteed 15-minute commitment for a bed at TMC," Polheber says. "That is unheard of! That's good because people could end up going to TMC faster than they could by going to the emergency room at TMC."

Willis sees opportunities in the coming years to pool resources on electronic health records and telemedicine. "That could be a longer-term outcome," she says. "In the meantime we are trying to find the most efficient and effective ways to hand off medical information because we do transfer a lot of patients back and forth between these communities and Tucson."

At some point, Willis says, SAHA likely would consider bringing in new members "as long as it's a good fit for us that would make good sense."

"Right now it's important that collectively we deliver on what we are intending to do, which is to make things better for the five of us," she says. "It makes sense to get going with what we have right now."