Memorial indecision hurting its biggest competitor, too

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The delay and indecision about Memorial Health System is hurting Penrose St. Fancis, too, CEO Margaret Sabin said.

Doctors and staff from Memorial made the same complaint about their hospital to City Council a few weeks ago.

While Penrose has seen its share of the market increase about 4 percent in the last year, Sabin says more patients are leaving the Colorado Springs market completely.

“We think we can share the market equally with Memorial,” she said. “And that’s what we want to do. But this indecision — all this talk — is damaging Penrose as well. And that’s a shame, because we offer world-class health care here.”

She said that any organization whose future has been held in question for years would suffer from it.

“The community suffers as well — and Penrose is part of that community,” she said.

Penrose now has about 44 percent of the market share, a result partially of declining patient volumes at its Colorado Springs competitor, she said

“It had gotten upside down there for a while,” she said. “But we want to have equal shares with Memorial — we want patients staying here. It’s good for the community.”

Growth at St. Francis Hospital has been especially strong.

“In 2009, the year it opened, St. Francis had 6,000 admissions,” said spokesman Chris Valentine. “This year, so far, they’ve had 8,000.”

“That’s all part of the plan,” Sabin said. “We knew it had potential when we built the hospital there. It’s doing well, just like we thought it would.”

But even that good news is tempered by the cloud hanging over the city’s health care industry.

“It’s the one thing I’m sad about in our overall picture,” she said. “That uncertainty is damaging. We need Memorial to be strong along with Penrose. We want both hospitals to be strong in the city.”

Even as Memorial’s future remains on hold, Penrose is moving toward more collaboration, as required under the Affordable Care Act.

“We’ve sent an invitation out to every single doctor in the community who wants to be part of an integrated delivery service — come talk to us,” Sabin said. “We were getting inquiries anyway, so we just opened it up.”

As Memorial struggled with lower than expected patient volumes, due in part to lower cardiology volumes, that isn’t a problem at Penrose. The hospital recently announced a partnership with Colorado Springs Cardiologists and earlier this year, one with Rocky Mountain Cancer Center.

“We’re really seeing our volumes increase there,” she said. “You’re going to see more partnerships in the future. We’re open for any kind — we can get married, we can get engaged, we can just exchange services.”

It’s the kind of plan that Dr. Larry McEvoy envisions for Memorial, and a plan Penrose itself supports in its rival. But it can’t happen — at least not yet.

Memorial Health System’s future has been up in the air for nearly two years, as one commission was replaced by a task force, which was replaced by a second task force. Recently, even more uncertainty was thrown into the mix when business leaders and health care professionals were named collaborators with the task force.

City council has set a timeline: a recommendation to City Council about who should lease the hospital by the end of the year, and a vote sometime in the spring to finalize the decision.

But, according to the latest financial figures from Memorial, the damage has been done. Hospital administrators are setting a series of cost-cutting measures in place to bolster Memorial’s bottom line.

Among them: early retirements, delayed construction and a travel ban. Purchases over $1,000 must be approved at the vice president level.

McEvoy told the council that until the ownership issue was solved, the hospital’s strategy was focused on the short-term.

“Our strategy is to build a regional hospital with regional partners, headquartered in the Springs,” McEvoy told them. “Until the decision on the future is made, our strategy has become very short-term.”

Short-term isn’t something Penrose is focused on. For the past three years, the hospital has focused on quality of care and patient satisfaction. Those efforts have finally paid off, Sabin said.

“Our patient satisfaction numbers are finally as high as we want them to be,” she said. “And that hasn’t been easy. A lot of people around here will tell you that turning those numbers around was the hardest thing we did. But we did it.”

Quality of care is also paying off in the form of more awards from organizations that monitor health care quality. Penrose was recently the only hospital in the state to be named to HealthGrades’ top 50 hospitals.

“We work toward that,” she said. “It’s one of the legs of our strategic plan, and it’s paid off beyond our expectations. We have two or three more awards we’re very proud of that we’ll be announcing in the next few months.”

And that’s probably the worst news McEvoy’s heard all week.