In January 2014, Dr. Ram Raju took on the herculean task of rejuvenating NYC Health & Hospitals, the largest municipally owned healthcare system in the nation, with 11 hospitals and 59 other locations. Modern Healthcare editor Merrill Goozner recently spoke with Raju about his plans for a system that faces a huge budget gap within four years because of a loss in federal funding. The following is an edited transcript.
Modern Healthcare: What's your biggest challenge today?
Dr. Ram Raju: It has to be remaining financially stable while delivering healthcare to the most vulnerable and competing with other healthcare systems in New York City. So the question becomes: How do we lead a large inpatient-focused system, with a large medical education and unionized environment, into the future of population health?
MH: What's the strategy?
Raju: There are multiple strategies. We completely changed the structure of the organization from an inpatient basis to a network model and from a hospital-centric model to a service-line model. We eliminated all the geographic vice presidents and created service-line directors for inpatient care, for ambulatory care, for post-acute care. We branded a new organization. We called ourselves NYC H&H, but visually we looked very different. So now we do not call ourselves by a hospital's name. It's not Bellevue Hospital. It's NYC Health & Hospitals/Bellevue. Bellevue is not just a brick-and-mortar structure. It extends into the communities it's part of. We also unified all the hospitals under one unified logo. We changed our tag line to create: Let New Yorkers live the healthiest lives possible. And the third thing we did: We started working on improving access. If you need a mental health appointment, you get one within seven days; a pediatric appointment within five days. If you want a primary-care appointment, it is down to 19 days from 65 days. How did we do that? We had physicians who worked 9 to 5. We said no. We extended outpatient hours into the evenings; we're open on Saturdays and Sundays. We're also expanding our clinics to be where we need to be.
MH: Have system employees responded well to the changes?
Raju: We identified about 400 midlevel and front-line people—visionaries—who really wanted to change the way we practice medicine in a public system. They included labor, community boards, advisory boards as well as patients. We all joined together. We redefined what a patient experience should look like in NYC H&H. Right now, our patient satisfaction scores are going up. By 2020, we want to be in the 90% percentile.
MH: That still leaves the financial problem. How will you address it?
Raju: This year we will close with $130 million cash on hand. Next year, we'll be OK. Our problem will be in 2020. Then we expect a $1.8 billion deficit largely driven by the fact that the (disproportionate-share payments) will stop coming in and New York state will move more people to managed care. We're not waiting until 2020 to fill the deficit. We're taking action now. We started with attrition. We've reduced our head count by 1,200 since last November. We didn't eliminate anybody's job. We are also putting in efficiencies. We centralized procurement. We also converted our treatment diagnostic centers into federally qualified health center look-alikes. That gives us an additional $25 million in reimbursement.
MH: How will you compete for people with private insurance when you're known primarily as the hospital for the poor?
Raju: I have a great advantage that not many healthcare leaders have: My healthcare delivery system reflects the community it serves. If you go to Lincoln Hospital, most of the employees are Hispanic and the patients are Hispanic. If you go to Coney Island, you will see that a lot of people working there are Russian immigrants, and the patients are Russian immigrants. We have a distinct advantage in that the workforce reflects the people we serve. We are trying to use culturally competent care as an essential part of our system. Speaking the language, understanding the background—I have every intention of using that to my advantage.
MH: Can you do that while maintaining your traditional mission of serving the poor?
Raju: There are still a half million people in New York City who are uninsured, and we disproportionately serve people who are uninsured compared to other hospitals. Who are these people? First, there are undocumented immigrants. Then there are people in such high-deductible plans that they can't use their insurance. They come into our system and get care even though they can't pay for it.
MH: The New York press seems to have a bull's-eye on your back.
Raju: New York has a couple of newspapers not very well disposed to city government, and I'm an extension of city government. So all my achievements will be underplayed and my deficiencies will be magnified 10 to 20 times. Some stories are not true; they just tell them. We always respond, but not all our responses make it into their news stories. For example, I implemented Epic (the electronic health record system). The New York Post wrote an article that we were in deep trouble and it would fail. We implemented it flawlessly. Then they found a resident who said something terrible happened in the ED. It was an anonymous source. We had no idea where it came from. There's no way to respond to that. We have to just bear it. I think we're doing a great job with limited resources. We turn no one away. We provide 40% of the inpatient mental health needs in New York City. I'm damn proud of what we've achieved. Is it perfect? No, things happen in our system. And we get more publicity than other systems. But that's part of doing business in New York City.
MH: How does the system have to change over the next decade?
Raju: We knew homelessness is a huge factor determining healthcare outcomes in New York City. So at Kings County Hospital, we downsized the beds and built a housing component within the facility. Then did the same thing with Metropolitan— supportive housing of 400 beds. We've got other supportive housing for people with mental illness in the Woodhull campus.
MH: What are your relationships with the other systems in New York City? Are you forming partnerships?
Raju: We are working with Northwell. We have common labs and that saves us $20 million a year. With Montefiore, we have common planning for what we need to do in the Bronx. We're academic partners with Mount Sinai (and) with NYU (Langone Medical Center). We are collaborating with all the big systems across the city. We will compete at one level, but collaborate at one level. That has been very, very fruitful for them. We are a major teaching facility for the medical schools. We take care of all the medical residents who get trained in NYC. They all go through our system.
