Cautiously, Mayo Builds an Empire

DECEMBER 8, 2014 • STARTRIBUNE.COM MINNESOTA’S TOP NEWS CHOICE • MINNEAPOLIS • ST. PAUL

THE NEXT MAYO / REMAKING A MEDICAL GIANT CAUTIOUSLY, MAYO BUILDS AN EMPIRE

● Affiliates in 18 states give Mayo national reach and new patients.

Story by Dan Browning Jackie Crosby

Photography by Glen Stubbe

Graphics Mark Boswell Ray Grumney

EDGEWOOD, KY. – Jordan Hatfield’s case puzzled the doctors. A champion javelin thrower and top student at North- ern Kentucky University, Hatfield devel- oped stomach pains and insomnia during his sophomore year. Then came head- aches, vision problems and nerve pain. Arriving travelers to Cincinnati/Northern Kentucky International Airport are greeted by a By the time Dr. Angela Rackley saw display heralding the partnership between St. Elizabeth Healthcare and the Mayo Clinic. him at St. Elizabeth Healthcare here, a battery of tests had turned up vitamin de- ficiencies and a lot of unknowns. So the For such patients as Hatfield, the ar- health care’s continuing consolidation as neurologist put through a call to Mayo rangement means access to some of the one of the few flagship medical centers in Clinic in Minnesota, and soon the young finest medical specialists in the world. the United States. Minnesota’s taxpayers athlete was on a fast track to Rochester, For Mayo, the network is an opportuni- are all in on that bet, having pledged $585 where a team of specialists quickly as- ty to expand its footprint without having million toward the remaking of down- sembled to begin the search for answers. to build or acquire new hospitals. It al- town Rochester as an international med- Doctors still haven’t quite solved the so gets to market its world renowned ex- ical destination. mystery, but Mayo’s expertise has given pertise to patients — many with the most “In the markets where we have been Hatfield’s family and his Kentucky phy- complex cases — who might not other- present in the Care Network, brand sicians new peace of mind. wise travel to Mayo clinics in Minneso- awareness has gone up,” said Dr. John “I feel better knowing that the spe- ta, Florida or Arizona. Noseworthy, Mayo’s CEO. “We’re seeing cialists at Mayo have taken a look at him Mayo’s strategy is not unique among thousands of patients who need to come and done the appropriate testing,” Rack- the nation’s top medical centers in an era for high-end services to [Mayo’s campus- ley said. of financial pressures and intensifying es in] Jacksonville, Phoenix or Rochester Hatfield is among dozens of patients competition. The Cleveland Clinic and … But the folks that don’t need to come, in Kentucky to benefit from the Mayo MD Anderson Cancer Center in Houston, don’t need to come.” Clinic Care Network, an ambitious ef- two nationally renowned institutions, are fort by the Rochester-based health sys- also shopping their expertise and reputa- A novel growth strategy tem to expand its reach and secure its tions to regional hospitals and health sys- The Care Network has its roots in a place in an era of rapid changes in health tems in exchange for access to patients. Mayo board meeting in 2009, when clinic care. In just four years, Mayo has signed These franchise-like agreements un- leaders began bracing for the passage of up 31 affiliates in 18 states, Mexico and dergird Mayo’s unfolding, $5.6 billion federal health reform legislation. When Puerto Rico. plan to ensure that it emerges from the Affordable Care Act of 2010 became DECEMBER 8, 2014 • STARTRIBUNE.COM MINNESOTA’S TOP NEWS CHOICE • MINNEAPOLIS • ST. PAUL

reach as many as 200 million people di- rectly or indirectly by 2020. The network is “a very smart move” to preserve the Mayo brand and its source for referrals, according to Dr. Joel Sha- lowitz, who teaches at Northwestern University’s Kellogg School of Manage- ment and Feinberg School of Medicine. At the same time, he said, such part- nerships are new and unpredictable. “I don’t know what the difference is between dating and going steady — but it’s not getting married,” he said of the Care Network agreements. To Noseworthy, the network is also a chance to export the Mayo model: A vir- tuous circle of skilled specialists and pro- prietary research, with the patient at the center. Simply acquiring another hospital doesn’t guarantee that it will embrace the same philosophy, Noseworthy argues. “The reason we didn’t do the merger and acquisition strategy … is that that’s really not scalable,’’ he said. “But it also doesn’t do anything for patient care.”

Careful courtship law, they forecast that it would cut the through the network in 2013, and that At Altru Health System in Grand clinic’s revenues by as much as 20 to 40 new patient appointments in Rochester Forks, N.D., the first affiliate to join, the percent as private insurers and govern- rose 15 percent. Since launching the net- network has benefited both the organi- ment health programs put the squeeze work, Mayo’s reach has grown threefold, zation and its patients, said Dr. Matthew on spending. with some 63 million people now con- Roller, a neurologist and a member of Al- Mayo’s board considered three op- necting with Mayo for medical care, lab tru’s board of directors. tions. Do nothing and hope for the best. tests, products and services or through Roller frequently consults Mayo’s Bulk up by buying hospitals and clinics social media. The clinic said it aims to subspecialists on such complicated around its major campuses in Arizona or Florida, as it did 20 years earlier across southern Minnesota. Or try something new. The board chose option three, and Mayo hatched an idea that could make its brand as familiar nationally as Star- buck’s Coffee. In addition to St. Eliza- beth Healthcare, the largest hospital system in northern Kentucky, the network includes such well-regarded names as Dartmouth-Hitchcock in Vermont and New Hampshire, and Shriner’s Hospi- tals for Children in the Twin Cities. Network affiliates remain wholly in- dependent. They pay a fee that gives their physicians online and phone consultations with Mayo specialists, as well as access to Mayo’s rich medical data- bank of disease research and treatments. They can also tap Mayo’s “system en- gineering” lab, which helps hospitals streamline their operations and reduce operating costs. Nancy Henry and George Wietmarschen of St. Elizabeth Healthcare distributed The tactic seems to be paying off. information during an event where Mayo sent one of its cardiac specialists to speak to Mayo said it reached 7 million patients tout their partnership. DECEMBER 8, 2014 • STARTRIBUNE.COM MINNESOTA’S TOP NEWS CHOICE • MINNEAPOLIS • ST. PAUL

