The Cardio Service Line, Rebooted

This article appears in the March 2013 issue of HealthLeaders magazine.

As healthcare leaders pay more attention to what their patients want and need, the tactics for caring for cardiology patients are changing. Those responsible for cardio service lines are placing more emphasis on patient behavior. Closely and loosely aligned partners, often practicing in the community and not in the hospital, are playing pivotal roles in expanding the patient referral base in new ways. And even though there is more emphasis on care outside the hospital, for the most part, healthcare leaders expect stability in cardio revenues and contribution margins, partly as a by-product of industry consolidation.

Shift toward prevention

Half of the Intelligence Report respondents (50%) say that prevention programs are critical parts of their cardio service lines. Wellness programs are important to nearly as many, 47%. That's today. Looking forward three years, prevention (62%) and wellness (54%) top the chart, while inpatient drops from 69% to 35%.

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Laura Robertson, RN, chief executive officer of the 111-staffed-bed Banner Heart Hospital in Mesa, Ariz., explains one way her organization extends care into the community. "[We've been through] a big transformation of care. We brought in a postacute care skilled nursing facility and home care. With them we designed cardiac units in their skilled nursing facilities and [established] cardiac teams to manage patients through home care. [Now they are] more successful at assessing, understanding what to do, managing both resources and patients in the home."

Revenue stability

With a shift away from inpatient care for some services, what happens to cardio revenues? Sid Kirschner, executive vice president of Piedmont HealthCare and president and CEO of Piedmont Physicians Organization, looks at patient care in pretty broad terms. "Wherever a patient enters our system, [we] have to be able to treat that person for all of their cardio needs for the rest of their life. We could get someone who is healthy and goes to a cardiologist; as time evolves, other problems develop. Our system is designed to handle all those issues."

Piedmont's wellness programs prompt early medical encounters with the population at large, maximizing the opportunities to establish relationships with patients. Does that sound like marketing? Kirschner calls it "a mutual benefit endeavor. You want to capture the patient as early as possible in your cycle. It's a combination of preventive health benefit for the patient as well as a marketing program. So now that you have the patient, as the patient ages and has a problem, the patient is in your system."

See Also: Hospitals Rethink the Service Line

Banner Heart's Robertson observes that population characteristics support such a long-term view. "There will always be cardio patients who need procedures," she says. "Cardiac disease isn't going away. Look at diabetes incidence, the aging population, obesity. The risk factors for cardiac disease are so prevalent."

If one examines the make-up of the revenue stream, one sees continuing revenue in imaging, mostly on an outpatient basis. Says Kirschner, "If you really track reimbursement, most of the volume is outpatient testing after the first visit. You do an initial MRI or CT scan and then there is appropriate follow-up." This may be why imaging is cited by 35% of respondents as a technology they expect to add to their cardio service line in the next three years. The appeal of imaging is even stronger among smaller enterprises: 42% of organizations with net patient revenue of less than $250 million expect to add imaging technology, while just 19% of organizations with NPR of more than $1 billion will be doing so, as they focus more on remote monitoring technology (60%) and hybrid rooms (55%).

Contribution: Mostly positive

For most, the cardio service line remains a leading service line in terms of financial contribution. The mean positive contribution margin reported by respondents is 19%. Nearly half of respondents (45%) expect a minor increase in contribution margins from cardio in the next three years. On top of that, 21% expect a major increase. No wonder 74% of healthcare leaders expect to expand their cardio service lines in the next three years.

While only 1% of respondents expect a major decrease in cardio service line margins, a notable share (11%) expects a minor decrease.

Collaboration and alignment

More attention to collaborative care means more attention to physician alignment. Many provide collaborative care through comanagement programs (31%) or joint ventures (17%), but the fully employed model is used in 33% of cardio service lines. Robertson notes the benefits of the medical staff model for cardiology. "More than ever, we are aligning with medical staff. For the cardio service line, you need cardiologists who are committed to your facility to bring business, ensure quality and service, and manage costs." And today, interventional cardiologists are in demand, especially with more procedures done in an outpatient setting. Nearly one-third of respondents (31%) plan to hire interventional cardiologists to drive business to their cardiology service line. "Interventional cardio is the real driver of reimbursement," Robertson says. "They'll do the procedures like catheters and stents. A noninterventional cardiologist can do a diagnostic catheterization, but they can't do any interventions."

Carol Mascioli, vice president of clinical services at the 680-bed Baptist Hospital in Miami, explains how inclusion helps her organization earn buy-in from a 100% voluntary cardio physician team. Baptist Hospital is developing a protocol for patients arriving at the emergency department with atrial fibrillation. Baptist wants to identify which patients with the condition can be treated or observed in the ED and sent home, instead of being admitted as a matter of course. The effort started with a broad clinical team, including nursing leaders, the ED medical director, the clinical cardiology medical director, the electro physiology medical director, hospitalists, and the anesthesia medical director.

"Our goal was to tackle the reason they came to the emergency department, correct that, and then get the patient back to their primary care physician or cardiologist for additional evaluation," Mascioli says. Being inclusive about developing such a protocol "may slow down some processes, but if it's related to quality improvement, we make sure we have participation across the spectrum." She predicts complete buy-in to the atrial fibrillation effort because the same clinical team has accepted a jointly developed chest pain process and heart failure process. She observes that all of the 30 or so doctors on the cardio team are voluntary. "It doesn't require an employment model to get collaboration. We do it."

Boosting admissions

As healthcare leaders look to enhance their cardio services and expand their reach, though, they should keep in mind an important customer dynamic about visits to the doctor. As Kirschner explains, "A patient doesn't mind driving a long distance for a unique service, as long as routine care is local." Indeed, because 75% of respondents want to be a regional cardio destination center or local cardio leader, their current challenge will be to offer a competitive set of subspecialties while increasing their outpatient services.

Michael Zeis is research analyst for HealthLeaders Media. He may be contacted at mzeis@healthleadersmedia.com.

Reprint HLR0313-3

This article appears in the March 2013 issue of HealthLeaders magazine.