Episode 15: COVID-19
This is What We Do
Nancy Howell Agee, President and CEO, Carilion Clinic
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In this episode of Fireside Chat, we sat down with Nancy Howell Agee, President and CEO, Carilion Clinic to talk about the needs of caregivers, patients and the community during the COVID-19 pandemic. We also talked about operating margins for nonprofit health systems, updating the community through live streams and news conferences and how she communicates with the board of directors during the crisis.

Please note: The number of COVID-19 cases and the situation referenced in this episode were based on reported data at the time of the interview and are subject to change.

Please note: The number of COVID-19 cases and the situation referenced in this episode were based on reported data at the time of the interview and are subject to change.

Nancy Howell Agee is president and chief executive officer of Carilion Clinic, a nearly $2 billion not-for-profit integrated health system headquartered in Roanoke, Virginia, serving more than 1 million people in Virginia and West Virginia.

Carilion Clinic includes seven hospitals ranging from the third largest in Virginia to mid-sized community and small rural or critical access hospitals. Carilion also operates complementary business lines, including home health, imaging services, pharmacies and free-standing surgical clinics and has a large physician group with more than 1,000 employed physicians.

Before becoming CEO in 2011, Ms. Agee served as executive vice president and chief operating officer. During her tenure as COO, she co-led Carilion’s reorganization from a collection of hospitals to a fully integrated, physician-led clinic. The reorganization resulted in a partnership with Virginia Tech to create an allopathic medical school and research institute.

Ms. Agee is recognized nationally as a health care leader and currently serves as chair of the American Hospital Association, a membership organization representing the nation’s 5,000 hospitals and health care systems. She was named one of Modern Healthcare’s top 25 women in health care in 2017 and one of the national magazine’s 100 most influential people in health care in 2016 and 2017. She is a former member of The Joint Commission’s Board of Commissioners and past chair of the Virginia Hospital & Healthcare Association and the Virginia Center for Health Innovation.


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Nancy Agee 0:02
We were developing a strategic plan and there’s so much regulation around telehealth, both at the state level at the federal level. It’s not as easy as it seems. And we thought, well, we can extend telehealth to all of our ambulatory sites in 48 months. That was kind of our trajectory just seven weeks ago. Today, literally, we have extended telehealth to all of our inventory sites.

Gary Bisbee 0:31
That was Nancy Agee, President CEO, Carilion Clinic. Nancy spoke about how the reduction of state and federal regulations in response to the covid 19 pandemic allowed Carilion clinic to broadly introduce telemedicine years before they thought it possible. I’m Gary Bisby and this is Fireside Chat. Nancy began her healthcare career as a nurse and she’s been chairman of the American Hospital Association Board of Directors. Her background ideally positions her to understand the politics and health policy considerations of the COVID-19 outbreak, as well as the needs of caregivers, patients, and the community. The conversation with Nancy includes her thoughts about operating margins for nonprofit health systems COVID-19 updates to the community through live streaming news conferences, and how she communicates with the board of directors during the crisis. Let’s welcome Nancy Agee to the show. Good afternoon, Nancy, and welcome to the Fireside Chat.

Nancy Agee 1:29
Good afternoon to you, Gary, it’s good to hear from you.

Gary Bisbee 1:33
We were just chuckling a bit. Two and a half years ago, we were in your office with Don and interviewed you on video at that point. And boy, how things have changed since then?

Nancy Agee 1:44
Well, a lot of things have changed since then. But I would say the world is completely different as of about four weeks ago. So how fast life comes at you sometimes that’s for sure.

Gary Bisbee 1:55
Well said each region is different. How has the surge affected the Roanoke area and the Carilion Clinic population?

Nancy Agee 2:03
Well, let me just go back and say each region is different. Even in Virginia, almost every part of Virginia had one or two cases before southwest Virginia had any cases, or West Virginia had any cases. And so we were laughing a little bit that these Appalachian Mountains here may have been protective. Turns out that’s not true. But it was good while it lasted. But we had our first case about 12 days ago. And we now have five cases, we’re seeing some escalation in the number of cases, but only two are hospitalized at the moment. And the rest are self-isolating at home.

Gary Bisbee 2:50
Well, it’d be great if it doesn’t go beyond that. Let’s hope that’s the case. Testing has been a problem nationally. How is testing work for you? Has there been a shortage of testing kits?

