Healthcare Financial News

In yet another sign of the earthquakes shaking the financial markets this week, the London interbank offered rate (LIBOR)--the rate that member banks of the British Bankers Association charge each other for large loans--more than doubled on Sept. 16, from 3.10 percent to 6.44 percent. That jump is the largest on record, said The Wall Street Journal.

Central banks responded the next day with an infusion of $200 billion to try to unfreeze bank lending, and the overnight rate fell. The three-month LIBOR remains high, however, and was only slightly affected by the central banks’ actions. If LIBOR remains at a high rate, access to capital for healthcare providers “will be limited or in some cases not available at all,” said HFMA president and CEO Richard L. Clarke, DHA, FHFMA. “Default rates on auction rate securities, variable rate demand bonds, and pricing of bank letters of credit often are based on LIBOR, which could indicate an increase--maybe substantial--in interest cost, and could foretell increased default on bonds, which in the past has been very unusual.”

The LIBOR jump is a reflection of the shift in capital for very low-risk investments like Treasuries.

Read the WSJ article (subscription required). Read HFMA leaders’ response to the credit turmoil.

Nine research teams from across the country on Sept. 17 unveiled innovative prototypes of personal health record (PHR) applications that provide a glimpse of the “next generation” of PHRs. The prototypes range from a medication management system to help children with cystic fibrosis manage their disease (housed in an age-appropriate form, like a stuffed animal or cell phone), to a sophisticated “conversational assistant,” a computerized tool that helps people with congestive heart failure manage their health from home through a series of voice-activated questions and responses that they can quickly share with their medical providers.

The nine design teams are supported by Project HealthDesign, a $5-million national program of the Robert Wood Johnson Foundation. Each team created applications that help move the perception of PHRs from static repositories of health information to dynamic, tailored applications that allow people to easily and actively manage their health as they go about their daily lives. The project also ensured that these PHR tools can readily share common technical functions and operate on a common technology platform.

Over the next several months, the grantee teams will work to publish details about their findings, as well as extend the use of their applications to the clinical practices connected to their institutions. Read the press release.