November 17, 2018
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Financial recovery proves painful for Maine hospital group

Courtesy of Central Maine Healthcare
Courtesy of Central Maine Healthcare
Central Maine Medical Center in Lewiston is one of the three hospitals in the Central Maine Healthcare system. The other two are Bridgton Hospital and Rumford Hospital.

Jeff Brickman knew in March that conditions at Central Maine Healthcare had reached a critical point when staff openly resisted an electronic health care data management system that combined inpatient and outpatient information.

Brickman, chief executive officer of Central Maine Healthcare, saw the move as overdue, a way to save the Lewiston-based health care system money and help staff more easily share patient data. But some physicians saw the extra time doing computer “paperwork” as an intrusion on patient care.

Some left, while others, joined nurses and other staff, in July to issue “no-confidence” votes in Brickman, citing hospital changes they considered detrimental to medical care, service cuts and what some saw as his brash manner with staff. The votes did not result in any sanctions.

The hospital board reviewed the complaints and ultimately backed Brickman, 62, who already had stopped the red ink that had been bleeding for years from the Central Maine Healthcare system, which includes Bridgton Hospital, Central Maine Medical Center in Lewiston, Rumford Hospital and various private medical practices in central Maine. It employs 3,062 people, a spokeswoman said.

Brickman, who helped turn around four other hospital systems before coming to Central Maine Healthcare, admits he may have moved too quickly and not fully communicated his vision for other changes to reinvigorate the financially anemic medical system.

“With the pace of change, there was a breakdown in communications,” he said. “We did not have the ability to clearly understand when [staff] were at the point where they needed help.”

But he sees the visible wounds of Central Maine Healthcare, which played out in public with stories of physicians leaving, unhappy staff, program cuts and financial woes, as happening more quietly at hospitals across Maine and the country as health care administrators struggle to make enough money to supply quality care.

“What we’ve seen [at Central Maine Healthcare] over the last several weeks is a microcosm of that,” he said. Hospitals are in for big changes if they want to survive, he said.

More and more, business executives are getting a stronger voice in how medicine is practiced in the nation’s hospitals, causing ripples in a medical system that doctors have run for decades, at times thinking of care before cost or efficiency.

Hospitals in other states, including Massachusetts, already measure data from doctors and patient outcomes diligently.

“In the organizations where I came from, physicians were held accountable. Every month, we were measured on performance metrics,” said Dr. Scott Johnson, who previously worked at Beth Israel Deaconess Medical Center and St. Elizabeth’s Medical Center, both in Boston. He became the new chief of surgery at Central Maine Healthcare in January 2018. Johnson has been a surgeon for 17 years.

“That is the way health care is going. [Central Maine Healthcare] is moving from the doctors calling the shots to the other end of the spectrum where administration is calling the shots,” he said. He added there is room for compromise so every organization can find a balance.

‘We were hemorrhaging’

Brickman likens the financial and organizational problems at Central Maine Healthcare to a burning house that he and others had to run into to put out the fire, then rebuild. And many of the staff may not have realized their house was on fire.

“We were losing money at such a pace that we were fighting off insolvency,” Brickman said.

He joined Central Maine Healthcare in fall 2016. When he started, the hospital already was losing $2 million to $3 million each month and only had 39 days of cash on hand by December 2016.

“We were hemorrhaging from basic operations from our physician practices to our offices. It was across the board,” he said.

The Maine Health Data Organization shows similar tight cash on hand at three of Maine’s top four hospitals. Central Maine Medical Center had 31.6 days in 2016, according to the organization’s most recent data, while Eastern Maine Medical Center in Bangor had 33.2 days and MaineGeneral Medical Center in Augusta had 24.2 days. Maine Medical Center in Portland had 137.9 days.

Brickman said 100 days is healthy for Maine, but nationally, financially strong hospitals have up to 150 days of cash on hand.

Brickman is reorganizing and streamlining operations, and said the cash on hand had climbed to 67 days in July 2018. His goal is to get that to at least 90 days by the end of December.

And Central Maine Healthcare said it no longer is oozing money each month. Monthly revenue is averaging $40 million, compared to expenses of $39.1 million. But there’s still a lot of work to be done, he said.

Central Maine Healthcare also provided $9 million in wage increases through this fiscal year that ended in June and $6 million in infrastructure improvements.

Those figures provide the reasons why the Central Maine Healthcare board supported Brickman after the no-confidence votes.

