>> CATHY: A FORMER MINNESOTA HEALTH COMMISSIONER WAS -- IS BACK ON THE SCENE IN A FAMILIAR ROLE AS A TROUBLESHOOTER.

THIS COMES AT A TIME WHEN HCMC AND RURAL HOSPITALS ACROSS THE STATE ARE FACING A FINANCIAL CRISIS.

OUR NEXT GUEST WAS UP AT THE CAPITOL TUESDAY TESTIFYING TO LAWMAKERS AND JOINS US NOW.

JAN MALCOLM OF MINNESOTA HOSPITAL AND HEALTH SYSTEMS.

, WHO IS A TOP-LEVEL ADVISOR TO THE GOVERNOR ON THESE ISSUES.

IT IS GOOD TO SEE YOU AGAIN.

>> THANK YOU.

GOOD TO SEE YOU.

>> Cathy: COMING OUT OF RETIREMENT TO TACKLE WHAT IS A THORNY ISSUE.

WE'VE DONE SOME REPORTING ON THE SITUATION WITH HCMC.

THEY'RE STRUGGLING FINANCIALLY.

THEY COULD CLOSE.

THEY'RE NOT THE ONLY HOSPITAL HAVING TROUBLE, IS THAT RIGHT?

>> THAT'S RIGHT.

I'M SURE YOU'VE HEARD THE PHRASE OVER AND OVER AGAIN, AS THE CANARY IN THE COAL MINE, THAT'S HOW THEY'VE BEEN REFERRED TO.

THE ISSUES AT HENNEPIN HAVE BEEN BUILDING FOR A LONG TIME, THEY'RE IMILAR TO WHAT OTHER HOSPITALS FACE, BUT TO A MUCH GREATER DEGREE AT HENNEPIN.

THEY'RE REALLY SEEING -- THEY'RE KIND OF THE SHARP END OF THE SPEAR, AS THEY SAY.

CONFRONTING SOME CHANGES AND TRENDS IN THE INDUSTRY THAT JUST, I HINK, A LOT OF THE HOSPITALS ARE SAYING ARE FUNDAMENTALLY UNSUSTAINABLE.

>> Eric: AREN'T THERE TRILLIONS OF DOLLARS FLOATING AROUND IN THE HEALTHCARE SYSTEM?

AND OW ON EARTH COULD ANYBODY BE SHORT CHANGED WITH ALL THIS MONEY THAT'S RELATED TO THE HEALTHCARE INDUSTRY?

>> IT'S A GREAT POINT, ERIC.

AND, YOU KNOW, ONE OF THE THINGS I'M REALLY HEARTENED BY IN ALL OF THIS, THIS IS AN IMPORTANT CONVERSATION GOING ON, PEOPLE HAVE BEEN EDUCATED ABOUT THE IMPORTANCE OF HENNEPIN, BUT THE HEALTH SYSTEM LEADERS THEMSELVES, AND I'VE TALKED TO A LOT OF THEM IN THESE LAST FEW WEEKS, THEY ALL SAY, THE HEALTHCARE FINANCING SYSTEM REALLY IS FUNDAMENTALLY BROKEN.

THERE IS A LOT OF MONEY IN THE SYSTEM.

THEY THEMSELVES SAY HEALTHCARE COSTS TOO MUCH.

BUT THE RESOURCES ARE NOT VERY WELL DISTRIBUTED.

THEY'RE NOT GOING TO THE PLACES WHERE THE PATIENT NEEDS ARE THE MOST ACUTE, NOT GOING TO THE PLACES WHERE THE ACTUAL CARE IS BEING DELIVERED TO THE FRONT LINE.

>> Eric: SO WHAT DO YOU DO?

>> WELL, I THINK, FIRST, WE NEED TO SEE SOME FUNDING THIS SESSION TO STABLIZE THE SITUATION AT ENNEPIN AND PERHAPS SOME OF THE RURAL HOSPITALS THAT ARE CLOSE TO THE EDGE.

>> Eric: LOOKS LIKE THAT'S GOING TO HAPPEN.

>> I AM HEARTENED THAT LEGISLATIVE LEADERS AND BIPARTISAN SUPPORT FOR HENNEPIN, SUPPORT FOR HENNEPIN FROM THE OTHER HEALTH SYSTEMS THAT ALL UNDERSTAND, THEY REALLY ARE IN IT TOGETHER.

