MedCath facilities profit from focus

Firm streamlines processes, costs

McAllen (TX) Heart Hospital, a 60-bed facility has been open for less than two years and already boasts the largest market share and lowest operating costs in the area. At the same time, the facility produces outcomes well within the national average. A sister facility, 84-bed Arkansas Heart Hospital in Little Rock saw a profitable bottom line in June, its fourth month of business. The two facilities are the first heart-only hospitals opened by MedCath Inc., based in Charlotte, NC.

MedCath heart-only facilities focus exclusively on operations encompassing the continuum of cardiovascular disease management. The company’s diagnostic division operates mobile and fixed-site cardiac catheterization laboratories; the practice management division develops partnerships with local physician groups; and the hospital division provides inpatient cardiovascular care.

The hospitals are part of a trend toward hospitals that focus on a particular disease or condition. Specialty providers have shown that they are able to treat patients more quickly, more efficiently, and with better outcomes than providers who offer a range of services.

"We concentrate on one thing and do it well," says Joan McCanless, RN, vice president of clinical disease management for MedCath. The hospitals have received excellent results in their patient satisfaction surveys, she says. When asked if they would return to a facility or recommend it to someone else, nearly 100% of patients reply, "Yes."

Success attributable to outreach

McCanless attributes MedCath’s success in attracting patients to a number of factors including advertising, working with managed care companies, and community outreach and educational programs.

The first MedCath facility, McAllen Heart Hospital, has a staff of 137 including 14 cardiologists. It has three surgery suites and three cardiac catheterization labs. In 1996, the hospital treated 2,330 patients in labs and performed 354 open-heart procedures. To generate interest, the hospital ran a screening program targeting "winter Texans" who live in McAllen only part of the year.

In the first quarter of this year, 82% of revenues were generated by patients treated for cardiovascular diseases. The remainder was split among the emergency department (ED), other related surgical and support procedures, and the hospital’s cardiovascular home health agency.

MedCath hospitals operate 24-hour EDs that care for noncardiac patients as well. "If someone comes into the [ED] with chest pain and we rule out cardiac problems, we can do whatever procedures are required so they don’t have to go to another facility," McCanless says.

Also, if a patient is already at a MedCath hospital and needs a noncardiac procedure, such as a hernia repair or dialysis, the MedCath staff can do that while he or she is in the hospital. "We don’t do neurosurgery or orthopedic surgery, but we can take care of patient needs within reason," she adds.

Treatment at MedCath facilities involves a multidisciplinary team approach and adherence to clinical pathways. The company has worked to streamline the documentation process to allow nurses to spend more time with patients. "Focusing on cardiac care allows all of the staff to be trained and cross-trained to provide the very best care possible to cardiac patients," McCanless says.

Some factors that contribute to MedCath’s success include:

- Educated staff.

"That’s a key to success for us all," McCanless says. The company prefers hiring critical care registered nurses (CCRN) for its facilities. If that’s not feasible, it hires nurses who agree to work toward the goal of becoming a CCRN.

- Cross-trained staff.

MedCath hospitals employ nursing assistants — called patient care partners — who are trained to assist patients in activities of daily living, such as dressing, ambulation, and drawing blood. "It’s more efficient to cross-train them so we don’t need as many physical therapists and phlebotomists," McCanless says. The unit support staff are cross-trained for housekeeping and food service duties, avoiding the need to hire separate staff for those jobs.

- Lower labor costs.

In most acute care hospitals, the cost of labor is about 50%. MedCath has kept its labor costs to less than 30% by streamlining management teams and operating efficiently. "We bring care to the patient’s bedside, rather than taking the patient to the care," McCanless says. That eliminates the need for a transportation staff. Other than going to the catheterization lab or for special radiology procedures, patients remain in their rooms during their entire stay.

- Low overhead.

MedCath can keep costs low because it doesn’t have unprofitable product lines, such as burn, trauma, or OB/GYN units. Community hospitals are left to provide those services.

What’s next?

MedCath plans to open cardiac care hospitals in 20 states over the next several years. The following heart-only hospitals are on the drawing boards:

1. 50-bed facility in Phoenix in February 1998;

2. 60-bed facility in Austin, TX, in spring 1998;

3. 54-bed facility in Bakersfield, CA, in fall 1998.

Hospitals in Dayton, OH, and Montgomery, AL, are also being planned.

MedCath also manages three medical practices comprised of a total of 76 physicians. The firm manages fixed-site cardiac diagnostic and therapeutic centers and owns and operates mobile cardiac catheterization laboratories serving networks of hospitals.