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Christus rolling out new hospital
October 1, 2010

San Antonio Express-News - by Patrick Danner

Christus Santa Rosa Health System plans to convert one of its outpatient surgery centers near Alamo Heights to a 35-bed surgical hospital that's slated to open in early 2012.

The renovation and expansion of the building will cost $25 million.

While Christus will own the hospital, it will contract with a company owned by about 40 doctors to co-manage the facility - an arrangement that's emerging as an alternative to hospitals employing or entering into joint ventures with physicians. Co-management deals are seen as a way to try to improve care while lowering costs.

"It is a huge change from the way hospitals participate in the management of hospitals," said Dr. Michael Murphy, a member of the physicians committee developing the co-management agreement with Christus. "In a typical hospital arrangement, the doctors offer input and the administration does all the work."

The hospital will cater to patients who require short says of two to four days.

"About 85 (percent) to 90 percent of inpatient surgeries will be done on this campus: that could be anything from hip replacements to appendectomies to gall-bladder surgery," said Patrick B. Carrier, Christus' president and CEO.

The hospital won't handle more complicated procedures, such as open-heart surgery. It's expected to employ about 100 people, with about 150 doctors on staff.
The hospital will replace the Christus Santa Rosa Physician Ambulatory Surgery Center that's located in a 19,000-square-foot building at 403 Treeline Park.

Outpatient surgeries will continue in the surgery center next door in a 31,000-square-foot building at 423 Treeline Park.

Redevelopment work on the smaller building, which Carrier said originally was built to inpatient hospital standards, will start in December. The work will include the addition of 7,000 square feet.

Christus acquired a majority stake in the two surgery centers, along with one in Stone Oak and one in the South Texas Medical Center about a year ago from Foundation Surgery Center of San Antonio. A local physicians group has a minority interest in the centers.

Earlier this month, Christus acquired the Concord Imaging Center, based in the surgery center at 423 Treeline Park and renamed it Christus Santa Rosa Imaging Center-Alamo Heights.

"What we hope to do is keep our costs low and our quality high by working in synergy with the physicians," Carrier said. "These physicians will actually receive compensation for helping us to manage the hospital."

Independent companies will give guidance on the fair market value of the administrative services provided by the doctors' company so the hospital doesn't run afoul of anti-kickback laws.

"It is (a) relatively new (concept) and it's a way for hospitals to partner with physicians, at least in terms of managing outcomes of patients that is legal," said Bruce M. Mitchell, a lawyer in the health-care practice group at Oppenheimer Blend Harrison + Tate Inc. in San Antonio. "Hospitals have always had to be sure that they comply with the anti-kickback laws ... so it's always been difficult to reward physicians for really helping the hospital serve the patients better."
He's not involved with the hospital.

Half of the doctors' compensation will come from the hourly wages they earn, Murphy said. The other half will come in the form of payments to the management company if certain goals are met.

For example, if the hospital achieves an infection rate of less than 1 percent, the company will receive 100 percent of the "bonus." If the infection rate is 2 percent, however, the doctors group may only receive 75 percent of the bonus, Murphy said.

"So it incentivizes the doc to help in improving quality of care, improving infection rates, improving timeliness, improving costs of implants, (and) improving education of the support staff," Murphy said. "It's a perfect blend of the clinical side and the administrative side, to hopefully improve patient care and decrease the cost of care."

The passage of health care reform earlier this year has spurred Christus' interest in adopting similar models at its hospitals, Carrier said.

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