Inside Healthcare - RedCoat Publishing

With much at stake for hospitals around the country in an uncertain healthcare landscape, the urge to compete and drive other players out of the market is understandable. But at Stanislaus Surgical Hospital (SSH), increasing patient volume goes hand in hand with improving the quality of care and the level of collaboration throughout its service area.

Doug Johnson, president and CEO

“We are trying create a culture that is constantly learning and sacrificing in response to today’s challenges and tomorrow’s opportunities,” said Doug Johnson, president and CEO.

This July, Stanislaus Surgical celebrated its 25th year of operations. Started as an ambulatory surgery center (ASC) when it opened in 1984, it became a surgical specialty hospital in 2000. The hospital was built so physicians had the opportunity to work in an environment Johnson said allows them to do their work more efficiently.

“This hospital was started because working with general community hospitals make it difficult for surgical practices. That isn’t to be critical of community hospitals, but that is where emergencies come first,” said Johnson. “About 60% of what our surgeons do is elective non-emergency procedures. To get their surgical day complete at community hospitals, they end up waiting around, and they can do their cases much more efficiently and effectively in an ASC or surgical specialty hospital.”

Positive impact
Operating out of three locations in Modesto, the main surgical hospital has eight ORs, two procedure rooms, and 23 inpatient beds. The Coffee Road Surgery Center has two ORs and a pain management clinic, and in 2007, the organization acquired a diagnostic imaging center where it offers outpatient imaging services. SSH has 54 owners and more than 200 physicians on its medical staff. It has all the services of a general acute care hospital as it relates to surgery, including general surgery, gynecology, orthopedic, neurosurgery, plastic surgery, and more—everything except hearts and heads.

According to Johnson, the Modesto area has been especially hard hit in terms of the physician shortage. He sees Stanislaus Surgical’s presence as beneficial to the quality of available care because of its ability to attract physicians to the area.

“The presence of surgical specialty hospitals means communities can recruit physicians they wouldn’t be able to and provides recruitment opportunities for the healthcare community at large,” he said. “Physicians essentially created the surgical specialty market out of the inadequacies of running surgical practices out of local community hospitals.”

In addition, some physicians are enticed by the equity ownership model employed by many surgical specialty hospitals. In particular, smaller markets have been able to boost recruitment because of the presence of an ASC or surgical specialty hospital. And although many hospitals would prefer not to compete with surgical hospitals, the mere presence of such competition can be beneficial to the market as a whole.

“McDonald’s may not celebrate Wendy’s successes, but its presence has improved McDonald’s fortunes because more people are eating fast food,” said Johnson. “Similarly, as you bring more physicians into a market, more surgery is being done in that market because you are meeting a need with resources that weren’t there before.”

Steady focus
Last year, Stanislaus Surgical saw a noticeable dip in profits, something Johnson was tasked with reversing when he took over the top job earlier this year. To do so, the organization has recommitted itself to a focus on efficiency, expertise, and productivity. Particularly, Stanislaus Surgical’s administration is placing renewed emphasis on treating its medical staff as colleagues and customers rather than keeping them on the sidelines, trying to meet their needs better and helping them understand the cost of providing care and how that impacts profitability.

Another way for the organization to ensure profitability over the long term is to look at ways to expand its surgical capabilities. Johnson said SSH won’t be branching out into heart or head surgery anytime soon, believing those procedures are better accommodated at a full service community hospital. But other ambulatory types of procedures and specialties, like bariatrics, could be in the hospital’s future, as could an expansion of its pain management services. Advancements in medicine will also bring more procedures under its roof.

“As techniques and technologies improve, procedures move to lesser acute settings. For instance, gallbladder removal used to require a five-day stay and now it is an outpatient procedure,” said Johnson. “In addition, there are many other procedures that lend themselves to a less acute setting because of new practices, technology, and the ability to manage post-operative pain. It is SSH’s strategy for the future to maintain a contemporary perspective on the ability to continue to move patients to a less acute setting for surgical care.”

The key to Stanislaus Surgical’s future success will be driving more productivity, efficiency, and effectiveness in an increasingly competitive and cost restrictive environment. It must be careful to select the right technologies, disciplines, and specialties to fuel its future, at the same time recognizing it cannot be all things for all people. By maintaining transparency throughout the organization and engaging people at all levels in strategic planning, the medical staff will not only have an impact on operational governance, but will become an active partner in promoting the hospital.

In addition, Johnson believes it is important the community know the vital role SSH plays in the overall continuum of care throughout its service area. But for the entire medical community to perform at its peak, it will take more than a thorough understanding of the value a surgical hospital like Stanislaus Surgical can bring. It will take a commitment to a new kind of healthcare competition that is all about quality.

“I’ve seen many entities decide competition is better than collaboration and focus only on their survival. I don’t look at the hospital down the street as my competitor.

I look at the cost of healthcare nationwide and the reimbursement battle as my competitors,” Johnson said. “The competition is supposed to be about how we can improve the health of our communities, not just who gets the local physician 10 more cases. Sometimes organizations pick the wrong parameters to measure success, and that needs to change.”

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