David Pate became the head of St. Luke’s Health System in Idaho in 2009, arriving just in time for the upheaval of the nation’s health care system through the Patient Protection and Affordable Care Act.
Pate, who is both a doctor and a lawyer, has been guiding the care provider toward the accountable care model since.
Before heading St. Luke’s, which has 11,000 employees throughout seven hospitals and more than 100 clinics in Idaho and western Oregon, Pate was an internist and an executive at Texas Medical Center in Houston.
He recently discussed St. Luke’s ongoing transformation into an Accountable Care Organization and what it will look like to its patients. The conversation has been edited for length and clarity.
What is an ACO (Accountable Care Organization)?
Today, health care providers are paid for what they do regardless of the outcomes. And they are paid for what they do even if there was a less expensive option available. In accountable care, an organization is (a) coming together of health care providers to say, “We are going to be responsible for the outcomes of our care, and we are also going to be accountable for that health care spending.”
There are many institutions cutting costs and saying their hospitals are more efficient than they used to be. Why isn’t that the answer?
It’s a good thing to do. We want to be focused on reducing costs, but it won’t be enough. The reason it won’t is that there is so much disease in the pipeline coming at us, due to childhood obesity and due to other health problems now that are going to cause very costly illnesses at a much younger age, that the health care system is simply going to be overwhelmed. The key thing is, it is too expensive to take care of patients. So we have to keep people from becoming patients as long as we can.
What are some of the technological upgrades that people can expect when it comes to their care?
We are in the process of implementing a single electronic health record around our health system. What that will mean is that no matter who you see in our health care system, everyone will have access to all your information. All of your X-rays, all of your lab tests, all of your physician’s records will all be in one place. And you only have to register one time. We are making it very patient-centered by making it so that people can access their own health record online, people can email in a question to their health care provider and people can request office visits online.
Can any of those technical records help doctors provide care?
Yes. With the electronic health record in place, what we are next going to do is take evidence-based medicine, that is those practices that have been identified as, “Here is clinical evidence that this will benefit a patient.” We can take that information, and we can embed it in the electronic health record so that a physician seeing a patient will receive the information that here is some evidence of best practice, because no physician can keep up with all of medical evidence today. It’s just overwhelming.
How does the ACO model change who pays, and how, for health care, and what does that mean for patients?
Today’s reimbursement system is called fee for service. It pays for every single thing that is done to someone. What we believe is that incentivizes the wrong behaviors and in fact, the institute of medicine has said that 30 percent, at least, of health care spending is of no value or low value to patients. What we want to do is be paid for value. We want to receive a model that rewards us not for everything we do to you, but can we improve your health and do it at a lower cost? And that lower cost will be recognized by patients, because their insurance premiums will go down.
Will they, in addition to that, see any changes to how they receive their care?
A key thing that will happen is that physicians are no longer incentivized based on productivity, based on “How many patients did I see today?” Instead, it’s going to be, “How well did I manage the patients I care for? What are their outcomes? And did I help control the cost of spending?” Because of that, now physicians will be happy to take care of minor things by phone, by email, maybe by Skype or Facetime. It is going to be much more convenient for patients, because they won’t have to come to the doctor for everything.
What about for your own staff of nearly 11,000? How do you make the case for them to go along with this new philosophy?
One of the key things is that all health care workers are also paying for their insurance, and they see the costs involved. We all understand that the current situation in this country with health care is unsustainable and is unaffordable to too many. What we have done is, we’ve implemented health programs for our own employees to help improve their health, and because of that, they have seen their premiums go down. Now we are communicating across the health system that look, because health care is unsustainable, we can either change it or we can let somebody else change it, but it is going to change. Do we want to lead or do we want to let somebody else fix this? I’m proud St. Luke’s said that we are going to lead.
How long will people in the Treasure Valley wait before major milestones kick in for the change to an ACO?
I think the real noticeable things will be that by the end of this year, we will have achieved what we call clinical integration with the independent physicians. … That will occur by the end of this year. By 2015, St. Luke’s will be in the position to assume the financial risk for the care of all the patients we take care (of). I think already a lot of patients will be seeing the difference of being able to go online and see their medical records, and that will be more and more over time. I think that over next several to five years, you will see these transitions in team-based care, the ability to get visits without coming in to the doctor, maybe a so-called e-visit. It’s happening now, but you will see more and more of it every year.