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    Letter to Sutter Health Employees from Pat Fry, CEO

    In 2008, Sutter Health began taking bold steps to transform health care. As part of our strategic plan, that year our organization embraced a vision to deliver high-value services by providing expert, personalized care that is both high-quality and affordable. While we've made great strides, our work is far from done. In fact, coming reductions in government reimbursement and rising pressure to hold the line on premium increases for commercial health insurance plans creates even greater urgency to make care more affordable.

    Every employee across Sutter Health plays a vital role in improving and growing our network’s services. In the coming months, Sutter Health will take even more steps to connect with employees to share news and information about the changed environment. As part of this effort, President and CEO Patrick Fry sent a letter to the homes of approximately 50,000 employees.

    Dear Colleague,
    Our Sutter Health network set out on a journey several years ago to deliver the highest quality patient care in an affordable way—to ensure that we remain accessible to our patients. I’m sending this letter to update you on how we are doing and to tell you about some tough challenges ahead.

    Whether you work in a clinical setting or an office, we’re all about caring for patients. We made huge strides in improving medical care quality in 2010. One impressive example involves reducing the number of central line-associated bloodstream infections (otherwise known as CLABSIs).

    Many of you who work on the clinical side know that CLABSIs are serious and can lead to sepsis—one of the leading causes of hospital deaths. At Sutter Health, we’ve made it a priority to reduce CLABSIs, and we’re succeeding. From 2007 to the third quarter of 2010, CLABSI rates at Sutter Health dropped by 76 percent, which puts us far ahead of the national average. Together, our CLABSI-fighting efforts saved 52 lives and prevented 330 cases of infection. Deaths from sepsis within Sutter hospitals also improved by 31 percent since 2008, with more than 2,000 lives saved.

    We made these strides by reducing variation in medical care and by adopting best-practice approaches. As a result, we actually reduced costs by $37 million. Time after time, we have shown that we can provide quality care to our patients by improving efficiency and reducing costs.

    In the years ahead, delivering high-quality care as efficiently as possible will become even more important. Under federal health care reform, the government will provide health coverage to 32 million uninsured Americans. The government will help cover these new costs by paying health care providers less. Over the next decade, Medicare will reduce reimbursement to Sutter Health by nearly $2 billion. At the same time, the state of California faces a massive debt—and it is very possible that Medi-Cal will also reduce its payments to doctors and hospitals.

    Despite legal maneuverings and Congressional debate about the future of health care reform, we fully expect that these deep government reimbursement cuts will continue—along with demands that doctors and hospitals deliver more care for less money.

    Meanwhile, the prices of medical services have become as important to our patients as receiving high-quality care. After all, what is the value of outstanding care if patients can’t afford it? Health care is expensive, but health plans, employers and consumers claim at times that our prices are high compared to some competitors. If our prices aren’t competitive, we
    will see fewer and fewer commercially insured patients, and we won’t be able to make the investments our patients and employees expect.

    Here is our challenge: Sutter Health must find ways to continue serving growing numbers of government-sponsored patients at a cost close to what Medicare insurance pays us. This means rethinking how we deliver our services. Our success in lowering CLABSIs and sepsis infections, while also lowering medical costs, proves what we can do when we put our minds to it. Although our progress is commendable, our work is far from done. Sutter Health needs to achieve about $700 million in additional savings by 2014.

    This month, I spoke to several hundred leaders from around Sutter Health, asking them to help continue identifying solutions to our financial challenges, while creating new opportunities to better serve our patients. In the weeks ahead, we will talk with thousands more managers.

    As a valued employee, you play a role in achieving our goals. By remaining open to different approaches to delivering our services and continuing to provide patients with a level of personal care they can’t get anywhere else, we can grow while maintaining a stable and secure workforce.
    Your local and region leaders and I will be talking to you quite a bit this year about our challenges and opportunities—and we’ll keep you informed of our progress. Thank you for your continued commitment and flexibility. We greatly value the positive difference you make in our patients’ lives.


    Pat Fry
    President and CEO, Sutter Health