Seth Warren leads revitalization of St. James at Olympia Fields
Seth Warren took over the helm of St. James Hospital in February 2008 and has spearheaded a revitalization of the two-campus health care facility that had become a financial liability for the Mishawaka-based Sisters of Saint Francis Health Services Inc.
The President of St. James Hospital and South Suburban Chicago Regional CEO talks frankly about the challenges the hospital faced.
“Our financial picture was bleak. We were averaging a $20 million loss per year. At the same time our reputation suffered, and our satisfaction scores were not stellar,” Warren says. As a third generation hospital administrator, Warren grew up learning about health care’s organizational and financial aspects. His mother, a registered nurse, also taught him to focus on patient care, he says.
Warren honed his skills during tenures at hospitals and as a consultant before joining SSFHS in 1998. He has continued to rise through the SSFHS ranks, starting as manager of operations at the order’s St. Francis Hospital & Health Centers in Beech Grove, Indiana. His career with the Sisters of Saint Francis Health Services Inc. has taken him to other Indiana-based SSFHS hospitals in Mooresville, Michigan City and Crown Point as director of operations, executive director, CEO and president.
Although each hospital presents its own challenges, St. James needed a turnaround specialist, a position Warren was uniquely qualified to fill, according to Sr. M. Aline Schultz, OSF, vice president of corporate communications for the Sisters of Saint Francis Health Services. St. James Hospital has served the Chicago south suburbs for 99 years. In the late 1990s, SSFHS purchased Olympia Fields Osteopathic Hospital, merging the two into a 400-bed teaching hospital that is also “the largest employer and economic engine serving a diverse, economically-challenged market,” Warren says.
That merger put financial strains on the organization because of duplication of services and the high cost of providing health care in Illinois, he says.
“In Illinois there are no malpractice caps like there are in Indiana. St. James pays more than two times more for malpractice insurance than all of the SSFHS Indiana hospitals combined,” Warren says.
“St. James had also gotten into a bit of a rut. I was charged with trying to turn that around.”
The changes have come on many fronts during Warren’s nearly three years at St. James Hospital and have been the result of the combined efforts of employees and management, he says. An internal review of patient care practices and management techniques focused on the goal of “providing high quality, compassionate care—a good product,” Warren says.
“We parted ways with employees who were not sharing that goal.” As part of that effort, the hospital launched “Together We Can” in 2009 to sharpen employee focus on the corporate goal, he says.
Improvements have also come in staff interactions with patients, he says. In the past two years, patient approval ratings have increased significantly and patients are now recommending St. James Hospital to family and friends, he says. “We took another hard look at services, the cost of those services and where those services were offered on our two campuses,” Warren says.
“We had to consider whether to provide services at all,” he says. “St. James is committed to the South Suburbs, so it meant making tough decisions.” The decisions made were designed to stem the $113 million losses experienced by the hospital over the last decade.
That situation was created by a “perfect storm” of dramatically rising numbers of uninsured patients and other factors including bad debt. The number of Medicaid patients, too, has risen increasing the hospital’s dependence on a delayed reimbursement cycle from the state, Warren says.
In 2008, for example, 45 percent of patients were on Medicare and 15 percent on Medicaid. St. James Hospital also provided $17.4 million in unpaid care in addition to $38.8 million in charity care. “In Illinois, the state tells us how much we can charge and how much they’re going to pay us. It is unique,” he says.
Consolidating services rather than duplicating them has become a major part of the St. James turnaround. Another move involved down-grading some services. One of those was the change in St. James Hospital’s status as a Level I Trauma Center at the Olympia Fields campus.
The highest level of emergency care, a Level I Trauma Center must have an operating room available at all times with a staff dedicated to that operating room. An on-call staff’s response time must be 15 minutes or less and physician specialists must be in the hospital 24 hours a day.
Given the hospital’s financial straits, that designation could no longer be supported, Warren says. However, trauma and emergency care continue to be provided at the hospital’s campuses. As part of this change, a different physician group is now serving the Emergency Room. Emergency Medical Physicians “have had a huge impact,” Warren says.
“We now have physicians in the triage area of the ER, and they are able to begin treating patients before they ever reach the main ER,” he says. In 2009, administration moved to consolidate surgery specialities at the Chicago Heights and Olympia Fields campuses.
For example, cardiac surgery is performed exclusively at St. James Olympia Fields as part of that campus’s Heart and Vascular Institute. The institute provides a full spectrum of heart and vascular services from prevention and diagnosis to treatment and rehabilitation.
The Olympia Fields campus is also the site of the Patricia A. Joyce Comprehensive Cancer Institute that brings together cancer specialists and a full array of cancer-fighting technologies in one location to help patients.
St. James is a teaching hospital affiliated with Midwestern University’s Chicago Osteopathic Medical School. In 2006, the hospital was approved as a Teaching Hospital Cancer Program by the American College of Surgeons. Elective surgeries, including outpatient procedures, are performed at the Chicago Heights campus.
Another consolidation in 2009 brought the two campuses’ pediatric and obstetrical units to St. James Chicago Heights. “Our OB unit provides care for non-high-risk pregnancies,” he says.
Leadership at St. James Hospital has also changed under Warren’s administration. “We looked at the management and executive levels. We have new members of those teams and have redistributed responsibilities,” he says. “I have very much enjoyed working with the management team and staff.”
Throughout the organization, Warren says, the message continues to be “It’s really in your hands to make sure that patients, families and employees have a positive experience at St. James.” And the results of these changes have been dramatic, according to Warren.
Patient satisfaction scores have gone from single digits to between 70 and 75% of patients now reporting a positive experience. Physician satisfaction is also on the rise because of the way their patients are treated and how procedures are followed, he says.
Although St. James Hospital continues to face budget losses, the financial picture is brightening, Warren says. “This year, our budget losses are less than half of what we were losing 2-1/2 years ago. It’s now $6 million annually,” he says.
Other financial improvements can be attributed to the federal economic stimulus plan, Warren says. “We are getting paid in a more timely fashion by the State of Illinois. That had historically been a problem.”