Home
  Go 
Advanced SearchTopics Login Become a Member 

Locate A Chapter

HFMA News - May, 2006

HFMA NEWS


Wednesday, May 31, 2006
Vermont Becomes Second State to Pass Healthcare Reform

Last week, Vermont Gov. Jim Douglas signed into law a healthcare reform initiative that is expected to insure 25,000 residents through state-subsidized insurance offered by private insurance companies. The second state to pass such legislation (Massachusetts passed a similar bill in April), Vermont has a goal of providing near-universal health insurance to its residents by 2010. Currently, approximately 10% of the 620,000 Vermonters are uninsured. Under the new Catamount Health program, low-income earners will pay premiums on a sliding scale beginning in October 2007. Some of the funding for the low-cost insurance will come from an assessment on employers who do not offer their employees insurance, and from a higher excise tax on cigarettes, reports Reuters.

posted on 5/31/2006 7:18:55 AM (CST)  Permalink   
High Medical Spending Doesn’t Lead to Physician Satisfaction, Says Study

Primary care physicians practicing in areas with a high concentration of specialists and medical facilities are less satisfied with the quality of care they are providing their patients as well as their own careers compared with physicians in areas with fewer resources, according to a study by Dartmouth researchers published in the May 2 issue of Annals of Internal Medicine. Areas of the country associated with high medical spending led to high patient demand that physicians felt they could not meet. The Chicago Tribune reports that physicians in high-intensity medical areas had more difficulty obtaining specialty referrals, adequate hospital stays, elective surgery, and imaging services for their patients than physicians in areas with lower medical spending. In an earlier study, Dartmouth researchers found that 30% of Medicare spending is not warranted.

“The implications [of the study] are important; it’s not that we need to pour more money into the system and it’s not that we need more hospital beds and more specialists,” Lawrence Casalino, MD, PhD, professor of health studies at the University of Chicago, told the Tribune. What is needed, Casalino said, is to reward physicians for spending more time with patients so they can treat them more effectively.

posted on 5/31/2006 7:16:23 AM (CST)  Permalink   
Demand for Primary Care Physicians Outpaces Specialists

As the population ages and fewer medical graduates are choosing primary care, the demand for internists has jumped 46%--and 55% for family physicians--from March 2005 to April 2006, according to physician recruiting firm Merritt, Hawkins & Associates as reported in an AP story. And as demand keeps rising, so will salaries. In the past few months, internists’ salaries--the average is $162,000--have increased 10% to 15%, according to a Merritt Hawkins executive.

posted on 5/31/2006 7:15:19 AM (CST)  Permalink   
Termination of Retiree Health Benefits Disrupts Plans and Savings: Study

A Kaiser Family Foundation survey of steel company retirees and dependents who had lost health benefits as a result of bankruptcies of their companies found that 74% of respondents younger than 65 obtained new health insurance but at a significant disruption to savings and retirement plans. Forty-nine percent of retirees of LTV Corporation and Bethlehem Steel who lost health coverage after the bankruptcies said they or a spouse delayed retirement in order to afford new health insurance, and a quarter of those younger than 65 said they had to dig deep into savings to pay the premiums. But even with new health insurance, 29% of respondents younger than 65 said they postponed hospital care and 49% went without physician care due to cost. More than half of Medicare-eligible respondents without supplemental coverage skipped medications, and 28% did not get recommended hospital treatment because of concerns over cost. Survey respondents also reported being less satisfied with their new health insurance than they were with their retiree health benefits.

posted on 5/31/2006 7:14:00 AM (CST)  Permalink   
Tuesday, May 30, 2006
75% of All Claims Now Filed Electronically, Says AHIP

The number of claims filed electronically has increased substantially from four years ago, decreasing processing costs and speeding up payment, according to a survey of 25 million claims by America’s Health Insurance Plans. Seventy-five percent of claims are now submitted electronically, compared with 44% in 2002, and cost almost half as much to process--$0.85 for a clean electronic claim versus $1.58 for a clean paper claim. Yet although 69% of electronic claims are processed within seven days versus 29% of paper claims, the percentage of providers who wait to submit claims until 30 days after service--29%--is virtually unchanged from four years ago. For the 14% of all claims that are delayed, 35% are slowed because duplicate claims were submitted, 12% lack complete information, and 1% contain invalid codes. Read the survey.

In related news, athenahealth, Inc., a billing and practice management software company for physicians, has ranked national and regional health insurers on their ability to efficiently pay claims. The rankings consider such measures as the length of time an insurer takes to pay a claim, the percentage of claims that get paid in full the first time they are submitted, and denial rate. Among the results: Aetna denied claims twice as often as Humana, Cigna led all carriers in requiring providers to resubmit claims because the insurer says they are not on file, and Wellpoint was the most aggressive in requesting physicians to secure payments from patients directly.

posted on 5/30/2006 8:10:14 AM (CST)  Permalink   
Lawsuits on Excessive Hospital Prices Before South Dakota Supreme Court

Two class action lawsuits alleging that two South Dakota hospitals charged uninsured patients excessive prices are before the South Dakota Supreme Court for reinstatement after being dismissed by a circuit court judge, reports the Sioux City Journal. At issue are charges for intestinal surgery at Sioux Valley Hospitals and Health System and for a broken hip at Avera Health. A lawyer for the two patients says that charges must be reasonable according to law--not two to three times higher than insured patients pay--and, as charitable institutions, the hospitals should bill what patients are able to pay. Sioux Valley said the patient was charged the standard rate, that the hospital lists prices for its procedures on its web site, and that the patient could have asked for a charity care discount. Justice Steven Zinter told the Journal that he believes patients should be able to challenge excessive hospital charges under the law.

