Vladeck, Bruce C.

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Henry Ford Hospital Medical Journal Volume 38 Number 2 Article 11 6-1990 Primary Care: The Urban Hospital's Role Bruce C. Vladeck Follow this and additional works at: https://scholarlycommons.henryford.com/hfhmedjournal  Part of the Life Sciences Commons, Medical Specialties Commons, and the Public Health Commons Recommended Citation Vladeck, Bruce C. (1990) "Primary Care: The Urban Hospital's Role," Henry Ford Hospital Medical Journal : Vol. 38 : No. 2 , 130-132. Available at: https://scholarlycommons.henryford.com/hfhmedjournal/vol38/iss2/11 This Article is brought to you for free and open access by Henry Ford Health System Scholarly Commons. It has been accepted for inclusion in Henry Ford Hospital Medical Journal by an authorized editor of Henry Ford Health System Scholarly Commons. Primary Care: The Urban Hospital's Role Bruce C. Vladeck, PhD' In the best of all possible worlds, solutions to the problems of delivering high-quality primary care to inner-city resi-dents would probably involve hospitals peripherally, if at alt. Ideally, other mechanisms for delivering primary care, from private group practices to freestanding community health cen-ters, might be preferred. The track record of hospitals in organiz-ing and delivering primary care services is, at best, mixed, and there are powerful structural limitations on the capacity of hos-pitals to do what is right in primary care. Moreover, hospitals that are located in the communities most in need of primary care services are precisely those operating under the greatest fiscal stress, with the fewest available resources to invest in primary care development. Nonetheless, if we are to begin rebuilding the primary care infrastructure in our inner cities over the next decade in order to give those communities some semblance of the services they need, hospitals will have to do it because no one else will. More precisely, other institutions or organizations that make the at-tempt will find themselves highly dependent on hospitals if they are to succeed. While hospitals are indeed characterized as hav-ing many significant limitafions as potential organizers and de-liverers of primary care services, much can be done to increase the likelihood that they will succeed. Missing Links The essential element in providing primary care services in inner-city neighborhoods, or anywhere else, is a supply of com-petent and interested health professionals—physicians, "physi-cian extenders" (such as nurse practitioners and physician assis-tants), nurses, pharmacists, and others. These professionals can work in individual or group practices, in community health cen-ters or similar freestanding clinics, in facilities operated by pre-paid plans, or a number ofother possible settings. The shortage of such professionals is the principal reason for the inadequacy of primary care services in many inner cities, and, for a variety of reasons, that shortage is getting worse. Extensive experience in a number of communities has dem-onstrated that such professionals can be recruited to work in inner-city primary care settings provided there is an adequate f i -nancial base, an appropriate physical setting, opportunities for professional interaction and educational experiences, and ties to a good hospital. However, start-up capital for freestanding phy-sician practices is scarce, and most community health centers and freestanding clinics have traditionally relied on govemment subsidies that are increasingly difficult to obtain. Even when f i -nancing is available, professional isolation and especially prob-lems with admitting privileges have crippled such facilities' at-tempts to retain medical staff. The experience of the 1980s with efforts to enroll Medicaid populations in health maintenance or-ganizations or other managed care arrangements suggests that such enrollment efforts for primary care services are not likely to be successful in most communities in the foreseeable future. There has been some success, but simply not enough people will be enrolled to make a major dent in the primary care system. Hospital Assets In the development of primary care services, hospitals thus start with the capacity to develop appropriately supportive rela-tionships between the hospital and primary care providers. In addition, they possess some of the infrastructure—laboratories, radiology, billing and medical records capabilities, malpractice insurance—which is so difficult and often impossible to repro-duce economically on the smaller scale of a primary care set-ting. Hospitals already constitute major mobilizers and employ-ers of health professionals; even if the hospital has an inade-quate cadre of individuals expert or interested in primary care, it at least has a critical mass of nurses, administrators, other health professionals, and physicians. In many inner-city communities, hospitals are the only institutions that have a repository of sub-stantial managerial and intemal educational capabilities as well as the capacity to amass and target the efforts of a large number of people with different skills and occupational backgrounds. Most critical, the hospitals already have the patients. Emer-gency rooms and clinics in inner-city hospitals are the de facto family doctors for large parts ofthe population. While their cur-•Presidenl. Uniled Hospilal Fund of New York, New York City. Address correspondence to Dr. Vladeck. United Hospital Fund of New York. 55 Fifth Ave, New York, NY 10003. 