News

Pardee, AdventHealth chart strategies for a changing health care market

By Bill Moss, Published: January 4, 2019

Among the certainties in the new year is change on the health care front, and nowhere is that change as certain as in Henderson County.

Here, the two nonprofit hospitals are charting their next steps to compete for customers, adapt to patients’ changing habits and cast themselves as the go-to option for everything from sprained ankles to chemotherapy.
Early in 2019, state Attorney General Josh Stein is expected to render a verdict on whether the state should OK the sale of Mission Health to HCA Healthcare, which would convert Western North Carolina’s leading hospital into a for-profit enterprise for the first time. Proceeds from the sale, if approved, would create a new non-profit, Dogwood Health Trust, with up to $2 billion in assets that would channel millions of dollars’ worth of grants to area agencies to advance health-improvement goals.

Advent of a brand change

Neither Pardee UNC Health Care nor Park Ridge Health are waiting for Mission’s next move to react to the changing health care market.
On Wednesday, Park Ridge Health officially changes its name, to Advent Health, a new brand that applies to more than a thousand Adventist Health System’s facilities across nine states.
Jimm Bunch“Right now, Adventist Health System does not have a national brand,” Jimm Bunch, the president and CEO of Park Ridge. Just how well that might work for Park Ridge became clear to for Bunch when he struck up a conversation with a couple moving here from the Orlando area.
“In my subdivision there’s still lots for sale,” he said. “One afternoon I was driving and there was a couple looking at a lot. I asked them where they’re were from. ‘Where do you get your health care?’ ‘We get it at Florida Hospital.’
“Well, that’s Adventist Health System’s flagship hospital. Right now they would have no way of knowing that we’re brothers and sisters and if they receive their care at Park Ridge, (would) use the same medical records, etc.
“At first I didn’t like the idea and honestly at that moment, I thought, ‘This is a fabulous thing,’” he said. “The vast majority of people prefer to get their health care from a multi-state organization or a very large organization because they have the resources and so forth. And obviously those who worked on it and ran the name by religious people and nonreligious people, the name Advent Health really resonated well with all groups.”
The change on the heels of moves by Park Ridge to improve the quality and efficiency of its emergency room and to partner with Wake Forest Baptist Medical Center for cancer treatment, just as Pardee has partnered with UNC Health Care for oncology and other specialties.
“Our values align,” Bunch said of the Wake Forest partnership. “They’re rated No. 1 as the No. 1 oncology provider in the state. We like working with the best.” In running emergency departments, “They have a model that physicians like,” Bunch said, adding that Wake Forest Baptist operates some 17 ERs at rural or regional hospitals.

Health care ‘consumerism’ drive change

Last month, Park Ridge broke ground on a new urgent care facility, AdventHealth Centra Care, on Airport Road in Arden at the I-26 interchange. In doing so, AdventHealth plunges into the competition to provide lower cost care for non-emergency cases from sprained ankles to the flu.
“I think the reason thers’s more and more urgent cares is more and more people want, in areas of their life, (services that are) all about convenience,”Bunch said. “Urgent cares give them that convenience and give them the ability to get in and out quickly at a far cheaper price than the emergency department.”
Explaining the proliferation of urgent care clinics, Pardee CEO Jay Kirby describes as a market shift to patient choices based on “consumerism” — checking out options and seeking a bargain and a time saver.
Pardee opened its third urgent care center, in Mills River — 4 miles from AdventHealth’s new facility — in late 2017. It operates one at the Epic movie theater shopping center and another on the Henderson-Buncombe county line.
“As consumerism continues to grow in health care, we have seen our urgent cares really flourish,” said Kirby, president and CEO of Pardee. “We see Four Seasons continue to grow and develop, the one at Mission-Pardee health campus continues to grow and develop, the one in Mills River has actually grown faster than the one at Mission-Pardee did. The location and market has done very good and has already seen 50 percent (in patient visits) of what the one in Fletcher does after 120 days.”

