Dennis Murphy 0:04
We’re trying to avoid the use of normal, and actually talking about this idea of a series of next normals, which is we’re going to monitor data and continue to adjust and adapt as an organization. We’ve avoided the new normal because it almost feels like it’s a destination and then you become static.
Gary Bisbee 0:28
That was Dennis Murphy, President and CEO, Indiana University Health reframing the term “new normal” following the onset of COVID. I’m Gary Bisbee, and this is Fireside Chat. IU Health is the largest provider in the state with a commitment to improving the health of the Indiana population, which is among the lowest of any state in the country. Social Determinants of Health is not an abstract term for IU Health, and Dennis is hoping that the Indiana legislature will allocate more resources to public health at its next session. Dennis has a unique view of the likely next normal. Let’s listen.
Dennis Murphy 1:05
I think Gary, this notion of who has to come to you for care, versus where do you go to them either virtually or physically, is going to be one of the most profound changes for us.
Gary Bisbee 1:19
Dennis shared with this the effects of the increased use of telemedicine during the COVID outbreak, which might result in 30 to 40%, fewer exam rooms, and a new building being planned. He spoke about the board support during the COVID crisis and the risk of not slowing the pace of CAPEX. I’m delighted to welcome Dennis Murphy to the microphone.
Well, good afternoon, Dennis, and welcome.
Dennis Murphy 1:44
Thanks, Gary. It’s always a pleasure to talk to you.
Gary Bisbee 1:47
Well, we’re pleased to have you at this microphone. Let’s get right into what we’re all dealing with: Coronavirus. We’ve learned that the surge is highly variable, by region, and in your case by the state as a statewide system. So what is the status of the surgeon IU health primary service areas, Dennis?
Dennis Murphy 2:00
You know Gary, it’s been interesting because overall, I would say the state’s seeing a slow progression down that it’s not this very high peak and rapid downturn, but rather a rapid increase and then a very slow downturn with plateaus that in our largest market in the Indianapolis metropolitan area, we’re still seeing a significant number of cases and new cases. And then in other regions, we tend to divide the state up by other college campus towns are other hubs. And we’ve had two of those that have seen a more rapid decline and one of them actually be near a new focal hotspot; a meat processing plants where they had relatively low volumes for the first 45 days of this outbreak for us, and all of a sudden had 100 patients that were either admitted or triage to another one of our hospitals in a very short period of time, just over a week. And so, again, that’s probably some of the benefits of being a big system as they felt like they had resources to tap into for really emblematic and I think troublesome for our politicians in the state because they’re hearing in some areas and southern Indiana, they’ve had all of seven patients the entire past 60 to 70 days. And in Marion County in Indianapolis, that number has been substantial and really not too different than other major metropolitan areas around the country.
Gary Bisbee 2:55
Well, you said that the surge ramped up considerably, but it’s ramping down very slowly. Is that correct?
Dennis Murphy 3:57
Gary Bisbee 3:58
So hopefully we’ll see over the course the next couple of months things get back to normal. Is that what you’re thinking?
Dennis Murphy 4:05
We’re trying to avoid the use of normal. And actually talking about this idea of a series of next normals, which is, we’re going to monitor data and continue to adjust and adapt as an organization. We’ve avoided the new normal because it almost feels like it’s a destination, and then you become static. Once you get there trying to continue this notion of being adaptive throughout this. First, because we don’t know. There are lots of different predictions on how this will roll out in the future. Is there a large second wave? Is there a series of rolling waves? And so trying to have a mindset of adaptability. And then I think we’ve learned a lot of really good things that are positive for our organization that we don’t want to lose and I think the analogy we’ve used as we’re in this epoxy like a moment that it’s fluid and shapeable. But pretty soon it’s going to get solid again. And before it gets solid and people retrench to their old behaviors, how much of the place can we change? Our current example is we’ve started elective procedures, and really pushing our surgeons to say, why would you ever do a pre-op and post-op visit on 100% of your patients in an office and really pushing hard to move them to virtual visits either on the front end or the back end or both. And so that notion of next normal I think has resonated well with our organization and where people want to see us go.
Gary Bisbee 5:51
in terms of telemedicine virtual visits. I’m assuming that same thing happened for IU health, which is a dramatic increase in these sorts of visits, is that true?
