Since July, Charlie Shields has served as CEO of the two-hospital Truman Medical Centers in Kansas City, Mo., the area's safety net hospital system, succeeding longtime CEO John Bluford III. Truman suffered operating losses in 2013, with a -3.4% operating margin on operating revenue of $459.5 million, compared with a -1.5% margin the year before, according to Modern Healthcare's financial database. Shields previously served as chief operating officer of the system's TMC Lakewood hospital. Before that, he served as Republican leader of the Missouri state Senate. Modern Healthcare reporter Steven Ross Johnson recently spoke with Shields about his efforts to persuade his former GOP legislative colleagues to expand Medicaid and what would happen at Truman if they don't. This is an edited transcript.
Modern Healthcare: How will your experience as a lawmaker affect how you carry out your duties as a CEO of Truman?
Charlie Shields: In an organization like Truman, which is a true safety net hospital, the reality is that the vast majority of our payer sources are connected to government or public policy in one form or another. So there's a lot of interaction between us and the local government, state government and federal government. Understanding both worlds of how government budgets are made, how laws are made, and understanding the healthcare business puts me in a little bit of a unique position for an organization like Truman.
MH: Why do you favor Medicaid expansion under the Patient Protection and Affordable Care Act?
Shields: The Affordable Care Act takes a disorganized system of giving care through disproportionate-share payments to safety net hospitals and other charity-care providers and moves that into a more organized, rational system of expanding insurance coverage through the exchanges and Medicaid. Then the Supreme Court ruling came along that kept the DSH cuts but made Medicaid expansion optional for the states. That created the perfect storm. If you move the charity-care population into Medicaid, you would eventually see a lowering of your cost structure as people move from chaotic episodes of care into more organized care. Eventually, you would begin to bend the cost curve. That's one of the arguments you try to make to policymakers.
MH: How have your conversations gone with your former Republican legislative colleagues who have opposed Medicaid expansion?
Shields: I've been in their shoes and I know the dilemma they're in. The public perception of the ACA is still very negative. I think in their heart of hearts they know it's a rational decision to expand Medicaid, but they also know it's politically very risky because it's perceived that if you vote for Medicaid expansion you're endorsing the ACA. I try to help them work through that and create something that looks like a Missouri solution that works best for the people of the state.
MH: Does your role in the healthcare industry give you a different perspective on the ACA from your fellow GOP lawmakers?
Shields: Absolutely. If you work in this business, you see that uncompensated care tends to be very chaotic. People who lack primary care wait until they get to an acute-illness stage before they come to us. You see that every day in a safety net hospital and you realize that if people had access to coverage and primary care and all the things that come with Medicaid expansion, you wouldn't see so much expense on the back end with our patients and see them in very bad conditions. You'd actually begin to improve health outcomes. Serving in a hospital CEO role and visiting with patients and making rounds in the emergency department, that is a perspective you don't get as a lawmaker.
