Published in the August 2009 issue of Today’s Hospitalist
AS COMMUNITY HOSPITALS across the country fight for their financial lives, more than a few are taking a hard look at their pediatric beds. Faced with an aging population and declining reimbursements from Medicaid “the default payer for many children ” many of these hospitals are wondering whether it makes financial sense for them to maintain pediatric bed capacity.
While this line of thinking has produced much handwringing in the pediatric community, financial concerns are pushing hospitals in many communities to launch “or expand “pediatric hospitalist programs. A good example is the new service that opened last month at University Medical Center in Princeton, N.J.
The program, which offers 24/7 coverage, is the latest community partnership established by Children’s Hospital of Philadelphia (CHOP), the academic powerhouse 35 miles to the south. CHOP is staffing the Princeton program with its own employed hospitalists. It also began covering a neonatology unit there last month, backing up the physicians on both services with CHOP training for nurses and respiratory therapists.
It’s the fifth program that CHOP has launched in community hospitals within a 60-mile radius of the main hospital. The goal in setting up such programs, says Mark Joffe, MD, CHOP’s director of community pediatric medicine, is to make each of them, including Princeton, “a regionalized pediatric center.”
A quick survey of locales around the country reveals that Princeton is far from alone “and that it’s not just children’s hospitals that are getting into the act. A number of communities are finding ways to stabilize or extend their pediatric inpatient services, thanks to a variety of business models, from hospitalist management companies to local hospitalist groups.
Buoyed by what they say is a growing demand for hospitalist programs, these organizations are bullish on the potential growth of the market for inpatient pediatric services. Here’s a look at what these organizations are doing to provide hospital-based community care.
The hub-and-spoke model
The new hospitalist program and the neonatology unit at University Medical Center are just the latest expansion of CHOP’s pediatric services in Princeton, an affluent community.
For years, CHOP has maintained a pediatric subspecialty center there, integrating its subspecialists into the local community of pediatricians, many of whom trained at CHOP. Those well-established connections are coming in handy now that local pediatricians have decided for the first time to turn inpatients over to pediatric hospitalists at the Princeton hospital.
“The hub-and-spoke model applies to a multitude of different services, not just inpatient care,” Dr. Joffe says, referring to CHOP’s model of suburban-hospital partnerships. While he won’t disclose financial details of the CHOP-Princeton venture, he says that “both sides are putting in money and are invested in the program. It’s a real partnership, not just a ‘buy-the-doctors’ arrangement.”
Dr. Joffe also points out that “the movement along those spokes is in both directions, so patients from the community who need tertiary pediatric care come to CHOP and patients from CHOP get transferred to the community. It’s not a strategy that works in isolation.”
The Princeton hospital gets the cachet of CHOP’s brand and a critical mass of quality pediatric services, including five newly-hired hospitalists. Those services in turn should continue to grow the hospital’s pediatric census and the number of pediatric consultations.
That’s all part of CHOP’s strategy to create regionalized pediatric centers throughout what Dr. Joffe calls its “catchment area.” Building a strong pediatric satellite center obviates the need for other nearby suburban facilities to maintain pediatric capacity.
“If we’re doing well,” says Dr. Joffe, “more and more general pediatricians will admit to our program.”
Seattle Children’s Hospital similarly operates a hub-and-spoke model, but over a much wider area and with several twists. While the academic center employs the pediatric hospitalists who cover two community hospitals within the Seattle metropolitan area, it uses a different model to support more outlying pediatric hospitalist programs.
Seattle Children’s regional services consist of 25 different sites in four states: Washington, Alaska, Montana and parts of Idaho. Most of those sites, says Sandy Melzer, MD, the hospital’s senior vice president for strategic planning and business development, are outpatient specialty clinic sites, some of which utilize telemedicine consults. A few of those sites offer pediatric hospitalist programs.
When it comes to more far-flung areas, Seattle Children’s maintains a relationship with several pediatric hospitalist groups, including a site in central Washington state. But that relationship, Dr. Melzer explains, consists of support and affiliation, not employment.
“We train community hospitalists in areas like airway management and central line placement,” he says, “so they come to our institution, which is an opportunity for them to get to know us better and increase their skills.” In addition to training, the relationship with outlying pediatric hospitalists entails “collaboration and working together to improve quality, in part by sharing our policies and procedures.”
Community hospitals have to struggle not only with the economics of pediatric coverage, Dr. Melzer points out, but with retention. For hospitalists in more rural areas “who can, he says, get “isolated very quickly” “the links with Seattle Children’s mean collegiality and make their community-hospital tenure more sustainable.
The upside of that relationship for Seattle Children’s is referrals. “Actually, less than half of our patients come from Seattle, so our relationships with community hospitals are an important dynamic,” Dr. Melzer explains. “But these relationships are also important to maintain Children’s’ role as a regional resource.”
According to Dr. Melzer, one reason that Seattle Children’s doesn’t send its own hospitalists to work in far-flung communities is that community hospitals often do a better job of recruiting their own physicians.
“Community hospitals are very interested in having us provide services locally,” he says. “But those hospitals are actually better recruiters for their local communities than we are. They can figure out who’s going to fit there well.”
The 11-physician IPC pediatric practice group in Phoenix takes a different approach to boosting community coverage. The group covers eight facilities throughout the greater metropolitan area, including three tertiary children’s centers, three community hospitals associated with those tertiary centers, and a sub-acute and a skilled nursing facility.
