Good evening, I am Alan Aviles, President of the New York City Health and Hospitals Corporation, our City’s public hospital system. Thank you for being with us tonight for our Queens annual public meeting, the third of five borough-specific meetings we convene each year. As always, I am eager to hear what HHC’s communities have to say about our performance, especially during what continues to be a challenging time in healthcare generally and for HHC specifically.
First, let me recognize HHC’s senior executives here in Queens. Our host this evening is Chris Constantino, Senior Vice President of the Queens Health Network and Executive Director of Elmhurst Hospital Center. Also in attendance is Julius Wool, Executive Director of Queens Hospital Center. I thank them both for the excellent work they do every day as leaders helping us to render the best possible care to Queens residents.
I also want to acknowledge the support and guidance of our Board of Directors, under the leadership of Dr. Michael Stocker. My special thanks to Board members who are here tonight and to the members of our Queens and Elmhurst Community Advisory Boards, who advocate on behalf of our public system and help keep us grounded and responsive to the needs of our patients and communities.
Last year, I spoke about the impact of Hurricane Sandy on the city and on HHC. While our facilities in the Queens were not damaged significantly, our employees here certainly suffered storm-related effects as many found it difficult to get to work because of transportation disruptions and fuel shortages, and some experienced personal hardships that were storm-related. Despite these challenges, our Queens facilities remained adequately staffed throughout the storm and our employees ably staffed the Special Medical Needs Shelters that operated at both York College and Queens College.
Across our public system, we have had to repair several severely damaged facilities, notably Coney Island Hospital, Bellevue, and Coler Specialty Hospital and Nursing Facility. Additionally, we have been working to make our at-risk facilities more resilient to minimize the impact of any future severe storm.
The Challenges As you would expect, the storm added an additional burden to the significant financial challenges we already face. These challenges will continue to intensify as we confront projected reductions in revenue and a daunting budget gap.
Medicaid cuts and reforms in the State’s budget will reduce HHC’s reimbursements from the state by more than $50 million this coming year. Over the past five years, HHC has absorbed cuts that now total an astonishing $540 million annually.
In addition, we will receive nearly $10 million less in our annual Medicare revenue going forward as a result of the federal sequester.
In a bit of good news, last week the Mayor added $12.5 million to HHC’s baseline budget for fiscal year 2015 and beyond. This represents funding that the City Council restored to our budget this year to help fund our child health clinics, certain developmental disability services, as well as other operational expenses. Now that these funds have been base-lined, we are spared the uncertainty of whether we can persuade the City Council to restore them. However, we are increasingly in an environment where we will be expected to deliver better care, with better patient outcomes, and to do so at lower cost. More and more of our funding will be tied to our ability to accomplish these three things.
While healthcare providers throughout the country are also dealing with these same expectations, the challenges for HHC are greater because we provide care for so many uninsured patients. Indeed, last year we served nearly 500,000 patients without insurance.
As you have heard before, HHC has worked hard to control costs internally. Over the past four years, we have implemented a cost-containment and restructuring plan that, in the aggregate, has reduced our projected budget shortfalls by more than $1.7 billion since FY 2010. As part of that plan, by July 1st of this year, HHC also had successfully met its workforce reduction target of 3700 full-time equivalent positions one full year ahead of schedule, and this has contributed significantly to an annualized $600 million closing of our budget gap. Most of this workforce reduction has been achieved through attrition and we have tried to shield direct patient care positions as much as possible. Indeed, we actually have increased our total number of registered nurses slightly during the last four years despite the overall workforce reduction. It is a credit to our dedicated employees that even with more than a 9% reduction in our total workforce, we have maintained virtually the same service capacity across virtually all care settings.
Going forward, our financial plan assumes another $193 million in savings in FY2014 based on our implementation of remaining restructuring initiatives as well as additional cost containment measures. These measures include efforts to consolidate targeted services, centralize procurement, improve revenue collection and maintain our lowered workforce headcount. These efforts, when fully implemented, aim to achieve savings of $390 million in FY15. HHC’s senior leadership team has been exploring every possible way to close our budget gap while continuing to provide high quality, safe care to our patients and maintain our capacity to adequately serve the communities that depend on us. That said, maintaining the full scale and scope of current services will be very challenging, given the reductions in federal funding that started this year.