Nancy Agee 3:04
We’ve been very judicious with testing to protect the number of testing kits that we’ve had and only testing those that meet certain criteria. And they’re the usual criteria. Have you been out of the country? Do you have a cough? Do you have a fever? We’ve been able to stay up to date with that and we have a testing center. So we’ve tried to funnel all the cases, physician referrals to the one testing center. And a separate problem, which was a pretty big problem was that testing was taking somewhere between four and seven days, which meant that anyone who had been in contact with that person had to self isolate for 14 days. And that has improved. And the Virginia Department of Health has improved. But I ache for having a test that we can do point of service or get turnaround time and hours versus days.

Gary Bisbee 4:07
Yeah, that’d be great. And I see the FDA just last Friday did approve a point of care test. I don’t know anything about how available it will be or when but at least they’re moving in that direction.

Nancy Agee 4:19
I was on a phone call with TMS earlier today. And that was talked about the antennas for that to be inpatient only. Also, understand the FDA has approved a nasal foam swab that theoretically at least can be self-administered. So I’m anxious to learn more about the various ways we can test because the quicker we can test and get results back. I think the better off we’re going to be.

Gary Bisbee 4:49
How about ICU beds and your ventilator supply?

Nancy Agee 4:53
The Medical Center here is a large 725-bed Medical Center and we have about 150 ICU beds, so we are being careful. We have eliminated now about a week ago. elective procedures are nonessential procedures and surgeries, which is helping. And we’ve identified a variety of sources for what we hoped we won’t need, but for surge capacity. And so far, we feel like that we can handle this, we also have the availability of two tents. And the state here has been good, I think to help identify where needs are. And since applause for those needs is, so far in this day, we’re all in constant communication. And I think we’re doing all right. Of course, we believe this will continue now for some weeks to come. And so if we talk again next week or the week after, I might tell you something different.

Gary Bisbee 5:57
Well, we’ll come back to COVID-19 later, but why don’t we ask you to describe the Carilion Clinic.

Nancy Agee 6:06
Carilion is an integrated delivery system. We’re organized around our physician group, we employ about 1000 physicians and we have another 1000 providers in private practice. We have seven hospitals, including two critical access hospitals, one micro-hospital, a children’s hospital, embedded, and our accurate Medical Center. Which as I mentioned, is the second or third largest depending on how you count it in, Virginia. We have a partnership with Virginia Tech and have an allopathic medical school and Research Institute. So we’re a significant player. We’re the largest employer west of Richmond, Virginia for the state of Virginia. And we provide services for about a third of Virginia, as well as some into West Virginia, Tennessee, Kentucky, and North Carolina,

Gary Bisbee 7:03
Were you from that area to begin with?

Nancy Agee 7:06
I was born here in Roanoke. And, you know, I teasingly say sometimes I do get out of town.

Gary Bisbee 7:15
I was chairman of the VHA. Long ago, you got out of town quite a bit, I’m sure.

Nancy Agee 7:20
Yes, I’m not sure I know what to do with myself with this imposed travel ban. We’ve certainly imposed that here I have for our employees. But you know, for the last three years with the American for the last six years, but the last three years as an officer with the American Hospital Association, which was my great honor to do. I was traveling somewhere around the nation as well as around the world with the AHHA and it was just an incredible experience that I will never forget.

Gary Bisbee 7:57
Well, you did a terrific job. Congratulations. Well, back to social distancing. So what is the policy of Carilion Clinic now?

Nancy Agee 8:02
We implemented a travel ban. So no international or national travel, work-related travel. Also, because our hospitals cover geography that’s from end to end about a four-hour drive. We’ve curtailed travel between in among our facilities to the extent possible, we’ve tried very hard to only have meetings that are by phone or by computer. We do have some in-person meetings that we practice social distancing there, we’ve changed our cafeterias, and so on. So there’s space between among the tables and people. We’ve done a lot to provide safety for our employees. And we think that’s working. I think our staff, as much as anything is getting tired and anxious. They’re working hard. That said, as you may have heard from others, our volumes are down. So some of that is self-imposed because we have restricted, nonessential procedures and surgeries. And some of it we find that the public has just responded with staying at home, and so fewer visits to our ambulatory sites, fewer visits to our emergency departments, the social isolation in our region is working. The financial consequences to our organization, I think will have a lasting impact and very worrisome.

