Flying Solo in Health Care Skies

Article excerpt

Some might call Deaconess Hospital the last bastion of a bygone era. With construction of its $8.5 million urology and office building nearly complete, the nonprofit hospital is setting its eyes on something far bigger: a proposed $15 million renovation of its main complex and a $2 million addition to its Copper Lake assisted living center.

The 5501 N. Portland Ave. hospital also is listening to proposals from physician groups for joint ventures in the outpatient and clinical realms -- all in reaction to today's turbulent health care environment.

But some things choose to weather the storm alone, and Deaconess is one. Despite modernization efforts, hospital leaders cling fiercely to the staunch independence Free Methodists founded Deaconess upon in 1946. "Some people have kidded us, calling us the Switzerland of health care in Oklahoma City," laughed Administrator Paul C. Dougherty, who came aboard in November. "We're the only one not committed to some group." In this age of for-profit medicine, catastrophic Medicare forecasts and the spread of outpatient centers unburdened by indigent care needs, cynics might scoff at the role Deaconess has chosen. Dougherty understands that -- but he doesn't agree. "With more and more managed care, you do have to find yourself in larger groups to spread the risk," he allowed. "That's why we're involved in this HMO (Healthcare Oklahoma, of which Deaconess is a co-owner). That's why we're involved in other managed care products." Merger, however, is not on the horizon. The Deaconess board, which remains 51 percent Free Methodist despite having only three churches in the metro area, believes its mission -- to deliver cost- effective, high-quality health care in a Christian environment -- is best met by clinging to the principles that got Deaconess where it is in the first place. "Right now it seems to be a strength for us," he said of independence, "a strength to maintain our unique ministry, our unique mission. "We certainly feel that there's a place for the for-profit industry, but we feel we provide an alternative." That alternative takes a whole new light when studying the strong returns for Deaconess this decade. Hospital revenues have climbed 65.6 percent since 1990, from $64 million to $106 million last year. Including Copper Lake, Deaconess Health Services clinics and other joint ventures established since 1990, Deaconess revenues surpassed $114 million in 1996, up from $64.9 million. Following national trends, outpatient services accounted for 31.7 percent of the Deaconess revenue stream last year, up from 15.8 percent in 1990. Inpatient services also have grown, with the hospital's average daily inpatient census topping 160 since December after running at 130 through 1996. Despite that growth, Deaconess has only $3.6 million in debt on a consolidated basis. "Usually a hospital of this size would have $35 million in debt," commented Phil De Long, assistant administrator of finance. …