Growth is key to success: Jacobson

Growth is key to success: Jacobson

In the annual state of the medical center speech delivered on Feb. 4, Dr. Harry R. Jacobson, vice-chancellor for Health Affairs, summarized key elements of the VUMC five-year strategic plan, highlighting new funding to recruit scientists, a doubling in annual spending for renovation of existing facilities and replacement of current equipment, and new funding to build research, administrative and parking facilities.

Speaking in Langford Auditorium to a near-capacity crowd of staff and faculty, Jacobson wove varied elements together to present a vision of Vanderbilt’s future.

“In a generation Vanderbilt will be known for three things,” he said. “We will be recognized for Nobel-quality research across a broad spectrum of biosciences. We will be known as one of a small group of institutions that train doctors and nurses for academia. And we will be thought of as a place that offers hope to people with the most serious diseases and injuries.”

With his leadership team seated in the front rows, and with the accompaniment of a succession of charts and graphs projected at center stage, Jacobson alternated between analyses of the current state of play at VUMC and the changes he and his team will promote to carry the institution forward. Figuring prominently were a range of operational changes to accommodate increased demand for hospital and outpatient services, and changes under consideration to help employees strike a better balance between home and work life.

But it was the strategic spending initiatives, coming late in the speech, that seemed to define most clearly Jacobson’s vision of the future.

In announcing $135 million over five years to recruit scientific faculty, Jacobson said, “What makes us different and what makes us better is that we are devoted to discovery. Whether it is discovery about how cells behave or discovery about how to better manage the operating room, we are driven by a simple question—Why? Why do cells differentiate? Why do some patients recover faster than others? Why can’t we turn over a clean room faster? We ask ‘why?’ more often, more relentlessly and more passionately than any provider in our region. And that is what makes us better.”

Jacobson announced an additional $200 million over five years for construction, on top of $400 million previously allocated.

• A medical research building, MRB IV, is sited tentatively in what is currently a Veterans Administration Medical Center parking lot at the corner of 24th and Garland avenues.

• A medical office building will go up on the south end of campus.

• An administration building is planned (no specific site mentioned).

• The School of Nursing will be expanded.

• Another parking garage is planned near the center of the VUMC campus, between the hospital garage and the clinic garage, with completion in early 2003.

The speech included a brief update on current construction: the vivarium opens this month with space for 60,000 mice; Medical Research Building III, in the final stages of construction next door to Godchaux Hall, will open in May; the Vanderbilt Children’s Hospital and Outpatient Center is on track to open in fall 2003; and, next door to MCE, construction has begun on a building to house the Vanderbilt Bill Wilkerson Center, Orthopedics, Sports Medicine and the Diabetes Center.

Jacobson announced $210 million in spending over five years for renovation and modernization of existing facilities, “In part because our increasing activity has taxed our hospital and clinic, and in part because we have not invested enough in maintaining them—exam rooms, waiting areas, patient rooms and procedure space. I know for many of you who provide direct patient care, this has been a difficult problem. I want to assure you that help is on the way. The leadership of the hospital and clinic are committed to making this better and doing it quickly.”

By the time he was through, Jacobson had outlined $1 billion in new investment. “Our plans are pretty expensive but they are achievable,” he said. “I’ve seen this medical center set some pretty aggressive goals in the past. And we’ve met them.”

Per his usual approach, the vice-chancellor took care to set out the business goals and financial assumptions that are involved in carrying the institution forward and supporting the vision.

• The surplus expected this year from VUH/VMG operations is $24 million, up from $22.9M in fiscal year 2001 and $14.5M in 2000.

• The total VUMC surplus from operations this year is projected to be $35.6M, up from last year’s $23.8M.

• The next five years are projected to bring seven percent annual growth in clinical revenue, which is a slightly slower rate than the previous five years.

Rallying his audience, Jacobson said, “We need these kinds of results to support the construction of the Children’s Hospital and our other major projects. We’re doing the right things, but we can’t let up, not on volume, not on service and not on cost control.”

Amid the financial primer, Jacobson introduced laughter in saying, “We also earn money the old fashioned way—we ask for it.”

VUMC raised $55 million from philanthropy in the first half of the current fiscal year, up from $49M in the same period one year ago and $24M the year before that. VUMC will also look forward to a major share in the $1 billion development campaign soon to be launched by Chancellor Gee.

VUMC financial prospects are tempered by unanswered questions related to TennCare, and to state budget problems and federal sources of funding. As Vanderbilt’s share in TennCare continues to grow, the federal government is sending less money to fund the program.

“I don’t know of anyone who is willing to predict the likely outcome for the TennCare program, or even for the state,” Jacobson said, adding that the next few months will be a crucial period in deciding these questions. “We will work hard to ensure that the state recognizes Vanderbilt’s extraordinary efforts on behalf of TennCare families and pays us fairly. Second, we will push to make sure that doctors and hospitals across the state who have abandoned TennCare begin to do their share and reduce the burden on Vanderbilt and the rest of the safety net providers in the state.”

Help for employees

Jacobson began the speech by underlining the significance of individual and team effort at all levels of the institution.

