Salem Health CEO gives interesting City Club talk

I made a good decision to join the Salem City Club. 

What's not to like? Great historic meeting rooms at Mission Mill; excellent lunches by Loustic Catering; friendly members; and always-interesting presentations with an opportunity to ask questions afterward.

Today Norm Gruber, President and CEO of Salem Health, talked about how health care is changing. I came away impressed. Gruber was appealingly honest about the screwed-up American health care non-system.

Having spent about 15 years in health planning and policy analysis, and now being Medicare eligible, I had both a previous professonal and current personal interest in what Gruber had to say. There wasn't much that I disagreed with.

About the only skeptical hmmmm? that crossed my mind was when he said that Salem Health only recovers 80% of its costs from Medicare reimbursement.

I recall from the lengthy TIME expose of health care costs that Medicare does a pretty precise job of calculating what it costs providers like Salem Hospital for various services, then adds a decent profit margin.

On the whole, I found Gruber's remarks both informative and hopeful. I happened to walk out of the meeting room at the same time he did. I told him, "It's reassuring to know that Salem Health is in such capable hands."

I asked a question during the Q&A part of the City Club meeting, noting that my Willamette Health Partners primary care physician recently told me she now was on a salary, which she much prefers. I asked Gruber if this was a sign that health care is moving in the direction of Kaiser Permanente, an HMO with salaried providers.

Before replying Gruber said that any physicians in the audience should put their hands over their ears, because they might not like what he was going to say. Naturally that made everyone perk up. 

He cited a survey of medical students that found exactly zero wanted to be in private practice. All preferred being salaried. So Gruber said that only physicans older than fifty, who are so used to private practice they can't envision doing anything else, will keep on running their own medical businesses.

Here's some other topics from Gruber's talk that stuck in my mind:

-- As reflected in the salaried physicians comment, trends are moving in the direction of Kaiser Permanente'ish health care organizations where insurance and provider networks are tightly linked. 

-- The United States has the most wasteful health system among developed nations. We spend way more and generally have poorer health outcomes. 

-- Our approach to end of life care is dreadful. European nations are way ahead of us in their promotion of hospice and home care, allowing people to die more peacefully and naturally. A disturbingly high percentage of Americans have operations in the last month and even week of life. Crazy.

-- Hospitals are trying to act like the airline industry (not exactly reassuring to me). They need to have higher occupancy rates, to spread fixed expenses over more patients, just as airlines have reduced routes/planes to do the same thing with passengers. 

-- Consolidation is the name of the game in health care these days. Salem Health is looking for a larger partner. I heard Providence Health Services mentioned several times. If this turns out to be who Salem Health links up with, you heard it here first. 

-- Small towns aren't going to be able to keep their small hospitals. Gruber asked whether the West Valley Hospital in Dallas, which is part of Salem Health, needs to have overnight beds. Maybe it should just offer outpatient and ambulatory surgery services, he suggested.

-- Not long ago, there weren't advertisements for prescription drugs on television. These are directed at patients, not physicians. Someone asked if they could be banned. Gruber was doubtful, saying we live in a free country. 

-- We pay much more for prescription drugs than people in other countries do, where drug prices are regulated. Supposedly we need to do this so the drug companies have enough profits to enable them to develop new drugs that they can then sell to Americans for a high price, and to people in other countries for a much lower price.

Sounds like a scam to me. But so is much of our current health care system.

It's so messed up, there's no way the Affordable Care Act isn't going to be a marked improvement. That's my conclusion, not Gruber's. But it fits with most of what he said. 

Update: came across a post from The Incidental Economist blog that illustrates how messed up our health care system is. Spend way more and get way less health benefits, that's the USA way. Here's the key graph in the post. USA is an outlier in the world, and not in a good sense.

Comments

[John Hawkins]

You captured Gruber's talk very well. The other astonishing revelation: Hospitals recoup the loss from Medicare and Medicaid by charging more to insurance companies, which eventually comes out of higher premiums.