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Case Study: Nebraska Spine Hospital

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By Troy Stockman

The Nebraska Spine Hospital is a specialty hospital that focuses on the practice of spine surgery. Located within the campus of Alegent Health Immanuel Medical Center in Omaha, Neb., the Nebraska Spine Hospital is a joint venture between Alegent Health, Nebraska Spine Center and Health Inventures.

For more than two decades, the Nebraska Spine Center surgeons have been practicing complex spine surgery at Alegent Health Immanuel Medical Center, building a program of spine-specific technology and spine-trained staff to care for the most complex surgery cases in the region. In 2009, key leaders from both Alegent Health and Spine Surgeons discussed the need to design a Center of Excellence in Spine Surgery where best practice models could be built while reducing global costs. The groups agreed that a physician-owned hospital joint venture could create this Center of Excellence more effectively than in a health system the size of Alegent Health. As the ever-changing healthcare policies continued in Washington, it was evident that a partnership between these two groups must join before the new healthcare reform law was put in place in 2012, as a result of the specific language within the health reform bill stating a moratorium for physician-owned hospitals opening after Jan. 1, 2010.

On the eve the healthcare reform bill was signed by President Obama, a joint-venture letter of intent for a partnership by Alegent Health, Nebraska Spine Holdings and Health Inventures was signed. This started a nine-month race for the owners of the Nebraska Spine Hospital to design, construct and staff a licensed 34-bed hospital with six operating rooms – achieving all standards and licensures from the State of Nebraska, The Joint Commission and Centers of Medicare and Medicaid by Dec. 31, 2010.

Thanks to the concerted efforts of the dedicated staff of The Nebraska Spine Hospital, Alegent Health Immanuel Medical Center, Health Inventures and Nebraska Spine Surgeons, this hospital-within-a-hospital was licensed and accredited by the associated agencies with no recommendations or rejections. On Aug. 16, 2010, the Nebraska Spine Hospital opened its doors. As of today, more than 2,000 patients have experienced the exceptional care the facility’s staff offers.

The engagement of the physician owners and partnering with Alegent Health and Health Inventures’ resources allowed Nebraska Spine Hospital to decrease implant costs by more than 50 percent, increase patient care quality outcomes, and receive patient satisfaction scores higher than the 97th percentile nationally since January 2010. These results have been achieved by serving a patient population constituting the nation’s sixth highest case-mix index according to the Centers for Medicare and Medicaid Services.

To achieve the desired outcome, all parties involved agreed that each would put forth supreme effort in the areas they could provide the greatest value to the initiative. The Spine Center contributed the clinical and research expertise necessary to run a successful operation. Alegent Health was given the task to support the managed care contracting and ancillary provisions. Health Inventures was responsible for the development and execution of a plan that maximized the strengths of each partner. In addition, Health Inventures took on the responsibility to manage the hospital’s day-to-day operations, the development and implementation of strategic plans, and human resource management. The results have significantly exceeded expectations by all measures of success. In its first year of operation, the Nebraska Spine Hospital served more than a thousand patients, 15 percent more than initially projected.

To read a related SurgiStrategies article about physician-hospital partnerships in light of healthcare reform, click here

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