Rural Health Summit: Alex Roehling, Chief Strategy Officer of Holland Hospital

JH: So, Alex, you were involved in, and I heard your name used by MHA on numerous occasions because your advocacy in 340B. For our listeners today explain 340B and why it’s so important. What are you doing as a hospital to maximize that program? So, what is it? What are you doing?

AR: So, 340B is a federal program that allows certain types of healthcare providers, we qualify Holland Hospital as a disproportionate share hospital or dish hospital, meaning we have a disproportionate share of our inpatients that are on Medicaid essentially. What this does is it allows us to purchase drugs at a discount from what we’d otherwise be able to purchase those drugs at. This is the federal government’s way of recognizing that essentially Medicare and Medicaid underpay hospitals. So, to stretch scarce federal resources, they’ve allowed hospitals to purchase those drugs from drug manufacturers at discount, which is brilliant. It allows hospitals to save money, but that money is not coming from the government itself. It’s coming from the drug manufacturers.

JH: I think that’s a misnomer right now because Congress and even certain members of the community think that 340B, I’m paying that on my taxes. Congressional leaders think that that’s government. It’s not.

AR: There’s no government dollars that are paying that. Absolutely.

JH: If you looked at the profit margins of pharmaceuticals, they’re doing a lot better than healthcare today. So, you’ve been an advocate for 340B. How have you leveraged at your hospital?

AR: We’ve leveraged it in a number of ways. One thing that we’ve done fairly recently, two years ago, we opened up a specialty pharmacy. This was just born out of necessity. So, we were losing access to 340B drugs because of some unilateral actions that the drug manufacturers were taking. To really take matters into our own hands, we had to open up our specialty pharmacy to secure that access. Really, that’s been a godsend to us. It’s allowed us to retain that access, but then find new creative ways to help keep new programs within the community, and then also find ways to bring discounts to community members. So, for instance, we’re working with a number of employers that we have a certain arrangement with them where we can if a prescription is written by one of our providers, it’s 340B eligible. If it’s filled by one of their employees, our community members at our specialty pharmacy, we’re able to make it so there’s no co-pay and no deductible. So yeah, really benefiting the community members on their savings. That helps with medication adherence.

JH: You’re returning it back to the community, what it was intended for. So, in your advocacy efforts right now, you know that it’s on the chopping block. So, what advice and advocacy would you give to our listener today about what they can do?

AR: Yeah, I would just ask listeners to do their research on the 340B program. You mentioned the profit margins of the drug manufacturers. They’re certainly different than what we see in the healthcare industry with hospitals specifically. I think that tells us enough there that this is not a play over what’s good for the community. It’s a play over what’s good for the bottom line for manufacturers. So, really do your research and also please reach out to your representatives. Actually, from the hotel, just last night I sent an email to Senator Slotkin and Peters, the two senators for the state of Michigan, asking them to support the bill that is being brought forth by a senator in California. Pushing back on the actions from Eli Lilly. I’m not sure if your audience is familiar with that, but they have decided to cut off access to hospitals that are not submitting patient information to Eli Lilly. If you haven’t done that, including my hospital hasn’t done that because we have concerns about sending PHI with no non-disclosure agreement, no understanding of what they’re going to be doing with that data confidentiality.

JH: It’s one of the tactics and games that they use. They tried to deploy the voucher method. Now they’re doing things like this really to distract. They don’t want to pay as they should pay. It’s critically important that if you’re listening today be an advocate for 340B as a 340B hospital. All right. Let’s talk about some other challenges. The political landscape today is very rough. There is a lot of Washington legislation and a lot of Lansing legislation that’s going to negatively impact hospitals in our margin. I guess I’m going to ask you, strategy officer, what are you doing and what strategies are you deploying to ensure the success of your rural hospital? Let’s pause there before you answer that, give us give our listeners a sense of the size of your hospital, because I think that’s important to talk about. It’s not a critical access. You are in a market that I’m surprised that you have a disproportionate share, to be honest, because you’re in a region of the state that I think you have high commercial, but you must see it from surrounding areas, I would assume.

AR: That’s exactly right.

JH: Okay. So, you’re seeing that. So, in your environment today Howland is an independent hospital. 300. How many beds?

AR: 191 beds. Independent community hospital as of last week that’s down to six within the whole state of Michigan. Just for context, if you look back 20 years just in the area that we serve, which is essentially just Ottawa and Allegan County, we branch out just into the very western border of Kent and the very northern border of Van Buren. 20 years ago, there were nine independent community hospitals in existence, not critical access. Now we’re down to six in the entire state.

JH: We’re in the minority of hospitals that are still independent. I believe we have a purpose and a passion to continue that. So, I see that passion in you. Given all of that. You’re a hospital that’s what I’d call a mid-size vital hospital. You’re not a big center tertiary center, but you’re not a critical access. So, you’re a mid-size vital serving, a critical role in your community. Probably one of the largest employers.

AR: Yeah, with third largest within the city.

