After the storm

Rebuilding a hospital decimated by natural disaster would be tough enough. St. John's Regional Medical Center in Joplin, Mo., faces particularly difficult obstacles that go beyond the physical destruction caused by the tornado.

Executives for 347-bed St. John's and its parent, Sisters of Mercy Health System, Chesterfield, Mo., must continue to manage the immediate needs of the damaged hospital, its employees and the community. At the same time they must begin the long-term work of deciding what the new St. John's will look like. They will do so under the increasing demands of healthcare reform, with an eye toward keeping its relationships with referring doctors, and while battling for patients with a locally based rival in a competitive healthcare market, experts say.

In addition to those existential challenges, St. John's must sort out the highly unusual privacy breach of paper medical records falling out of the sky after the tornado struck Joplin on May 22, forging a three-quarter-mile-wide path of near total destruction estimated to be six miles long. At deadline, an estimated 132 people had died and 156 were missing, and HHS had declared the state a public health disaster area. In the midst of the storm, which blew out the hospital's windows and left some walls missing, St. John's clinicians and staffers evacuated 183 patients to hospitals nearby and in the region. Officials for the hospital are unsure if the remaining building is usable.

“It will be a challenge” to get St. John's rebuilt given what's happened to the hospital itself and the community, said Brian Haapala, managing director with consultancy Stroudwater Associates, Portland, Maine. “You have to commend the efforts of the leadership of the organization to restabilize,” Haapala said. And while it's hard to think about in the middle of a disaster, Mercy officials will have to start making decisions, he said.

Mercy Health and St. John's vowed to rebuild with an array of services. “It will definitely be an acute-care hospital,'' said Lynn Britton, president and CEO of Sisters of Mercy Health System. “It will be a wonderful opportunity to reimagine” how to provide healthcare in Joplin, he said.

As a part of that, Mercy and St. John's will have some hard questions to answer as they evaluate the marketplace and how the new hospital will look amid the looming Medicare requirements of reform. Which services should they provide? If the existing building is not salvageable, where should they build? How do they pay for the rebuilding effort?

Mercy's board was scheduled to meet last week to begin that process, which will be broad in scope, Britton said. “We absolutely have to get the community involved in that process,” he said. Financing the reconstruction will be a struggle, Britton said. Insurance will cover some of it but significant investments will be required, he said.

Healthcare strategy experts say the analysis should pay close attention to the community's needs if the hospital is to survive in the long term, looking at the strengths of St. John's and its local competitor, Freeman Health System, which operates a two-campus hospital with 318 beds in Joplin and a 25-bed critical access hospital in nearby Neosho, Mo.

As much as one-third of the town of roughly 48,000 residents was destroyed by the tornado, so demand for healthcare in Joplin may fall, depending on how many affected people remain in the community as it rebuilds. Hurricane Katrina resulted in a steep drop in demand in New Orleans. Staffed bed counts there fell to about 2,700 as of January from about 4,400 beds as of April 2005, according to the Louisiana Hospital Association.

“The jury's out on whether it will return to its previous status,” said Curt Whelan, managing director with Huron Consulting Group, Chicago. “You can't afford to be everything to everyone,” he said. That means taking a look at what services St. John's can provide while keeping itself financially afloat. Five years ago, their considerations would center on volume and growth, but that is no longer the case with the increasing emphasis on healthcare performance and reporting, such as through Medicare's value-based purchasing plans, Whelan said.

St. John's and its president, Gary Pulsipher, had already been working to turn the hospital around after acquiring it in November 2009 from Catholic Health Initiatives. Englewood, Colo.-based CHI recorded a loss of $71.7 million on St. John's in the year ended June 30, 2009, and a gain of $6.7 million the following year, according to CHI's latest annual report.

And Mercy also was able to produce an operating profit of $3 million in the year ended June 30, 2010, with St. John's adding $170 million in operating revenue and $167 million in expenses, according to Mercy Health's latest annual report.

But for now, most of St. John's patient volume is likely to go to the competition, Freeman Health, Whelan said. Along with other nearby hospitals, Freeman was generous with its support of St. John's in the aftermath of the storm, Britton said. “We may be friendly competitors on some levels,” but when something like this happens, that gets put on hold, he said. At some point, though, that competitiveness is going to return, with Freeman holding the upper hand for a while. In order to stay partially operational, St. John's planned to open a 60-bed mobile hospital—with electronic health records—over the weekend offering emergency care, surgery, imaging, laboratory services and inpatient care.

