Tulare Regional Medical Center

Agenda•Key data

•Why change is necessary

•Ideal solutions

•Conclusion

Key Data•112 bed, acute-care hospital

•3 Rural Health Clinics, 2 more clinics opening

•Medical tower expansion

•Significant growth potential

Service Area Demographics•Population estimate: 171, 438

•Average age: 30.3

•57.9% Hispanic

•High poverty rates

Why Change is Necessary

•Lack of physician alignment

•Quality perception

•Disproportionate market share

•Current payer mix

Physician Alignment•To remain competitive, physicians must

be fully integrated into TRMC

Perceived Lack of Quality•HCAHPS lower than state and national

averages

•HCAHPS lower than Kaweah Delta Medical Center in almost every categoryMetric TRMC Kaweah

DeltaPatients who would definitely recommend hospital

50% 69%

Patients who reported area around their room was “always” quiet at night

37% 50%

TRMC’s Current Market Share•80% of patients participate in government

insurance programs▫45% Medi-Cal

•Poor quality perception is hurting patient retention

•Potential patients directed elsewhere

Key Operating IndicatorsTRMC 2010 OSHPD

Net Rev/APD 1,946 3,124

Supply/APD 264 476

Labor/APD 730 1,590

Total/APD 1,915 3,082

Ideal Solutions•Physician alignment

Renegotiate Physician Contracts

•Business development and physician communication▫What do they want? ▫What do competitors offer?

•Sizeable share of the newly insured▫PPACA will increase commercial payers

•Focus on community needs

Optimize TRMC’s Clinic Network

•Maintain 3 Rural Health Clinics and 2 1206(d) clinics

•RHCs▫Higher Medi-Cal reimbursement rates▫PPACA increasing Medi-Cal rates 2013-

2014▫Patient access to care▫Specialized care for the population

Optimize TRMC’s Clinic Network•1206(d) Clinics•Hospitals

▫Higher Medicare reimbursement rates 100-113%

▫Increased patient base▫Reinforce physician-TRMC alignment

efforts Inpatient referrals

Optimize TRMC’s Clinic Network•Physicians

▫No overhead, focus on patients▫New technology

•Community▫Increase quality perception ▫Bring access to health care▫Programs for elderly

42%

35%

21%

2%

Projected Payer Mix of 1206(d) Clinics in 2014

Medicare + Managed

Medi-Cal + Managed

Commercial

Other (Self Pay, Indigent, etc)

14%

62%

19%

5%

Projected Payer Mix of Rural Health Clinics in 2014

Medicare + Managed

Medi-Cal + Managed

Commercial

Other (Self Pay, Indigent, etc)

