El Paso Specialty Hospital, the 2003 winner of the first Specialty Hospital Award of Excellence, co-sponsored by the American Surgical Hospital Association and Modern Physician, is known for the remarkable cohesion among its physician-partners. The award will be presented Nov. 22.
"We're all part of the operation," says Craig Cameron, D.O., medical director of the hospital "We get together and we brainstorm. That's how we run things."
Cameron and the 23 other physician-partners in the hospital are all part of El Paso Orthopaedic Surgery Group.
The facility started as an ambulatory surgery center that the physician-partners acquired in 1997. In 1999, the doctors partnered with Chicago-based National Surgical Hospitals to convert the ASC into a surgery hospital at a cost of $8 million.
"I was impressed with the very high level of customer satisfaction of this hospital and the fact that it is continuing to grow. It is showing rapid growth in revenue and in cases," says Mike Lipomi, CEO of Stanislaus Surgical Hospital, Modesto, Calif., who was one of a panel of judges.
The 29,000-square-foot hospital opened on March 26, 2001. The facility has about 100 employees, 31 beds, six ORs, two treatment rooms, a lab, a radiology department, dietary services and emergency services.
The venture has been a success by all the key measures. The facility reports that case volume has increased from 5,000 cases in 2000 to a projected 9,000 cases for 2003, a compounded growth of nearly 20%. Net revenue grew from $5 million in 1999 to $23 million in 2003. Turnover times for the OR are under eight minutes.
The hospital could not have rung up such numbers without the partners' close working relationship-making it possible to agree on policies such as standardized supplies and equipment, says Donna Worsham, vice president for hospital operations at National Surgical Hospitals.
"When it comes time to make decisions," she says, "they can focus on the right thing for the entire group and not be sucked in by one or two physicians trying to push their agenda through."
Worsham adds, "They are probably the most cohesive group of physicians that I've worked with." NSC has partnerships with 15 surgery hospitals and ASCs.
The doctor-partners have divvied up spots on four standing committees: the medical executive committee, which oversees the operation; the care track committee, which decides how certain procedures should be carried out; the quality committee; and the equipment committee.
Cameron says peers are in the best position to put the brakes on demands for equipment that fails to meet their cost effectiveness or ROI standards.
"If only one guy is going to use an expensive instrument, we're probably not going to buy it," Cameron says.
He says the physician-partners are slowly moving toward standardizing their supplies, because "if we can standardize which instruments we use, we can work out a deal with the vendors and get a better price."
CEO Mitch McBeth adds that standardizing also makes the staff more efficient because they are working with fewer kinds of equipment.
McBeth estimates that cost savings from standardizing equipment totaled $600,000 in 2001 and $350,000 in 2002.
McBeth says the hospital plays staunch defense around its top line by singling out and aggressively appealing underpayments.
After opening, hospital staff noticed net revenue per case did not match expectations. McBeth's staff sampled claims and found underpayments. After more investigation into the underpayments, they found more than $1 million in underpaid claims.
To recapture the money, McBeth says the hospital added a second staffer to handle billing inquiries. The two now review all explanations of benefits and make appeals. McBeth says they have had to appeal 80% of workers compensation cases. In 2002, the hospital squeezed an additional $600,000 from 2001 explanations of benefits in all lines of business.
The hospital also has reversed a modest decline in staff morale.
McBeth says the hospital's first employee satisfaction surveys generated merely "good" scores, well below expectations. Like the doctors, many staffers had come to the surgery hospital to get away from slow-moving acute care hospitals, but in the evolution from ASC to surgery hospital "the feedback revealed that we were suffering from bureaucracy, the very disease we were trying to avoid," he says.
As a remedy, the staff now meets two or three times each month, with McBeth routinely asking, "Do you have what you need to get your job done?" In the October 2002 survey, 80% of the staff of about 100 employees gave the hospital an excellent score.
Patient satisfaction has always been high, a source of pride for the doctor-partners.
"Patients love to come here," Cameron says. "They get what they perceive as better care for a cheaper price."
Panel of judgesMike Lipomi, CEO of Stanislaus Surgical Hospital, Modesto, Calif.
Bill Mohlenbrock, M.D., CEO and president of Iameter, a quality improvement software and consulting firm for hospitals and ASCs, based in San Mateo, Calif.
Alan Pierrot, M.D., CEO of FSC Health, surgical hospital development and management company in Fresno, Calif., and past president of ASHA.
Jane Thilo, M.D., consultant, executive coach and co-founder of Encompass Health, Mercer Island, Wash., and a member of the Modern Physician Editorial Advisory Board.
Daniel Zismer, Ph.D., managing principal of Dorsey Health Strategies, a health law and consulting group that is part of Dorsey and Whitney, a law firm in Minneapolis.