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What's happening to Chicago's safety-net hospitals?
Facilities that treat patients regardless of their ability to pay are going to look very different in the next few years, local health care leaders say. And if they don't, the hospitals may not survive.

Monday, November 25, 2019
Crain's Chicago Business
by Stephanie Goldberg

Chicago hospitals that treat patients regardless of their ability to pay are going to look very different in the next few years. In fact, if they don’t, more hospitals will close, making it harder for people to get the care they need.

That was the message at today’s Health Care Council of Chicago, or HC3, forum on reimagining the city’s safety-net hospital system. The group, started in 2016 by health tech hub Matter and consultancy Third Horizon Strategies, is a collaborative of more than 50 health care businesses.

Safety-net hospitals, many of which are independent, have struggled to stay open amid falling inpatient volumes and rising operating costs. Treating large numbers of uninsured and low-income people, such facilities rely more on government funding than hospitals that treat many patients with commercial insurance.

Safety nets need more state and federal support, but “there is only so long Springfield can underwrite this challenge,” Third Horizon CEO David Smith said during the event. “We need to be able to create a financially self-sustaining system. We need to integrate.”

That integration could be through joint ventures or consolidation, which Smith acknowledged is “scary” given the potential to cut services and leadership. But the local health care leaders who spoke during today’s event agreed that the alternative—hospital closures—is much scarier.

Among those leaders was Cook County Health CEO Dr. John Jay Shannon, who will step down Dec. 31 following the system’s board vote last week to remove him from the role. He addressed the shake-up today, joking that he wants people to start calling him “the physician leader formally known as the CEO of Cook County Health.”

As Chicago-area community hospitals close, as did MetroSouth Medical Center in Blue Island and Westlake Hospital in Melrose Park, “people with the best insurance will get picked up by (other) institutions. . . .Uninsured patients will find a way to our health care system,” Shannon said, adding that “the health of the community determines the economic vibrancy.”

Shannon said he talked with the Cook County Health board earlier this year about what the safety net will look like in the future, as technology pushes more care into outpatient settings. He said one goal is to provide charity care, or free care to poor patients, earlier—before conditions become more serious and, subsequently, more expensive to treat.

Virtual consultations are another way the two-hospital network is reaching patients earlier. “We haven’t found a way to make money” off this, “but it seems like the right thing to do,” Shannon said.

Safety-net hospitals are under pressure to transform, which isn’t easy to do with so little cash on hand. For example, Smith, a member of the board of Chicago-based Sinai Health System, said Sinai only has six days of cash on hand to fund operations.

Illinois House Majority Leader Greg Harris, a member of the state's Hospital Transformation Committee, said during the event that facilities will likely have to prove they’re not taking a “business as usual” approach to get government funding moving forward. “It may cause disruptions,” he said.

Meanwhile, Illinois Deputy Gov. Sol Flores said health care reform and transformation are Gov. J.B. Pritzker’s biggest priorities.



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