130 Henry Ford Hosp Med J—Vol 38, Nos 2 & 3, 1990 Primary Care—Vladeck rent services lack continuity, provider familiarity with patients, and patient convenience and amenity, hospitals already are in the primary care business to a greater degree than anyone else, and they have the patient base from which to build a better sys-tem. // we are to begin rebuilding the primary care infrastructure in our inner cities over the next decade in order to give those communities some semblance of the services they need, hospitals will have to do it because no one else will. Hospitals are becoming increasingly motivated to restructure their system, since the current system is one with which every-one is unhappy. Hospitals don't like overcrowded emergency rooms filled with people who don't meet their trauma surgeons' or cardiologists' definition of emergency cases. They don't like losing the amount of money that their emergency services are costing them. They especially don't like losing money on what they and others perceive as a second-rate service. At the same time, hospitals recognize that their pafients are also unhappy with this system, its long waits, inadequate physical facilifies, and lack of continuity of services. While economic issues remain the major barrier to develop-ment of hospital-based primary care services, hospitals do have some advantages over other providers or potential providers in financial management. They employ, or can employ, capable financial management professionals and systems; they have working capital—often not enough for hospital purposes, but much more than that availabte to many other organizafions— and they generally have access to credit and to debt. Hospital Liabilities Hospitals also have significant liabilities in attempting to de-velop primary care services. To start, primary care is not their business. Most hospitals continue to be concemed primarily with high-technology inpatient services. The hospital power structure, economic structure, and managerial system, as well as the dynamics of most medical staffs, dictate that direction. Hos-pital mores reflect, unsurprisingly, the tendency in our society to value the technologically intensive, dramatic, and sophisticated services more than the apparently humdrum provision of routine care. High-technology inpatient services are what hospitals do best; those are the services around which they compete and which establish their identities. Because of potential conflicts between doing a first-rate job of community-based primary care and a first-rate job of tertiary high-technology inpafient ser-vices, it is not surprising that more often than not the inpatient services wins. In many ways the provision of primary care services is a fun-damentally different business from the provision of inpatient services. It requires different types of management systems and different kinds of managers. Most importantly, primary care services require a different orientation and philosophy than those acfivities on which most hospital managers have based their careers. Thus, the customary pracfice in many hospitals has been to appoint to ambulatory care positions either junior man-agers right out of training programs or the most senior manag-ers who aren't yet ready to retire, while keeping the "important" services like cardiac surgery or new imaging equipment under the jurisdiction of those who are still on the fast track. Moreover, even with the best of managers, hospitals often have trouble building and operating what might be described as user-friendly or patient-friendly systems for the provision of outpatient services. Such "user friendliness" is not solely a matter of image where inner-city primary care services are in-votved; without it, patients won't come for services, those who do come won't come back for needed revisits, and reliance on the emergency room for nonurgent evening and weekend ser-vices will persist. However, hospitals have traditionally been extremely friendly to their "users"—the physicians—by organ-izing the routines of their services, physical facilities, and sched-ules to maximize physician convenience, often at the expense of patients or potential patients. Hospital involvement in primary care raises complex issues of govemance issues of a sort that do not bedevil other potential primary care providers. Hospitals tend to be large, complicated institutions, and their governance is intrinsically complicated most ofthe time. Yet effective inner-city primary care requires a degree of connectedness and responsiveness to local communi-ties that may be particularly difficult for many hospitals. The people who have traditionally been responsible for the oversight and govemance of hospitals, and who are central to its ability to tap both govemmental and private sources of support, are fre-quently unlikely to live in, to be politically connected to, or to be viewed as representative of the communities they are trying to serve. Bridging that distance