Becker's Hospital Review

23 CEO / STRATEGY Proposed commercial reimbursement cap would 'devastatingly weaken' Beebe, CEO says By Andrew Cass A proposal making its way through the Delaware legislature would "devastatingly weaken" Lewes, Del.-based Beebe Healthcare and other community hospitals, its CEO David Tam, MD, said in an op-ed posted on the health system's website. According to the Delaware Hospital Association, the proposal would impose a 250% of Medicare cap on commercial reimbursement. Dr. Tam said in his op-ed that, if passed as written, Bebee is projected to lose more than $60 million in the next two years, and that figure is estimated to be around $360 million throughout the state. In addition to the reimbursement cap, the proposed legislation would create a five-member board that would start reviewing and approving hospital budgets in 2026. Three of the members would be appointed by the governor, one by the speaker of the House and one by the president pro tempore of the Senate. The bill has passed the House and will soon be debated in the Senate. "We believe that budgetary control should stay with local hospitals, their leaders, and the community-based boards that know their communities best," Dr. Tam said. "Our community-based board allows us to nimbly make decisions that address our patients' and community's unique healthcare needs because they understand the unique needs of our population." The Delaware Hospital Association is also pushing against the legislation, which it said in an April 29 news release "decimates Delaware's healthcare system." The association said it has worked to offer proposals that "address affordability and transparency and establish a collaborative effort to identify realistic solutions to shared cost concerns." "Only a holistic approach to improving healthcare while addressing costs will benefit Delawareans, and we call on Governor Carney and state senators to join us in developing an approach that will help — not harm — the state of Delaware," Delaware Healthcare Association CEO Brian Frazee said. n Sutter installed a dyad leadership model to boost results. Did it work? By Laura Dyrda S acramento, Calif.-based Sutter Health restructured it's divisional leadership last October, naming six market presidents and six chief medical officers to lead dyad partnerships for more efficient decision-making and improved access to care. Many health systems have undergone leadership reorganization in the last few years and change is always a hard, but necessary step to growth. One of the first pivots Sutter's executive team made was aligning market presidents and chief medical officers around one incentive plan, down from 39 different plans historically. "To go from 39 to one incentive plan provided a great sense of clarity for the organization around a balanced scorecard," said Mark Sevco, senior vice president and COO of Sutter, on a recent episode of "Becker's Healthcare Podcast." "We have really put up top priorities across the organization for our leaders around patient experience, employee engagement, our growth and access quality. If we do those things well, our finances will take care of themselves and we'll continue to be able to reinvest in our people and technologies and our community." Mr. Sevco is working with his colleagues to ignite a deeper level of operational rigor in the dyad operating model to drive better results. He asked his team to lean in and focus on problem-solving together. Mr. Sevco is also clear about organizational deadlines, timelines and project management. "ere's a lot of opportunity to do things better in healthcare, so I think that the aligned incentive brings us all together," he said. e aligned incentives and operational excellence extends to the health system's medical groups as well. Sutter aims to enhance relationships with physicians and grow its network in the coming years. e health system is transitioning physicians from work relative value unit-based pay to value-based reimbursement. With this shi, Sutter aims to reduce the total cost of care and reimburse providers based on quality access. e physician group is setting up a clinically integrated network of physicians to align employed with private practice physicians as an accountable care organization. "We have eight aligned medical groups across Northern California and it's really been an extraordinary opportunity to get to know the CEOs and medical directors of all those medical groups," Mr. Sevco said. "We spend a lot of time with them. How can we help them? How can we be more supportive to help their growth? e aligned incentive plan translates across all of our divisions, markets and with our physicians." Seven months in, has the move made a difference? "We had a great 2023," said Mr. Sevco. "We hit all of our measures and exceeded our targets for growth and financials. We've done really well, and as most organizations do, set higher expectations going into 2024. We're working really hard to make a difference for the patients that we look to serve." n

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