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April 18, 2017

The hospital of the future might be in a town of 857 people

Daily Briefing

Lost Rivers Medical Center was bankrupt just a few years ago—but thanks to a determined community and an innovative CEO the rural hospital is rebounding and "helping forge the future of American medicine," Anna Gorman reports for Politico and Kaiser Health News.

Just a few years ago Lost Rivers, like many rural hospitals, was struggling. It was deeply in debt, had dilapidated facilities, and a limited scope of services. In 2013, it nearly closed its doors.

The key problem was low patient volume, Gorman reports. The hospital serves all of Butte County Idaho, which at half the size of Connecticut has a population of about 2,500. The county's biggest town is Arco, with a population of 857. As Lost Rivers CEO Brad Huerta put it, "Bears outnumber people out here."

To save a hospital, no more horse X-rays

Four years ago, when Huerta took over the hospital, he launched a turnaround plan based on technology, a smart use of resources, and strategic expansion of service lines, Gorman reports.

Huerta had an uphill battle, and his priority was funding. He borrowed money to cover expenses in the short term and pitched a $5.5 million bond to the local community. "He asked locals if it was worth $5 a month—one six-pack of beer or two movie rentals—to keep the hospital running," Gorman writes, and the answer was yes. The bond, plus several grants, gave Lost Rivers capital to start reinventing itself.

Huerta started by making a simple ask of clinicians and staff: "If it doesn't happen at a 'real' hospital, it doesn't happen at Lost Rivers," Gorman writes. That meant everything from standardizing what style of scrubs staff could wear to ending the practice of letting people bring their horse in for an X-ray. Huerta recalled saying, "I have no problem doing this, but you tell me what insurance the horse has."

Strategic investments

Huerta's strategies for raising revenue and cutting costs were innovative and varied, Gorman writes. For instance, Huerta used grant money to get the hospital designated as a level IV trauma center, which meant Lost Rivers could "get paid more for the care it was already providing," Gorman writes. And he cut costs by inviting locals to help renovate exam rooms and moving medical records to a cloud-based system that required less IT support.

Huerta's other strategies came from the recognition that the hospital's patient base is not likely to grow. He explained, "If you are not offering the services, people are going to go somewhere else … you have to find ways to keep that existing population here."

To that end, Lost Rivers has found ways to expand the services it offers its patient population. For instance, it now:

  • Offers patients telehealth appointments with a psychiatrist;
  • Connects its physicians via telehealth to specialists in trauma, ED care, and burns for consultations;
  • Has four part-time primary care doctors—some of whom live more than an hour away—who come in once a week;
  • Operates a pharmacy staffed with technicians and students who are overseen remotely by a pharmacist at Idaho State University;
  • Has several specialists, such as a cardiologist and orthopedists, who treat patients once a month; and
  • Trucks in an MRI once a week.

Moreover, a substantial amount of care is provided by "nurse practitioners, physician assistants, and even paramedics," Gorman writes, which helps keep costs down.

But when patients require more advanced care, the hospital is prepared to transport them to another facility—Lost Rivers has ambulances and an on-site helicopter ready to transport patients as needed.

These initiatives and others have paid off: Today, according to Gorman, the hospital is profitable and has reserves set aside for future projects, including a surgery center and a long-term care rehabilitation wing.

Threading the needle

According to experts, Lost Rivers is a reminder that rural health care can succeed in the right circumstances. Tom Ricketts, senior policy fellow at the Sheps Center for Health Services Research at the University of North Carolina, Chapel Hill, said, "They are under a lot of pressure, but there are rural places you can point to as places you would say, 'This is how things ought to be done.'"

But Rickets cautioned that innovation can fall short in the face of demographic and economic headwinds. "If you don't have enough people to support a clinic or a hospital, it has no economic reason to be there," he said.

And some rural communities don't have the infrastructure to innovate in a similar way to how Lost Rivers has, Gorman writes. For instance, Sally Buck, CEO of the National Rural Health Resource Center, said a lack of high-speed internet could make it hard to deliver reliable telehealth services. "You can't do home monitoring everywhere," she said.

Orie Browne, the medical director for Lost Rivers, also said it is important to keep the hospital's capabilities in perspective. "Ego is a dangerous thing," he said. "If there is anyone who can do a better job, I'm going to get [my patients] there," he said (Gorman, Politico, 4/12).

Why telehealth technology isn't enough


There are dozens of telehealth technologies to choose from. But planners who ask, "What technology should I invest in?" are focusing on the wrong question.

Technology is a tool that enables strategy, not a stand-alone solution. To build a successful strategy that effectively leverages telehealth technology, start by asking these three targeted questions.

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