The Clash of The Titans, Guest MINDSETTER™ Dr. Michael Fine

Wednesday, April 11, 2018


As healthcare institutions begin to do battle over turf and property in Rhode Island, it may be helpful for policymakers, legislatures and the public to understand a few basic principles of health policy to help sort out the truth and falsity of various claims the players are likely to make to buttress their own positions or to attack the positions of others.

First, it is worth remembering that Rhode Island has two over-riding interests at stake: the health of the public and the cost of healthcare. Medicaid and other health insurance expenditures consume about one-third of the state budget. Health insurance represents the second most significant source of overhead cost for businesses. Decisions we make about health policy that affect what we spend on health insurance impacts the need for taxation and the business climate. We should be focused on improving health outcomes, achieving optimal health for all Rhode Islanders, and reducing health care cost by the efficient organization of health services. Nothing else really matters.

Second, the more medical services we have available, the more those services will be used and the greater our costs become. Build more hospitals or hospital beds, and more will be used, generating more costs. Have more ambulances, and more ambulances will be used to make more ambulance runs. Each of those ambulance runs will generate an emergency department visit and some will generate hospitalization, many of which will improve the health of the transported, but some will not. (One estimate suggests about 50 percent of Emergency Department visits in Rhode Island could have been well cared for in a much less expensive primary care setting.) The challenge of health policy is to determine how much of each service is needed to address the burden of disease and injury we actually experience, and not more, and to choose services that are most cost-effective for each disease and condition. 

Third, hospitals are more about jobs then they are about health outcomes. There is no evidence that the number and location of hospital beds has any significant impact on public health outcomes; some evidence that more hospital beds produce more cost; and some evidence that hospitalization is associated with inherent risk (from infectious diseases acquired in the hospital, and from misadventures from procedures that are only performed in the hospital, and that are more likely to be performed unnecessarily when we rely on hospitalization for first-line care.)  That said, there are a few diseases and conditions that have better outcomes when regionalized, and others for which rapid treatment produces better outcomes. The absence of evidence doesn’t mean that the number and location of hospital beds have no impact on public health outcomes, but only that any public health outcomes is hard to measure. Even so, we’ve got to be mindful that 65 or so percent of hospital income is public money – Medicare and Medicaid, and we’ve got to ensure that public funds are spent in the public interests, not solely to generate private profit.

Fourth, there is an inherent tension between the need for regionalization and the need for rapid treatment.  The underlying principle of regionalization is that practice makes perfect.  The more experienced clinicians have with some less common diseases and conditions, the more skilled they become at treating those diseases, and regionalization brings together a critical mass of patients with specific diseases and conditions so that expertise can develop, and quality can be measured and improved.  We have long known that the regionalization of neonatal intensive care, for example, produces better outcomes. The driver of rapid treatment is that time and distance are critical factors for survival in some situations, like profuse bleeding and chest injury after trauma, or in cases of heart attacks and strokes. It takes planning, organization and the organized deployment of resources to make sure that the conditions benefiting from regionalization are in fact regionalized, and to make sure that rapid treatment is available for conditions that require speed.  Rhode Island does relatively little of that planning and organization now.  We are a home rule state, which means every municipality has its own emergency dispatch and ambulance providers, who are a hodgepodge of public, volunteer and private services.  Our hospitals are independent entities competing for business, with private self-appointed boards, when they are non-profits, who are accountable only for their errors.  There is no real authority that organizes and divides the work in a rational way, or that designs a rational delivery system based on the incidence and prevalence of disease.

