The long-term survival of safety net hospitals hinges less on reimbursement rates and more on questions of access, says Wright Lassiter, chief executive officer at Alameda County Medical Center in Oakland, CA. That's one reason why the safety net hospital he runs has recently agreed to buy the 136-bed San Leandro Hospital, which current owner Sutter Health had wanted to turn into a rehab center, shutting an emergency room with 25,000 annual visits.
Lassiter envisions the now money-losing San Leandro Hospital as a way to curb the impact of a changing business landscape in healthcare, which he perceives will lead to the shutdown or takeover of many local hospitals that are not owned by a bigger, better capitalized parent. Though many forces are at work as healthcare transitions to being measured on value and patient satisfaction as well as services rendered, he's worried safety net hospitals will lose out as patients get more options for care through insurance exchanges being created as part of the Patient Protection and Affordable Care Act. That's why he feels the need to expand geographically, as ACMC will in the San Leandro deal.
Safety net hospital as acquirer is a new twist in the ongoing consolidation of the healthcare industry. Lassiter says that while the PPACA is positive in general because more people will have healthcare coverage, it's a significant risk for safety nets.
"Some of us aren't as focused or as good at patient experience as others might be, or aren't as good with access because we take care of folks who are not attractive to the rest of the community," he says. Because patients who previously did not have coverage will soon have a choice on where to access care, ACMC has been tracking wait times for everything from ED access to wait times to see a specialist. The focus is on how to best decrease those.
That's because the access issue "could be our Achilles heel even more than patient experience," Lassiter says.