Ascension, the nation's largest Catholic healthcare system with 125 hospitals, 7,000 employed physicians and multiple health-related enterprises, has in recent years taken a number of steps to reduce the financial burden for low-income people when they access the healthcare system. Modern Healthcare editor Merrill Goozner recently asked CEO Anthony Tersigni about some of those moves and other major issues affecting the sprawling system's operations. This is an edited transcript.
Modern Healthcare: You recently initiated a program to waive deductibles for people who earn less than 250% of poverty. What's behind that decision?
Anthony Tersigni: Our mission is to care for all. But we pay special attention to the poor and vulnerable. We were also advocates for the Affordable Care Act because we believe in 100% coverage, 100% insurance for every man, woman, child in this country. Having said that, what we saw in our experience with the Affordable Care Act is the uninsured were getting insurance with high deductibles and copays. We saw patients presenting themselves who had significant deductibles that we knew they could never pay. So we had to make a decision as an organization. We decided that we needed to figure out a way to lessen the burden on those, especially the very poor, that we are caring for. So our financial officers got together and we actually refined the policy that we had from years ago.
MH: People in high-deductible plans have pushed the issue of the high prices hospital charge to the forefront. How do you respond when people say all this merger and acquisition activity by the big hospital systems is raising prices?
Tersigni: We continue to be on a mission to provide the highest quality care at the most affordable cost in every market that we're in, and we're on that journey. It's called the One Ascension Journey. So, we continuously look at ourselves and recognize that this is a consumer-oriented industry. As we move into the future, we're going to have to be very sensitive to the retail market in healthcare. Our hope is that by providing the highest quality, lowest cost care with great outcomes, we will be relevant in every market.
MH: Is price transparency something that you will put into this program as well so that people know what they're going to have to pay upfront?
Tersigni: Yes. As a matter of fact, through our Leadership Academy we have a pilot coming out in the fall of this year on price transparency. We are piloted in one market (where we) share the information on a retail basis with our consumers. We hope to really learn from that in terms of what we can do in every market; how transparent we can be in every market; and does that help the consumer make a better choice.
MH: One of the big issues on the table today is high drug prices. What are you doing about that?
Tersigni: We continue to look at how we can leverage and influence the pharmaceutical industry in terms of looking at a different model. Our perspective is perhaps it's time for a different model in terms of how we pay for research and development and how we pay for drugs in this country. So we're looking at other parts of the world and what they're doing relative to reference pricing. We don't know whether that will be an answer for the U.S. But it's clearly one approach that we need to look at because the cost for drugs is unsustainable for the people who we're privileged to serve.
MH: We're in the middle of a presidential campaign here where the Affordable Care Act is going to come under attack politically. What do you think the next administration, whatever political party it is, needs to do with regard to expanding coverage and making care delivery more affordable with higher quality?
Tersigni: Ascension was a supporter and continues to be a supporter of the Affordable Care Act. Having said that, we know the ACA is not perfect. We know that from experience. Medicare in 1965 wasn't perfect. Eleven pieces of legislation later you've got over 80% approval ratings by the beneficiaries. We believe that's what is going to be necessary for the Affordable Care Act. We believe that whoever becomes the new president is going to want to revise aspects of it. Our hope is that we continue to fight for 100% access, 100% coverage for every man, woman and child in this country. We believe that we need a healthcare policy in this country. We don't have one. We have a healthcare financing policy. What we've cobbled together over the last 70 years is a financing mechanism. The Affordable Care Act, quite honestly, was really meant to be a reformation of insurance companies. So, we still don't have a healthcare policy in this country. Let me give you an example. Our current system depends on who you are as an American. If you're under 65, you're in a model that's very similar to a Germany or Japan where the employers and the employees share in the premiums, the insurance company pays all the bills, and the patients pay either a copay, deductible or percentage of the bill. If you're over 65, you're in a model like Canada where the government is the insurer, you have very low administrative costs, and the doctors are private and the hospitals are private. If you're a Native American or a veteran, you're in a system very similar to Britain where the government owns the hospitals, employs all the doctors, and nobody gets a bill. And lastly, if you're uninsured, you're in a model that's very similar to rural India or Cambodia. If you have money, you can get care, and if you don't, you're going to stay sick, injured or die. We have to change that as a society, and the Affordable Care Act is beginning to put healthcare on the front burner for the first time in my professional life. I think it is very good, very healthy to have those conversations.
MH: So if you were able to advise the next administration about what it ought to do beyond the Affordable Care Act, what would you recommend?
Tersigni: We'd like to ask whoever ends up in the White House to create a position that has the ability to do pilot projects that connect healthcare with other governmental agencies. Oftentimes in healthcare, we providers are the recipient of somebody who presents with their health deteriorated, not because of healthcare, but because they lack housing, lack food, employment, and so on. We believe there's an opportunity for us to move upstream in terms of caring for people's health if we can collaborate and have a panel of folks from different governmental agencies (to sit down) with the private providers and begin looking at what are the causes of ill health. We know what the determinants are, and they're not always part of the healthcare industry.
MH: People, when they use the healthcare system, are getting hit with multiple bills from multiple directions. It's very confusing and hard to understand. What are you doing to fix that?
Tersigni: There are a whole host of reasons why one system can't fix those problems. Some of them are regulatory in nature, and some of them have to do with laws. What we've been doing is looking at what are some of those laws that may have been relevant 25 years ago but are no longer relevant today as we try to transform healthcare in this country. From an advocacy perspective, we are providing our input to governmental agencies, Congress and the White House in terms of some of the things that we believe are barriers for us to transform healthcare in this country.
MH: What specific laws are you referring to?
Tersigni: The Stark law, for example. We have a huge physician organization, and there are certain things we can do with those physicians, certain things we can't do based on laws that we believe are out-of-date in terms of us trying to get higher quality, better outcomes and lower cost. So we're going to continue to advocate for taking a look at those laws to see if they're as relevant today as they were 20 or 25 years ago.
MH: A lot of procedures that used to take place inside the hospital are moving into ambulatory settings. Are you moving in that direction yourself and are there regulatory or legal roadblocks to moving to lower-cost sites for care?
Tersigni: We are moving in that direction because we're looking at the life cycle of the people we're privileged to serve. Fifty percent of our revenue at Ascension comes from other than inpatient care. And so we continue to look at those ambulatory sites and those different sites of care because we believe that there are better sites, lower-cost sites, where people should be able to have care. That means we need to have partnerships. And some of the laws prevent us from having partnerships, either with the physicians or with other competitors in the marketplace. Those are the kinds of things that we want to look at to see how we can, in fact, raise quality and lower cost.
MH: A final question. HHS came out with a rule that said that there can be no discrimination against transgender people. Catholic health systems have their own directives on issues like this. How is this going to impact Ascension and other Catholic health systems?
Tersigni: Our own theologians and our ethicists are working diligently for us to come up with a policy for Ascension, knowing full well that the backdrop is there are certain procedures relative to the ethical and religious directives that we as a Catholic ministry can't provide. But we are committed to taking care of all people, with special attention to anyone in need.