[Congressional Record Volume 140, Number 6 (Tuesday, February 1, 1994)]
[Senate]
[Page S]
From the Congressional Record Online through the Government Printing Office [www.gpo.gov]


[Congressional Record: February 1, 1994]
From the Congressional Record Online via GPO Access [wais.access.gpo.gov]

 
     OREGON'S HOSPITALS ARE AMONG THE MOST EFFICIENT IN THE NATION

  Mr. HATFIELD. Mr. President, the Nation has turned its hearts and 
minds towards health care reform. President Clinton has rightfully 
identified a crisis in our society and it is now up to the policy 
makers of our country to provide solutions to this epidemic. In 
addition, the Nation's Governors are meeting this week to discuss a 
number of important issues including health care reform. One of the 
issues highlighted in Sunday's Washington Post was the desire of the 
States to retain flexibility in implementing comprehensive reform. As 
we focus on national health care reform, a few lessons can be learned 
from the State of Oregon.
  As my colleagues know, Oregon is one of the States that is out in 
front in enacting and implementing health care reform. In fact, today 
Oregon's innovative Medicaid expansion goes into effect to bring basic 
health care coverage to an additional 120,000 Oregonians. But, Oregon 
is progressive in the private sector of health care as well. I was 
reminded of this when I met with representatives from the Oregon 
Association of Hospitals earlier today. That is why I come before the 
Senate now.
  In a recent study, HCIA Inc., a firm that analyzes the hospital 
industry, examined 5,600 hospitals around the Nation and ranked the 100 
best performers. Oregon led the Nation with 11 out of the 100 top 
performers--more than any other State. The efficiency rankings of 
independently-owned acute care hospitals were based on first, 
shortening lengths of stay, second, reducing mortality and morbidity 
rates, and third, improving facilities.
  In addition to the HCIA report, data collected in 1992 by the 
American Hospital association indicates that despite its high 
percentage of population over 65: Oregon has the shortest average 
length of hospital stay in the nation--5.05 days versus 7.12 days 
national average; Oregon ranks among the lowest in hospital inpatient 
days in the Nation--502.4/1000 versus 866.6/1000 national average; 
Oregon ranks 36th in adjusted expenses per hospital admission--$682 
lower than the national average; and Oregon ranks 42d in hospital 
expenses per capita--21 percent below the national average.
  This phenomenal success can be attributed to the State of Oregon's 
local control over health care. Oregon has decided not to regulate the 
cost of health care and the hospitals have responded by working hard 
with business to cut costs. To put Oregon's experience in perspective--
the data indicates that if the U.S. average hospital expenditures per 
capita had been the same as Oregon's in 1992, the Nation would have 
saved over $50 billion of its $248 billion in hospital expenditures 
that year.

  Mr. President, it would be tragedy if national health care reform 
would suppress the tremendous reforms that are proceeding at a rapid 
pace in Oregon and other States around the Nation. The States need to 
be allowed to forge their own reforms to ensure positive change in the 
event that the Federal Government fails to act.
  There is no doubt that health care reform is needed at the national 
level to achieve universal access to health care for all Americans. I 
am a strong believer, however, in the flexibility of States to enact 
innovative and creative programs to accomplish this and to help the 
Federal Government develop its database to enact needed Federal 
reforms. I expect to work with my colleagues in the Senate as the 
debate on health care reform continues to ensure that the States 
maintain flexibility and localized control in health care.
  Mr. President, at this time I would like to ask unanimous consent 
that a copy of an article from the Oregonian highlighting the HCIA, 
Inc. rankings be inserted in the Record following my remarks.
  There being no objection, the material was ordered to be printed in 
the Record, as follows:

                  [From the Oregonian, Jan. 14, 1994]

                State Hospitals Top U.S. Efficiency List

                           (By Vince Kohler)

