Competitive edge: What we know from Idaho hospital trial documents
The perceptions weren't necessarily wrong.
St. Luke's was concerned about its maternity services, too. St. Luke's noticed a dip in business from pregnant women, according to a hospital report written in 2012. Births at St. Luke's hospitals were down 7 percent in
Why? The economic downturn was part of it, St. Luke's surmised. But executives also suspected it was due to competition from Saint Al's, which unlike St. Luke's had a midwife program for expectant mothers.
Both hospitals would go on to make changes to maternity care.
The competitive outlook that helped spur those changes was revealed by 8,300 pages of records released in response to legal action by the
The records show jockeying for customers and market share by both health systems. The two tax-exempt nonprofits are also powerful
"We believe competition is good," said
BEHIND THE VEIL
The court gathered thousands of pages of documents -- PowerPoint presentations, emails, board-meeting minutes, text messages -- from the hospitals and other businesses. Many were kept from public view during the trial, because the judge gave lawyers the ability to say something was so competitively sensitive that it couldn't be released.
After news organizations sued for access, Winmill ordered the release of more than 300 previously sealed documents and hours of testimony. He allowed some to remain closed because they contained trade secrets.
THE BABY MARKETPLACE
Some of those trial documents describe strategies not related to competition -- cases where the health systems focused instead on helping Idahoans become healthier, on bracing for monumental shifts in health care or on offering safer patient care. One St. Luke's document posits that it's better to wait until you have a "quality product" than to simply beat a competitor to market with something inferior.
But many of the records pertain to the "competitive edge." For maternity, both hospitals were paying close attention to data about each other.
The St. Luke's action plan was to do a better job of marketing and "gain any market share that can be steered our way," and to create a midwifery program "where we'd hire certified nurse midwives to work collaboratively with physicians" -- a program that Saint Al's had been offering.
"Volumes will increase by keeping deliveries local rather than transferring to our competitor 14.1 miles down the road," said a late-2010 Saint Al's presentation pitching the idea. The competitor down the road? St. Luke's
They also built a new maternity unit as part of a
" Market share at SAMC-Nampa has declined to approximately 29 percent as public and physician perception of the existing facility has declined and after St. Luke's built a full-service hospital in
Leaders said in planning documents that they would measure the success of hospital improvements in part on maternity admissions rising from 120 in 2014 to 151 in 2018.
The new maternity suites near the freeway, described in the
The hospital project had five goals, spelled out on the last page of the presentation, Petersen pointed out: Keep care close to home; improve community perception; increase volumes, market share and service lines; increase patient, physician and staff satisfaction; and increase patient and staff safety.
"That's what we really thought was going to be the value of the project," he said.
CEO
Business at the
"SAMC-Nampa must improve community and physician perception of their facilities and reposition them to capture more market share or the
EYE ON THE OTHER GUY
A thread of us-versus-them runs through dozens of documents released from the trial. They talk of "competitive intelligence efforts," "dominance" and competitors as a "threat."
"In order to keep our market share and increase our volumes locally we must keep up with our competitor," an internal Saint Alphonsus strategic presentation said.
St. Luke's spread its roots further into
"As market share for (the) new St. Luke's
The antitrust laws courts say St. Luke's violated are meant to protect competition, based on the idea that businesses going head-to-head with each other is good for society. Competition keeps one company from setting prices for all the crude oil or tobacco in the U.S., and it drives innovations like those that turned boxy computers that only the wealthiest could afford into
Some trial documents show that competition has been good for the
And some documents even cite a lack of desire to compete at times. A former St. Luke's insurer-relations executive said in emails that his hospital system shouldn't get into a bidding war with Saint Alphonsus over a Micron health insurance contract.
Saint Alphonsus executives sent emails about a "sense of urgency" they felt when St. Luke's announced in
"The pace of change just accelerated," wrote Petersen, the chief financial officer, after learning of the alliance a week before it was publicly announced. "We are going to have to do quite a bit of work that we are not fully ready for. If we wait until we are fully ready, the bus will have left the station and we will be so far behind we may never catch up. From all I hear, St. Luke's is also not ready, but ready or not here we come."
Both health systems were working at the time toward tighter, quality-driven deals with insurance companies, Petersen told the Statesman.
"I don't think in retrospect it was as much of a disruption as I thought it was when I wrote these," he said.
Asked if Saint Alphonsus actually jumped into something it wasn't ready for, he said no. Petersen said the hospital system was feeling deadline pressure from
"It was something that happened in the market," he said. "I was just trying to make sure that we, as a management team, understood we've got to get moving forward."
THE WEST VALLEY
She said it's "refreshing" to work for St. Luke's, which she said is competing with itself to become better.
What about that "action plan" -- to compete with Saint Alphonsus by offering midwives?
"We don't want to lose market," she said. "We still want to make sure we are providing, and we are still the provider of choice, of obstetrics services. That's a deep and rich part of our history. ... It's a natural tendency to say, 'Why are we seeing a dip? Are the births down overall? Have we lost market share? Are we not delivering a product or a care experience that people are asking for?' "
St. Luke's launched its own midwifery program about a year ago, she said.
"If that's what the community is asking for, then we probably need to open our eyes and say, 'How do we provide those services?'" she said. "That was a reflection of us not being as attuned to what the community was asking us to do and responding based on seeing decreased volumes."
Still, documents produced by St. Luke's don't shy away from us-versus-them ideas.
A 39-page marketing report from 2011 is titled "How the West Was Won." It suggests "tactics" such as: "
The context for the latter statement, according to spokeswoman
Keeler said competition is in the bottom half of issues Saint Alphonsus leaders think about when they're making big plans. "Competition doesn't drive our strategy," he said.
Moore said the hospital's main competitor isn't at the front of her mind, either, when she's talking about the future.
"We don't define our strategy based on our competitors," she said. "You're not knee-jerking based on what your competitors are doing, but you're defining the vision and what you hope to have those outcomes be."
Yet one Saint Alphonsus document with Keeler's name on it portrays competition for health care in the
" Historically two systems (Saint Alphonsus & St. Luke's) have been locked in 'war of attrition' that has spilled over into
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