Fifth, there is likely some value, from the perspective of effective health professional training, jobs, research and the jobs that research may produce, in consolidating the work of Rhode Island Hospital, Women and Infant’s Hospital, Butler Hospital, Brown’s Warren Alpert School of Medicine, and URI’s Nursing and Pharmacy Schools, RIC’s Nursing and Social Work Schools, and training programs in laboratory science and physical and occupational therapy. The likely value in such a consolidation flows from an ability to achieve efficiencies of scale and to develop expertise in multi-disciplinary team function: we’ll be able to attract the best teachers and researchers in a place that has more resources; and we’ll be to develop more effective multidisciplinary practice teams when we give health professional students the experience of working together as students. There is likely to be some patient care value that flows from this coordination as well but also some downside risk:  it may be less satisfying to be a patient in a very larger organization focused on teaching and research.  On the other hand the strength of Rhode Island health care, outside of the primary care arena in which we have developed some depth, may well be the tunnel that connects Rhode Island and Women and Infants’ Hospital, which represents a long and deep clinical collaboration focused on patient care, a clinical collaboration that survives in the face of corporate battling.

All hospital consolidations are associated with increased cost, as the consolidated entities exert their monopoly power in negotiations with insurance companies and large employers. Some will argue that antitrust concerns prevent hospital consolidations.  But monopoly power and anti-trust concerns can be mitigated by state regulatory action: we could likely get out from under antitrust concerns by creating a hospital regulatory commission that sets rates and budgets if we determined that hospital consolidation is in the public interest, which is exactly what we do with electric power and the PUC.  Hospitals, of course, want to have their cake and eat it:  they want consolidation but will fight any regulation tooth and nail. Wise public policy should take on and defy that resistance.

It is irresponsible to allow any hospital consolidation without devoting attention and public resources to the organization and function of our primary care delivery system.  Primary care functions as the check and balance of the hospital system.  When we have one primary care practice for every 10,000 people open from 8 am to 8 pm and open on weekends, and when we enroll all Rhode Islanders in such a primary care practice, we can reduce emergency room and hospital utilization significantly – perhaps even in half – and improve all measurable public health outcomes.

What about Boston? One the one hand, diseases and conditions that occur infrequently, likely less than in 50 or 100 people per million, or less than one in 10,000 to 20,000, should be cared for at a regional center like Boston: we’ll never develop the critical mass of experience to care for those diseases and conditions effectively, despite any desire to do so.  For those people, who may number several hundred or a few thousand in total, we should pool our resources and figure out how to get them to Boston comfortably for care.  It’s no fun getting stuck on Route 95 when you are sick. But for everyone else, we should try to provide their care in Rhode Island, even if that means consolidating hospitals to do so.  Our economy is still fragile. We need those jobs here. Our parochialism may appear quaint to some, but it gives us our character. Allowing bureaucrats in Boston who are out of the reach of our legislative jurisdiction to have control of our health care decision making undermines our ability to self-govern, and undercuts our democracy. Collaborate when indicated? Absolutely. But allow the expropriation of our resources into a setting where we have no voice? Never. We joined a revolution to prevent taxation without representation, which is what moving ownership of our hospital system to Boston represents.

But resisting the Boston option isn’t enough.  Boston or no Boston, we still have to drive ourselves to achieve efficiencies in our health care delivery system.  We have to both plan and execute.  We have to build a right-sized balanced delivery system, informed by data on the incidence and prevalence of disease and data on the most effective and cost-efficient health services.  We need intelligent regulation of health professionals and healthcare institutions. We need public control of public expenditures. And we need to keep our focus on providing optimal health for all Rhode Islanders, eliminating unnecessary services and costs, and using any money we save to strengthen our communities by building better education, safe and healthy housing, community services, a clean environment and safe streets, which, at the end of the day, is what actually matters for health.

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Michael Fine M.D. is Chief Health Strategist for the City of Central Falls and Senior Clinical and Population Health Officer at Blackstone Valley Health Care, Inc.  He was Director of the Rhode Island Department of Health 2011-2015.


Related Slideshow: 7 Implications and Unintended Consequences of a Care New England and Partners Merger

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Providence does not usually do well in mergers

Remember Providence Gas, Fleet Bank, and Narragansett Electric?

Big employers, deep community involvement, and significant charitable donors — all were consumed and in each case, the number of employees left in Rhode Island by the succeeding company is a fraction of the once independent venture.

