PeaceHealth finalizes merger, works on new partnership; Legacy adopts 'lean' management principles
By Aaron Corvin, Columbian
Port & Economy Reporter
Published: February 23, 2013, 4:00pm
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The emergency department at PeaceHealth Southwest Medical Center is a Level II trauma center, one of only three designated trauma centers in the Portland metro area.
To say Clark County’s two dominant hospitals — PeaceHealth Southwest Medical Center and Legacy Salmon Creek Medical Center — are embracing change would be an understatement. Whether through internal initiatives or outside partnerships, both organizations are hunting for ways to cut costs, improve care and boost efficiencies, even as federal health care reform steadily becomes reality.
PeaceHealth and Vancouver-based Southwest Washington Medical Center took a big step in that direction by finalizing a merger in December 2010 that transformed Southwest into a subsidiary of PeaceHealth and that renamed the hospital PeaceHealth Southwest Medical Center.
That merger also brought with it the relocation of PeaceHealth’s corporate headquarters in Bellevue to Columbia Center at Columbia Tech Center in east Vancouver. By 2017, PeaceHealth projects it will have 800 workers at its Columbia Center offices.
And PeaceHealth’s evolution isn’t slowing down.
Little more than two years after its merger with Southwest, PeaceHealth aims to further increase efficiencies and to cut costs, this time by seeking a partnership with Englewood, Colo.-based Catholic Health Initiatives.
Both PeaceHealth and CHI are nonprofit, Catholic-based systems.
Their proposed partnership — which would create a regional health care system with operations based in Vancouver — would combine seven Catholic Health Initiatives hospitals in Washington and Oregon with nine PeaceHealth hospitals in Washington, Oregon and Alaska.
The new organization would have revenues of nearly $4 billion, nearly 26,000 employees and about 950 employed physicians.
The proposed partnership is expected to be completed before June 30.
It’s all a part of what experts say is a nationwide consolidation of health care organizations. The trend of consolidation is occurring as the federal Affordable Care Act pushes for lower costs and better health care results, and as it seeks to extend health insurance coverage to millions of uninsured Americans.
During a presentation he gave in Vancouver late last year, Alan Yordy, president and chief mission officer of PeaceHealth, told a group of more than 200 people that health care industry consolidation will ultimately leave the Northwest with three to five major health systems, with “a few niche providers.”
Indeed, additional new partnerships — and big impacts to patients — are in the offing. About 100,000 Clark County residents who receive health insurance through Kaiser Permanente Northwest could find themselves using Legacy Salmon Creek Medical Center for hospital services under a sweeping new agreement between the two medical giants.
The arrangement, announced in January by Kaiser and Legacy officials, means Kaiser’s Clark County members will receive most of their hospital care at Legacy Salmon Creek later this year. The change means a loss of business for PeaceHealth, which will remain Kaiser’s preferred hospital services provider until Oct. 1, when the changeover to Legacy goes into effect.
Legacy Salmon Creek
Meanwhile, Legacy Salmon Creek Medical Center — part of the larger Portland-based Legacy Health System — is driving big changes in different ways.
The 220-bed Salmon Creek hospital remains Legacy’s flagship in terms of visibility in Clark County.
But it’s “lean” management principles are taking root and catching the eye of visitors, including a delegation from the southern African nation of Botswana that visited recently.
The lean method of management is most often identified with manufacturing or industrial operations, including efficient management principles pioneered by automaker Toyota.
However, it’s leapt from the confines of manufacturers to hospitals, including ThedaCare in Wisconsin, Virginia Mason Medical Center in Seattle and Legacy Salmon Creek.
About three years ago, the hospital’s leaders recognized they lacked a systematic approach to monitoring work processes and improving them.
Since then, the hospital has launched pilot lean programs, including in its intensive-care unit, food and nutrition services department, and rehabilitation operations.
The programs hinge on a three-pronged approach: leaders who “live” the hospital’s lean principles; “visual management boards,” where key performance indicators are posted, and green- and red-colored boxes show what’s working and what needs to be fixed; and huddles — brief, periodic gatherings of leaders and employees around the visual management boards to make status checks and sort out ideas and issues.
The effort is working, data show.
For example, the hospital has cut the time it takes to secure a bed for a patient who’s transferring out of the intensive-care unit by 50 percent. That’s enabled the hospital to more quickly move patients from the emergency department to the ICU.
People are taking notice. In fact, a delegation of government officials from the southern African nation of Botswana visited the hospital in May 2012 as part of a tour of various sites in the Northwest to glean insights into and to share information about how to drive positive changes in an organization.
Cheryl Forry, manager of the Salmon Creek hospital’s intensive-care unit — who made a presentation to the Botswanan delegation — said the work hasn’t been easy and remains an ongoing project.
“We had to sell it to our staff,” she said. “If people on the ground don’t buy in, it doesn’t matter.”
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