Spectrum Healthcare CEO keeps an eye on the future
Spectrum Healthcare plans to build open a new residential men’s facility on Main Street in Cottonwood as the local non-profit organization makes decisions to continue to operate as a Verde Valley-focused behavioral health and primary care provider, according to April Rhodes, Spectrum CEO.
“There’s a lot things going on in health care that necessitate us needing to find a way to sustain - either through some sort of growth strategy,” explained Rhodes, or some sort of “partnership growth with other like-minded organizations.”
Spectrum operates out of a main campus in Cottonwood that has its offices, therapy rooms and a café to teach work skills, and a 12-bed women’s residential facility for substance-abuse and serious mental illness cases, Rhodes said.
The new men’s overnight facility, which is still in the planning stage and grant application process, would be similar to the women’s facility and would be in partnership with Northern Arizona Healthcare, Rhodes said. It would also have 10 residential beds and two temporary-stay beds.
Spectrum has always provided behavioral health services, but began offering primary medical care in 2009, Rhodes said. Today, Spectrum offers primary care along with mental health services at its Cottonwood, Camp Verde, Sedona and Prescott offices.
Offering primary care was a tough decision, but it was the right choice, Rhodes pointed out.
Rhodes said Spectrum felt that patients with serious mental illnesses were dying much earlier than most people. Spectrum staff believed they had the responsibility to provide physical and medical care, which those patients were not getting.
Rhodes said Spectrum is in good shape today. So much so, in fact, that she has concerns that its current status makes it an attractive target for takeover by a larger health care facility.
Consequently, Rhodes said Spectrum is always looking at partnerships and mergers that would help the Cottonwood facility be a larger but local-first organization – something she says is better for the community.
For example, Rhodes said Spectrum recently joined in a “unique and innovative” partnership with Northern Arizona Healthcare, which operates Verde Valley Medical Center, to provide behavioral health services for the hospital. Spectrum also partners with 13 law enforcement agencies in the Verde Valley and Yavapai County as their Mobile Response Team.
Rhodes said Spectrum uses a mix of four medical doctors and eight nurse practitioners at all their sites.
Before 2009, they primarily had psychiatry services, she said, adding that two of their MDs are psychiatrists and two are physical/primary care doctors.
Spectrum has about 200 full-time 200 employees today, Rhodes said.
The main campus on East Cottonwood Street is where out-patient and in-take services are located. Thois is the facility where people serious mental illnesses are treated. In addition, Spectrum has a work-skills café to train people and the women’s residential facility is also located there.
The Mingus Avenue location is where the fully integrated medical facility is located: psychiatry, primary care and pharmacy, she said. Spectrum also owns the currently vacant building at 636 North Main Street where the proposed men’s residential facility will be located.
“We’re a financially healthy company,” Rhodes said.
“We want to preserve who we are and what we do. And the best way to have some leverage in that is when you are healthy. If we’re not, then it becomes like a fire-sale mode and people are coming in and trying to take you over and we don’t want to be in that position ever.
Spectrum did have to adjust is workforce with layoffs and attrition a year and half ago, Rhodes said. She said the company kept it at about a 23-employee layoff and the rest of the downsizing came through attrition.
“Basically, it was just getting right-sized for the organization,” Rhodes said.
Rhodes was named Spectrum CEO in 2015. Even though Spectrum is a private, non-governmental, non-profit organization, Rhodes said they still have a responsibility to keep a positive net income.
Spectrum is required to put that back into the programing or the organization, she said. Spectrum provides services to Medicaid and non-Medicaid patients, but there are no “bail outs” or “rescues” for organizations such as Spectrum, she said.
Rhodes said the medical doctors “have accomplished their mission,” but acknowledged it’s difficult to keep primary care services in a positive net margin for any organization.
“It’s been challenging. I think the first couple of years we lost a lot of money,” Rhodes said, having to hire the physicians, support staff and to renovate the building. But the CEO said they will continue and “double down” on the primary care strategy because the outcome has proven that it’s good care.
Also, Medicaid integrated health plan pay outs for behavioral health and primary care in 2018, so Spectrum is ahead of the curve by integrating sooner than other behavior health facilities, she said.
Combining or partnering with another company would allow Spectrum to remain locally focused, but also share resources. Things like billing and back-office functions can be centralized, she said.
“We’re in no rush,” Rhodes said, referring to partnering with another company. She said her priority is “organic growth in Yavapai County. We’re from here. That’s who we are.”
“We need to be able to change,” Rhodes said. “I think the future is bright. There’s a lot of opportunities. There’s a lot of interest in working with Spectrum.”