DHMC appoints new trustees, who will oversee changes in payment system
Dartmouth-Hitchcock Medical Center’s Board of Trustees elected DHMC physician and Geisel School of Medicine professor Brooke Herndon, executive vice president and chief medical officer of CVS Health Troyen Brennan and Upper Valley resident Charles Plimpton, who recently retired after a career in investment banking that specialized in the non-profit sector of the health care industry, as new trustees to help guide the hospital in its transition from a pay-for-service model to a more value-based system, Board chairman Robert Oden said. At the Board’s spring meeting on March 20, the three new trustees were unanimously appointed to the 20-member Board.
Oden said that this is a “critical time” for academic medical centers, something he was not aware of until he was elected chair in March 2012. He noted that hospitals and physicians are expected to be more productive while receiving less income and Medicare reimbursements.
Oden said that the Board’s first goal is to develop a sustainable payment model for the hospital, which marks a “huge transition.”
DHMC chief executive officer James Weinstein said that most health care systems are currently operating on a fee-for-service model, meaning that patients are charged every time they see a doctor or have a procedure. He said DHMC is moving toward a capitation model, wherein patients pay a fixed amount annually for full service from the hospital.
“We want to have a system that doesn’t pay [DHMC] by the number of things you do, but how well we take care of you,” he said.
Weinstein said that 50 percent of DHMC reimbursements occur through risk-based contracting, which allows the hospital to be reimbursed by Medicare and rewarded or penalized based on performance.
Herndon said that the hospital is prioritizing population health and an integrated delivery system under the new organizational structure.
“We’re focusing on improving the overall health of the community and how to make our organization healthy,” she said.
Oden said that Board chairmen never come from the medical field, as they focus on representing the public and avoiding conflicts of interest. Herndon’s role on the board is to represent the voice of the physicians, he said. Oden is a former Dartmouth professor of religion and former president of Kenyon College and Carleton College.
Herndon said that her personal mission is to help cultivate relationships within the organization.
“What I personally hope to contribute is to foster a healthy, open dialogue between the Board and the physicians who I represent so that we can all work together to improve care, to promote discussion and dialogue so that all of these improvement processes can move forward,” she said.
Brennan, who has received both a juris doctorate and a medical degree, offers a valuable perspective on DHMC’s payment model transition, Oden said. Brennan understands the dynamics and finances of the consumer, and CVS is part of the future of more affordable medical care, Oden said. He explained that patients could go to a CVS medical clinic rather than a hospital if their need is not “life-threatening,” a less expensive option in a system with many potential stages of medical care.
Brennan has also served as president and chief executive officer of Brigham and Women’s Hospital in Boston and chief medical officer at Aetna Inc., a health insurance provider.
Plimpton worked as an investment banker for Citigroup, Merrill Lynch and a predecessor to UBS during his 31-year Wall Street career focused on health care finance. He worked with many health care organizations including academic medical centers, research institutes, vertically integrated providers and large hospital systems.
“There is nobody who knows the financial challenges of medical centers better than [Plimpton],” Oden said.
He added that Plimpton, who recently moved to Cornish, Vermont and is active in many local organizations including the Tuck School of Business, represents the local population served by DHMC.
Plimpton and Brennan could not be reached for comment by press time.