Yale-New Haven (Conn.) Health System, a $4.2 billion system with more than 20,000 employees, has expanded into neighboring states in recent years. Yet it is under financial pressure like most academic medical centers. In an interview with Modern Healthcare reporter Dave Barkholz, CEO Marna Borgstrom, who took the top job in 2005, spoke about Yale's approach to value-based care, expansion and how medical training is changing. This is an edited transcript.
Modern Healthcare: What are your two or three top priorities for 2016?
Marna Borgstrom: We have one key strategy throughout the system and that is to provide unparalleled value to the patients and families we're privileged to serve. And there's a lot in that. The numerator of value is making sure that we really get patient safety, the clear definition of clinical quality and the patient experience right. The denominator is getting the cost/price point that people must pay for right. If we can really focus on the elements of what it takes … to provide great value in healthcare, we will be able to be successful whether we continue to move forward under some sort of modified fee-for-service bundle or ultimately move to some total cost-of-care payment methodology.
MH: Academic medical centers tend to be expensive. How do you make sure that you are providing that value for patients?
Borgstrom: Academic medical centers have to be great community hospitals. A large part of what any of us do is provided to patients in a fairly regional geography. We also need to build out and link innovative research to innovative patient care. We need to build out elements of key service lines that are going to continue to distinguish us as an extraordinary sick-care system as well as a healthcare system. There's a lot of additional cost in doing that. It's very difficult to quantify the cost of training people in graduate medical education. It's the cost of running some of the region's only available tertiary and quaternary- care services that are there on a 24/7 basis. There isn't a recognition of those costs being embedded in the overall cost of an academic medical center.
MH: Have you built out your delivery network to the extent that you would like?
Borgstrom: We're building out a regional delivery network that has a reach into New York state, southern Massachusetts and western Rhode Island. It isn't one size fits all. In some cases, we have done that with hospitals and physician practices that are corporately part of the Yale-New Haven Health System. In more than a handful of other cases we have done clinical affiliations with hospitals and community physicians in geographies throughout the state to make sure that we have broader access points and that we can bring some of the academic medical center services more effectively into those communities.
And in the case of each of the geographies where we have an owned-system hospital, we have an expectation that each of those local delivery networks is working to build out—either through ownership, partnership, contract—a full system of care so that we can focus on primary and preventive and ambulatory care through either owning or having special relationships with long-term-care providers.
MH: Is reimbursement for academic medical centers getting better or worse?
Borgstrom: We don't seem willing to really sit down and say, “How many people are we going to be insuring? How much money is it going to cost to provide them care the way it's provided now? If we can't afford that, how do we want that care model to change and what do we do to stimulate that?”
Instead, it just seems to be, let's push patients into observation, let's consider taking down part of the 340B drug discount program, which is essential to most academic medical centers. It feels like some death by many different cuts without really stepping back and looking at the hard and very big policy issues.