The Joplin market has shown to be a tough one for both hospitals. While St. John's was losing money for CHI, Freeman's hospital in Joplin also reported mixed financial performance in recent years. Unaudited financial statements for its fiscal year ended March 30 showed an operating loss of $7.3 million, though nonoperating income—mainly investment income—was strong enough to produce net income of $2.4 million. In the previous year, the hospital recorded operating income of $2.2 million and net income of $20.1 million, according to the financial statements. Damageto Freeman facilities included the destruction of its Ozark Center for Autism, part of Ozark Center, a behavioral health operation, according to its website. A Freeman spokeswoman said executives there were too busy dealing with the storm to comment for this story.

At St. John's, engineers last week began evaluating whether the hospital building could be salvaged. At least 20 of its employees' homes were destroyed, and 40 had significant damage to theirs, Britton said. Employees will continue to be paid, he said, and efforts are under way to get them placed at least temporarily with facilities accepting patients as a result of the storm. Britton said Mercy appreciated the outpouring of support it has received from the healthcare industry.

The hospital was evacuated in about 90 minutes under trying circumstances, including the loss of power and a building with exposure to winds that exceeded 200 mph. “I couldn't be more proud of the doctors and nurses in the hospital that night,” Britton said. “They were very brave and very courageous.”

The state's disaster preparedness plan was implemented quickly and without hitches, according to Leslie Porth, vice president of health planning for the Missouri Hospital Association, which acts as the state's liaison in coordinating the plan. Ten to 12 hospitals in Missouri accepted patients from Joplin, as did hospitals in nearby Arkansas, Kansas and Oklahoma, she said. “It has gone extremely well,” Porth said. “We had been undergoing extensive emergency preparedness planning,” she said.

Two-hospital CoxHealth, Springfield, Mo., was among those that helped. Officials for CoxHealth said it sent five ambulances, three doctors, six emergency room nurses and five ER technicians. “Off the top of my head I can't think of a department that wasn't affected by the disaster and our response to it,” said Dr. John Duff, CoxHealth senior vice president and administrator of Cox Hospitals.

The country's disaster preparedness, meanwhile, is threatened by cuts to HHS' hospital preparedness program. The agency reduced funding by 11%, or $42 million, for fiscal 2011, which ends Sept. 30, and funding has been cut every year since it began in 2006, said Roslyne Schulman, director of policy development for the AHA. “I think we're getting away from the fat and into the meat of the program at this point,” she said. The association is working to prevent further cuts when the law that created the program comes up for reauthorization this year, Schulman said.

The growing use of social media allowed St. John's and Mercy to spread the word to the public and employees about what was happening. Social media has “been huge,” said Jeffrey Slatton, a spokesman for Mercy. “It's been a big source of communication. There were times when I couldn't get e-mail and text but I could get Facebook,” he said from Mercy's command center in Joplin.

Mercy and St. John's sent out Twitter messages with a phone number that employees were asked to call so they could give their status and whereabouts. That message was re-sent by other Twitter users who picked up on the Mercy tweet. Facebook served as a bulletin board for searching for employees and other matters.

Eventually, social media could become an effective means to deal with a disaster about to occur, said Eric Swirsky, clinical assistant professor and assistant director for academic practice in biomedical and health information sciences at the University of Illinois at Chicago. Penetration of Twitter and Facebook, both of which can send messages to mobile phones, is too low among older adults to be an effective means of communication now, he said, but that is likely to change. “It's just a matter of time before people get used to using technology that way,” Swirsky said.

One message St. John's tweeted was an assurance that the hospital's EHR system was intact and that “all patient records will be available once we get doctors set up.” The message came amid reports that paper medical records were found strewn around the area.

The tornado-driven release of the records is unlikely to cause a legal problem for the hospital, attorneys said. “I doubt there's any liability they would be facing,” assuming that the records were kept in a reasonably secure place when the tornado hit, said James Pyles, principal with the law firm Powers Pyles Sutter & Verville, Washington. Slatton said Mercy already had scanned electronic backups of the paper records that had been lost in the storm.

In a statement, Mercy asked anyone who had medical records that were lost in the tornado to determine if the record can be linked to a specific person, and if so return it to the Mercy/St. John's command center in person or by mail. If it can't be linked, Mercy asked that the finder “destroy the record by shredding, cutting into small pieces and disposing of the pieces, or burning.”