And under the Affordable Care Act, beginning in 2014 the federal government will make significant reductions in supplemental Medicaid and Medicare funding that supports public hospitals. These cuts increase dramatically by 2017 and ultimately could reduce HHC’s federal funding by more than $325 million annually. Although we are advocating against this destabilizing loss of essential federal funding, there is very little prospect of Congress re-visiting the wisdom of these looming, devastating cuts.
It is important for our communities to understand how serious HHC’s fiscal situation is, and why we have resorted to extraordinary measures such as targeted layoffs, the closure of some small community clinics, and the outsourcing of certain services. And it is important that all stakeholders fully appreciate the severity of our financial challenges and the forceful advocacy required to preserve HHC’s mission and to enable us to continue to meet community needs. While in the past we have relied on increases in governmental funding to keep our system solvent in the face of rising costs that were outside our control, the current economic conditions at all levels of government, the clamor for reducing healthcare costs, and gridlock in Washington, make additional significant government support unlikely for the foreseeable future.
Our willingness to make tough and, at times, painful decisions has enabled us to avoid closing any major HHC facility and allowed us to remain faithful to our core mission of serving all New Yorkers without regard to insurance or immigration status. However, the unrelenting financial pressure we are experiencing represents a grave threat to our mission and to our long-term ability to maintain sufficient service capacity to meet the needs of our patients across the City. And more tough decisions surely lie ahead.
One way we are meeting the challenge of doing more with less is by achieving greater efficiency through our continued redesign of our operations using Breakthrough, our employee-driven process improvement approach. The implementation of Breakthrough uses frontline staff members to help determine operational changes that allow us to work better and smarter to accomplish our goals. Since launching Breakthrough in 2007, our team-led rapid improvement events have achieved $377 million in financial benefits – nearly $349 in new revenues and $28.5 million in cost savings. There are 19 sites that have active Breakthrough teams working to make improvements in 71 areas. The vast majority of savings have come from five broad areas: inpatient services, Emergency Departments, ambulatory care, behavioral health and peri-operative services.
For example, thanks to Breakthrough efforts, Elmhurst has lowered the time from arrival to discharge in its Adult ED by 16%, despite a 17% increase in ED visits during the same period. Queens has used Breakthrough to increase ambulatory surgery revenue by 18% and at the same time reduce the cost per case by 23%.
Even as we struggle to make our system more efficient and to manage the formidable financial challenges we face, we continue to offer essential and high quality services to the communities that we serve. To promote wellness, we continue to offer robust primary and preventive care services, with an emphasis on the early detection of disease and the effective management of prevalent chronic diseases such as asthma, diabetes, and hypertension.
We are continuing to transform how we deliver care so that is better coordinated and managed. In January of this year, the federal Centers for Medicare and Medicaid Services designated HHC as an Accountable Care Organization in the Medicare Shared Savings Program with a focus on improving the health of Medicare beneficiaries through coordinated, high quality care delivered at reduced costs.
HHC’s investments and demonstrated ability in care coordination and care management also have resulted in our designation as a Health Home here in the Bronx and in three other boroughs. This means we have responsibility for managing the care of Medicaid patients with very complex medical conditions, including serious psychiatric illness and chemical dependency. We are the only organization to be given this responsibility by the State in more than one borough of the City.
As I have reported previously, all of HHC’s primary care sites have received formal certification as Patient-Centered Medical Homes. Now, all of these sites are in the process of being re-certified under more stringent standards and we expect all to be recertified with the next three months. Already, ten HHC facilities – including Elmhurst Hospital – have been recertified for another three years as Patient Centered Medical Homes at Level III, the highest level of certification. In fact, Elmhurst Hospital was recertified with the highest score received by any HHC facility to date.
HHC’s health plan, MetroPlus, will play a key part in the success of all of these activities aimed at delivering better care, helping our patients become healthier, and at the same time reducing costs. MetroPlus continues to be the highest rated plan in the City based on quality measures and customer satisfaction.
