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Bemidji health giants pledge cooperation, sharing

Bemidji's two health care administrators pledged cooperation and sharing more than ever before during Tuesday morning's Bemidji Sunrise Rotary Club meeting. North Country Health Services CEO and President Paul Hanson, right, talks about health care in Bemidji while listening is Dan Olson, MeritCare Bemidji administrator. Both relatively new to Bemidji, they have been long-time friends. Pioneer Photo/Brad Swenson

Bemidji's largest health providers plan to do a lot of sharing in the future to ensure quality community health care.

"With two new sets of eyes, we're coming in and we go, 'How come we're not working on this together?' 'Why do we have two departments of this?'" Dan Olson, MeritCare Bemidji administrator, said Tuesday morning.

"Even though we're two separate entities, there are models out there where you can share departments, share the revenues and share the expenses, share the losses and share the profits," he said.

Olson and Paul Hanson, North Country Health Services president and CEO, spoke to the Bemidji Sunrise Rotary Club about growing cooperative health care systems in Bemidji.

"It's very frustrating -- it has to be frustrating to the community, and certainly to us, as we look at the resources that could be saved if we just come to the table and talk," said Hanson, "about recruiting physicians or expanding services."

It can be done locally, they said, even though the merger of MeritCare and Sanford Health Systems creates one of the largest coverage areas in the nation, and North Country Health Services a substantial independent hospital and long-term care organization.

Olson has headed the Bemidji clinic since January, coming here from a clinic in Thief River Falls. Hanson started this fall, coming here from a hospital in Watertown, S.D.

But both have been friends for years, first meeting at Concordia College in Moorhead in the 1980s, and following each other's careers. And both had pledged to eventually work "in the lakes" in Minnesota.

Olson actually called Hanson in May, telling him of Jim Hanko's pending retirement as NCHS CEO and president.

"We really feel, knowing each other personally for 24 years, to tall the community we've got two Cobbers here that are the head of two different organizations, but we're going to work together in one great community," Hanson said. "We really believe that."

Some of that work has already begun.

Olson said recruiting new primary care physicians to Bemidji is the most challenging position he has, even ahead of balancing the books with uncompensated care adding up.

"It's tough to get doctors, an then primary care doctors it's even harder, because people don't want to be on call all the time and get up in the middle of the night and deliver a babies," Olson said. "They want 8-to-5 jobs."

In May, a new program was started at North Country Regional Hospital which puts a primary care or internal medicine doctor on staff. Called a "hospitalist" program, the hospital doc makes rounds for primary care physicians' patients, relieving them of having to make sometimes twice-daily trips to the hospital.

A traditional doctor, Olson said, will work 12 hours a day going back and forth from the hospital rounds to holding patient hours at the clinic, plus paperwork.

Incoming family doctors can more or less count on an 8-to-5 practice, Olson said. "They want to be home at night so they can have dinner with their family, they want to go to their kids' activities."

Hospitalists docs can admit and discharge patients upon recommendation of the clinic docs, said Hanson. "It's a huge investment by the hospital to help out the local physicians, but it's also a recruitment opportunity for us because Dan can say to incoming physicians ... we've got a really good hospitalists program over here just like you could have in the Cities."

Since the hospitalists program started in May, Olson said four new primary care physicians have been successfully recruited. "At least we get a second look now."

Cooperation between entities is extremely important, Hanson said, noting that when asking nurses and staff who is the most important to serve, the usual answer is the patient.

"In my mind, it's the physician," Hanson said. "Who admits to the hospital? And they wouldn't admit to the hospital if they didn't trust the care they are going to get, they didn't trust the staff, they didn't trust the equipment -- they would tell people to go to St. Cloud, Grand Forks or Duluth. They need to stay here."

North Country Health Services employs 700 full-time equivalent positions or about 900 people, Hanson said, and is the community's second-largest employer. It has net revenues of about $90 million, after discounts and uncompensated care at about 5 to 7 percent. It has a $50 million annual payroll.

In the next year, NCHS will run with a negative 1 percent operating margin, Hanson said, with hopes of turning that around, possibly through expanded services that generate revenue.

NCRH's emergency room sees 26,000 patients a year, which Hanson contrasts to about half as much at the hospital he served in Watertown with the same 100,000 population service area.

MeritCare Clinic Bemidji has about 330 full-time equivalent positions or about 500 people, Olson said, involving a $32 million annual payroll. Net revenue is about $80 million, with uncompensated care a little more than 4 percent.

A problem, Olson said, is reimbursements for care from public programs, such as Medicare, which covers only about 35 cents on the dollar for care. Discount care through such carriers as Blue Cross Blue Shield is at 50 cents on the dollar.

Hanson said that 65 percent of the care given at NCRH is through public assistance programs.

It's good to go back and analyze the financials, Hanson said, to find areas for improvement just as any business would.

"We don't care about the past," he said. "We just want to look at what's going to happen in the future and how we make it better."