Gary Bisbee 9:29
Yeah, that’s an interesting point when you say lasting impact. So your point is this is not just three months, six months, 12 months issue, but this is going to affect Carilion clinic for some time in the future.

Nancy Agee 9:42
Well, I hope that’s wrong, and I hope that the economy comes roaring back here this summer. And I was glad to see that the stock market is up a bit today. But you know, like most hospitals, we don’t have a huge margin. We were 3.5% to 5% operating margins. appropriate for not for profit, and we work hard to stay within that parameter. But I think this year is going to be pretty challenging financially.

Gary Bisbee 10:09
Yep, for sure. And we’re hearing that from all hospitals or all health systems around the country? Well, you’re from the area. So you have a good feel for how the public is looking at this. Do you sense that there’s an impatience there and wanting to get back to it? Or is everybody pretty much saying we’re gonna do what it takes here?

Nancy Agee 10:32
I would say there are both sides of the coin. There are those that and maybe it’s a three-sided coin, such a thing exists? There are those that think, what have we done? is we have we overdone? Is this really necessary? There are those that have said, Is there going to be a light at the end of the tunnel? And let’s move on. And surely there are those who say, either with anxiety or with determination will stay at home and will do what’s right. It’s quiet around everywhere. It’s very quiet. You know, all businesses are closed, of course, coming to work I live about, oh, about a 30-minute drive from my office and driving down interstate 81. Within if anybody’s been on Interstate 81. It’s a very crowded Interstate, and I can get here and half the time, it feels like there’s this you need to pass any traffic. So it’s changed a lot. You know, we the governor closed all schools, the universities and colleges around have all closed, and that’s created another burden amongst our workers who now have children at home and no place for them to go to be cared for. So it just seems like one unexpected turn after another. Well, I

Gary Bisbee 11:51
I know that the safety of your employees and staff is top notch for you, how have the physicians and nurses, the primary caregivers, how are they handling this?

Nancy Agee 12:04
I think you’re doing an incredible job and really remarkable. I know there are going to be so many people to thank once this and we move on. There are so many heroes. The good news is we’re staying about two weeks ahead with PPA. And we’ve been surprised at the number of places that have called to donate equipment. For instance, Norfolk Southern just showed up with a truckload of N95 masks. There are lots of places universities and colleges who’ve shown up with, with PPE donating things looking hard. So that’s been, that’s been terrific, as well as, of course, our various services and the state has released equipment as well. But more than that, the communities come together and finding ways to thank our healthcare workers. A few examples, there’s a bridge across the river walking in from the garage to the main hospital, and somebody had made a big chalk art, just thank you, to our nurse, doctors and nurses and beautiful people are delivering meals, people are offering to babysit it to take care of the dogs and cats at home. So the community’s really coming together. And one of the things that we worked with the churches. So Carilion, our name, it’s a derivative of the carillon, and which of course our bills working together in harmony. And so every morning at seven o’clock now, the churches toll bells to thank the health care workers in our region.

Gary Bisbee 13:48
Oh really? Yeah, it’s really quite lovely. That’s unique as well. I’m sorry to go here. But could you define PPE, for those that aren’t familiar with our terms?

Nancy Agee 14:00
Personal protective equipment, which includes gowns and gloves, and masks.

Gary Bisbee 14:06
We, of course, are used to the acronyms that work in healthcare. So for those that are so how’s the morale of the physician group and your other caregivers and other employees?

Nancy Agee 14:18
I would say 90%, this is what we do. We take care of people who are sick. We take care of our communities, we live our mission, which is to improve the health of those we that we serve. And we’re that’s an honor, that’s part of who we are. There are those of course who are concerned about their own safety or the safety of their families who are tired or frustrated, but that they’re really a small minority.

Gary Bisbee 14:49
We’ve had a national emergency declared. Congress is talking about a $2 trillion assistance package. Do you have any expectation that all these dollars are going to be helpful to your community? Is it actually going to help the economy or help healthcare?

Nancy Agee 15:06
That’s a really good question. At least the first couple of bills are targeted at small businesses. And we have a lot of small businesses here. So I hope that will be helpful. Until this last bill, nothing much was done to economically support hospitals. And we’re looking for some potential really, for what we know is going to be a difficult financial consideration going forward. So we’ll see it you know, I think that at least the stock market was up a bit today on the hope that the, house would agree and pass this last bill, I think the economic stimulus is going to be necessary. I’m guessing some ways those of us in healthcare or so in the middle of this, that our day to day concern is taking care of our patients, taking care of our staff, and helping our community get over this.

