KHI News Service

Southeast Kansas collaborative seeks $11M grant for virtual health center

Money saved on overhead and administration would pay for case management

By Mike Sherry | June 04, 2012

For years, poor patients in this southeast Kansas community have relied on a free health clinic that operates on Thursday afternoons out of a Bible school classroom.

In its heyday, the Parsons Community Clinic could count on about a dozen primary care physicians and an equal number of nurses to volunteer at the First Assembly of God building at North 16th Street and Dirr Avenue. It still treats about 35 to 45 patients each week for everything from rashes to diabetes.

But now, with the volunteers getting up in years, the clinic faces an uncertain future — and local medical leaders essentially are trying to put it out of business.

“That is our hope, yes,” said Dr. Stephen Miller, a retired surgeon who helped found the clinic 15 years ago.

Dr. Stephen Miller, a retired surgeon who founded the traditional safety net clinic in Parsons 15 years ago, said he hopes a new "virtual" clinic will replace it.

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In its place, though, members of the Southeast Kansas Healthcare Collaborative are proposing a model that, at least according the group’s research, does not exist anywhere else in the country.

The plan is to create a rural health network that would connect providers via computer to create a “virtual” federally qualified health center, or FQHC, serving Labette, Neosho and Wilson counties. FQHCs typically are bricks-and-mortar facilities offering primary care services in underserved communities.

Led by Labette Health, the hospital in Parsons, and its Chief Executive Officer Jodi Schmidt, collaborative members hope the idea is unique enough to earn funding through the new Health Care Innovation program administered by the federal Centers for Medicare and Medicaid Services.

They have an $11.4 million grant request pending before the agency that would allow them to develop and implement the plan.

The collaborative is targeting an area with about 50,500 residents in a corner of the state that has some of the worst health outcomes among Kansas’ 105 counties, according to the County Health Rankings from the University of Wisconsin Population Health Institute and the Robert Wood Johnson Foundation. This year’s ranks are Labette (91), Wilson (87) and Neosho (83).<a name="continued"></a>

Members of the collaborative are striving to achieve the “triple aim” of better individual care, better population health and lower per capita health care costs.

The virtual health center plan

Under the plan, organizers would establish a nonprofit organization – overseen by a 21-member board – to manage the virtual community health center. The center would contract with primary care physicians and midlevel providers at hospitals in the three counties.

Patients would receive care at the doctors’ individual offices. But through the use of tools such as electronic medical records, the providers would coordinate care and payments for services through a computer network.

The key principle underlying the virtual center is that its overhead costs would be significantly lower than a conventional safety net clinic. For example, there would be no utility costs because there would be no physical location for the center. Administrative functions such as financial services and information technology support could be handled through contracts with the member hospitals.

According to Schmidt, the pool of potential contractors includes more than 50 primary care physicians and midlevel providers. In addition to Labette Health, hospitals in Oswego, Neodesha, Neosho and Fredonia are part of the collaborative.

The center would direct money otherwise spent on overhead and administration into patient services handled by a case management staff that would include a home monitoring team and prescription assistance coordinators.

The case management group would have 14 employees in the first year and would grow to 20 in the third year, according to the grant proposal.

In addition, some of the funds would cover “coordinated care incentive payments” to physicians. The payments would be made with the understanding that the physicians adhere to best-practice protocols and gather certain quality data.

According to the grant proposal, the incentive payments in the first year would amount to more than $364,000.

The virtual clinic concept also could help avoid the physician resistance that a more traditional FHQC might encounter.

Jodi Schmidt, chief executive of Parsons Health, helps spearhead the effort of the Southeast Kansas Healthcare Collaborative to secure a federal grant to launch a new virtual safety net clinic that would serve patients in three counties.

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It is not uncommon for members of the medical community to view the safety net clinics as a competitor, and there was some of that sentiment in Parsons when members of the collaborative initially considered establishing a traditional federal health center.

“There was concern about already having enough providers and then adding another clinic, because it’s tough to be a primary care physician in a rural community,” Schmidt said. “So adding a bricks-and-mortar clinic that might spread that patient volume even more would hurt all of our providers, and it would not be in the best interest of the patient.”

She said a virtual center also could serve patients better by allowing them access to providers in their own communities. Getting to a stand-alone facility could be a substantial burden for some patients who don’t live nearby.

For the technological backbone, the collaborative would use the Kansas Health Information Network (KHIN), a health information organization.

KHIN is one of two networks under development in Kansas that will form the statewide health information exchange, which is set to go live in July. The aim is to link doctors, specialists, hospitals and regional cooperatives so they can share electronic patient health records.

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