Q&A with Jake Erickson, CEO of Bingham Memorial Hospital
November 19, 2019
by Sean Ruck
, Contributing Editor
This month’s spotlight is on Bingham Memorial in Blackfoot Idaho. CEO Jake Erickson took the time to speak with HealthCare Business News to share information about his background, strengths of his organization, the challenges it’s facing and the challenges facing healthcare overall.
HCB News: What inspired you to pursue a career in healthcare?
JE: I started out in college not really knowing what I wanted to go into. I grew up on a farm and ranch, the ninth of 10 kids. So it was a big family and obviously with a big family, there was a lot of healthcare services that happened in our family. I experienced quite a few of those, with lots of stitches and a few broken bones throughout my life. But as a consumer or participant in healthcare, you don’t really think much about it. They’re there and they help you and you feel better and you go on with your life. That changed while I was in college.
When I went to college, I was taking business classes to get my degree. I took a little detour and got the idea that I wanted to become an optometrist. So I was working at an optometry clinic. I liked it and started taking pre-med classes. It was okay, but it really just wasn’t as interesting as I thought it would be. The guy I was working with at the optometry clinic was just finishing his degree in healthcare administration. He told me a little about what he was doing and how he really wanted to stay in healthcare, but he wanted to be on the business side. I started to look into that since I had quite a bit of my business degree done.
I was introduced to the CEO of a hospital in the same community where I was going to school. He took the time to sit down and talk to me about what he did and his path to getting there and what he liked about the job. He encouraged me to basically get a job in the hospital to see if I liked it. I applied for a couple of different positions, first working in materials management in the inventory side of things, and then I was recruited to the operating room to work as an anesthesia tech. I finished my MBA with an emphasis on healthcare management while working in the operating room.
Soon after I finished my Masters, I got an opportunity to start a new pain management program at Bingham. I started here as a special project manager, then an assistant administrator, chief operating officer and now CEO.
HCB News: How long have you been with Bingham Memorial?
JE: This is my 13th year.
HCB News: Why did you choose Bingham Memorial?
JE: They gave me my first opportunity and I liked it here. It was close to where I grew up and close to my wife’s family as well, so we decided to stay for those reasons. But opportunities kept coming, so that kept me here.
HCB News: What attracts staff?
JE: I think it’s the culture. Even though we’re a robust, small hospital with just over 1,000 employees, it still feels like a small, tight-knit community within our organization. Seems everyone knows everyone, they’re members of the community and we just work well together. There’s a strong culture of compassion that we’ve been working on over the past three years. So much so, that we’ve been certified as a healing hospital.
We have a great benefit package and our pay is comparable to anywhere else. But we put more emphasis on compassion and caring rather than just numbers and driving the bottom line. So I think we’re a place where professionals feel they can practice their skills and what they’ve learned and be supported by management while doing it. I think people come here and enjoy that. People in healthcare want to help people. And that’s certainly our focus.
HCB News: What is the management style/culture like?
JE: It goes along with our vision statement which is high quality and high compassion. We have a strong focus on patient safety and quality too because obviously you can be the most caring, but if you can’t fix anyone, then you’re not doing your job.
HCB News: Can you talk about your patient mix? Rough percentage that’s private insurance versus Medicare?
JE: We’re about 45 percent Medicare/Medicaid and probably 50 percent commercial, and 5 percent which we consider self or cash pay. We feel pretty blessed in our area because of our high percentage of commercial payors.
HCB News: What kinds of challenges does your hospital feel day to day?
JE: Even though we have a good amount of commercial payors, reimbursement challenges still exist.
The other challenge that continues to come up is our expenses. The cost to provide healthcare continues to go up, but reimbursements don’t go up with it, they actually go down. For instance, being able to hire physicians — before, they ran their own practices and would bring cases to the hospital. We didn’t need to provide all those resources on the clinic side. Today, we employ about 150 providers, so we have to manage and run 150 practices and staff them, bill and collect for them, and all the other costs involved with running a practice. Physicians are also in great demand, so we have to pay a premium to get them to come to a rural community. And then continue to build their practices even though they might not be as robust a practice as they’d see in a more populated community. We have to balance that compensation with productivity to make sure we have what we need with our community, but we make sure we’re not paying so much that we can’t afford it.
Nursing shortage is also still a big thing. We run into that same issue because there’s three or four other hospitals within 40 to 50 miles of us and everybody is competing for the same staff.
Pharmaceutical cost is another big issue, because those costs continue to rise and we can’t do much about it because we need those medications, but reimbursements don’t follow.
HCB News: Do you anticipate any kind of big shift in services or patient types you serve in the next five to 10 years?
JE: I don’t know if there will be a big shift. We might take care of more of certain diseases, because as the population continues to get older, there’s more of the chronic care management.
I think if it was going to shift to anything, it would be to prevention and chronic care management instead of the episodic care; coming to the ER and dealing with those types of diseases in an acute setting versus working in an ambulatory setting. I see the shift going that way and working to prevent the problems from happening, and managing chronic illnesses in different ways.
HCB News: For a potential patient not familiar with your facility, what message would you want to convey to them?
JE: Our tagline is “Experience Bingham.” What that means is you’ve probably had all kinds of experiences in healthcare from very good to very bad. At Bingham, we feel we provide a service that’s personal, comforting . . . that you’re not running through a chute like a bunch of cattle, but you’re a person, a patient, a family member.
HCB News: What do you think are the biggest problems in healthcare today and if you had the power, how would you fix them?
JE: I think one of the biggest problems is the fact that there’s a portion of the healthcare sector that is run for profit. I think some of that obviously brings a different approach to taking care of a patient. Taking care of patients in their most vulnerable state is a calling rather than seeing how many CPT codes we can build out of that. Healthcare has gone away from being a community supported facility to a true business that’s quite frankly traded on Wall Street.
There’s also too many cooks in the kitchen – what people in Washington think should happen, what people in the individual states think should happen, what the insurance company, or Medicare thinks you should do . . . it takes some of the power away from hospital staff to do what they think is best for the patient. If we can remove some of that and get the power back to those who are trained and working in the field in order to help people, we’ll be in much better shape.
HCB News: How do you think healthcare will change over the next decade?
JE: I really think it’s going to change toward the prevention and management of diseases that are there. Patients go and complete all their annual healthcare visits. Diabetics do their regular maintenance. You’ll see a lot more in an outpatient setting as well. This past year and a half, since they’ve allowed total knees to be done in an outpatient setting, the procedure starts in the morning and you’re out by supper. Years ago, those were a two or three day stay, now you’re getting to go home within 24 hours. That experience will expand to other procedures. And lastly, I think we’ll also see a greater shift toward outcome-based medicine and away from fee-for-service. That will be the future.