| Charles T. Frock
Chief Executive Officer
FirstHealth of the Carolinas
We all know about the weather.
When our favorite meteorologist tells
us that it will rain sometime during the
day, we tuck an umbrella under an arm as
we head out the door. The rain may last
for a few hours or even a few days, but we
know that the sun will eventually reappear.
That’s what we expect with
a change in the weather.
Climate change is more difficult
to understand. It takes place over
years. It’s subtle and hard to predict.
And, unlike a change in the weather,
it will be around for a long time.
FirstHealth of the Carolinas has
historically been blessed with a very
congenial climate. We’ve had little or no
competition in many of our service areas and
a healthy payer mix of privately insured and
Medicare/Medicaid-covered patients. At the
same time, modern science and technology
have allowed us to grow and improve our
services. When there were challenges,
they were like the changes of a rainy
day—mere blips on the FirstHealth radar.
That’s no longer the case.
The climate of health care has
changed—not just locally, but statewide
and nationally, and not just casually, but
notably and significantly. More and more,
FirstHealth—like health care organizations
across the country—is facing what we
have come to call “the new normal.”
That means growing competition from
physicians and other hospitals, slower
increases in reimbursement despite increased
costs to provide services, and increasing
inpatient volumes of sicker patients who
need more resources (staff, supplies,
medication and technology) for their care.
At the same time, the public has become
savvier about health care and expects—and
rightly so—higher levels of quality and
service. Medicare and some private
insurers are linking reimbursement rates
to performance levels—known as “pay
for performance”—for some services.
These are all signs of health
care climate change.
Like a good meteorologist, FirstHealth
predicted the change and is preparing
for the new climate. We are seeking and
promoting ways to grow profitable services.
We are reevaluating programs whose costs
exceed their benefit to patients and other
customers. We are reducing supply and
contract costs in ways that won’t adversely
impact our service and quality. We are
also listening, even more closely than ever,
to the expectations of our public, as well
as to the suggestions from our staff.
FirstHealth has always been a successful
operation, and I am confident that it will
remain so. Three credit-rating agencies
recently reviewed our financial outlook
and reaffirmed our AA or AA- rating, and
we still solidly dominate our market. We
are also (in the words of our 2020 Vision)
working together to address our challenges.
Nowhere is that more apparent than in
the 3-inch stack of ideas that FirstHealth
employees have submitted to me about
ways of improving our services to better
serve our patients and other customers.
Dr. Wayne Sotile, a nationally recognized
expert on workplace collaboration, recently
visited the Moore Regional Hospital campus
for a quarterly meeting of FirstHealth’s
leadership. During his visit, Dr. Sotile shared
what he calls “roadmaps for positive thinking
through challenging times” and noted that
even little changes make big differences.
That is, in a nutshell, what we are
striving to do in this climate of the new
normal—we’re making a lot of little
changes, and a few bigger ones, in order to
make big differences as we work together
to remain first in quality, first in health.