Neurologist Angela Rackley at St. Elizabeth in Edgewood, Ky., John Dubis, CEO of St. Elizabeth, said he wanted a world-class frequently consults with Mayo doctors on complex cases. partner with broad specialization. problems as neuromuscular diseases. spine and transplant surgeries at no cost disease,’’ she said. “He would have liked He uses “e-consults” to send images, lab if they went to Mayo or one of several to be of service in this way.’’ work and notes to Mayo, and gets what other prestigious hospitals. In October, Members of the Care Network aren’t he called a “well thought-out, examined, the retailer expanded the coverage to allowed to use Mayo’s logo — three discussed opinion” back, usually with- breast, lung and colorectal cancers for shields signifying excellence in patient in two days. employees treated at one of Mayo’s three care, research and education. That’s re- “It has allowed a number of patients to primary campuses. served for entities that Mayo owns. stay at home and get an opinion, and al- “We could go to an employer or an in- Even so, St. Elizabeth highlights its as- lowed us to manage patients with some surance company and say, ‘We would be sociation with Mayo at every chance on of these subspecialty needs closer to your preferred portion of the network,’ ” brochures, its website and in television home in an effective way,” Roller said. said Mary Jo Williamson, chairwoman of ads. At the Cincinnati-Northern Ken- That spares patients a six-and-a-half Mayo’s Department of Practice Admin- tucky International Airport, for example, hour drive to Rochester and the related istration. a massive wall is dominated by photos travel expenses. Even when Mayo physicians can’t cure and messages touting the link between To protect its reputation, Mayo is a patient, the partnership can be instruc- St. Elizabeth and the Mayo Clinic. choosy in expanding the network. Poten- tive. Two years ago, a retired accountant Mayo does its part in return. When St. tial affiliates must complete a 1,400-page named Tony Luebbers went to his doc- Elizabeth’s heart center hosted a meeting application. In addition, they must share tors in Kentucky complaining of stomach in suburban Cincinnati earlier this year, Mayo’s primary value: The needs of the pain. When multiple screenings and bi- Mayo sent cardiac specialist Christopher patient come first. opsies left them baffled, they sent lab re- McLeod as the keynote speaker. Some “We’re looking for chemistry,” said Dr. sults to Minnesota and asked for a con- 250 people dropped by. “It’s a key point David Hayes, Mayo’s affiliated practice sultation. Mayo specialists pinpointed of differentiation in the market,” said St. network’s medical director. “We’re look- Luebbers’ ailment as Ewing’s sarcoma, an Elizabeth spokesman Guy Karrick. ing for organizations that are culturally extremely rare cancer. After surgery at and philosophically similar.” Rochester and 17 rounds of chemothera- Peace of mind In addition to contributing revenue py at St. Elizabeth, Luebbers got a clean John Dubis, CEO of St. Elizabeth and a pool of patients, the concept could bill of health last May and began working Healthcare, said he started looking for a position Mayo to create its own mini-net- on his tennis game again. world-class partner that could help im- works of hospitals around specific spe- Within months the cancer returned, prove its already well-regarded Heart cialties. That’s attractive to large employ- and Luebbers died on Aug. 3. Yet because and Vascular Institute. He first turned ers and health insurers, and it’s a power- Mayo’s specialists are likely to see simi- to the Cleveland Clinic, which has been ful selling point in the competition with lar cases in the future, they say Luebbers’ affiliating with regional hospitals on elite hospitals such as Johns Hopkins and case will help them treat other patients. heart care for years. But Dubis won- the Cleveland Clinic. That thought consoles his widow, Mary. dered how well the primary care physi- Wal-Mart, for example, announced “Tony wondered whether his case cians at home would work with the spe- in 2012 that employees could get heart, might help their understanding of the cialists in Cleveland. DECEMBER 8, 2014 • STARTRIBUNE.COM MINNESOTA’S TOP NEWS CHOICE • MINNEAPOLIS • ST. PAUL

“And secondly, I thought: Why would That was the case with Hatfield, 23, what’s wrong with him. But Mayo doc- we do a national partner with just heart? whose cascading health issues forced tors ruled out a number of rare and dev- Why not look at something broader be- him to quit the track team at Northern astating diagnoses, which offered some cause of where health care is going?” he Kentucky and drop out of school in his reassurance. said. sophomore year. “Mayo Clinic helped me stop wasting Rackley, the St. Elizabeth neurologist, Mayo had more sophisticated diag- time looking for things that aren’t wrong worried at first that the Mayo network nostic facilities than St. Elizabeth and with me,” Hatfield said. “There’s defi- would simply be a marketing ploy. But was able to assemble a team that includ- nitely some lasting comfort from the she says the e-mail consultations with ed a gastroenterologist, neurologist, pul- visit.” Rochester have proved simple and ef- monologist and headache specialists. fective, and that she appreciates having Hatfield and his mother went to Mayo in [email protected] • 612-673-4493 a sounding board of top specialists at her March and were back again in May. fingertips. Even after genetic testing and some [email protected] • 612-673-7335 “It’s nice to have someone who has startling procedures — Hatfield’s body a lot more knowledge in the field that was dusted with blue powder to assess you’re treating,” Rackley said. how his body sweated — it’s still unclear