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Habersham Medical Center Receives Results of Healthcare Reform Readiness Assessment

August 07, 2013

August 5, 2013

Habersham Medical Center (HMC) recently received the results of a preliminary New Era Readiness assessment, revealing their strengths and opportunities for improvement in the face of current and future challenges in the healthcare landscape.  The assessment was performed by the consulting firm Kaufman Hall as part of HMC’s strategic planning effort with Northeast Georgia Health System (NGHS).

For the past several months, representatives from Kaufman Hall have been gathering information to assess HMC’s position with respect to the core competencies required to be successful in healthcare’s new environment.  Through interviews with key stakeholders – including physicians, staff, local officials and community members – as well as qualitative and quantitative analyses of operations and finances, combined with the firm’s experience in the industry and market knowledge, Kaufman Hall was able to gauge HMC’s strategic position. 

The results were shared today with members of the Habersham County Commission, the HMC management team and physicians through a series of education sessions.

Among the results, HMC scored well in relation to service distribution and effectiveness, with the results of the study showing HMC as a well-positioned community hospital delivering quality care for primary and secondary services with a modern and up-to-date facility. 

However, the results of the survey showed HMC was unprepared for the majority of the measures. Among them, information systems sophistication, which showed HMC’s IT department will likely need outside expertise and additional funding to meet future healthcare delivery requirements.

While HMC scored well in market essentiality, as an essential provider for primary and urgent care to the local community, HMC’s current size presents future risk as market share and inpatient utilization continue to decline. 

HMC also needs to focus more on physician integration.  High physician turnover and patient outmigration, driven by patient preference and physician referral patterns, have contributed to the medical center’s decline in market share.

Another area HMC showed a negative position in was financial strength.  With sustained operating losses since 2009 and more than $35 million in outstanding debt associated with the medical center’s recent renovations, HMC does not have the financial resources required for long-term sustainability.

“The results of the readiness assessment were not surprising,” says Patrick Allen, senior vice president of Kaufman Hall, who presented the information.  “These types of assessment results are common in small community hospitals across the country and are not unique to Habersham.   There are a number of healthcare organizations that are in a similar position as Habersham.  The changing healthcare environment and the evolving core competencies are some of the reasons so many hospitals are exploring restructuring models to reposition themselves in this changing healthcare landscape.”

“The assessment validated the fact that HMC would benefit greatly from joining with a healthcare system to help achieve growth in these core competencies,” he adds.  “Size and scale are essential to achieving a strong position in many of these core competencies.”

“This assessment was key to us understanding what our limitations are and what steps are necessary for us to be successful and viable moving forward,” says David Kerby, chairman of the Hospital Authority of Habersham County.

Kerby says a small work group of HMC Authority board members will now work closely with representatives from NGHS to determine what type of enterprise model might be in each organization’s respective best interests. 

Benny Bagwell, chair of the NGMC Hospital Authority, agrees that the information is insightful and provides a framework for the organizations going forward.

“Using Habersham Medical Center’s assessment, along with a recently updated readiness assessment Kaufman Hall conducted for Northeast Georgia Health System, we can find areas of strategic alignment that move both of our organizations along the continuum of readiness,” says Bagwell.

Carol Burrell, president and CEO of NGHS, says this approach validates the groups’ original guiding principles.  “We established at the beginning that the ultimate outcome should be good for the people of Habersham County as well as for residents of Hall County and the region,” says Burrell.  “By keeping these and our other guiding principles at the forefront, I feel confident we will arrive at the best solution.”

HMC President and CEO Jerry Wise says the organizations are working toward a fall/winter timeframe for a finalized agreement.  “This is not a fast process,” he says. “It takes time to gather all the information for a well-thought-out decision to be made.  But the completion of this assessment is a critical step forward in our journey.”

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