Dennis Murphy 6:02
Absolutely. So we can, the first week that we stood up our virtual screening program. We saw more patients in that first week than we had the entirety of the year before. And pretty quickly, we’re on a pace to see more per day than we had that prior year. And so that is a piece that I don’t think patients or providers want to go back on. I think they realized the access and ease is really important from the patient standpoint. And from a physician’s standpoint, I think they realize it’s a better way to provide care quickly and efficiently. And I don’t know that any of our practitioners will go back to 100% office-based practice again.
Gary Bisbee 6:52
Well, that’s interesting. How much training did you have to do with your practitioners?
Dennis Murphy 6:56
Well, it was interesting because we had a number of specialists who are doing consults around the state via telemedicine. So we’re comfortable with the technology, but not comfortable doing it with a patient. And maybe our biggest learning curve was with our primary care physicians because they were almost exclusively doing in-office visits. And the good news is they’re smart, adaptable people. We had some basic training that we did with all of them. But I would say there is a lot of learning on the fly as people use technology but very adaptable. And again, it’ll be interesting to see how many folks want to revert back to the old practice style. But I would say the bulk of them that I’ve spoken to say at least a day, day and a half a week. They can see themselves just doing virtual visits and not having exam room or clinic sessions all the time.
Gary Bisbee 7:56
I’m sure you’re modeling that out for the future, but what consequences do you think that has for your strategic planning in the future, Dennis?
Dennis Murphy 8:04
Pretty massive. We had planned to integrate two large hospitals that are a mile and a half apart. In downtown Indianapolis, we had always assumed that virtual medicine would change the ambulatory model that we were looking at. But I would tell you, Gary, pre-COVID, that change was single digit change and volume assumptions. Now we’re working with our chairs and clinicians and may remove 30h to 40% of our exam rooms, just based on how much we think we could do virtually, how you would change the Hours of operation, a whole set of assumptions that we’ve had a natural experiment during this COVID outbreak that is really proven. You can work differently and see that on a regular basis.
Gary Bisbee 9:01
Sounds like a win-win for the practitioner and for the consumer.
Dennis Murphy 9:05
That’s the goal. And again, this has been really interesting how much you can learn in a 60 day period versus things we were trying to model and test and play out before that we’ve really seen people adapt. And again, I think you’re right, the clinicians do see the value in this, both personally and for their patients. So it’s a nice Win/Win.
Gary Bisbee 9:31
Why don’t we turn to IU Health if we could, many of us are generally familiar with it, but you’ve grown a lot over the last several years. Can you please describe IU Health for us now, Dennis?
Dennis Murphy 9:42
Sure. So we are 16 hospitals, all located in the state of Indiana and we have the commitment to see how we make Indiana a much healthier state. We have 300 plus physician offices or ambulatory sites spread out through the state and about 34,500 team members. So a pretty big footprint, three hours north of Indianapolis and three hours south of Indianapolis. So a lot of geography that’s covered, and that we have the unique circumstance of being the only teaching hospital and health system in the state. So there’s only one allopathic medical school in the state. And that is Indiana University. There are some unique market advantages and market obligations that come with being the only one in an entire state.
Gary Bisbee 10:42
Seems like a long, long time ago, but what were your top priorities before COVID hit?
Dennis Murphy 10:49
Probably like most academic centers, you’re building a destination program. We have a health plan that has about 250,000 lives attributed to it. So looking at both growth, but also understanding how to manage populations well in terms of quality and cost, looking at social determinants of health and community health, being something critically important to us. And then I think uniquely in Indiana, we are a state that is not very healthy. And so depending on the metrics you use, were somewhere between 38 and 40 is really how do you drive those, as the state’s largest healthcare provider to have better outcomes and really seeing the state become healthier are pretty broad array but given our footprint and our size and our market share, we felt like those were critical strategies for us.
Gary Bisbee 11:51
Sure. Well, speaking of social determinants, given what’s going on now with the unemployment and the COVID situation, it seems like the work you’ve done there is going to be very valuable for you going forward.
Dennis Murphy 12:04
Yeah, it’s been critical to getting outside your four walls. And again, we were doing that as part of this strategy, whether it’s we had a congregational relationship program that was ecumenical, so no specific denomination, but working with about 20 different parishes, or temples or religious groups around Indianapolis, with the idea of expanding this throughout the state, and really thinking about those patients who were socially isolated as sort of a core group that relationship and partnership could help us with. And we were already getting an incredible set of insights into why they were isolated, what were their broader health issues, what was the social set of issues that were driving that isolation, and so COVID sort of prompted us to say, you can’t sit back and just wait for everybody to get sick, just like we weren’t in these other circumstances. And so, we have been actively working with our state health department to test in every skilled nursing facility, every assisted living facility, our Department of Corrections, ensuring our federally qualified health centers had access to testing, really looking to take a lens to the disparities issues, as we’ve gone through covered based on the learnings we were having, thinking about these other social determinants of health.
