2013 a 'world of transformation'

Transplant surgeon and former Senate Majority Leader Bill Frist (R-Tenn.) sees a healthcare industry in flux, driven by the need to crack the “value equation” that ties cost control to outcomes. Frist signed on as co-director of a new fellowship program established by the Nashville Health Care Council to help council members' executives meet that challenge.

The council represents about 250 healthcare companies that call the city home, including HCA, the hospital chain founded by his father and brother, Dr. Thomas Frist Sr. and Dr. Thomas Frist Jr. The fellowship's sponsors are HCA, Community Health Systems, LifePoint Hospitals, Healthways, Vanderbilt University, and Blue Cross and Blue Shield of Tennessee.

This month, the council expects to select an inaugural class of 20 to 30 executives for eight daylong sessions in the spring.

Frist, who retired from the Senate in 2007, is a partner in Cressey and Co., a private equity firm focused on healthcare services and facilities, and he works on healthcare issues with the Bipartisan Policy Center, a think tank formed by four other former Senate majority leaders.

Modern Healthcare reporter Beth Kutscher, based in Nashville, talked with Frist about how the fellowship program will operate and the forces at work in the industry that he says created a need for it.

Beth Kutscher: Tell me a little bit about what led you to set up the fellowship program with the Nashville Health Care Council. What interested you about the project?

Bill Frist: After 20 years in medicine and then 12 years in the policy arena in the Senate, it was apparent to me that Nashville has all of the fundamental building blocks of being a premier healthcare—not just service, but total health—capital. The expertise that is in Nashville exists nowhere else in the United States of America. I say that after traveling to most all of the states, 44 countries, and being immersed at the highest level in writing policy in healthcare and then delivering healthcare one on one as a doctor.

This is where the gap is: to fill that void in having a formal program that would engage leaders in meaningful conversations and educate healthcare leaders of today and tomorrow on challenges and solutions, to foster leadership and prepare leadership for solving the problems that exist today, but for which we don't have solutions.

Kutscher: What are some of the challenges you see that are facing healthcare executives?

Frist: I think the world of 2013 is a world of health transformation created fundamentally by the cost of healthcare, which has skyrocketed in recent years to the point on a macro sense it's 18% of our GDP, and on a micro sense, the cost of healthcare is outstripping the typical person's ability to pay for it. So the biggest challenge is addressing cost. To do that effectively, healthcare companies, or the industry, have to focus on the value equation, which has cost as its denominator, but results in the numerator.

The biggest challenge to healthcare companies today is—in this environment of rapid change, of the call for transformation, of legislation like the Affordable Care Act or Obamacare being implemented—the goal is to maximize value in a way that patients and individuals benefit at the same time.

The second big challenge is, healthcare companies of the future are going to be … part of a more integrated delivery system, which demands collaboration and cooperation. In the past, we have relied on silos in healthcare delivery and silos in terms of healthcare companies, and the companies of tomorrow are going to have to focus more on seamless integration with other companies to achieve the goals surrounding quality and outcomes.

The third big challenge is the role of the consumer will be greatly magnified in the future. The role of the patient, the consumer, the individual who will be better educated and making demands, new demands on the system and insisting on transparency and accountability.

Kutscher: There's also an immersion component that asks executives to pull back the curtain and share with their competitors what goes on behind the scenes, maybe even proprietary information. Is that part of the goal of the fellowship, to have that sort of collaboration?

Frist: The immersion component, which is about a third of the course, will be deep and unprecedented. The ... very intimate interaction [will be both] with CEOs who will be sharing their toughest challenges to their own companies and to their own careers.

The second component of the immersion is to open up and break down barriers to encourage collaboration, and that might be with doctors and hospitals, it might be doctor inpatient with outpatient group, it might be home healthcare with hospitals, it might be academic health centers and community hospitals. But to break down barriers and the silos to ensure collaboration.

The third component of the immersion will be to engage the participants in activities that will be active and interactive. For example, looking at the new and important role in the future of personalized medicine, we will likely walk each participant through a immersion process of discussing the implications of privacy issues surrounding exchange of genetic information, going so far as even to take their own blood and submit it for DNA analysis to make it real and tangible, the sort of implications of having that information that may predict you're going to have heart disease 10 years later or Alzheimer's 20 years later—the tough issues that introduces into the healthcare system.

They'll go through appropriate genetic counseling, as part of this immersion course, to open up this world of how technology and genomics and the Internet and social media is so radically transforming healthcare today and how it will be very different tomorrow.

Kutscher: Do you expect to see more of that sort of collaboration among the for-profits working together going forward?

Frist: I think so. The world is going to demand it, and in this world of increased consolidation, which is being caused by the call for more seamless care and more efficient care and less waste, it will demand for-profit institutions both sharing information—whether it's health records or claims data—but also for-profits working with academic places. So one of the goals clearly will be much increased collaboration, greater transparency and more accountability as a part of doing business.

Kutscher: What are some of the other healthcare priorities that need to be addressed?

Frist: First and foremost will be the cost issue and how to maximize value, which means measuring outcomes and results.

No. 2, the biggest shift going on, and thus challenge to be addressed, is the shift of risk from government, from payers, and from business, over to consumers and to providers—the doctors and the hospitals.

That shift is a huge challenge, because providers—doctors especially, but doctors and hospitals—are not accustomed to managing risk. And the consumers are going to be greatly empowered with information, and that will increase all sorts of issues, like privacy issues and the like.

The third, which is a product of the Affordable Care Act, will be the access issues surrounding the newly insured, both in Medicaid, as well as through the state exchanges. Do we have enough primary-care physicians? If we have enough of primary-care physicians, will they be able to find a specialist? Is the workforce of nurses and physician assistants sufficient?