The result is county-wide inpatient pediatric coverage in the country’s second-fastest growing city. The area’s population explosion and resulting urban sprawl made it virtually impossible for outpatient pediatricians to continue to follow young inpatients, creating a major opportunity for the IPC group, which was launched in 2001. The group covers the pediatric beds in all the facilities as well as newborn care in some.
The IPC group provides that regional coverage, all without subsidies from the facilities where they work, says Robert MacLeod, DO, the practice leader. “We’re not financially tied to any hospital and bill strictly off patient visits,” Dr. MacLeod says. The group relies on referrals from pediatricians and health plans.
While the group does provide 24/7 service at those facilities, Dr. MacLeod points out that the coverage is not always on-site, with physicians sometimes traveling from the main tertiary hospital to the other two tertiary facilities, which are less than 10 miles away. If needed, the group has back-up from ED physicians and residents.
And while each of the group’s physicians is based primarily at one hospital, they all have privileges at all of the facilities where IPC provides pediatric coverage.
“We can flex from one facility to the next,” says Dr. MacLeod, adding that the group also triages patients from one hospital to another, depending on acuity. While moving among different hospitals’ computer systems can sometimes be a challenge, the physicians take that in stride.
The ability to practice in many hospitals also makes it possible for the group to deal with another major challenge in pediatric inpatient medicine: seasonal census variations.
“We see ourselves as similar to schoolteachers, so we’re really busy during the school year,” says Dr. MacLeod. “Our bonuses and incentives are a little more lucrative in the winter months, and summers are when we can take time off.”
A suite of services
Being situated in the same “catchment area” as CHOP and several other Philadelphia health care systems is not really a problem, according to Joseph DelGiorno, MD, medical director of Virtua Inpatient Pediatrics. (The group is an affiliate of Advocare LLC, a private primary care practice.) The hospitalist group, which now has 21 FTEs, provides 24/7 pediatric coverage at two Virtua Health community hospital sites.
“There is enough pediatric business to go around,” Dr. DelGiorno says. His group routinely transfers high-acuity children “who need complex surgeries, for instance, or oncology care “to other large pediatric centers in the area.
But the Virtua pediatric hospitalists treat a wide range of diseases and severity. That’s because in addition to staffing the pediatric floors, the group maintains a pediatric emergency department in both hospitals and a pediatric ICU in one hospital.
Like CHOP’s Dr. Joffe, Dr. DelGiorno reports that local pediatricians are now looking to larger community hospitals to replace them with pediatric hospitalists. Virtua Health, with four hospitals in Southern New Jersey, is in fact expanding its pediatric coverage.
“Virtua is building a state-of-the-art facility about five miles from its current Voorhees location,” says Dr. DelGiorno. “Our bed capacity will increase, and all beds in the new facility will be convertible to ICU beds if needed.”
Pushing the specialty
Offering “a palette of hospital-based pediatric services” is also the centerpiece of the business model for Children’s HealthCare Network (CHN). The private management company, which was founded 12 years ago and is based in Las Vegas, currently staffs 11 sites in California, Nevada, Montana and Louisiana. While some sites are tertiary hospitals “including Las Vegas’ Sunrise Children’s Hospital “most are community facilities.
“The more services we can provide, the lower the cost will be to that hospital,” says CEO and founder James Swift, MD. While the company will consider providing any level of pediatric inpatient coverage ” depending on what a hospital is willing to subsidize ” the preferred model includes CHN physicians taking over newborn babies; pediatric beds; pediatric emergency consultations; sedation services; and neonatal and pediatric ICUs, if those are onsite.
Dr. Swift points out that he’s interested not only in generating as many revenue streams as possible, but in “crossing different specialty lines.”
“We’re advocating for hospitalists to be in all of these care areas instead of looking at it from a very sterile view that, ‘We’re going to be one thing: hospitalists on a pediatric floor,’ ” he says. “We’re trying to define pediatric hospitalists as the jack-of-all trades until a patient can be put in the right environment.”
While some CHN sites have board-certified pediatric intensivists or emergency physicians, most feature hospitalists switching among several service areas. That not only maximizes revenue, but creates better regional pediatric care.
As an example, Dr. Swift says, his group now provides a suite of pediatric services in St. Vincent’s Hospital in Billings, Mont., allowing many children to stay in the state rather than being transferred out.
Physicians’ filling several inpatient roles is also critical because training programs are simply not turning out the number of neonatologists and pediatric intensivists and emergency physicians that is needed.
That’s particularly true, given what Dr. Swift says is the accelerating number of community hospitals that are now scrambling for pediatric hospitalist coverage.
His group, he adds, is considering branching out into the Midwest and Northeast while expanding its number of sites in existing areas. While smaller community hospital systems may find they need to consolidate pediatric coverage in one system facility, those hospitals are also realizing that they simply can’t afford to have inpatient care provided any longer by general pediatricians.
“Community hospitals have general pediatricians keeping kids in the hospital for a week, with q-two-hour treatments and a host of antibiotics,” says Dr. Swift. “Hospital costs are soaring on limited reimbursements.”
That is already very apparent in markets such as California and Nevada, he says, that have been hard hit by the economic downturn and Medicaid cutbacks. Add to that, says Dr. Swift, “the train coming down the track” of health care reform, which he believes will center on hospital-based services. That includes not only a mandate for more efficient pediatric and adult hospital medicine, but for anesthesiology, emergency medicine and inpatient radiology as well.
“The growth opportunities for pediatric hospitalist medicine are enormous,” says Dr. Swift, “and will continue to be for the next 10 years.”
Phyllis Maguire is Executive Editor of Today’s Hospitalist.