Landmark services still in jeopardy as sale nears

FULL ROOM: The emergency room at Landmark Medical Center in Woonsocket. The emergency room saw more than 40,000 visits in 2012, the fourth highest in Rhode Island. / PBN PHOTO/BRIAN MCDONALD
FULL ROOM: The emergency room at Landmark Medical Center in Woonsocket. The emergency room saw more than 40,000 visits in 2012, the fourth highest in Rhode Island. / PBN PHOTO/BRIAN MCDONALD

After more than five years in receivership and more than $4.1 million spent to support the efforts of Special Master Jonathan N. Savage to keep Landmark Medical Center financially afloat, state regulators are scheduled to reach a decision on Oct. 28 on the bid by Prime Healthcare Services of Ontario, Calif., to buy the struggling hospital.
Whatever state regulators decide, following the 120-day review process mandated by the state’s Hospital Conversion Act, the future of the Woonsocket community hospital will still be uncertain, despite the confident tone taken by Dr. Prem Reddy, chairman, president and CEO of Prime Healthcare Services, at a July 9 public hearing.
Reddy offered the first detailed public overview of his for-profit hospital network’s plans for Landmark at a public hearing by the Health Services Council of the R.I. Department of Health.
Prime Healthcare’s motto is “saving hospitals, saving jobs, saving lives,” and the job of rescuing financially troubled, acute-care community hospitals is his passion, Reddy told the council. “I don’t travel. I don’t go on vacation. I don’t play golf,” he said.
Nonetheless, maternity services at the acute-care hospital may be forced to close due to lack of patient volume. The high use of Landmark’s emergency room, with more than 40,000 visits in 2012, the fourth highest in Rhode Island, promises to come under increasing scrutiny as part of health care reform, with questions about whether payments spent on ER visits would be better invested in more cost-effective delivery of primary-care and behavioral-health services.
The critical challenge, according to Lt. Gov. Elizabeth H. Roberts, isn’t whether Prime Healthcare is the successful bidder for Landmark. Rather, she said, it’s whether the new owners will promote a system in which the care delivered is based on value over volume, with improved health outcomes for Woonsocket residents – where three-quarters of the payer mix receives Medicaid or Medicare health benefits. Reddy told the council members that the strategy was to make investments in health IT, replace major imagining equipment, reduce the length of stay for patients, and, as a direct result of the improved quality of care, increase the number of patients in the Woonsocket primary-service area.
An increase in imaging services translates to higher billing rates – and higher revenue. The viability of maintaining maternity services at Landmark has been challenged by the 2011 decision of Thundermist Health Center, a community health center, to affiliate with Women & Infants Hospital in Providence.
In 2012, about 175 Thundermist patients gave birth at Women & Infants, according to Chuck Jones, president and CEO of Thundermist. “The relationship with Women & Infants has worked out extremely well,” he told Providence Business News in late 2012. Last year, 14 patients transferred out Thundermist because they wanted to give birth at Landmark, according to Jones, compared to 68 patients during 2011 that had transferred out of Thundermist because they wanted to give birth at Women & Infants.
The move by Thundermist has dropped demand for birthing facilities at Landmark roughly in half.
Reddy told the council that he was prepared to “beg” Jones to reconsider his current arrangement with Women & Infants Hospital when he met Jones on July 10.
Jones, who described the meeting as congenial and nonadversarial, told Providence Business News that he and Reddy had talked about areas of potential collaboration. “We didn’t walk out with any plans for future meetings or discussions.”
Reddy’s aggressive fee-for-service business model contrasts with other Rhode Island hospital networks’ shift to a patient-centric business model, with bundled and global payments under health care reform, according to Jones. “In the fee-for-service versus Accountable Care Organization (ACO) [debate], what Prime told me is that they don’t think the ACO model is mature enough yet to put much time, effort and investment into it,” Jones said.
At the July hearing, Health Services Council Chair Victoria Almeida requested more demographic details about the 40,000 patients who are seen each year by the Landmark emergency department, wondering if they were being seen because they did not have access to primary care, and what the ages were.
Jones said that the high utilization of Landmark’s emergency room is often misdirected, particularly with complex issues such as behavioral health and substance, citing the case of a high-utilization Medicaid patient who had been seen 74 times at Landmark’s emergency room in 2012. “The emergency room visits were doing him no good at all, other than sobering him up,” Jones said.
Thundermist, through its patient-care team, including a social worker and a primary-care physician, working with the family, was able to intervene successfully and create a better, lower-cost outcome.
Ted Almon, president and CEO of Claflin Co., said that if the deal to buy Landmark did not go through, Landmark would need to redefine itself. “I believe they will have to reinvent themselves as a center of community health, not merely exist as facilities to provide acute services,” he said, partnering with a local hospital network to better utilize inpatient capacity as well as partnering with Thundermist to expand community health beyond the Medicaid population.
Landmark, he continued, “should be re-purposed, not eliminated.” •

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