JH: So, what techniques, what strategies are you deploying to combat the future impact of these Medicaid cuts? Because I’m sure you’ve heard of HR1 as the CFO previously. In working with your community, how are you doing that? There’s work requirements. There’s all these things. How are you navigating that?

AR: Yeah, we’re really trying to focus in on keeping as many people enrolled in Medicaid as are eligible. The work requirements are going to provide a lot of challenges for the community, which is frustrating. I’ve heard you talk about this. You can’t live off of Medicaid benefits. They don’t pay your rent; they don’t buy groceries. They’re there for healthcare, and they’re there for healthcare when it’s needed. We’re concerned that these work requirements are really going to be just paperwork requirements. We’ll see people drop off the Medicaid rolls because they either didn’t know they had to fill out the paperwork now every six months, they don’t know how to do it. They don’t have the resources or the time. So that’s where we’re trying to do. We have a fairly large migrant population within our area and surrounding communities. That’s a big concern for us. So, one thing that we’re immediately doing as an organization is we’ve long time partnered with an organization called First Source, and they have an employee that makes the rounds at our hospitals, and we pay them to do this to help check in with patients that don’t have insurance and see if they would qualify for Medicaid and if they do, then they assist them through that process.

JH: Now, is this in collaboration with the Department of Health and Human Services or no.

AR: Separate from that, yeah. We’re looking into that collaboration as well though.

JH: We have we have the MDHHS, but this intrigues me. Tell me more.

AR: So, First Source is the organization that does that.

JH: So, anytime you identify a patient without insurance you will send them up there.

AR: Correct. Now we’re starting to invest further into that resource so that we’ll have a representative from First Source not just available at the hospital, they will be available at the hospital now all days of the week. Currently we have not had that, but also at physician offices or non-hospital locations to make sure we’re reaching the full community and people where they are, not just when they’re sick, but hopefully when they’re with us getting preventative care as well.

JH: Are you going to try to do that on your own, or are you partnering with this company, or are you going to try to mix it?

AR: Yeah, partnering with First Source. We also realize that even that’s just a small bit of what the community needs as a whole. We can’t do this on our own. So, we’re really reaching out to community partners, a key one that we’re working with; there’s a fantastic nonprofit in our area called Community Action House. They’re essentially a food pantry. They call it a food club, and they have members and basically their entire constituency are individuals that qualify for Medicaid. So, they already have resource navigators on site helping people sign up for Snap benefits, for Medicaid, for other programs as well. So, we’re working with them in collaboration to help make the community aware of the resource navigation they have. Further, we do believe that even despite our efforts and despite community action House efforts, there are going to be people that lose their Medicaid enrollment and are not going to be able to afford commercial insurance. So, what we’re doing at this food club is we’re going to be putting a Holland Hospital provider on site and available at no cost, no copay, no deductible, nothing billed to insurance, for the food club members. What’s in it for us is really nothing other than trying to live out our mission. Our mission is to improve the health of the communities that we serve and the spirit of hope, respect, compassion and dignity.

JH: Good job to you. That’s an amazing. So that means it’s passionate. If you can remember that it’s coming from the heart and your and you’re serving it out every day in that population that you’re serving. All right. So let me ask, we talk about good things. We talk about bad things. We got to talk about bad things. Federal legislation is very bad. Recently Michigan introduced some bills. I don’t know if you follow that or not. Those are dangerous. Talk to us about what the impact of something like that would be to your hospital. A 10% reduction in payments.

AR: I mean, that would be devastating to us as an independent community hospital. Our operating margin last year was 2%, and that was the best one we’ve had in six years. The past couple of years we were at 0.2%. One year we were -2%. Already this year we’re back down to about 0.2%. So, if you were to cut our pay by 10% and pay in terms of what we’re getting paid for, the care that we provide, that puts us in unviable position financially.

JH: So, your job in strategy, but do you have a job in advocacy. What is that relationship between the two.

AR: A little bit. We certainly are not as involved in advocacy as you are. You’re truly one of the leaders within the state. We’re blessed to have you within the state of Michigan doing the work that you do. We have really started to step out in the last couple of years to get more active in advocacy, working with our local representatives, also at the state level, to try to tell our story. We believe that independent community hospitals play a vital role, and we’re unfortunately a dying breed, and we need to have that story heard, and we need the lawmakers to hear that story.

JH: Preach it. I think I found my co-host for my podcast. I’ll talk to you about a contract later. So, as you as you face these challenges the CFO in you is always worried about the margin. My CFO tells me every day, no margin, no mission. I didn’t understand that when I was in operations because I’m like, no, we need to spend this money. We have to do this. We have to do that. Until I became the CEO and I’m like, oh, I get it. So, we have to make a margin at some point. We have to invest in technology, our people back into the community because you give community benefit, right? Significant amount of community benefit. You have probably every group comes to you for donations. So, you face the same challenges. I want to ask you, you had a previous role; CFO, now you’re in strategy. What keeps you up at night as you think about all these things like what’s the what’s the number one that you look over to your wife and say, I’m really worried about this. What is it?