Pardee wins state’s OK for surgery center

Forecasting continued growth in northern Henderson County and patients’ desire for convenience, Pardee UNC Health is also moving to a significant shift in how it provides day-surgery procedures. The county-owned hospital received conditional approval on Nov. 29 to build a $16 million ambulatory care facility on land it owns on N.C. 280 in Mills River.
Jay KirbyPartly owned by physician-investors, Pardee Partners Ambulatory Surgery Center would shift two operating rooms from the hospital in Hendersonville to the new facility, expected to open in July 2021. In a certificate of need application filed with state regulators, Pardee projected that the facility’s physicians would complete 2,609 surgical cases and 764 other procedures in the first year of operation, from July 2021 to June 2022. Of 5,410 outpatient surgeries at the hospital’s operating rooms in fiscal year 2018, Pardee said, 3,143 “were appropriate to be performed at a freestanding ASF (ambulatory surgical facility).”
“Outpatient surgeries is growing at a greater rate than in-patient surgeries as patients seek lower cost, better quality and greater value,” Kirby said during a public hearing on the CON application in November. “Henderson County’s surgeries have grown at an even higher rate. Outpatient surgical volume has declined in recent years and we believe this is likely attributable to the lack of access at a lower cost from ASC services in our county.”
Dr. David Ellis, Pardee’s chief medical officer, said the facility would provide for greater productivity and scheduling flexibility and more efficient nurse staffing, resulting in “more surgeries in less time with superior patient outcomes, reduced infection rates and low rates of medical complications. With the addition of the first free-standing ASC in Henderson County, patients and physicians alike will be able expand enhanced quality, access and value.”
If Pardee didn’t act, Kirby said, it would continue to see patients migrate to the convenience of competing free-standing clinics across the county line.
“Clearly Buncombe County has had ambulatory surgery center for some time — not one but two,” he said. “So what you’ve seen is market shift, you’ve seen the demand, you’ve seen the need and you’ve seen the desire for patients to be seen in these environments.”
In its certificate of need application, Pardee notes that Henderson County’s median age is older than the state average and that the population of people 65 and older is projected to increase at twice the rate of the overall population. That’s significant because older residents tend to use health care services — including surgical procedures — at higher rates. The new ambulatory care facility, Kirby said, would meet that projected demand.
“For Henderson County not to have one, for Polk County not to have one, for Rutherford County not to have one, you’ve seen all that migrate to Buncombe County,” he said. “It only makes sense that Henderson County work alongside with physicians and other specialists who want to bring that advanced care close to home.”
Pardee plans to recruit physician-investors for Pardee Partners ASC.
“Should our request be approved, we would partner with physicians and specialists to work together to increase access, to reduce cost and improve quality and make those procedures more affordable for patients, consumers and employers who are carrying that cost for their team members,” Kirby said.
Pardee is already competing for cancer treatment, cardiac care and other kinds of surgeries not just on quality of its medicine but on its location.
“I don’t know about you, but the last time I drove to Asheville it took twice as long as I thought,” Kirby said. “The fact is, do you want to drive 55 minutes to the cardiologist, do you want to drive an hour each day to have chemo, do you want to drive an hour through traffic to have outpatient surgery done? We think in our community, as we grow and develop, our patients and citizens want those things here.”

What will Mission sale mean?

Bunch and Kirby said they’re closely following the HCA’s proposed purchase of Mission Health. Both said they’d not been invited to comment on the sale, either by Mission’s leaders or the state attorney general’s office.
“Clearly any time Mission is impacted, Western North Carolina’s going to feel it,” Kirby said. “For as long as I’ve served in Western North Carolina, Mission has been the safety net of our region, Mission has been the standard and Mission has helped make us better. We wanted a strong Mission because what couldn’t get done here, I’ve said over and over again” would need to get done at Mission. “We need to support the tertiary facilities for our region.”
The rural mountain towns where Mission bought health care facilities fear that the HCA sale will result in a reduction or loss of services.
“We’re worried that our citizens won’t have those services in an accessible area, short of trying to drive 80 miles” to Asheville, Highlands Mayor Patrick Taylor told North Carolina Health News. Mission operates the 24-bed Highlands-Cashiers Hospital in Highlands.
Elected leaders in Highlands, Burnsville and Mitchell County have all passed resolutions or appealed to Stein, the attorney general, seeking assurances in the Mission sale that would keep their rural facilities open or force HCA to sell them to local organizations.
Kirby, who served as an administrator of a rural hospital in Sylva, said he fears the HCA sale could result in “health care rationing” in those rural outposts, especially for the poor and elderly.
“I don’t know what they have in store but I do know when you spend $2 billion for something and you’ve got to answer to your investors you’re going to have to change how you do business,” he said. “The scope, the scale, the breadth, the depth of what they do — I don’t know. But it’s not going to be the same Mission that you see today.”
Kirby is more sanguine about Mission’s flagship medical center in Asheville, which will continue to be the place where confounding challenges and life-threatening trauma cases wind up.
“HCA is a reputable organization, a proven organization,” he said. “We’re still going to want to support Mission. Western North Carolina needs a strong viable, regional tertiary (provider). It just overextended itself by trying to take on the burden of the highly rural, dispersed geographic region all the way from Robbinsville to McDowell County.” With reimbursements dropping, “the infrastructure they created couldn’t sustain itself.”
Having an HCA hospital next door won’t be new to Bunch.
“The reality is Adventist Health competes with HCA in other markets,” he said. “I think they do well and we do well. They run good hospitals.”
It’s unclear, however, what role Dogwood Health Trust — suddenly flush with $2 billion — might have in Hendersonville, Fletcher and the rest of the county. The trust is set up to improve conditions that affect people’s health, so-called social determinants that cover everything from housing to education to jobs.
Since HCA would own facilities in needier communities, it’s unlikely that Henderson County, served by two nonprofit hospitals and a multitude of active nonprofit agencies, would rank high in the grant-making. But regional agencies that serve multiple WNC counties could receive money.
“There are determinants of health that we struggle with in Western North Carolina, affordable housing being one of them, access to care,” Kirby said. “I can assure you that Pardee Hospital is not going to be there with a handout from the Dogwood Health Trust but I think there are programs such as MAHEC, the YMCA, Habitat for Humanity and other regional programs that serve our region” could receive grants.
There’s always unmet needs, Bunch said, even in a wealthier community like Henderson County.
“In every community there’s almost endless need. It’s the reason we have a foundation and Pardee has a foundation,” he said. “It just allows you to meet more needs. That foundation certainly has the potential to be very helpful, hopefully not only to Buncombe County but to the rest of the region.”