Gary Bisbee 16:05
Right. And you mentioned, there’s a couple of critical access hospitals in your portfolio of hospitals. And I would think that we’d be looking for some economic support, particularly for that group of hospitals.

Nancy Agee 16:18
Yeah, and we’re at a recent Medicaid expansion state, thankfully, but one of the ways that we got to Medicaid expansion approved is a provider assessment on all hospitals. So we are asking for that to be relieved from the state need. And as a matter of fact, just today, send a letter to the governor, from all of the hospitals in Virginia saying, if you can eliminate the provider assessment, that’ll be one way that we can find some solutions?

Gary Bisbee 16:46
Well, in terms of the states, we’ve already talked about the regional variation in this disease, how much support Canadian state provides, compared, let’s say to the federal government?

Nancy Agee 16:57
I think both are possible. And in the state being able to support us with, as I mentioned, the provider assessment. I think the federal government, there’s a variety of things that we think they can do, and I think that is in the bill, I have to say I’ve been very pleased with CMS and HHS, and FDA, all of whom have commonly had a call with those of us who want to participate, have been listening have been trying to provide in a number of things that they can do releasing regulation, and one of the most important has been telehealth. So, you know, Gary, we were developing a strategic plan. And there’s so much regulation around telehealth, both at the state level at the federal level, it’s not as easy as it seems. And we thought, well, we can extend telehealth to all of our ambulatory sites in 48 months, that was kind of our trajectory just seven weeks ago. Today, today, literally, we have extended telehealth to all of our inventory sites, people have worked tirelessly internally. But this both the state and CMS have relaxed regulations and have made it possible for us to do something we didn’t think we’d be able to do for quite a long time. What I hope is that that will continue after, after this crisis is over, because we now know we can deliver care in a way that’s different. And that saves money, and that our providers and our patients feel good about even in the emergency departments that you know, we’re you we can use telehealth and imagine the follow up you can do with telehealth, imagine if you can screen a patient before they even come in and tell them which room to go to. I mean, there’s so much we can do technologically. So I’m really boid by this turn of events, if there’s a silver lining to this crisis, it’s being able to do some important care delivery in new and different ways.

Gary Bisbee 19:08
Good for patients and good for the finances of the hospitals. And as you mentioned, there are some long term consequences probably to both. This would be terrific if we could keep this going. I’m sure there’ll be a lot of comments to HHS and CMS about that.

Nancy Agee 19:23
Yeah, it’s a little bit like you can’t open up the window now and expect us to put the genie back in the bottle. Right?

Gary Bisbee 19:28
That’s exactly right. Well, and I noticed that there have been some Medicaid waivers passed so-called section 1135 waivers, and Virginia was granted a waiver. So that’s apparently going to help with prior authorization and some of these other regulatory hurdles, which seems like clearly be good for patients and providers and might be good financially as well over time.

Nancy Agee 19:52
I hope you’re right. I think anything we can do to reduce the friction that occurs in healthcare and do things more expeditiously less expensively, and improve healthcare, then let’s use any opportunity we can to make that happen and make it stick.

Gary Bisbee 20:09
So you’ve basically postponed all elective surgeries that are most elective surgeries?

Nancy Agee 20:15
We’re asking the chairs of each of our departments. So we’ve non-chairs, large departments to make a decision, and we have a tiering of services, recommended services. And whether it’s a “do now,” whether it’s “wait.” The reason we did that, as much as anything is to protect our supply of PPE, personal protective equipment. You know,

Gary Bisbee 20:49
There are second and third-order effects that will, of course, occur in one of them. There’s been a lot of talk about cutting down in hospital beds. And yet, this brings into focus the important role that hospitals and provider organizations play as part of the domestic infrastructure, clearly a vital national asset, do you think that we’ll be able to make that case and bring more attention to bear on the importance of our provider institutions?