Gary Bisbee 13:41
Well back to IU Health for a moment, what is the remote working policy, Dennis?
Dennis Murphy 13:46
What we said is if you are a nonclinical worker and can work effectively from home, that we are asking everybody to do that and continue to do that through the month of May, and then we’re going to reassess for our ambulatory, clinical, and elective procedure. The personnel we set up early on a resource pool that you can think of it as a call pool, and basically said if you join the call pool, we will pay your full salary. So we have not furloughed anyone. We have not cut anyone’s salaries. Through this, we have not had layoffs. We have asked our team members to be in that resource pool. And they have been the ones to ramp up our telemedicine programs. They have staffed up our COVID units, they have helped with broader infection prevention program development, and we really tapped into that pool and sort of repurposing those folks. And then a little bit earlier discussion about when we’ve had particularly hard hit hospitals, we’ve deployed that resource pool to that hospital staff in that pool, so it’s been really helpful to have a little bit of slack in the system to be able to address urgent issues.
Gary Bisbee 15:10
Communication is obviously very important in a crisis. How have you communicated with the IU health community?
Dennis Murphy 15:17
Yeah, I would say if I had major kudos to go out, they would be to our communications and PR team. We have all the findings of our incident command for the last 24 hours in terms of decisions that were made, policies that we’re changing, all of that goes out daily, in writing. I do a weekly message that’s videotaped to our employees. And then we have a blog. So I get questions, you know, virtually every day that either I’m fielding or I’m triaging, down to people on our team to deal with, but we have found that being brutally transparent, and I have pushed our team. We show all of the numbers of bed used, employees that have been infected, employees tested, whatever the status. There’s no piece of data that I see that we don’t share with all of our employees throughout this incident. And I think where we are, is we’ve probably got better employee engagement now than we’ve had in my tenure here that transparency, I think it’s been really critical to it.
Gary Bisbee 16:37
How’s morale? I mean, it sounds like the morale is terrific, based on what you’re just saying, but how is the morale among your caregivers?
Dennis Murphy 16:44
I think there’s a pride for all health care workers to serve and to be there and sort of worst possible circumstances. There’s a joke that a lot of us are like firefighters you run to the fire you don’t really run away from it. And I think that’s true of all of our care teams. And I say overall, really strong whenever you have, you know, over 34,000 people, it’s not going to be a universal feeling. But I would say the numbers of detractors have been in the handfuls and very small, but overall, we’ve really focused on ensuring team members’ safety, both physical but then even the emotional sense of safety. And I think they feel that way and feel supported. Thankfully, we’ve had a balance sheet that’s allowed us to do that and let them feel supported through this
Gary Bisbee 17:42
Coming to testing supplies because that also relates to your caregivers, but how has the supply of testing and processing capability been?
Dennis Murphy 17:52
I think we’re probably like everybody in not only the country, but the world is we’ve had adequate testing to deal with our team members, our patients that are either inpatient or outpatient and then some of this vulnerable population support that I talked about either skilled nursing facilities and our state health department. But we aren’t able to open up to the public yet, and a broader set of generalized testing. And I think it’s been interesting, just in a state relatively on the lower impact side to New York, Chicago, Seattle, all of California. Just you end up lower on that prioritization list for resources. And so we’ve had to be creative with local vendors and help from others to actually build up that testing capacity.
Gary Bisbee 18:53
Well, that leads us into the supply chain for PPE. Was that Ben Dennis?
Dennis Murphy 18:58
Yeah, it’s evolved dramatically since early March. And you know, I think in the first weeks of this, we were like everybody in a state of panic saying, Okay, if the burn rates are what we’re seeing, it would be really problematic. We’re fortunate we built an integrated service center. So Indiana happens to be one of the hubs for Amazon and FedEx and a few other big internet marketing companies. And so we actually had their logistics teams help us build a service center that supplies all of our facilities out of a single location. And so pretty quickly, we were able, and again, probably like a lot of others that your standard vendors were not going to meet your needs and that you were going to gray market or black market kinds of vendors to meet that demand. And thankfully now I think we’re in a position where we have at least 60 days of all of our essentials and 90 of the majority of those items. And so feel like the supply chain is catching up. And that we’ve been able to create a big enough buffer that if there’s another wave, we feel like we’re prepared.