AR: Honestly, it is the Medicaid disenrollment that’s going to be coming that is just going to put us in a very challenging position. There’s always going to be challenges in the industry side of care is something that we’ve been dealing with. Site neutrality might be something that comes down federally at some point in time, but 340B is always on the chopping block, as you mentioned. Really that Medicaid disenrollment jeopardizes a lot. Our community is still going to need the care. Our concern is that they’re not going to get that preventatively. Instead, they’re going to show up in our emergency room, when things are more acute and it’s more costly to provide that care. They won’t have insurance at that point, and we’re not going to turn them away. We’re going to make sure they get the best possible care, but it’s expensive to do that. On top of that, as a disproportionate share hospital, we have qualified for a long time as a dish hospital, but as you mentioned, our area is not particularly known as an area that you think we’d have a large dish population. If you see significant disenrollment, then that jeopardizes our ability potentially to remain eligible for 340B.

JH: Not only is 340 be on the chopping block, but if the average commercial rate goes away what happens with dish. Do we get it back; disproportionate share? Then you’ve also got LVA I don’t know if you if you qualify for low volume adjustment, but we’re a hospital that we do. That to us is a significant impact. All right so that’s all the bad news right. What excites you about what you’re doing right now, give me both you individually and Holland Hospital. So, your role, what excites you, and then what excites you about the future for Holland.

AR: Honestly, I think the answer to those are it’s going to be the same in my role. Part of why I made this move to the chief strategy officer is because of my ability to get more involved in the community. I was doing that as employers are reaching out to the hospital about direct contracting, etc., and we’ve just been getting more involved in not necessarily just the direct contracting piece, but looking for ways to meet the community’s need in a cost-effective manner and build relationships so that we have actual relational care and not getting not going, continuing towards the large system type of feel, but really getting back to that community-based care. That truly excites me because there’s some exciting things that I think we’re on the precipice of that can make a difference and bend the cost curve, but just as importantly, actually make a healthier community.

JH: Wow. Incredible work. You’re doing incredible work. I have followed you and the work that you’ve done. I’m pretty excited for what’s going to happen with Holland, with you and the strategy. See, I think some great things. I would encourage you to continue the relationship with MHA. It’s so critically important. There’s some great people there. Then when you think about strategy, we’re independent as a hospital, but we don’t put sandbags around ourselves. We’re interdependent. So, the Hollands and the Hillsdales and the Oak lawns, the very few of us that are left need to come together and have meaningful dialog to so in their community, having dialogs about how do we sustain rural health in this country because I’m going to tell you. Tertiary centers don’t want us. At the end of the day, they don’t have capacity to meet. They’re already staffing ratios are low. They’re ER’s overwhelmed right now. They can’t serve properly. We need community hospitals today more than we ever have before. Yet, 174 on the immediate list, 734 are on the at-risk list. That’s us. We have got to advocate and be a voice in that. In that vein, the last question I’ll ask you is; you have young aspiring leaders like yourself that are rising up in a very tumultuous environment today. What rural health recommendation would you give them as a leader to continue keeping on? What sage advice would you would you offer?

AR: Yeah, I thought about this in advance, since I know this is a question that you asked your interview participants, and actually, I think you almost hit on it already in that answer. My answer to that was going to be, this isn’t something we need to do alone. In fact, it’s something we shouldn’t do alone. I think the reason that our institutions are still independent is we’ve been good at partnering. We’re not trying to be everything to everybody. We know with our community sizes, it doesn’t make sense for us to have, say, an open-heart program. Even if we could get the providers to do that.

JH: But you just don’t have the volume to do it.

AR: Right, to keep them skilled at doing it. That’s where we need partners. I would suggest that anybody in our positions or similar positions find partners that have aligned values and work together to find those win-wins, because they do exist. That’s necessary for us to continue to provide the care that we do for the community.

JH: Alex Rowling, vice president and chief strategy Officer, that’s awesome. Holland Hospital, independent hospital in a beautiful location, Holland, Michigan. It’s been great to have you on this series. I’m going to get you back for a full podcast at Rural Health Today. This is this is kind of our intro of you, but I think you’re going to do some great things. I would like to come back and talk about 340B if we could specifically to really break it down, and get in the weeds. We need to get in the weeds to educate our communities and our lawmakers. We just found out last week that one of a very well-known legislator in the state of Michigan listens to the podcast every week. We got that. We got that confirmation from her in in a text message. So, we know that there are legislators listening to this, and across the country, not just in Michigan, but we have the most to gain by leveraging Michigan Legislature. I want to get you back to talk about 340B in some of the programs, and then to talk about how would you duplicate strategy across the state of Michigan for small hospitals. Are you willing to do it?

AR: I’d be. I would love to do it.

JH: All right. It’s been great to have you here today. Thanks for joining us. And thanks to our listeners for tuning in to Rural Health Today as well. You can catch our next segment, Rural Health News, to stay up to date on the current state of rural healthcare every Monday, wherever you get your podcast. And don’t forget to check out our latest updates and resources from Rural Health Today at ruralhealthtoday.com, and make sure you subscribe so you never miss an episode. Until next time, remember Rural Health strong.