Hartford Business Journal

www.HartfordBusiness.com December 12, 2016 • Hartford Business Journal 3 Doc recruiting challenges leave small CT hospitals seeking help By Matt Pilon mpilon@HartfordBusiness.com I n recent years, Sharon Hospital has been forced to shutter its sleep center and Yale- affiliated cancer center after failed efforts to find suitable replacements for physician managers who relocated or retired. That's drained the 78-bed hospital's reve- nues, leading to financial troubles that spurred its parent company, Tennessee-based RCCH Healthcare Partners, to agree in September to sell Sharon Hospital to New York-based Health Quest, a nonprofit operator that owns three hospitals in the Mid-Hudson Valley. The small provider in the state's rural north- west corner is far from alone when it comes to doctor-recruitment troubles. While smaller Connecticut hospitals offer a lifestyle that's appealing to some doctors, they typically have lower patient volumes, fewer resources and less exposure to doctors in training than teaching hospitals — all drawbacks in recruit- ing talent. Even being on call fewer nights of the week, often a benefit of a larger system, can be a deciding factor for some. Hiring and retaining doctors has been a hurdle for smaller hospitals for years, but executives say the challenge has intensified as industry consolidation creates larger sys- tems with more resources. "Right now this is definitely a doctor's market," said Dr. Ian Tucker, vice president of medical affairs at Johnson Memorial Hospital, which joined the Trinity Health-New England system early this year following nearly a decade of financial struggles. "We have fewer and fewer doctors to fill a greater and greater need." There are also fewer independent hospitals in Connecticut as Hartford HealthCare, Yale New Haven Health and the recently formed Trinity system gobble up hospitals and other facilities. In the northeast corner of Connecticut, the 104-bed Day Kimball Hospital has long strug- gled with recruiting and retention, according to Chief Medical Officer Dr. John Graham. When Day Kimball launched a physician group in 2008 to ward off an encroachment by ProHealth Physicians, there was hope that recruitment would improve and bring in added revenue. "Unfortunately that has not come to frui- tion," Graham said. "We've had some recruit- ment, but I'd say we're slowly slipping behind and we need to retain physicians." In the past few months, the hospital has taken a new tack, signing a contract with a recruiting firm to help it find doctors. "Our strategy has to be more aggressive," Graham said. "That costs money." Day Kimball's biggest competitor for doc- tors is Backus Hospital, 35 miles to the south in Norwich, but they lose even more of their physicians to retirement. The aging work- force is a national trend and nearly one-third of Connecticut doctors were 60 or older in 2014, according to the Association of Ameri- can Medical Colleges. Day Kimball and Hartford HealthCare were in affiliation talks but those ended in late 2015, and Graham said there are no current discussions happening with any poten- tial acquirer. Large-system edge Joining a larger system often means smaller hospitals get help with recruiting and poten- tially become more attractive as an employer. For example, Charlotte Hungerford Hospi- tal in Torrington, which last month filed for approval to affiliate with Hartford Health- Care, is set to receive $3 million for recruiting and training programs. Charlotte Hungerford has found it increas- ingly difficult to hire and keep primary-care doctors and specialists alike, it wrote in its filing submitted to the Office of Health Care Access. Brian Mattiello, vice president of organizational development at Charlotte Hun- gerford, said compensation, unsurprisingly, remains an important factor for hiring doctors. "It's hard in a market like ours to be pay- ing top dollar," he said. "It's definitely a strug- gle to match some of the more capitalized health systems." Matt Katz, CEO of the Connecticut State Medical Society, agrees that better capital- ized providers have an edge in recruiting and retention, but even larger entities in the state encounter struggles. He sees Connecticut's cost of living, cer- tificate-of-need standards, malpractice insur- ance costs, and Medicaid reimbursement lev- els as negatives for attracting needed doctors to come to, or stay, in the state. "We have huge issues," Katz said. "If I'm a specialist coming into Connecticut, there are a number of issues causing me to say 'no.' " He also wants Connecticut to implement a loan-forgiveness program for medical-school graduates to incentivize them to stay here. Financial impact Recruitment challenges can have a direct impact on a hospital's bottom line. In its merger application, for example, Sha- ron Hospital said that "consistent difficulties recruiting physicians" and numerous physician retirements, relocations and practice divesti- tures have resulted in declining patient volume. The hospital saw a 16 percent decrease in inpatient discharges between fiscals 2013 and 2016, and a 22 percent decline in inpatient surgical cases since fiscal 2014. During that time, the hospital was forced to shutter its sleep center after its medical director relocated out of state, and close its oncology service for similar circumstances — all tied to its inability to recruit and retain physicians to the rural part of the state. Sharon, which until recently was Con- necticut's sole for-profit hospital, is part of a larger system, but is isolated from its sister hospitals, the closest of which is in Ohio. Sharon is now seeking to be acquired by Health Quest, which has a nearby presence over the border in New York. The hospital would revert back to non- profit status, which could be the first example of a reverse conversion in New England. Continued Declining Patient Volume In its merger application to the state Office of Health Care Access, Sharon Hospital said an inability to recruit doctors has led to declining patient visits. This chart shows some of that impact in recent years. Service FY 2013 FY 2014 FY 2015 FY 2016 Inpatient Discharges 2,878 2,616 2,466 2,411 Outpatient Visits 92,898 92,902 90,592 90,590 Total 95,776 95,518 93,058 93,001 S O U R C E : O F F I C E O F H E A L T H C A R E A C C E S S Johnson Memorial Hospital President Stuart Rosenberg and Dr. Ian Tucker, VP of medical affairs, say hiring and retaining doctors is tough but they expect their recent entry into the Trinity Health system to improve matters. P H O T O | S T E V E L A S C H E V E R Cybersecurity is hard. Defend Forward is easy. One monthly subscription puts the technology, training and expertise in place to defend your company's information, reputation, and future. Your Allies Against Crippling Cyber Attacks www.kelsercorp.com/DefendForward www.kelsercorp.com 111 Roberts St, Suite D East Hartford, CT 06108 860 610 2200

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