Gary Bisbee 20:18
There is substantial momentum among your peers, CEOs to redesign the supply chain so that it’s more reliable. How do you think about that, Dennis?
Dennis Murphy 20:27
I think it’s going to be critically important. And again, I don’t know where the trade-off is Gary between trying to build reliability into the supply chain and maybe I think one critical incident is going to not look like the next one. So PPE and a whole set of things that are critical items for this incident… I’m not sure we can assume that they will be the exact same ones for the next incident that we all face. We’re trying to, I think, build that durability in the supply chain. But I think also, quite honestly, just getting into the warehousing function, because we received some supplies from the National Stockpile, but I would say it was extraordinarily limited relative to our demand. And so I think a key learning for us was that we have to become more self-reliant in this whole thing, which may mean just taking some portion of our balance sheet and saying, it’s going to go into inventory that we have to maintain just because you never know when you’re going to need it.
Gary Bisbee 21:38
I think a lot of people are thinking the same way, Dennis on that one. How about the capacity of ICU beds and ventilators?
Dennis Murphy 21:44
We have been again, as I said earlier, strained but not broken. Our ICU beds have ranged depending on the hospital. We’ve had some that are at 110% of their license capacity and some that had been in the 60s. So overall, we’ve had an average of about 80% utilization today as we speak, and that ventilators we have never really broached a point where those had been a problem. They’ve always been someplace below 50% utilized and that was one patient, one ventilator, we early on, created the capacity to do that splitting, in case we needed that and that’s not in that denominator. So we always felt pretty well resourced from a ventilator standpoint.
Gary Bisbee 22:35
In terms of elective non-emergent surgeries. You indicated that you’ve begun to ramp up what’s been the reaction by the practitioners and the patients.
Dennis Murphy 22:47
What we’ve done, Gary is we’re one week in. Last week, we tried to place a cap at 25% to understand the impact on PPE impact. Extra early on were we continuing to see volumes go down because, at the same time, we were opening out elective surgeries was when the state had begun to open up some of those social isolation rules. And we had to make sure we weren’t going to see sort of this influx of patients at the same time. And so from a surgeon standpoint, as you can imagine, there was some prioritization required every surgeon but their patients were the most important and the most critical so really had to have our or committees come up with prioritization requirements in terms of which cases we didn’t exactly follow the American College of Surgeons, an Rn, and I think there are a couple of other bodies put out some guidelines. We felt like they were really complex and we needed something a little more streamlined. And so part of it was patient urgency. Part of it was how much risk any of the procedures put the caregiving team at. So I have them or aerosolized procedures, how much of it was important for us as an organization, if we were trying to get through what we have now is a backlog of starting last week 14,000 procedures that we had to get through. I think the first week went well. And now we’re looking this week to say, can that 25% increase up to a number closer to 50. And by the end of this week, and then we’ll keep, again, monitoring and assessing and adapting those numbers as we see the internal impact and the external impact.
Gary Bisbee 24:45
Underlying that is you can take care of both COVID patients and call them regular patients at the same time, doesn’t have to be exclusive. Right?
Dennis Murphy 24:56
Correct. And I think we’re in most of our facilities, large enough that you can create isolated COVID units within your hospital. We continue to have the same very strict visitor restrictions that we’ve had. And again, that is part of that monitoring and adapting phase that we’re going through right now. We’ve been able to keep one of our large academic facilities COVID free. And so we have continued to run our Transplant Program. There are cancer patients are there, and a set of other more fragile patients and really cohort, all of our COVID adults at a different facility, and our pediatric COVID patients have all been a part of our children’s hospital.
Gary Bisbee 25:47
Why don’t we turn to the economics, which isn’t a pretty picture for any of our health systems? How is economics going to be affected in 2020 for IU health?
