Keck Medicine CEO Jackiewicz talks about his expansion strategy

Since 2012, Thomas Jackiewicz has served as senior vice president and CEO of Keck Medicine of USC, an academic health system in Los Angeles that reported $1.24 billion in revenue in its fiscal 2014. The Keck system, part of the University of Southern California and formerly owned by Tenet Healthcare Corp., includes the USC Norris Comprehensive Cancer Center, USC Care Medical Group, the two-hospital Keck Medical Center of USC, USC Verdugo Hills Hospital, and outpatient facilities and other clinical practices and joint ventures throughout Los Angeles and Orange counties. He previously served as CEO of UC San Diego Health System and chief operating officer at Columbia University Medical Center in New York City. Modern Healthcare reporter Bob Herman recently spoke with him about how his system is competing with UCLA, its expansion strategy, and his thoughts on USC's exclusion from Anthem's Vivity health plan. This is an edited transcript.

Modern Healthcare: What drew you to Keck Medicine?

Thomas Jackiewicz: I realized we had an opportunity to create an academic medical center for the future because we were starting from scratch. We recruited folks who were very focused on where healthcare was going and not where it had been. I thought this was going to be an amazing opportunity in the second-largest market in America.

MH: How do you gain a competitive edge in Los Angeles?

Jackiewicz: USC is big here in Los Angeles in the number of alumni we have. Our name recognition is big and broad. We've got a lot of momentum. Over the past 2½ years, we've doubled in size. The opportunities in L.A. are tremendous because the market is so large. Both USC and UCLA can be successful without ever taking a patient away from the other organization.

Because of L.A.'s size and traffic, there are going to be natural flows for where patients want to go, and we want to make it very convenient. One part of our strategy is bringing our healthcare closer to where people live, with our satellites, partnerships, affiliations and potential acquisitions.

MH: Why did USC buy Verdugo Hills Hospital, the system's first community hospital, in 2013?

Jackiewicz: It was about 12 miles away from USC, and it was an area where we felt we could make a difference in what we could bring to the community. But Verdugo Hills had things that we didn't have as well. It had a very low cost structure. It had an emergency room, which we don't have at Keck Medicine. We wanted easier access for some of our patients. The last part is that we have a very large obstetrics program, but we don't actually deliver babies here at Keck Hospital and they do at Verdugo Hills Hospital. So it was a nice strategic alignment for us.

It's gone exactly as we expected. We've increased the volume in the emergency room. We're looking at developing more programs here like orthopedics and our stroke program, and bringing those out to the community.

If one of our patients calls, we can direct them to our emergency room in the middle of the night to make sure there's good continuity of care. We have Cerner as our electronic health-records system, and we implemented it at Verdugo Hills as well. So if you have a medical record with USC and Keck, if you present at any one of our sites, they could have all of your medical records.

MH: How long has USC been on the Cerner EHR system?

Jackiewicz: We have been on Cerner at Keck now for a year and a half, and we've been on at Verdugo for about four months. Those implementations change your culture because you have to reinvent your processes to make sure that you take advantage of everything an EHR offers. It is a transformative moment for any health system, because you examine your systems and practices, you develop new best practices, and you have the ability to improve patient care and become a center for the most innovative therapies.

MH: Do you see hospital acquisitions in the future for USC?

Jackiewicz: With stand-alone, not-for-profit hospitals, it is a process because you have to work very closely with the board. There are opportunities on the near horizon that could have a tremendous impact on both those hospitals, as well as USC. If they're in the right location, have the right services and the right sort of alignment with us, it makes perfect sense. But they don't always have to be acquired. We can partner, and we can affiliate. You've got to look at every way to build your network, and partnerships and affiliations can be just as effective as acquisitions.

MH: Are you considering any kind of bigger system alliances?

Jackiewicz: We're talking with a large for-profit hospital chain about expanding relationships in Palmdale and potentially in Bakersfield and Las Vegas about where we can leverage the local resources. We don't want to compete locally. We want to add value locally because any lasting relationship has got to be a win-win. So we go in and we look at the local physician groups and the local hospitals, and see if we can work out a relationship that makes sense for all of us, with the idea that we provide the high-end specialty care and partner with the local providers to make everybody successful.

MH: What was the reasoning behind USC agreeing last fall to develop a network of ambulatory surgery centers in the L.A. area with a for-profit chain called Surgical Care Affiliates?

Jackiewicz: We wanted a broader network, and patients want to get ambulatory surgery closer to home. We also realized that to run ambulatory surgery centers well is a very specific skill set. SCA is a high-quality, very efficient service. We've got to make sure we are working with somebody who's going to be cost-effective. We can bring our doctors, which can add a lot of value to those centers and it's the perfect combination. That partnership has worked out very well. We've got a center in Glendale that we just closed on, and we've got a couple of others lined up that will close in the first part of this year. I think we can do anywhere between five and 12 of these over the next few years. USC has a 51% interest.

MH: Do you still think it's not a big deal that USC was excluded from the new health plan called Vivity that Anthem Blue Cross and Blue Shield created last summer with seven Los Angeles-area hospitals and health systems?

Jackiewicz: I think Vivity is a very good first step. USC will have other opportunities to participate in networks like this and we will do that. One of the things that's going to be important is how you coordinate care and exchange clinical data. For Vivity to take off, they'll have to address how to exchange clinical data, and how to really integrate care for the patient. Patients want to make sure the doctors are talking to each other. The potential for Vivity is tremendous if all the physicians come together across all of the health systems that are involved. If they do not, it will be an opportunity lost. I thought it was interesting that they talked about using Vivity to compete with Kaiser Permanente, because the one thing Kaiser does very well is integrate care.