Panelists also discussed the pros and cons of the increasing trend toward consolidation in health care.

Dec. 13—What effect will the Trump administration have on hospitals? That was a major question faced by a panel of hospital leaders on Dec. 9 at a Chicago forum sponsored by Crain’s Chicago Business. 

Several panelists mulled the question of whether the incoming administration will simply repeal the Affordable Care Act (ACA) or replace it with something else. Sonia Mehta, president and CEO of Loretto Hospital in Chicago, noted that the ACA has enabled about 20 million people to become insured. Repealing the law, therefore, would be difficult.

 “There are a lot of unknowns in this market, but the general consensus is that not in the immediate future are we going to see the repeal of the Affordable Care Act,” Mehta said.

A reduction in insurance coverage is not the only potential healthcare issue under the new administration, other panelists noted. Kenneth Polonsky, executive vice president for medical affairs for the University of Chicago, explained that healthcare reform has improved the emphasis on quality and safety, a positive consequence that should be preserved.

 “All of us are spending much more time figuring out how to make our hospitals safer and how to give high-quality care to patients. The focus is greater now than it’s ever been,” Polonsky said. “What I would say—if I were advocating, which we will be doing—to the new government is that those issues should not be lost. Whether there is a new mechanism to pay for them, not the mechanisms of the Affordable Care Act, I think is less important than that this progress in the healthcare system doesn’t get lost.”

“Obviously, President Obama wanted to pay for it in a certain way. Clearly, President-elect Trump thinks that there should be a different way,” Polonsky added. “We don’t have enough clarity yet on what they’re going to be proposing, but I imagine that we will understand better in the near future. And hopefully it will provide us with a viable way to move forward with all these good ideas that people have.”

Regardless of the changes, the uncertainty is weighing on executives’ minds, said Kevin Schoeplein, CEO of OSF Healthcare System, a Catholic healthcare corporation headquartered in Peoria, Ill.

“We’re dealing in a world of uncertainty,” he said. “It’s difficult, from my perspective, to repeal something and wait for a replacement. … Pivoting that quickly is something that creates a great deal of anxiety.”

Consolidation Impacts Health Care

Consolidation provides a number of benefits to systems and patients, two panelists said. These benefits go beyond cost savings: The union of two or more healthcare organizations brings knowledge and strategic benefits as well.

 “One thing I love about consolidation at Tenet is it allows for shared learning across a large organization,” said Tony Tedeschi, CEO of Weiss Memorial Hospital in Chicago, which is part of the 78-hospital Tenet Healthcare Corporation. “You test some initiatives [and] better ways of delivering care, and then you can spread those within the organization.”

Tedeschi said Tenet is developing what he called “standard work,” or procedures for particular situations that can be applied consistently throughout the consolidated organization.

The University of Chicago Medical Center has experienced consolidation on a much smaller scale compared with Tenet. Its lone merger was with Ingalls Health System, a community provider southwest of Chicago, in October.

Ingalls has a large inpatient psychiatry department that will improve the University of Chicago’s options for mental health care, and several ambulatory centers that extend the medical center’s reach beyond its traditional geography.

 “In addition to that, Ingalls is a lower-cost platform than the University of Chicago,” Polonsky said. “By nature of what we are and what we do, we have to invest in huge amounts of complicated technology for people who are very, very sick and have very complicated disease. Ingalls is a community hospital, and we will be working to create a more rational system, where people will be able to be hospitalized at a lower cost than at the University of Chicago. And if you need a bone marrow transplant, for example, you come to the University of Chicago.”

Mehta, whose hospital is independent, noted there are pros and cons to independence versus merging.

 “There are advantages to standing alone, such as you can keep the costs down, because you don’t have the bigger system expenses that some [merged hospitals] face,” she said. “On the other hand, we’ve always been open [to] merging or affiliating with the right partner. The biggest challenge we have is that there’s no parent. If you don’t do well by yourself, you have failed.”

Anticipating the Future

At the end of the event, the panelists were asked to predict how the healthcare landscape will appear in five years.

Polonsky noted that the Congressional Budget Office has projected that half the hospitals in the United States will be in the red by 2025. 

 “Whether that’s true or not, obviously I don’t know,” Polonsky said. “But that is the challenge that is going to face us. How do we provide high-quality and safe care, administered by an outstanding team of people, including physicians and nurses, in a way that is sustainable financially for the country? That’s our challenge.”

Tedeschi took a rosier view.

 “I actually think we’ll be doing better, and at a lower cost,” he said. “I think we will get through this transformation, and as I tell my youngest son, who’s a freshman now in pre-med, ‘There’s good news out on the horizon. This is a wonderful time for us in health care.’ We will get through it.”

Ed Avis is a freelance writer based in Chicago who frequently writes about healthcare management topics.

Publication Date: Tuesday, December 13, 2016