Multicare's James Lee on tough choices and new opportunities

National Harbor, Md. - James Lee says an evolving healthcare landscape requires novel approaches.

Lee, the executive vice president of population based care and chief financial officer of the Multicare health system in Washington state, engaged in some conversations about the state of the industry at the Healthcare Financial Management Association conference this week. Lee says he talked with his peers about the mounting financial pressures facing health systems and the industry’s long-term viability.

In an interview with Chief Healthcare Executive®, Lee said challenges with reimbursements and Medicaid cuts slated to take place over the next several years are forcing health systems like Multicare to make difficult choices. Multicare operates 13 hospitals and 300 other care sites across Washington, Idaho and Oregon.

“We have to be ever more efficient,” Lee says.

Hospital executives have long lamented inadequate reimbursements from Medicare and Medicaid, but the problem is particularly imposing for Multicare.

More than two-thirds of Multicare’s patients (70%) are covered by Medicare and Medicaid, with 28% covered by commercial insurance and 2% who self-pay, Lee says. As it stands now, Medicare reimburses 80% of costs for Multicare, while state Medicaid programs cover 50% to 70% of costs, he says.

With Medicaid cuts unfolding over the next several years, Lee says Multicare is looking at the delicate balance between providing services and remaining viable. And he says some of those options may include looking at what services the system continues to provide in some areas.

“We've been in our communities for over 140 years, and we aspire to be there for another 100-plus years. So in order for us to remain viable, there might be some adjustments that we need to make,” Lee says.

“We need to think about this again very differently than we have been in the past,” he says.

Multicare has invested heavily in its ambulatory care enterprise in recent years. The system has more than 50 urgent care sites and eight off-campus emergency departments.

Optimism about AI

Facing more financial pressures, Lee says he hopes AI can provide additional efficiencies and cost-savings. Multicare is using AI in a number of different areas.

Multicare has used AI technology in revenue cycle management for years, with coding assistance and handling prior authorization claims with insurance companies.

Multicare has also rolled out AI on the clinical side of the system, with doctors using ambient documentation to record and summarize physician-patient conversations. Lee says ambient documentation is showing good returns, helping doctors save time updating patient records.

“I think there's clearly a lot of opportunities with AI,” Lee says. “So on the clinical side, the ambient listening is the number one use application of AI, but it's not going to end there.”

“Because if you take the next logical step in that progression, it's not just about recording, but also pulling data from the patient's record, and then comparing with other patients with similar conditions, and then providing some recommendations to the provider, based on 100,000 patients with similar conditions,” he says.

Lee says he’s optimistic that as AI technology evolves, physicians will get more prompts that can help them offer better care.

Multicare’s physicians are also able to see more patients with the use of ambient documentation, Lee says.

“With ambient listening, we are seeing providers' ability to see one or two extra patients a day,” Lee says. “Now that doesn't sound like a lot, but when you add up all the providers that we have over a course of every year, it's significant capacity that we are adding.”

Affiliation with Samaritan

Multicare has also been working towards an affiliation with Samaritan Health Services, based in Corvallis, Oregon. Samaritan operates five hospitals and more than 100 clinics. If regulators sign off on the deal, Samaritan would become MultiCare’s first health system in Oregon.

State regulators are continuing to review the deal. Lee says he’s hoping the transaction is approved soon, and he says Multicare is looking forward to working with Samaritan. He also says Multicare can help Samaritan expand its ambulatory offerings.

“The Samaritan team has been fantastic about this,” Lee says. “They’ve been through a lot in the last 18 months, and thinking about their future, but they embraced this, … and they see the synergies.”

Multicare is also looking to get into the payer space and is seeking approval to launch its own Medicare Advantage plan.

“Our goal is not to make money from Medicare. There is no illusion of that,” Lee says.

But he says Medicare Advantage plans have been more than four times more likely to deny claims than traditional Medicare. Lee says forming a Medicare Advantage plan could reduce some headaches that impede the delivery of care.

“Think about the friction it creates to the providers and to the patients,” Lee says. “Because we have this extra work that's going on that doesn't add any value, it doesn't help the patient get better. So, by being a Medicare Advantage plan, we are looking to eliminate most of that friction.”