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Texas Health Resources COO Talks Innovation, Strategy—and Faith

September 16, 2014
by Mark Hagland
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Texas Health Resources COO Jeffrey Canose, M.D., shares his perspectives on his organization’s forward progress

The Arlington-based Texas Health Resources, one of the largest faith-based, nonprofit integrated healthcare systems in the U.S., encompasses 25 hospitals, 3,800 licensed beds, 18 outpatient facilities, more than 250 additional care sites; more than 21,000 employees, and more than 5,500 affiliated physicians, serving 6.2 million people across 16 counties in north central Texas.

Jeffrey Canose, M.D., who has been an executive at THR since January 2006, on Sep. 1 was named senior executive vice president and chief operating officer of for the entire health system. As explained on the organization’s website, “Dr. Canose works in a dyad relationship with Dan Varga, M.D., senior executive vice president and chief clinical officer, to align operational and clinical strategies in an ongoing plan to transform from a hospital system to an integrated health system. He is responsible for achieving full and seamless integration of all system operations, including administrative leadership of Texas Health’s three geographical zones,” as the website further notes.

Shortly after the announcement of his new position at Texas Health Resources, Dr. Canose spoke with HCI Editor-in-Chief Mark Hagland regarding his current work and his perspectives on THR’s journey forward into the future. Below are excerpts from that interview.

Jeffrey Canose, M.D.

What were you doing at THR just before accepting this new position?

I’ve been here for eight-and-a-half years so far; I came in January 2006, as the COO of our Dallas hospital. And then I had the opportunity to move to our largest hospital in the northern suburbs and served as president out there, and when we developed the zone architecture for THR, six of us—three classic physician executives and three regular executives—became zone executives.

THR serves a 16-county area including a population between 6 and 6.5 million. And when we were focused on being a hospital operating company, we had a classic architecture with a system COO responsible for hospital operations, and that was divided into east and west sides. But as soon as we made the decision to become more of an integrated health system, and started to build the infrastructure for population health, the need to cover our service area led us to divide our service area into three zones, with each one encompassing about two million people. At the same time, we consider all three zones to have permeable membranes around them, so there are no boundaries or fences; in fact, we encourage a lot of synergy and collaboration. We all office together and all meet together about things. I officially became system COO on September 1.

What are the biggest issues facing Texas Health Resources as an integrated system now?

The biggest challenge is to continue on our journey to increase our capabilities as a fully integrated health system; to develop the competency to be a high-performing system in the realm of population health management; to shift our focus from sick care to actually managing well-being; and to do that in an environment where we don’t think we need to own or build everything, but to do things through partnerships to actually accomplish our strategic vision.

Are you involved in any of the Medicare MSSPs?

Not at the current time.

Would you wish to be?

We’re always evaluating those programs, and evaluating the total cost of ownership. We initially got involved in the Pioneer ACO program, but left fairly early on [in July 2013, along with eight other organizations; THR was one of two to leave the ACO program entirely, while seven shifted from the Pioneer ACO program to the regular MSSP program—see here for HCI’s reporting of that development].

In the broadest sense, what made you choose to leave the Pioneer ACO Program?

Two primary factors were involved. One was the way the attribution model was structured; the other was that there were significant restrictions on how we could actually manage the care of the patients attributed to the ACO model. It’s sort of like having a professional football player go on the field with his hands tied behind his back.

What were the restrictions?

The essence was that CMS [the Centers for Medicare and Medicaid Services] had created the guidelines in a way so that you could not impose any gatekeeping functions on utilization of healthcare services by the beneficiaries you were responsible for managing. You could try to channel them into a narrower network of providers or affect where they received their care. So you could have patients attributed to your system who were getting their care from more expensive outside providers/health systems and there was no way or incentive to get the patients to participate in eliminating waste and redundancy.

So you participated from January 2012 through July 2013, essentially?

That’s correct.

Do you feel that you learned anything from participation in the Pioneer program?