“His background of improving access to affordable, high-quality health care, a commitment to local care and a history of thoughtful stewarding resources to ensure continued organizational success supported our decision to select Jeff Brickman [as CEO],” board chair Deborah Dunlap Avasthi said in an email.

“Jeff has introduced new strategic partnerships and recruited high-caliber talent at all levels of our organization,” she said. “The board is confident Jeff and the senior leadership team at CMH will continue to move the organization forward to best meet the unique needs of our Maine communities.”

Putting out the fire

Brickman came to Central Maine Healthcare from Colorado, where he was group president at Mountains and North Denver Operating Group. His reorganization work increased its market share to 25.6 percent in fiscal year 2015, up from 20.9 percent in fiscal 2012. His cost-reduction strategy saved about $70 million in fiscal 2014 and $80 million in fiscal 2015, according to data provided by Central Maine Healthcare.

When he first looked at Maine’s health care system, he said he saw opportunity because it had similar rural areas, but had far fewer medical facilities in local areas close to where people needed care.

“The focus in Colorado was more outpatient,” he said. “The majority of care in Maine is centered around the four walls of a hospital. For a state like Maine with an older and poorer demographic, that doesn’t really respond to the needs of its community, where there’s an inability to travel and there’s a poorer clientele. There’s a need to find a way to provide care that is more affordable, accessible and convenient.”

That’s part of his mission in Maine, starting with the Topsham campus, where he’s partnered with private providers of cancer, plastic surgery and other services to expand the health care that’s available under one roof.

“Topsham meets patients where they are,” said Chip Neilson, director of business development at Central Maine Healthcare, who expects the Topsham facility to draw several thousand midcoast patients. “Our focus is to make improvements and access to quality care in a way that is affordable for patients.”

And while Brickman may have come to Maine with these plans in his head, he quickly found there were immediate fires to put out at Central Maine Healthcare. Recent financial figures signaling the trouble were not yet publicly available because data on the hospitals are almost 2 years old, he said. So he had a few unpleasant surprises.

One came two weeks into his new job, when he discovered Central Maine Healthcare had lost a critical federal subsidy just before he joined.

“We had lost our 340B payment from the federal government,” he said. The program provides deep discounts for prescription drugs under Medicare and for hospitals that serve a disproportionate level of indigent patients.

The loss of the subsidies hit Central Maine Healthcare hard for two years, costing the hospital $8 million to $10 million. Brickman was able to recapture subsidies through another federal program in late 2017.

He also saw that expenses outpaced revenue because of costs for staffing and programs in Bath, Brunswick and Freeport that didn’t perform as expected and were later moved to Topsham, with a total of 50 staff leaving in two cuts.

Other programs not performing as well as expected and later revamped included general surgery and trauma, heart and vascular, and oncology. Staffing, technology and other issues had to be addressed.

In some cases, Central Maine Healthcare invested in new technology and retooled an inefficient and costly medical imaging program.

Unlike many regional medical centers, Central Maine Healthcare did not have an MRI machine within the hospital. It was in a separate building across the street for outpatient MRIs.

“So if you were an inpatient, we used to put you in an ambulance, truck you across the street in the middle of winter, have an MRI and then bring you back inside the medical center,” Brickman said. In January, Central Maine Healthcare shut the old outpatient machine and installed a new system within the hospital.

He’s also invested in different subspecialties in oncology. He brought in Johnson as the new chief of surgery in January, and Johnson in turn attracted about eight new surgeons, among them oncologist Dr. Lisa Rutstein.

“It’s exciting going to a center that needs to be turned around in the center of the state,” she said. “Brickman wants to enhance relationships.”

One example is a strategic relationship with New England Cancer Specialists, which will provide oncology services at the expanded Topsham facility.

Brickman said this is all part of his plan to be a “disruptive innovator in health care” in Maine.

“What I’m describing are the fundamental building blocks we’ve put in as we stabilize a fragile base in the way we found it a few years ago, and get it ready for a very different model of providing health care,” he said.

But he realizes there still are bumps in the road.

“You’ve got legacy programs in facilities and markets and now you’re moving to a new vision and model of health care and you have a cultural clash of the old and new,” he said. “You have what we’ve just experienced, which is a level of concern and frustration, as we try to communicate and connect the dots while we work from moving from our insolvent base to a new one that’s more sustainable for the future in a way that will meet the needs of the state of Maine.”

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