To the victor goes the spoils.

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As if the Boston economy isn't good enough, and the Providence economy couldn't be more stagnant

The cityscape of Boston is littered with cranes. Boston Business Journal maps the construction projects utilizing cranes in Boston (see image) and the number of projects is staggering. 

In Providence, there few construction projects and not a crane to be seen. The last thing Providence needs is for another one of its largest employers to be merged into a Boston mega-organization. The likelihood is that jobs will be lost or consolidated to Boston - basic functions like purchasing, accounting, etc. will be lost. 

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Harvard beats Brown in Ivy League match-up

Harvard Medical School is ranked as the #1 research-based institution in America by U.S. News and World Report.

Partners Healthcare’s academic partner is Harvard.

In contrast, Care New England’s academic affiliation is with the Warren Alpert Medical School of Brown University. Brown’s best ranking is 21st for primary care - and is ranked for research way back at #31.

One of the biggest losers in the merger could be Brown's medical school.

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Care New England is RI’s 2nd largest employer, so what will It be in 2 Years?

According to the RI Department of Labor and Training, Care New England is Rhode Island’s second largest employer.

Lifespan is the largest: 12,050

Care New England: 8,500

CVS: 7,800

Cities like "Meds and Eds" (the medical and educational business segments), but Providence and all of Rhode Island is likely to lose high paid, highly educated jobs as a result of this deal.

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Care New England Continues to Struggle

Despite hopes that closing Memorial Hospital would solve the financially beleaguered Care New England's economic woes, new financial documents unveil that CNE continues to struggle.

Additionally, the pursuer - Partners HealthCare - is also making cuts. The Boston Globe unveiled the Partners is cutting about 100 of the company’s tech workers that their jobs were being outsourced to India to cut costs.

“Many of the employees have worked for Partners for several years, or even decades, and are struggling with the company’s decision. Almost all are coders — people who scour patients’ medical records to pinpoint billable services — and earn upward of $40 an hour. Coders in India earn a fraction of that amount, making overseas coding an attractive way for hospitals to cut costs,” wrote the Boston Globe.

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Can the unions battle?

Within hours of GoLocal breaking the news of the merger, the United Nurses and Allied Professionals (UNAP) President Linda McDonald, RN, released the following statement today:

"This proposed merger has the ability to impact thousands of jobs and the quality of care in Rhode Island and should be thoroughly scrutinized. Like most Rhode Islanders, we only recently learned of this proposal but expect Care New England and Partners HealthCare to be transparent in their process and begin a conversation with our union about the effect any deal would have on our members and our patients.  

Memorial Hospital provides critical care to scores of Blackstone Valley residents every year and preserving its status as a fully-functioning community hospital will be among our top priorities as this process continues to unfold. 
The onus is now on Care New England, Partners HealthCare and Prime Healthcare Services to make the details of this proposal public and to do it quickly so that workers, patients and state regulators may begin asking the appropriate questions."

The nurses represents nearly 1,400 registered nurses, CNAs, ER techs, surgical techs, orderlies, endo techs, environmental employees and ancillary staff at Kent and Memorial hospitals.  But, will they have any impact on the decisions?

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Speaking of Lifespan - will they be forced to merge with a Boston partner?

Lifespan is having its financial challenges too. While Care New England lost $53 million last year, Lifespan's losses were $40 million. The Lifespan losses were smaller proportionately to the healthcare group's overall budget and it does not have the cash crunch that Care New England was battling.

In February, Lifespan announced it had has entered into another Boston Hospital agreement. This agreement with Dana-Farber Cancer Institute is a long term agreement with the goal of advancing cancer treatment and research. Lifespan previously entered into an agreement with New England Medical Center and that deal led to years of protracted litigation to unwind. Lifespan also ran into a legal battle with Tufts Medical Center.

Will Partners' potential arrival in the market force Lifespan to affiliate?


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