THERE'S SUCH INTERDEPENDENCY IN OUR SYSTEM.

BUT NOT ONLY DO WE NEED THE SHORT-TERM FINANCING STABILITY, WE NEED A BIG FUNDAMENTAL CONVERSATION ABOUT HOW TO CHANGE THE WAY WE PAY, SOME THINGS ABOUT HOW WE AYBE DELIVER CARE IN A MORE COORDINATED WAY ACROSS SOME OF THESE SYSTEMS.

AND THE LEADERS THEMSELVES ARE STARTING TO TALK ABOUT THAT.

>> Cathy: BUT WHAT'S THE FEDERAL ROLE?

THE FEDS PLAY A HUGE ROLE IN THIS, AND THEY DON'T SEEM LIKE THEY REALLY WANT TO PLAY BALL.

>> YEAH.

>> Cathy: WHAT'S THE LONG-TERM FIX LOOK LIKE, I GUESS?

>> WELL, THAT'S RIGHT.

WE ARE HARD PRESSED, AS STATES, TO PICK UP EVERYTHING THAT THE FEDS ARE NOW SAYING THEY WANT TO SHIFT TO US.

SO I VERY MUCH HOPE THAT THE FEDERAL DEBATE WILL REVERSE AT SOME POINT AND WE CAN GET BACK TO TALKING ABOUT HOW TO BUILD A HEALTH SYSTEM THAT WORKS FOR EVERYBODY RATHER THAN TAKING IT APART PIECE BY PIECE.

>> Eric: HOW ARE RURAL HOSPITALS FARING?

>> SOME OF THEM ARE QUITE CLOSE TO THE EDGE.

LIKE HENNEPIN, MORE AND MORE OF THEIR PATIENTS ARE COMING THROUGH MEDICARE AND MEDICAID.

WITH THE AGING POPULATION AND THE INCREASES IN LOWER-INCOME POPULATIONS.

AND, SO, THEY, TOO, LIKE HENNEPIN, ARE SEEING COSTS GO UP AND REVENUES GO DOWN.

AND THAT IS CERTAINLY UNSUSTAINABLE.

BUT THE GOOD NEWS IS, MINNESOTA DID GET A GRANT FROM THE FEDERAL GOVERNMENT TO HELP RURAL HOSPITALS KIND OF FIGURE OUT HOW TO EVOLVE IN THE FUTURE AND MAYBE SOME NEW MODELS FOR CARE DELIVERY.

IN THE RURAL AREAS.

WE ACTUALLY LEARNED SOME GOOD LESSONS OUT OF THE PANDEMIC ABOUT HOW TO APPROACH THIS AS SORT OF A COORDINATED SYSTEM.

SO I'M CAUTIOUSLY OPTIMISTIC THAT WE'VE GOT SOME THINGS TO BUILD ON HERE AND WE'VE JUST -- WE'RE ALL GETTING A GOOD WAKE-UP CALL TO HOW FUNDAMENTALLY IMPORTANT OUR HEALTHCARE SYSTEM IS AND HOW FRAGILE.

>> Cathy: ERIC ND I WERE TALKING OFF AIR ABOUT, YOU ARE A SPECIAL BREED OF INDIVIDUAL IN THE STATE OF MINNESOTA.

YOU COULD HAVE STAYED IN RETIREMENT AND ENJOYED YOURSELF, BUT YOU'RE KIND OF BACK IN THE FRAY.

NAMES LIKE CATHERINE ROBERTS, WE WERE TALKING ABOUT HER AND SHARLENE BRINER.

>> Eric: MIKE BECKVICH.

KATHLEEN BLATZ.

>> Cathy: EXACTLY.

YOU'RE IN A RAREFIED ATMOSPHERE, WHAT BROUGHT YOU BACK.

WHY EVEN BOTHER?

>> WELL, FIRST, I'M FLATTERED TO BE CONSIDERED IN SUCH COMPANY.

I SPENT MY WHOLE CAREER IN HEALTH POLICY AND PUBLIC HEALTH.

AND IF THERE'S ANYTHING I CAN DO TO HELP JUST EXTEND THE GOOD WORK THAT PEOPLE ARE ALREADY DOING ON THESE ISSUES, IT'S A LOT BETTER TO BE TRYING TO HELP THAN TO BE SITTING ON THE SIDELINES HOWLING AT THE MOON.

>> Eric: APPRECIATE YOUR SERVICE TO OUR