Stormont Vail CEO: Aging population, Costs Require Changes in Health Care

By Amy Geiszler-Jones
Friday, May 4, 2018

Because of America’s aging population, keeping the status quo with today’s healthcare model will create capacity strain and cost issues, says Randy Peterson, President and CEO of the Topeka-based Stormont Vail Health system.

Healthcare costs already account for about 18 percent of the U.S. gross domestic product, and about 10,000 people a day are added to the rolls of Medicare, Peterson notes. According to two papers published in The Lancet last year, the U.S. spends the most of any country on health care per person at $9,237.

“I’m not sure our country can absorb much more in that way,” Peterson says. “We need … to incentivize people to stay well and manage chronic diseases to keep them out of the hospital.”

Stormont Vail Health participates in programs with insurers and is a Medicare accountable care organization to help in its pursuit of reducing costs and putting an emphasis on providing quality coordinated and preventive care to its patients. The nonprofit Stormont Vail Health system serves more than 24,000 Medicare beneficiaries.

As a self-insured employer, however, it carries 100 percent risk in covering 8,000 employees and their dependents.

“We’re in various stage of sharing in savings programs and reducing risks. We’re on a journey to move from reimbursements for procedures and surgeries,” Peterson says. “Prevention is always best.”

To help with issues such as re-admits, for example, Stormont Vail has created an intensive primary care clinic where providers will spend as long as two hours providing treatment, intervention and education to a patient with a chronic disease.

Of course, patients aren’t the only aging population Stormont Vail has to consider. Of its 270 physicians, 58 — about one of every five doctors — are older than age 60. It has three full-time recruiters who are working diligently to replace those physicians who are leaving because of retirement. One drawback is “we’re working against states that have expanded Medicare,” Peterson says. One benefit, however, is that since 1995, Stormont Vail Health has included the Cotton O’Neil Clinic infrastructure. “We call that our secret sauce,” Peterson says. Many other communities depend on independent practices.

Another marketplace pressure is insurance companies who are competing for physicians and expanding into healthcare services such as pharmacies.

“That’s going to change the dynamics for stand-alone hospitals,” Peterson says.

While the past 10 years have been about changes in reimbursement and dealing with different rules and regulations, the next 10 will likely bring a wave of more healthcare consumerism and patients looking for a more competitive marketplace, Peterson says. As employers cut their healthcare spending, employees who have to pay for more out-of-pocket costs will shop around.

With consumers looking for more affordable care, Stormont Vail is already adapting one lower-cost method of delivering care ­— through electronic doctor visits. For certain acute conditions, patients who would usually seek care at an express or urgent care clinic, can conduct an e-visit with a Stormont Vail Health provider through the MyChart patient portal.


Stormont Vail Hospital is a 586-bed acute care referral center in Topeka. It was formed with the 1949 merger between Christ’s Hospital (founded in 1884) and the Jane C. Stormont Hospital and training School for Nurses (1895). The Cotton O’Neil Clinic comprises 27 primary and specialty care clinics in and around Topeka.