Reliance on outside vendors requires heightened safeguards.
The Fairview Health Services CEO who hired an aggressive outside company to collect debts and lower medical care costs is leaving. But Accretive Health, the contractor brought in by Mark Eustis, and firms like it are only going to play a more prominent role in health care in years to come.
Faced with thinning patient-care margins and mounting pressure to cut costs, hospitals across the nation will need to rely more on outside vendors to save on staffing costs and provide expertise in information technology. This is part of what it means to "find efficiencies" and "bend the cost curve,'' to use two gauzy phrases oft-cited during state and federal health reform discussions.
That reality is why it is so important to intensely scrutinize what went wrong at Fairview and what the lessons are for other hospitals. Sen. Al Franken of Minnesota continued this much-needed postmortem at a U.S. Senate field hearing on Wednesday in St. Paul. Among those testifying were Fairview's interim CEO Charles Mooty, Accretive senior vice president Greg Kazarian and Minnesota Attorney General Lori Swanson.
Swanson released her headline-grabbing report about Accretive about a month ago. It alleges high-pressure debt-collection practices -- such as bedside attempts to collect payment in Fairview emergency rooms and excessive upfront payments for nonemergency care.
Swanson's report also revealed troubling internal documents from Accretive. At Wednesday's hearing, she brought an enlarged memo in which the firm dubbed its emergency-room collections as "Accretive Secret Sauce" and bragged "Check out our ASS!" That memo, along with Minnesota patients' stories of being hassled for payment while in pain or distress, undercut Kazarian's smooth assertions that the company aims to help patients qualify for medical assistance or wrangle on their behalf with insurers.
Mooty, who also served as the board chair, has been forthcoming about the damage to Fairview from the allegations. On Wednesday, he vowed to rebuild trust with patients and staff. The board's recent decision to hold Eustis personally accountable for Accretive's hiring was a solid step toward that goal. Eustis, 59, retired last week. His departure came one day after the Fairview board decided not to renew his contract. Fairview also has cut ties to Accretive.
Mooty, in contrast to the energetic and assertive Kazarian, sat quietly as patients rehashed at the hearing how they were hassled for payment. It was painful but necessary to hear the disturbing accounts repeated.
The continued airing of Fairview's situation sends a strong, timely signal to other hospitals. Patient-centered values don't play out just in clinical care, but in every aspect of a patient's interaction with those who staff a medical institution.
That must be foremost in hospital executives' minds as they weigh the use of outside contractors -- whether it's for janitorial services, bill collection or data analysis. With the potential savings comes the sobering responsibility of providing strong, internal oversight to ensure that core values aren't outsourced, too -- especially when the institution is a nonprofit health care provider.
Fairview's next CEO must ensure that "patient-centered" encompasses every part of its operations. Other hospitals need to do the same and ensure that they have detailed safeguards in place -- not just blind faith in outside help.