Publicly-funded hospitals like Nashville General vital

October 6, 2016

Originally published in The Tennessean.

Government-funded hospitals are invaluable institutions in many American cities because they are the health care safety net for a city’s most vulnerable citizens. But it’s no secret that they often struggle. In our community’s case, Nashville General Hospital at Meharry has seen, and is still experiencing, financial struggles, and with the recent resignation of Nashville General’s chairwoman, Mary Bufwack, the hospital is at a crucial point in its history.

Despite its troubles, Nashville General continues to demonstrate its solid commitment to providing quality care, as was evidenced recently by its receipt of The Joint Commission’s Gold Seal of Approval for Hospital Accreditation.

As Nashville General sits at a crossroads, as do many government-funded hospitals across the region and our nation, it’s important for us to be aware of the roles these health care organizations play in our communities and what they need to be sustained.

Role of government-funded hospitals
Government-funded or government-owned facilities tend to serve low-income or medically-underserved populations. Indeed, they are often the only source of medical care readily available to these community members, which is why it is vital their doors remain open.

In 2015, Nashville General had approximately 33,360 emergency room visits. If the hospital were to close, those thousands of individuals seeking emergency services, some without the means to pay, would end up in other local emergency rooms, putting a financial and occupancy strain on those facilities.

Successful practices in today’s environment
Facilities serving medically-underserved populations will inherently have financial issues due to treating all patients regardless of their ability to pay and will require some subsidies from the local government for survival — whether that be the city or the county. But in order for these hospitals to thrive, they must also take on new functions and adapt to a changing health care environment.

Many hospitals have experienced decreased inpatient admissions, which have a direct, negative effect on profits. For this reason, many rural hospitals are redirecting some of their focus to outpatient services. Urban health care facilities, such as Vanderbilt University Medical Center, have established clinical integrated networks to support facilities in rural communities to accommodate these trends.

Because most hospitals cannot afford to subsidize a full-time outpatient surgery practice, and physicians can’t afford to only practice at one facility, an emerging resolution is a circuit schedule. A circuit schedule allows a physician to practice at multiple facilities, alternating days of patient visits and surgeries, providing revenue for both the hospital and the physician.

Lean purchasing practices will also be more essential than ever before. When proactively audited and adjusted, streamlining purchasing can have a substantial impact on a hospital’s bottom line. I know of hospitals that have saved hundreds of thousands of dollars by taking a hard look at their supply budget, for example.

Because Nashville General serves a medically-underserved population and will always depend on Metro Nashville government for some subsidies, Metro has an annual budget allocation for the hospital. As members of the greater Nashville community, we can do our part to keep our safety net hospital strong by encouraging our Metro Council members to continue a prudent and monitored allocation of tax dollars to support Nashville General. It’s not only the right thing to do. It is the healthiest choice for all of Nashville.

C. Timothy Gary is CEO of DW Franklin Consulting Group, a Nashville, Tennessee-based, full-service health care firm providing consulting services in the areas of government relations, general business guidance, and legal strategy. Mr. Gary is also an attorney with Dickinson Wright PLLC. He holds a J.D. from Samford University, Cumberland School of Law and an MBA from Vanderbilt University, Owen Graduate School of Management.