Dennis Murphy 25:57
I think as you said, Never pretty. We sort of estimated early on and saw that play out pretty consistently about $40 to $45 million a week that we were losing and revenue. We have had, again, some help from the feds cares act grants, nowhere near enough to make up for that. And I think, Gary, the real issue we’ve been trying to figure out is, our board has been really helpful in terms of our perspective that they view this as a balance sheet issue, not a statement on how we are operating as a team, at least in this early stage and said, you’re probably going to lose half a billion dollars in this first wave of this. And thankfully, our balance sheet is strong enough to absorb that. I think the real question is, what do the subsequent months look like? How much of an impact will we have if there’s a rolling set of, you know, second, third, fourth waves if there’s one large second wave, we, like every other state, are seeing huge unemployment numbers? So what does it mean for a charity care standpoint? Not only is staying in lots of Medicaid applications, but their tax revenues are down. So I think the bigger concern is not how much have we lost today? It is, what is the forecasting look like for the next 24 to 36 months?
Gary Bisbee 27:36
Right, for sure. Because almost certainly cap X will be affected by it.
Dennis Murphy 27:39
Yeah, I think the pace of it will be affected, and I talked about that big project we had on the books. We’re looking at that project being fundamentally different. I think we will carry forward with some version of it. I know there are other academic health centers that have pulled projects completely off the table. We’re not planning on doing that. But everybody is reassessing their cap x. I think everybody’s reassessing how much of their strategy is reasonable to invest in and push forward just because there’s inherently some investment level and some risk and all of those moves and you’re not going to have the resources to take the levels of risk. You may have, you know, four months ago.
Gary Bisbee 28:30
I’m assuming that’s a strategic plan falls in that same category of affecting it over the next 24 to 36 months.
Dennis Murphy 28:37
Absolutely. So there were several big initiatives that were, again not pulling the strategy but probably reassessing the pace of the strategy and re-prioritizing what are the essential few for us to move forward. Just until we have a better sense of how all of this is going to play out.
Gary Bisbee 28:59
Dennis thinking about it is inherent in what you’re saying, really. But it’s now evident to public health as part of the national security. How do you think about that?
Dennis Murphy 29:08
It’s really tough Gary in a state that has consistently ranked 48 out of 50 states and terms of investments and public health. So we have been pleading with our state legislators and our governor, to see this as a priority over the past five or six years. And I think this incident has brought all of that to light. And so I’m interested to see in the next legislative session, Indiana. Indiana’s a bit unique. They only do their budgets every other year. And this upcoming session is a budget session. How much will they be willing to put behind the idea of building up public health infrastructure? Because it’s clear this is demonstrated the need for that in terms of governance.
Gary Bisbee 29:57
You mentioned your board weighed in right to the balance sheet, have you had a virtual board meeting yet?
Dennis Murphy 30:03
We have, you know, it’s been interesting because we’ve got a really diverse board, from business leaders to federal appeals court judge to somebody who’s a faculty member in Health Sciences Department at a major university. And I would say the comfort level of using technology varied. But overall, I think it went well. And maybe the important learning for us for our future ones are, you probably have to leave twice as much time for questions, just because I think you can answer them offline. And you got to do everything sort of virtually with the whole group. And so we realized the meeting went long just because it required a lot of communication while they were in the room
Gary Bisbee 30:52
At some point in the future when you could have every meeting in person, which is still thinking about mixing in some virtual meetings or not?
Dennis Murphy 31:01
We have a board retreat in June. And we have been asked by our board chair if we can do that in a hybrid fashion. So we have probably a third of our board is out of state. And then a third is here in Indianapolis, and then another third is spread out around the state. So we’re going to try a hybrid approach and really pressing on our technology team to say, how do we make this as seamless as possible for people?
Gary Bisbee 31:32
Dennis, this has been a terrific interview, I’d like to ask one last question. I’ve been asking it in terms of new normal, you made the point earlier that you’re thinking about it as next normal. But what do you think the major aspects of a next normal will be?
Dennis Murphy 31:48
I think Gary, this notion of who has to come to you for care, versus where do you go to them, either virtually or physically, is going to be one the most profound changes for us, again, some of the numbers that I’m seeing from our team, half of your ambulatory visits may be things you could do differently than what you’re doing today. And getting that embedded into our culture, both from a patient standpoint and a provider standpoint, is really going to take some work. But I think there’s been a proof of concept that’s occurred over these past 60 days that we want to take advantage of.
Gary Bisbee 32:31
That is thanks again, terrific interview. You’re doing a great job at IU health, and we very much appreciate your time.
Dennis Murphy 32:37
Thanks, Gary, and thank you for the opportunity to talk and I’m glad to hear you’re doing well.
Gary Bisbee 32:43
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