The investments we are making in information technology will have a significant impact on our success in these areas, as well. HHC has purchased a new electronic medical record system that will be phased in over the next five years. Our new system will enable our providers to share information more easily to better coordinate care, as well as give patients ready access to their health information, facilitating their ability to partner with their caregivers to improve their health status. By meeting certain objectives for using certified electronic medical record technology to improve patient care, HHC has qualified for meaningful use designation from the federal government that will result in our receipt of $122 million in federal dollars to help offset the cost of our new electronic medical record.
Additionally, we are completing installation of a new billing and appointment scheduling system. The new scheduling system will be more patient friendly and will enable us to ultimately consolidate multiple call centers.
As the Bloomberg administration draws to a close, I would like to thank the Mayor for the support he has shown for public health in New York City, and for our system in particular, over the last 12 years. We have prepared extensive transition materials for the incoming administration, and expect to begin briefings soon. Based upon his public statements during the campaign, Mayor-elect de Blasio certainly understands the critical importance of the public hospital system and we anticipate that he will continue the same strong support for its mission during these challenging times.
As we work to make our system more efficient, and manage our ongoing financial challenges, we continue to be responsive to the needs of our communities, and especially to the uninsured. In Queens, HHC provides 87% of all hospital-based clinic visits and 25% of all inpatient stays made by uninsured residents.
Turning specifically to our work in Queens, let me briefly report on some recent accomplishments at Elmhurst and Queens hospitals.
In June 2013, for the third consecutive year, Elmhurst Hospital Center received the Gold Plus Performance Achievement Award from the American Heart Association/American Stroke Association for its successful implementation of higher standards of stroke care, aimed at reducing death and disability and improving the lives of stroke patients. In addition, both associations also acknowledged Elmhurst on their “Honor Roll” for its consistently timely administration of clot-busting (thrombolytic) therapy within 60 minutes of a stroke patient’s arrival to the hospital.
Elmhurst also achieved designation as a NICHE-recognized hospital for its nurse-led geriatric care that addresses the unique needs of hospitalized older adults. The acronym – NICHE – stands for Nurses Improving Care for Healthsystem Elders. Also this year, Elmhurst received a grant from the LiveStrong Foundation to help it achieve the new Joint Commission Advanced Certification in Palliative Care for its existing comprehensive Palliative Care program.
In 2014, Elmhurst will open its new Women’s Healthcare Services Pavilion. The state-of-the-art facility, which is being funded by HHC and the City Council, will house a variety of women’s health services, including pre-natal care and other obstetrical services. The Pavilion will also be home to a number of support programs, including those offering classes in breastfeeding, childbirth, nutrition, and diabetes education.
Earlier this month, Queens Hospital Center received the Northeast Business Group on Health’s 2013 Leapfrog Award. This award is given for improvements in patient safety and quality, including significant improvement on seven nationally reported safety and quality measures. Queens also received a Leapfrog Hospital Safety Score of “A” for each of the last three years.
Last year, Queens opened the first Emergency Department Observation Unit within HHC. Its eight beds accommodate patients who come to the ED with chest pain and who require testing and monitoring to rule out a heart attack before they can be safely sent home. The unit now serves approximately 1,000 patients per year, three-quarters of whom are treated and released, rather than being admitted. Queens plans to expand this unit to incorporate additional diagnoses to help reduce avoidable admissions and readmissions, in line with national goals.
Thanks to a comprehensive program to improve care to heart failure patients at Queens Hospital Center, the no show rate in their heart failure clinic has decreased by almost half and the 30-day readmission rate for these patients has decreased 20%.
In 2013, the Cancer Center within Queens Hospital achieved accreditation by the American College of Surgeons with 8 commendations, which earned it the “Gold Standard,” the highest level of accreditation a cancer program can achieve. Queens and Elmhurst have the only comprehensive cancer care programs in the borough.
I am proud of the work that our dedicated HHC staff performs every day here in Queens and across our city to provide accessible, high-quality healthcare to our patients. I can assure you that the leaders across our organization, as well as our Board of Directors, are advocating at every level of government to secure the resources necessary so that HHC can continue to effectively meet the needs of our vulnerable patients and communities.
We appreciate the strong advocacy support that we receive from our partners in labor, our community advisory boards and auxiliaries, and many community-based organizations that care about our mission. Our strong connection to, and support from, the communities we serve is one of our most important assets.
Thank you for your attention and your attendance. I will now turn the program over to Mr. Russo. I look forward to hearing your comments.