For the second time in two years, a Missoula hospital is entering a joint venture with a hospital in Billings. Last year, Billings Clinic and a for-profit partner bought Missoula Community Medical center. The new joint venture announced this week isn’t a merger, but it does have Missoula’s other hospital, St Patrick, joining with St. Vincent hospital in Billings.
Mark Wakai with St. Pat’s says they’re getting together with St. Vincent to create a statewide network of health care providers they say will save Montana businesses money.
"Why now is because spending is out of control in health care, and we want to be seen as part of the solution," says Wakai.
Reducing the cost of health care has long been one of America’s most vexing problems. St Patrick and St Vincent are trying a new strategy being employed across the country that’s a huge change in how health care is paid for. Instead of doctors and hospitals getting paid for every patient visit, or test or procedure, they’ll get paid based on how well they do at keeping a given group or population of patients healthy.
Ron Oldfield is an executive with St Vincent in Billings.
"It’s sort of the wave of the future," Oldfield says. "We create a narrow network. We work with an employer, and we say, we would like to see 90% of your employees, rather than maybe the current 50% we see now. If we see more of your patients we will be able to help you bend your cost curve."
The idea is that if this new network is given responsibility for most or all of a company’s employees, they can better track those employees’ health, and steer them to preventive care that keeps them out of hospitals and from needing expensive interventions like surgeries. These new kinds of networks are supposed to be held accountable for doing that, and are called Accountable Care Organizations, or ACOs.
Benjamin Miller, a health care researcher at the University of Colorado says that although ACOs are relatively new, there’s reason to think the new payment model can work.
"There’s evidence that’s been published looking at the Medicare ACO program, and we know that there were areas that were found to have lower cost."
But, Miller says, lower costs aren’t automatic. For an ACO to work, it has to have a broad network of providers who work well together, everybody from general practitioners or family doctors, through to specialists and hospitals. He says it really helps if behavioral or mental health specialists are included in the network. And all of that has to be backed with really robust information technology so the network can efficiently track every patient and measure whether everyone is getting the most efficient care possible. A big goal of ACOs is to reduce the current fragmentation in American health care, where doctors and hospitals and therapists may all be working independently and not necessarily communicating well, and nobody’s held accountable for whether patients are actually getting better, or just continuing to rack up more and more bills for more and more procedures.
"Creating an ACO is not the panacea," Miller says. "Creating an ACO is a conduit for being able to fix some of the problems that have come from fragmentation in health care, where providers simply don’t track patients, aren’t able to collaborate with other providers in their community for those patients."
So the new joint venture between St Patrick in Missoula and St Vincent in Billings is an attempt to create a new network that’s on the hook for making sure people get the right amount of health care when they need it, and don’t fall through the cracks, or end up in a cycle of repetitive tests or procedures being done because health care providers aren’t communicating well.
It’s a theory that works well on paper, but isn’t necessarily easy to carry out in the real world, admits St. Vincent’s Ron Oldfield.
"I wouldn’t say we have this all figured out."
But, Oldfield says, the future of health care is hospitals and doctors getting paid for the quality of care they deliver, not the quantity.
"And we want to be prepared for it. Because we don’t think that in the long term, getting paid by the number of transactions is sustainable."
The new ACO isn’t just St Vincent and St Patrick hospitals. Both are parts of larger, not-for-profit health systems that include doctors and clinics outside the walls of the hospitals themselves. St Patrick is part of the Washington state-based Providence Health System, and St. Vincent is part of the Sisters of Charity of Leavenworth system, based in Kansas. They also run St James hospital in Butte, and Holy Rosary Healthcare in Miles City. Those two systems joining means they can offer big Montana employers coverage across the entire state.
St Patrick’s Mark Wakai says the new network is planning to lease more office space and is searching for a chief executive. He says it’s going to need to hire some new staff, including some with new skill sets, but didn’t have specifics on the number of new hires.