Nancy Agee 21:21
I do, if I turn back the clock and all the time, with the American Hospital Association when for the last couple of years, there’s been this seemingly growing notion that hospitals were getting too big, we had too many beds, you heard the term admission is a fallacy or a failure of the hospital of the healthcare system. Personally, at least for our region of felt like we’re always going to need hospital beds, we run very full beds. And I think this is a wake-up call to America that the one stability that you’ve got the ones who are always there are your frontline workers, whether they’re EMF providers, our physicians, our nurses, a technologist, and a shout out right now to environmental services. So the staff that clean is our first line of defense, aren’t they? So I think that we’re going to see a change in the heart of politicians in particular, that hospitals are needed and necessary, and were the ones who are there in any crisis.

Gary Bisbee 22:29
Well, you made the point earlier, a great quote, you said, This is what we do. And that’s pretty much in capsules, this for our health workers, could we turn for a moment to your board of directors and the governance process? So what questions does your board have? How frequently are you communicating with your board?

Nancy Agee 22:48
We are doing a couple of things. We’re having a telephonic meeting weekly, with our board, and we run through where we are, what we’re doing, how our employees are doing any particular issues or concerns. Because it’s a telephonic meeting, it really isn’t a protected meeting, per se, although the only invitees are board members. And we’re going to continue to do that throughout the duration of this. And then we have a portal so we can post anything we like to the portal that is confidential. And additionally, I pretty rarely send out emails. And the media has been actually quite helpful and asking us questions, but not overwhelming us. So what we’ve done, we did our first one last week, we did a full news conference and live-streamed it and then most of the local media live-streamed, that we’re going to do that again this week. And what we’ve told the media is we’ll continue to do that. So they won’t have to keep asking for things. And we’re live-streaming it so that we only have a few people in the room at a time. The board’s just been terrific, both curious and interested in wanting to know how they can be helpful. What information can we give them? What information do they need, as they talk to their colleagues and, and their support for us? So no real specific questions, other than, you know, financially, what are your What are you projecting? What are your concerns? How are the employees? And do we have the equipment that you need? You know, is there anything that they can do to be supportive? In general, our board, our boards for all of our hospitals, and our fiduciary board as well have just been tremendously supportive and helpful.

Gary Bisbee 24:38
Well, this has been a terrific interview. Nancy, we really do appreciate your time. And I know you’re very busy there. Let’s turn it back to you just for one question, which is, what award has meant the most to you out of all the awards you’ve received?

Nancy Agee 24:56
Oh, that’s not fair.

Gary Bisbee 24:58
I didn’t give you an advanced warning on that one so you can answer later if you don’t want to answer now that’s okay.

Nancy Agee 25:06
Can I name three?

Gary Bisbee 25:08
Yes, you can.

Nancy Agee 25:09
One is every year our organization gives Quality Award, the highest award we give in our own organization. And several years ago that was given to me. And that probably means as much as anything could possibly mean. The second is and similar. Growing up, you always saw the mayor gave the keys to the city to somebody who resides in the paper. And I thought that is so cool. Those are that’s really cool. About a year ago, to my surprise, I was speaking at something and the mayor gave me the key to the city and I thought, that’s, that’s pretty cool. And then lastly, the Gail Warden award for leadership really touched me because it was from my peers, and it meant a lot to me. Thank you for asking, but that’s embarrassing.

Gary Bisbee 25:58
Well, I’m sorry, but they’re all three very nice awards. I love the key to the city story. And actually, Gail Warden hired me at the American Hospital Association.

Nancy Agee 26:08
Oh my goodness, no kidding. Well, that’s a very good story. Thanks for what you’re doing to get the word out and hope that we can all see each other in person soon. Look forward to it.

Gary Bisbee 26:20
Thanks so much, Nancy.

This episode of Fireside Chat is produced by Strafire. Please subscribe to Fireside Chat on Apple Podcasts or wherever you’re listening right now. Be sure to rate and review fireside chat so we can continue to explore key issues with innovative and dynamic healthcare leaders. In addition to subscribing and rating, we have found that podcasts are known through word of mouth. We appreciate your spreading the word to friends or those who might be interested. Fireside Chat is brought to you from our nation’s capital in Washington DC, where we explore the intersection of healthcare politics, financing, and delivery. For additional perspectives on health policy and leadership. Read my weekly blog Bisbee’s Brief. For questions and suggestions about Fireside Chat, contact me through our website, firesidechatpodcast.com, or gary@hmacademy.com. Thanks for listening.

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