can be accomplished, under the right set of circumstances, but doing so is often neither easy nor enjoyable. Dollars and Cents All ofthese other obstacles notwithstanding, the major prob-lem hospitals have in the provision of primary care services in inner-city communities is economic. Only a few hospitals in the United States can currently avoid losing money on primary care delivery. Those are in states where subsidies for uncompensated care run through a hospital rate-setting system are generous enough and can be applied to hospital-operated or -affiliated outpatient services. Elsewhere, inner-city primary care means serving Medicaid recipients and the uninsured, and in an in-creasing number of states Medicaid reimbursement for outpa-tient services is extremely inadequate and appears positive only in contrast to no reimbursement at all. The reimbursement problems are complicated by the diffi-culty hospitals have in providing primary care inexpensive-ly, tn New York City, for example, it costs hospitals 20% to 25% more to provide a primary care visit and associated ancil-lary services than a freestanding clinic, and private physicians' charges are lower still. For years it was believed that hospital outpatient costs appeared so high because of cost allocation Henry Ford Hosp Med J—Vol 38. Nos 2 & 3. 1990 Primary Care—Vladeck 131 practices, although the incentive to do so has actually increased in recent years since the advent of the Medicare prospective pay-ment system, while the relative pricing differential does not ap-pear to have changed dramatically. A more plausible explana-tion is that hospitals have a great deal of standby and overhead capacity, particularly in their emergency services, associated with operating 24-hours a day, seven days a week. Hospitals also tend to be more generous, and perhaps less demanding, em-ployers of nurses and clerical and laboratory personnel com-pared to private physicians or freestanding clinics, and they are certainly required to meet more stringent requirements for their physical facilities—although hospitals can generally get their capital less expensively than other primary care providers. Providing high-quality primary care to a population with low income and high disease prevalence is not cheap. Ambulatory care may be less expensive than other forms of care, but that does not mean that it's inexpensive, although the major payers insist that it should be. Looking Forward The critical step in hospital involvement in primary care services is the institutional decision to take on these challenges. For some, the decision will be dictated by a perception of mis-sion; for others, it will be seen as the key to a survival strategy; the potential motives are numerous. Once the institutional com-mitment is made, the financial problems can then be addressed. Underthe Omnibus Budget Reconciliation Act of 1989, state Medicaid programs are now obligated to make supplemental payments of some kind to disproportionate share hospitals, but whether those payments will be at all adequate to subsidize pri-mary care services is a question that will have to be fought out in every state legislature. More targeted subsidies are becoming available for prenatal care and possibly also for services to pa-tients infected with the human immunodeficiency vims. Other new, targeted subsidies may well follow. Community philan-thropy cannot provide nearly as many dollars as these public sources, but it has probably not been adequately tapped over the last decade or two, when the third-party reimbursement environ-ment was more favorable, and hospitals are gradually redis-covering the potential of such philanthropy for subsidizing ser-vices to the poor. In developing and implementing all of these measures, hospi-tals will need to take the lead. Certainly, faced with many legiti-mate competing demands, potential funders will not seek to channel funds to primary care services ifthe potential providers of those services aren't creatively, visibly, and actively inter-ested. Experience suggests that hospital commitment and initia-tive is a necessary condition for the development of new funding sources. Such interest and initiative may not always succeed at developing such funding sources, but the development will not take place without them. Considering the variety of inner-city communities and the hospitals located in or near them, the specific details of hospital-based primary care services are sure to vary considerably be-tween institutions, as they should. Those services will, to vary-ing degrees, involve a web of relationships with other organiza-tions, providers, and community groups and will be financed and organized in a variety of ways. However, existing models suggest that with sufficient quantities of goodwill, energy, com-mitment, and, above all, patience ho.spital-based primary care will not only survive but thrive. tt can be done, if the institutions want to do it, as I obviously believe they should. Since we have no other options, we may as well make the best of it and enjoy the process as much as we can. 132 Henry Ford Hosp Med J—Vol 38. Nos 2 & 3, 1990 Primary Care—Vladeck 

Primary Care: The Urban Hospital\u27s Role

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