Profit & Loss 2011 2012 2013 2014 2015Gross Patient Revenue 267,526,211.00$ 280,891,028.75$ 345,882,635.02$ 340,993,383.35$ 327,705,586.86$ (Deductions from Revenue) 188,294,053.00 197,708,755.65 227,365,069.00 238,733,322.45 250,669,988.57Net Patient Revenue 79,232,158.00$ 83,182,273.10$ 118,517,566.02$ 102,260,060.90$ 77,035,598.29$ Other Operating Revenue 1,878,170.00 1,972,078.50 2,110,124.00 2,215,630.19 2,060,536.08Total Operating Revenue 81,110,328.00$ 85,154,351.60$ 120,627,690.02$ 104,475,691.09$ 79,096,134.37$ (Operating Expenses)Salaries & Wages 29,771,868.00 31,260,461.40 35,609,716.77 39,882,882.78 44,668,828.71Employee Benefits 10,747,336.00 11,542,638.86 13,536,794.14 14,538,516.91 15,614,367.16Physician Professional Fees: 6,471,520.00 6,795,096.00 9,940,507.52 11,133,368.42 12,469,372.63Other Professional Fees: 2,643,050.00 2,510,897.50 4,267,205.20 4,779,269.82 5,352,782.20Supplies 10,779,438.00 11,318,409.90 14,810,619.09 16,587,893.38 18,578,440.58Purchased Services 10,392,223.00 10,911,834.15 13,121,254.25 14,695,804.76 16,459,301.33Depreciation 3,125,385.00 3,281,654.25 5,273,902.39 5,801,292.63 6,091,357.26Leases & Rentals 886,336.00 930,652.80 2,042,331.14 2,287,410.87 2,561,900.18Insurance 364,469.70 382,693.19 1,863,616.37 2,087,250.33 2,337,720.37Interest 848,042.00 800,476.00 2,460,571.20 2,386,754.06 2,315,151.44All Other Expenses 2,409,549.00 2,530,026.45 2,412,533.06 2,702,037.03 3,026,281.47Net From Operations 1,803,080.00$ 2,889,511.10$ $15,288,638.90 $16,053,070.84 $16,855,724.39Non-Operating Revenue 13,897,152.00$ 14,592,009.60$ 16,051,210.56$ 17,656,331.62$ 19,421,964.78$ (Non-Operating Expenses) 3,872,312.00 4,065,927.60 4,879,113.12 5,464,606.69 6,120,359.50Net Income $11,827,920.00 $13,415,593.10 $26,460,736.34 $28,244,795.77 $30,157,329.67

2010 2011 2012 2013 2014 2015$0.00

$5,000,000.00

$10,000,000.00

$15,000,000.00

$20,000,000.00

$25,000,000.00

$30,000,000.00

$35,000,000.00

Projected Net Income for TRMC

Establish Medical Foundation•Key component of physician alignment

•Will help facilitate recruiting and retention

•PPACA influential in the move toward collaborative care

Conclusion

•Physician alignment with TRMC•Care for population health needs•Funnel patients to TRMC main campus

▫Increase revenue generation•1206(d) and rural clinics are a first effort

toward long-term Foundation goals

Mission Statement

“A patient-centered organization that sets the standard for patient

experience and quality of care by pushing the boundaries of technology

in service to our community.”

ReferencesAbbott, D. (2009, March 12). Healdsburg hospital to partner with primary care. Sonoma West Times and News. Retrieved from http://www.sonomawest.com/healdsburg/newsKaweah Delta Health Care District. (2012). Kaweah Delta welcomes second neonatologist to NICU. Retrieved from http://www.kaweahdelta.org/ news/view_details.asp?newsid=221Mineful Demographics. (2010). Tulare household income. Retrieved from http://mineful.net/California/County/County_Income/Tulare_County_CA_income_ignore.htmlSchiff, A. (2010). Hospital outpatient clinics--legal considerations impacting physicians. Retrieved from www.mdhealthlaw.com/Studer Group. (2012). About Studer Group. Retrieved from http://www.studergroup.com/about_studergroupTaylor, M. (2006). California’s health care districts. Retrieved from http://www.chcf.org

ReferencesTulare County Association of Governments. (2008). Tulare county. Retrieved from http://www.tularecog.org/Tulare Regional Medical Center. (2012). Tulare Regional Medical Center. Retrieved from http://www.tulareregional.orgU.S. Department of Health and Human Services. (2006). Comparison of the rural health clinic and federally qualified health center programs. Retrieved from http://www.ask.hrsa.gov/downloads/fqhc-rhccomparison.pdfU.S. Department of Labor. (n.d.). General facts on women and job based health. Retrieved from http://www.dol.gov/ebsa/newsroom/ fshlth5.htmlU.S. House of Representatives. (2010). Compilation of patient protection and affordable care act. Retrieved from http://housedocs.house.gov/energycommerce/ppacacon.pdfWeekly Probe. (2011). Hospitals use focus group to drive changes to surgical procedures. Retrieved from http://www.weeklyprobe.com/2011/12/ hospital-uses-focus-group-to-drive-changes-to-surgical-procedures/