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Wednesday, 07 November 2012 05:59

Challenges lie ahead for new MedWest CEO

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A new CEO who will take over MedWest-Haywood in December will face the parallel challenges of improving the hospital’s bottom line and capturing patients who travel to Asheville for health care.

At the same time, shifting sands beneath MedWest are threatening to disband the tenuous partnership between Haywood and the neighboring hospitals in Jackson and Swain counties that were brought together under the MedWest partnership nearly three years ago. By all accounts, incoming CEO Janie Sinacore-Jaberg will have a full plate on day one.

“It is a challenge, but I don’t think it is a daunting challenge to her,” said John Young, a vice president of Carolinas HealthCare System, which manages the MedWest hospital group. “She likes a challenge and likes to turn things around. She has tremendous experience in growing business and keeping costs down.”

That’s what hospital leaders hoped would happen by joining forces with the neighboring hospitals in Jackson and Swain under the MedWest umbrella. On the surface, merging the neighboring community hospitals would cut down on duplication — from nutritionists that plan patient meals to ordering supplies — while bolstering market share.

But, the Jackson medical community quickly became disillusioned with the loss of autonomy and has pushed back against what it perceived as a second-fiddle status to Haywood. Young said mergers are rarely easy.

“It is a hard thing to do. You got a lot of things working against you,” Young said.

The business struggles of MedWest are a microcosm of the healthcare debate playing out nationally, Young said.

Doctors are making less than ever before; rural hospitals are struggling to survive; the health insurance reimbursement system is inherently flawed: and baby boomers’ mounting medical costs are becoming an unmanageable burden on society, Young said.

“You can see a national debate is inevitable on health care — and it will play out as we try to figure this out locally,” Young said in his quarterly “state of the hospital” report made to Haywood County commissioners this week. “It is a dilemma for our society.”

Young contends shoring up the financial outlook for the hospitals would go a long way to overcome the internal turmoil with MedWest. 

“Our problems go away if we start to make a profit and get away from the edge,” Young said.

Jackson’s medical community, however, has cited other reasons than simply financial challenges for its soul-searching. Some believe the cultures of the two hospitals are simply different.

Whether the Haywood side of MedWest will let WestCare pull out amicably, however, remains to be seen. The MedWest board of directors — comprised of seven members from each Haywood and WestCare — will debate the issue during the coming months.

“The board is made up 50-50 from both sides of the system, so they are split right now,” Young said.

Young said a turnaround is on the horizon. For starters, MedWest-Haywood will save $3.9 million a year after eliminating 87positions last month. Young said the layoffs weren’t taken lightly but were necessary.

“It is a difficult situation because the hospitals have always been one of the largest employers in the county. We put this off for a long time,” Young said. 

MedWest-Haywood will also be reimbursed for a multi-million dollar electronic medical record system it had to pay for upfront. Also, a new surgery center and urgent care center will start to reap benefits.

MedWest-Haywood still owes $8.5 million to its parent management company, Carolinas HealthCare System, which loaned the money to help bridge a temporary cashflow shortage. It is due back in January, but that appears unlikely to be paid off by then.

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