Winneshiek Medical Center management: Contract with Gundersen Lutheran would hurt us

Here is the text of the statement issued by the Management Committee of Winneshiek Medical Center at Wednesday's Board of Trustees meeting:

"The numbers tell the story.  That's according to Winneshiek Medical Center Chief Administrative Officer Dan Werner on his presentation to the Board of Trustees planned for September 1st.   To reach an agreement with Winneshiek Medical Center regarding full participation in the Gundersen Lutheran Health Plan, Gundersen Lutheran � Decorah Clinic must identify a long-term solution to support Winneshiek Medical Center outpatient services.  Werner said, "Winneshiek Medical Center highly values patients in the Gundersen Lutheran system and the health care providers who practice locally, and that the first step in true collaboration is to identify a way for Gundersen Lutheran, a private health system, to support the long term viability of a facility owned by the citizens of Winneshiek County."

Werner outlined a history and key considerations for the Gundersen Lutheran Health Plan decision by first clarifying, "Our recommendation is regarding the Gundersen Lutheran Health Plan, which covers approximately 1.5% of our county's population � or about 300 people, most of who are Gundersen Lutheran � Decorah Clinic staff.  The public must understand that Gundersen Lutheran � Decorah Clinic patients covered by Blue Cross/Blue Shield, Medicare, or most other insurance companies have full in-network access to Winneshiek Medical Center services, as outlined in their personal insurance plan."

Background
In 2004, discussions on a formal collaboration between Winneshiek Medical Center and Gundersen Lutheran leadership stopped due to differing business philosophies, prompting Gundersen Lutheran to build off campus and state their intent to directly compete with Winneshiek Medical Center.  Since 2005, Gundersen Lutheran � Decorah Clinic utilization of Winneshiek Medical Center has markedly declined, according to a formal analysis by the Winneshiek Medical Center Management Committee.  Results of the analysis revealed a steady decline in referrals from Gundersen Lutheran � Decorah Clinic physicians in all areas of service, including inpatient and outpatient services.  

In 2006, Gundersen Lutheran obtained Iowa licensure for Gundersen Lutheran Health Plan, which was being marketed to Wisconsin businesses and individuals, and requested Winneshiek Medical Center become a participating provider for hospital-based services only.

At Winneshiek Medical Center's request, language to include Decorah Clinic Physicians - Mayo Health System in the Gundersen Lutheran Health Plan was added during negotiations; however, Gundersen Lutheran denied the request to include Mayo Clinic visiting specialists in the contract.  Winneshiek Medical Center leadership declined full participation in the Gundersen Lutheran Health Plan due to this gap in coverage, but left an open invitation to allow Gundersen Lutheran - Decorah Clinic staff and families to receive service at Winneshiek Medical Center.  Gundersen Lutheran did not acknowledge the compromise made by Winneshiek Medical Center.

Talks continued in 2008 and 2009, and most recently through a request for reconsideration at the July, 2010 Winneshiek Medical Center Board of Trustees meeting. 

In August, 2010, Gundersen Lutheran gave notice they will cancel their contract for MRI services at Winneshiek Medical Center effective November 1, 2010.  Since 2008, Winneshiek Medical Center has provided local MRI tests, sending the results to Gundersen Lutheran � La Crosse for professional interpretation. "Failing to sign another year's MRI contract seems to be telling of their long-term intent to collaborate," said Werner.  Additionally, Werner was notified by Gundersen Lutheran � Decorah Clinic leadership of their intent to remove all oncology and chemotherapy services from Winneshiek Medical Center in the upcoming months.

Local Support?
"We have analyzed the data and aligned our recommendation to the Board with our mission statement, which is to provide quality and compassionate primary care, inpatient and outpatient services, diverse local specialties and multi-disciplinary health programs," said Werner.   "Participation in the Gundersen Lutheran Health Plan will put our stated purpose at risk."

According to the data, beginning in 2005, Decorah Clinic Physicians - Mayo Health System and Gundersen Lutheran � Decorah Clinic evenly supported Winneshiek Medical Center inpatient services, with providers from each system referring 50% of inpatients.  In 2010, Decorah Clinic Physician - Mayo Health System referrals have risen to 61% and Gundersen Lutheran � Decorah Clinic referrals have decreased to 39%. 

Similarly, in 2005, Decorah Clinic Physicians - Mayo Health System referred 53% of patients to Winneshiek Medical Center outpatient services (lab, radiology, rehabilitation, infusion therapy, same day procedures, etc.), and Gundersen Lutheran � Decorah Clinic referred 28%.  In the past five years, Decorah Clinic Physicians - Mayo Health System have increased their referrals to 80% and Gundersen Lutheran � Decorah Clinic referrals have decreased to 8%. 

According to Werner, 81% of Winneshiek Medical Center's revenue comes from outpatient services.  He said, "Gundersen Lutheran � Decorah Clinic drastically decreased referrals to local outpatient services when they relocated off of the Winneshiek Medical Center campus. Gundersen Lutheran Health Plan administrators decisively stated that the primary purpose for a health system to offer a health plan is to steer patients to their own system.  Unfortunately, we have experienced this prior to participating in the Gundersen Lutheran Health Plan, and can only expect referrals to continue in a downward trend if we accept the Gundersen Lutheran Health Plan."

Recommendation
"If the Gundersen Lutheran Health Plan establishes a significant presence and more local patients obtain health care from Gundersen Lutheran providers, it is expected that utilization of Winneshiek Medical Center's outpatient services will continue to decline, putting the facility at significant financial risk," said Werner.  "The people of this county financially support their local medical center through patronage, gifts and tax dollars, and we are committed to providing the level of care and available services the region has come to expect from our organization.  Though our offer still stands to accept Gundersen Lutheran staff and families insured by the Gundersen Lutheran Health Plan, on behalf of the people we care for on a daily basis, we cannot become full participants in the Gundersen Lutheran Health Plan."

Werner summarized the recommendation: "Winneshiek Medical Center strongly values our relationship with our local Gundersen Lutheran � Decorah Clinic providers.  We highly respect the services that they provide and respect their quality and value that they bring to our community.  This business decision is in regard to the Gunderson Lutheran Health Plan and is not a reflection on the quality or value of our local Gundersen Lutheran � Decorah Clinic providers.  We look forward to a strong and collaborative relationship with our local Gundersen Lutheran � Decorah Clinic providers in the future which supports the growth and viability of Winneshiek Medical Center."