       Oregon's hospitals are the most efficient in the nation, 
     according to a report released Thursday.
       The report ranked 11 hospitals in Oregon--more than any 
     other state--and five in Washington among the nation's 100 
     best performers.
       The annual report by HCIA Inc. of Baltimore, a firm that 
     analyzes the hospital industry, is considered among the most 
     definitive in the health care sector.
       The study said that at least $14 billion--and maybe as much 
     as $28 billion--could be saved if the U.S. hospital system 
     improved its clinical and financial efficiency. HCIA said 
     money could be saved in part by emulating the 100 most 
     efficient hospitals.
       Oregon had the most hospitals on the top-100 list, followed 
     by Wisconsin with nine. California and Michigan tied for 
     third place, each with eight hospitals. Washington, Ohio 
     and Indiana were in fourth place, each with five on the 
     list.
       The William M. Mercer Inc. analyst firm processed numbers 
     for the study, which analyzed 1992 federal Medicare data from 
     5,600 hospitals nationwide to arrive at the rankings.
       Lowell E. Lichtenberg, a principal in Mercer's Portland 
     office, said hospitals that made the top 100 were notified 
     Wednesday and Thursday. The list was made public Thursday 
     morning. It listed the hospitals alphabetically and did not 
     give specific rankings.
       Making the list will be a boost for administrators planning 
     for national health care reform, likely attracting business 
     to those institutions classed as the nation's most efficient, 
     Lichtenberg said.
       ``One hundred hospitals in 33 states made the list, and 16 
     percent of them were in Oregon and Washington,'' Lichtenberg 
     said. ``It's phenomenal, really.''
       Lichtenberg said HCIA's study was confined to independently 
     administered acute-care hospitals.
       Publicly funded or controlled hospitals and chain-owned 
     hospitals under centralized administration were not included.
       Specialty hospitals such as children's hospitals and 
     psychiatric hospitals also were not part of the study.
       ``Investor-owned hospitals have a different measure of 
     debt,'' Lichtenberg explained. ``And in states such as New 
     York, where they regulate hospital spending,'' costs are 
     ``artificially controlled.''
       Oregon does not regulate hospital costs.
       Washington regulates them to some degree but not to the 
     extent of New York and a number of other eastern states, he 
     said.
       The 100 hospitals charge their customers significantly less 
     than average--as much as 21.2 percent less, depending on the 
     type of hospital.
       Mortality was from 9.3 percent to 14.6 percent lower than 
     average and length of patient stay was from 10.6 percent to 
     26 percent shorter than average, according to the report.
       The top 100 hospitals also are relatively profitable, the 
     report said.
       Keys to efficiency included: Shortening length of stay; 
     reducing mortality and morbidity rates; improving facilities.
       Oregon hospitals have taken steps such as these, as the 
     state's big health care networks jockey for business by 
     cutting costs.
       ``I guess we won a contest we didn't know we were in,'' 
     said James E. May, president and chief executive officer of 
     Legacy Portland Hospitals, which owns Good Samaritan Hospital 
     & Medical Center, one of the listed hospitals.
       ``We have worked real hard over the last three to four 
     years on the cost side of the equation. . . . I'm pleased to 
     see that our efforts are paying off.''
       Larry Dodds, president and chief executive officer of 
     Portland Adventist Medical Center, said the staff of the 302-
     bed hospital had worked for years to cut costs while keeping 
     up the quality of medical care.
       ``I think that Oregon has led the nation in terms of 
     managed care, attention to costs,'' he said.
       ``As a state, we rank among the lowest for cost of medical 
     care,'' Dodds said.
       The report broke the 5,600 hospitals studied into groups, 
     including academic medical centers, other teaching hospitals 
     with more than 250 beds, nonteaching hospitals with more than 
     250 beds, urban hospitals with fewer than 250 beds and rural 
     hospitals with fewer than 250 beds.
       It then analyzed Medicare cost reports and patient 
     discharge data, adjusting for severity of illness and 
     geographic differences.
       These Northwest hospitals are among the 100 most efficient 
     in America.


                                 oregon

       Good Samaritan Hospital & Medical Center, Portland; Good 
     Samaritan Hospital, Corvallis; Grande Ronde Hospital, La 
     Grande; Josephine Memorial Hospital, Grants Pass; Lebanon 
     Community Hospital; Portland Adventist Medical Center; 
     Providence Medical Center, Portland; Sacred Heart General 
     Hospital, Eugene; St. Charles Medical Center, Bend; St. 
     Vincent Hospital and Medical Center, Portland; Willamette 
     Falls Hospital, Oregon City.


                               washington

       Washington hospitals on the list were: Deaconess Medical 
     Center, Spokane; General Hospital Medical Center, Everett; 
     St. John's Medical Center, Longview; St. Mary Medical Center, 
     Walla Walla; University of Washington Medical Center, 
     Seattle.


                                 Idaho

       Madison Memorial Hospital in Rexburg, Idaho.

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