6 ways PSJH is organizing for the future

September 10, 2018 Rod Hochman

At Providence St. Joseph Health, we are making a significant pivot, shifting from health care to health.  It’s a journey we call Health 2.0. We’ll continue to be here in times of sickness. But we are also committed to being a partner in health. 

Our vision – health for a better world – is driven by a fundamental belief that health is a human right.  We believe everyone deserves a chance to lead the healthiest life possible, especially those who are among the most poor and vulnerable in our society. That’s why we’re continuously innovating to create access for all and foster healthier communities.  

Nine months into the year, we are making solid progress toward this commitment.  So far in 2018, we have already served six percent more people than we did the previous year. And we’re delivering care in the most appropriate settings – as evidenced by a nine percent growth in our ambulatory services this year.  In addition, we’re serving more individuals covered by Medicaid while also reducing the cost of caring for this population, which tend to be among the most complex and at risk. 

We’ve accomplished all this at a time when health care is experiencing unprecedented disruption and turbulence, such as: 

  • New entrants, the likes of Amazon and CVS, getting into the health care space and disrupting the traditional model of care delivery
  • Advances in medical technology that are making it possible to do more procedures in the outpatient setting 
  • Consumer demand for more convenient, affordable and digitally enabled ways to access care 
  • The pressures of declining reimbursements and increasing regulatory burdens
  •  The rising cost of pharmaceuticals, supplies and labor 

With 51 hospitals and 11,906 licensed beds across our family of organizations, acute care is – and will continue to be – at the core of what we do. That’s why “strengthening the core” is the first pillar in our strategic plan. We’re committed to operating our hospitals exquisitely well, delivering the highest quality care as affordably as possible. 

Yet to sustain our Mission in today’s environment, we are called to operate in new and different ways. This includes re-organizing our structure, diversifying our revenue streams, strategically deploying capital, and modernizing the way we deliver administrative services. 

Here are six key ways we are organizing for the future:  

1.    Expanding our ambulatory network – With medical advances and consumer demand driving more care outside the hospital walls, we are investing in retail clinics, outpatient surgery centers, behavioral health clinics, urgent care centers and telehealth. We expect our ambulatory visits to grow from 2.5 million today to 5 million by 2022, helping ease the way for our patients and their families by offering more convenient and timely access to care.

2.    Forming a new population health management company – Having operated a health plan for 32 years covering more than 1 million lives, PSJH offers deep expertise and resources in population health management, including addressing the social determinants of health, better management of the Medicaid and Medicare populations, quality and affordability. We intend to share our knowledge and infrastructure as a service to other health systems, employers and payers. This new business is both a strategy for improving the health of more communities as well as for diversifying our revenue streams to offset declining reimbursements.

3.    Becoming a services and solutions provider – PSJH has been investing in digital innovation and IT solutions for some time. Today, we invest in 12 health IT companies and are incubating more than 20 innovative solutions. We also provision EMR and IT services to more than 50 independent hospitals and medical groups outside the PSJH family. Making these solutions available to other health providers is another key strategy for bringing in new revenue. At the same time, it will help usher health care into the digital age more rapidly by allowing us to share proven solutions across a broader scale. We also see tremendous opportunity to use the vast amount of data and clinical research we collect to mine more solutions that will improve health.

4.    Building out the continuum of care – To ensure our communities have access to the full spectrum of care, our new Home and Community Services division will focus on expanding our breadth of post-acute services, including home health, home infusion, hospice, skilled nursing and assisted living facilities, supportive housing, all-inclusive care for the elderly, and home medical equipment. 

5.    Unconventional partnerships – PSJH is one of seven health systems that recently banded together to launch a not-for-profit generic drug company to address the crisis of rising pharmaceutical costs and drug shortages. This is just one example of how we are collaborating in innovative ways beyond traditional mergers and acquisitions. We are also seeking partnerships with technology companies that offer needed expertise in areas such as cloud computing and artificial intelligence. 

6.    Modernizing administrative services – Despite rapid advances in medical technology and science, health care remains behind the times when it comes to administrative services. We are looking at the latest technology, processes and practices –inside and outside the health care industry – to ensure we are operating as efficiently as possible while reducing the overall cost of care for our communities and patients.

Even though we’ve made significant progress in a short amount of time, we recognize the need transform even more rapidly to outfly the strong headwinds coming toward us. I am grateful to everyone in our organization who is working diligently to accelerate this work. By staying ahead of the curve, we will continue to be here for our communities, especially the most vulnerable, for many decades to come, and we will do our part to make the U.S. a model for health around the world. As we move into the last quarter of the year, we expect to have more updates on this work. I look forward to keeping you informed of our progress.

About the Author

Rod Hochman

Rod Hochman is president and CEO of Providence St. Joseph Health, a national, Catholic, not-for-profit health system, comprising a diverse family of organizations serving Alaska, California, Montana, New Mexico, Oregon, Texas and Washington.

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