“It is important that we all recognize the valuable contributions everyone makes to this institution,” he said, and then pointedly repeated the line.

Jacobson said employee surveys in 1998 and 2001 showed remarkable improvement in attitudes about Vanderbilt. “In 40 of 41 questions the staff rated their work experience higher in 2001 than they had in 1998.” He said the survey revealed a commitment to excellence and to the mission of VUMC, respect for managers and peers, and a sense of being engaged and challenged by the work. “I can’t imagine a stronger endorsement,” Jacobson said, then he outlined a number of recent changes brought about in direct response to calls from employees:

• Bonus payments in 2000, and the inauguration in 2001 of a new pay for performance system of employee compensation. “If the Medical Center is to be successful we must continue to produce strong financial and clinical results. When we do, I think our staff and faculty should be rewarded.”

• Free parking for patients and families.

• New standardized job performance appraisals.

Jacobson also acknowledged some continuing concerns of employees from the 2001 survey.

“It is clear from the survey results that many of us are having difficulty balancing our demanding work environment with home life. It was true in 1998 and again in 2001. We need to focus more attention on this aspect of our work environment.”

Last week a task force presented leadership with several recommendations to help employees cope with the sometimes conflicting demands of work and home life. The proposals under review include more flexible work schedules, an on-campus service to assist with errands such as dry cleaning and take-out meals, a new campus office focused on assisting employees to structure more manageably their work and home obligations, and a new benefits package tailored to life stages: young and childless, starting a family, school age kids, kids in college.

Strides in clinical quality and research support

Four years ago Jacobson and his team launched an effort to increase annual research funding 250 percent by 2006. He said progress toward this goal was now two years ahead of schedule.

What’s more, productivity has increased 55 percent in terms of funding per square foot of research space. Jacobson credits a vital research infrastructure, set up by Lee Limbird, Ph.D., associate vice-chancellor for research.

People are becoming more aware of quality differences in health care, Jacobson observed. “There is ample evidence that the quality provided by some hospitals and some doctors is better than others.” However, it’s still the case that, “We know more about the quality of the washing machine that we buy than we know about the surgeon who will operate on us.”

Jacobson said Vanderbilt is maintaining its place “at the forefront of developing hard-nosed quality,” and is gaining new recognition for clinical quality improvement efforts. The Leapfrog Group, a consortium of Fortune 500 companies and other large private and public employers, recently singled out VUH for computerized physician order entry with prescribing error prevention capabilities, and for exemplary physician coverage of intensive care units. VUH also exceeded patient volume criteria for various surgical procedures dealt with in the Leapfrog survey. (Patient volume is considered a marker of how well a hospital is likely to perform a given major surgical procedure.)

Jacobson also highlighted a newly revitalized nurse recruitment effort, and an ongoing study of the causes for high turnover in the first year of nursing.

Market success creates pressure

Vanderbilt continues to increase its lead in consumer preference. Growth in admissions and visits is outpacing area population growth, indicating an increasing market share. Among other things, this has placed Vanderbilt in a position to raise prices moderately for commercial insurers.

Hospital occupancy and patient severity are also increasing, Jacobson said. He drew attention to the ways in which demand is creating pressure for Vanderbilt care providers. In 2000 the hospital and emergency room began routinely to back up, causing non-emergency patients to be diverted to other hospitals. Jacobson outlined several changes that have been used to address these consequences of success.

• VUMC has added 25 full-time equivalent clinical physicians in the past year, and expects to add another 15 to 20 per year going forward.

• In its first two months of operation the V-Fam program to provide 48-hour access to outpatient care for Vanderbilt staff, faculty and families has been a great success. Jacobson’s take: Today the Vanderbilt family, tomorrow all patients.

• The ER will soon open three new trauma bays, and is renovating its waiting areas. The ER also has a new process to get patients with minor injuries in and out in one hour, rather than the usual three to four.

• An admission/discharge/bed management project added significant new flexibility and allowed Vanderbilt to improve occupancy.

• A team ferreted out space that has allowed placing of 23 new beds in VUH, and the hospital will add another 14 beds by the end of this year.

• As mentioned above, a new parking garage will be constructed soon between the hospital and clinic garages. For the time being, new construction will continue to contribute to the scarcity of parking, Jacobson said.

• VMG is working to give patients more precise parking instructions.

• An appropriately big and splashy signage plan has been approved to aid route finding.

Jacobson took a minute to commend staff and faculty for the route-finding assistance they give to patients and families. “I often hear from our patients about how hard it is to make their way around our complex and sometimes intimidating environment. And I see many people who look confused. But there is one other thing that I see and I hear from our patients. They are uniformly grateful that so many of you stop and ask if you can help them find their way. I see it every day and every day I’m grateful to all of you who are sensitive to the needs of our patients in finding their way. I know that most of you do that completely out of a sense of kindness and compassion for our patients. I hope you also understand that it is that kind of behavior that makes it possible for us to flourish as a health provider.”

Jacobson thanked his leadership team, took several questions from the audience, and ended by drawing and announcing winners of door prizes, here and there eliciting squeals of delight.