Thomas H. Carman, president and CEO of Samaritan Medical Center, outlines how the Watertown hospital has made it through the economic downturn by having a sustainable business model. Photo by Norm Johnston.
Hospital chief believes steady, strategic planning helped navigate in tough times
The Samaritan Medical Center campus has been in a constant state of flux for more than five years, adding a parking garage, new pavilion, connector to Samaritan Keep Home and dozens of interior renovations, costing in total more than $61 million. We sat down with Samaritan President and CEO, Thomas H. Carman to find out how the hospital has been able to achieve such growth in a dicey economic climate.
NNYB: What brought you into the administration side of the business from a pharmacy background?
CARMAN: I?ve always been interested in the business side. At one point I thought as a pharmacist I might own my own pharmacy. So I?ve always had that interest. When I went off to college and I actually learned about pharmacy and started working in hospitals, I really fell in love with the clinical side as well. So i think I?ve had that interest in both the clinical and business sides all along. That?s driven me to where I am today. That?s why I went back and got my MBA. I was able to combine the clinical piece with the management piece and as I progressed in the organization I moved more toward a pure management administrative role.
NNYB: How has Samaritan been able to guide itself through the lean economic times while growing facilities into these resources now?
CARMAN: I think it is because of the strategic plan that we put in place in 2006. I arrived in 2004 and spent much of my first year spending time seeing how Samaritan fit into the community and into the region and then in 2005 we launched a strategic planning effort guided by the board of trustees. We introduced it in 2006. It had five components in it. I think because of that plan it guided us and put us in the position we are in today. We have seen a growth in revenue of nearly 40 percent, about 10 percent each year, over the last four years. We have been fortunate with not only a growth in services but a growth from the capital and building perspectives as well, with adding the new pavilion in 2010, by going through the renovations and now up at the Samaritan senior village. We?ve been fortunate and have had tremendous support from the community. We?ve been blessed by that. We?ve also had support from the state. The state has come forward with some HEAL grants for us as well, which has allowed us to move forward.
CARMAN: It really is a focus on the five areas of our strategic plan. Our plan called for a facility master plan, which is physical plant changes we?ve seen. But there are goals around physician development, making sure we are recruiting and maintaining the physicians in this community; goals around performance improvement in the quality of our services; goals around the workforce and goals around Fort Drum as well. I think it?s the focus on the physician development piece and the focus on quality and our workforce that has really allowed us to see an improvement in our services and growth in business as well.
NNYB: What do you estimate the economic impact of Samaritan is?
CARMAN: We get an impact statement from the hospital association occasionally and the last one that was done was in 2008. If I roll that forward and look a the growth we?ve seen I would estimate the economic impact on the community at about $330 million. We have an annual budget between the medical center and the Keep Home of about $220 million. We currently employ about 2,000 individuals, which is about 1,750 full-time equivalents.
NNYB: Describe the relationship that the hospital has built with Fort Drum, given that there is no hospital on-post.
CARMAN: I think it?s safe to say it?s an honor for us to be able to serve our soldiers and their families. When we went through the strategic planning process in 2005 we made sure our mission statement reflected that we are here to serve both the civilian and military community. It?s critical for us to make certain we understand what their needs are. We have a couple of different ways to do that. We do it directly with Fort Drum. We stay in direct contact with the command, with the medical activities side as well as the command side. We want to make sure we understand exactly what their needs are and can help to meet those needs. We recognize that this is a bigger issue than just acute care. That?s why we have the Fort Drum Regional Health Planning Organization, so we are a part of that and work with that group.
CARMAN: I think the biggest challenge for us is healthcare reform and what that?s going to mean for the future and understand and try and get prepared for that as well. It is an unknown and I think there are certain things that are fairly clear and we are preparing for those. One of those things is around value-based purchasing and really having to make certain we are going to be paid in the future based on outcomes we provide. The other piece we?re seeing is the focus on wellness. Hospitals have been taking care of people when they?re sick. We are looking forward to keeping people out of the hospital and improving the wellness of the community.
NNYB: How would that impact the traditional revenue model of healthcare institutions?
CARMAN: If you think of that on the surface, it will do just that: it will cause revenue to decline as you keep people out of the hospital. We updated our strategic plan in 2011 and are introducing it this year in 2012. In there it does have a growth goal as well. We are looking at areas can grow the business because we recognize keeping people healthy will take revenue away. We are focusing on women?s health, cancer care, orthopedics and behavioral health. We think those are some unmet needs in the community that will help us grow as well.
NNYB: Finding out and realizing the impact of federal health care legislation, since the Supreme Court decided to uphold the law; is that something you?re still unraveling and figuring out?
CARMAN: It is, but it was the basis for our strategic plan. As we looked at that and had success with our prior plan when we updated that plan in 2011, we took all of that into consideration. That?s why our plan moving forward has strategic goals around value; ways we can improve quality of our services and take costs out of the system as well. We are also looking at what we call clinical integration because we know that in order to keep people out of the hospital it?s going to require a different relationship between Samaritan and the other health care providers in this community. We are looking at things and value and clinical integration, which we think will put us in a good position moving forward to meet the needs of health care reform. The growth we will see with growing certain services, staying focused with the two other goals we have include our continued focus on Fort Drum and grow our own workforce as well.
NNYB: In terms of Fort Drum, what long-term challenges do you face with soldiers returning from overseas deployments bringing with them a myriad of physical and mental issues?
CARMAN: I think, as I look at it, the first thing we need to do is ensure the behavioral health needs that the military and their families have. For years we have had a shortage of behavioral health services in this community. We have done a lot to improve that and more recently Samaritan has taken a more active role in that. We have engaged a consultant to come in and help us look at what there might need to be for additional behavioral health services. Right now we are contemplating the need to expand our in-patient mental health unit, we think there might be a growth of 10 to 15 beds there to meet needs of the community and Fort Drum.
NNYB: You?ve made significant improvements in infrastructure in recent years. How do you determine which projects to take on first and in what order? Is the puzzle ever complete?
CARMAN: It is an evolution. I think what has guided us and allowed us to prioritize what we have done is based on our strategic plan. The plan we developed in 2005 kind of guided us over that six year period of time. The plan we introduced in 2011-12 will both help shape and guide. We look at the needs of the community and how to best serve those needs. We started with a funnel of lots of thoughts and had to sort of narrow those down because any organization can only do certain things and do them successfully. We needed to narrow it down to a group we felt we could work on over a course of time and our strategic plan has done that very well.
[Editor's note: This is a truncated version of this story. For the full version, please see NNY Business in print or subscribe.]
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