posted on 5/30/2006 8:08:49 AM (CST)  Permalink   
Massachusetts Hospital Association, Others Oppose Nurse-Ratio Bill in State Senate

The Massachusetts Hospital Association and Massachusetts Organization of Nurse Executives are opposing a bill, passed last week by the state House, requiring the state to determine how many patients would be assigned to each registered nurse. In a joint statement, the MHA and the MONE said, “We believe that the entire caregiving team must be included in the development of flexible staffing guidelines. The union [the Massachusetts Nurses Association], by contrast, believes government should set RN-only ratios.” As the bill passes to the Senate, MHA and MONE reiterated their message to the state’s senators: “Let government hold hospitals accountable for their performance and patient care. Don’t let government micromanage how that care is delivered.” Prior to the vote, MHA and MONE had sent a letter signed by every hospital CEO in the Commonwealth opposing the legislation.

However, Beth Piknick, president of the Massachusetts Nurses Association, said, “We are very pleased with this vote for patient safety.” The nurses group cites Massachusetts physician and patient surveys attributing compromised care to nurses having to take care of too many patients. “The scientific research clearly shows that when nurses have fewer patients, patients get better care, medical errors are reduced, and millions of dollars are saved,” said the MNA. Only California has a law regulating nurse staffing limits in hospitals, but 14 other states currently have similar legislation pending, according to the MNA.

posted on 5/30/2006 8:04:26 AM (CST)  Permalink   
Medicare Proposes Payment Changes for Ambulance Services

CMS has issued a proposed rule designed to improve the accuracy of payments under the ambulance fee schedule and incorporate changes in geographic adjustments based on the most recent census data. The proposed rule would resolve several issues that have arisen since April 1, 2002, when CMS began phasing in the ambulance fee schedule. One change would revise the designation of areas as urban or rural to incorporate changes made by the Office of Management and Budget to reflect the 2000 census data. The proposed rule would lead to some redistribution of aggregate Medicare payments among ambulance services, since trips originating in a rural area are generally paid at a higher rate than urban trips. But in newly designated urban areas, an ambulance company would be expected to have a greater volume of business.

The proposed rule would also clarify that the extra payment for specialty care transport applies only to hospital-to-hospital ambulance transportation. In addition, the rule states that the extra payment for emergency responses is available not only to ambulances responding immediately to a 911 call, but also to ambulances available in a hospital setting when a 911 call is unnecessary to respond to an emergency. CMS is also proposing to discontinue formal annual reviews of “low billers” and air ambulances to determine whether adjustments are needed in the ambulance fee schedule conversion factor.

 

 

posted on 5/30/2006 8:01:38 AM (CST)  Permalink   
Friday, May 26, 2006
Drug Benefit Less Expensive in Medicare Advantage Plans

In an analysis of Medicare drug benefits, a study by Mathematica Policy Research, Inc., for the Kaiser Family Foundation found that drug coverage provided by Medicare Advantage plans had lower premiums and deductibles than stand-alone prescription drug plans. Medicare beneficiaries who choose a Medicare Advantage plan receive a drug benefit in addition to Medicare Part A and B and supplemental coverage. The average premium for the stand-alone drug program is $37/month compared with an average premium of $18 for all Medicare Advantage plans, which include HMOs, PPOs, and private fee-for-service plans. The lowest-cost stand-alone drug plan carries a $29/month premium, but the lowest-cost Medicare Advantage HMO charges $10/month for drug coverage. And 49% of Medicare Advantage HMOs charge no additional premium for a drug benefit. In addition, 79% of all Medicare Advantage plans have no deductible for prescription drugs, but 72% have maintained the “donut-hole” gap in coverage where beneficiaries are responsible for 100% of drug costs above a certain threshold. Download the study.

posted on 5/26/2006 7:38:25 AM (CST)  Permalink   
Tennessee to Provide Low-Cost Health Insurance

A plan to offer basic health insurance to low-income uninsured residents of Tennessee has been approved by the state’s legislature and is expected to be signed into law by Gov. Phil Bredesen, reports the Associated Press. Beginning in January 2007, eligible adults under the plan will pay an average of $150/month for basic insurance, with the state paying $50 of the premium and employers having the option to contribute $50. By eliminating catastrophic coverage, deductibles will be modest. “The idea is to set a large-deductible plan on its head,” Dave Goetz, the state finance commissioner, told the AP. Private insurance companies will offer the plan, which will be limited to individuals who earn $24,500 or less or a family of four with an income of less than $50,000. Cover Tennessee is expected to provide insurance to 100,000 adults, 75,000 children, and 15,000 chronically ill individuals. The state has 600,000 uninsured people.
 

posted on 5/26/2006 7:37:15 AM (CST)  Permalink   
Thursday, May 25, 2006
Growing Numbers of Young Adults Are Uninsured

Young adults--those 19 to 29 years old--are rapidly becoming one of the largest groups of uninsured people in the United States, according to a new Commonwealth Fund study. In 2004, 13.7 million young adults had no health insurance--a jump of 2.5 million in four years. Although young adults make up only 17% of the population under age 65, they represent 30% of the nonelderly uninsured. Young people are often thrust into the world or college without health insurance because, after age 19, they may be dropped from their parents’ health insurance unless they are full-time college students. Medicaid and the State Children’s Health Insurance Program also cut off benefits to children at age 19. As a result, 40% of part-time students and nonstudents are uninsured, compared with 20% of full-time college students. And two out of five recent college graduates will lack health insurance as they work in entry-level jobs, are employed by small companies, or frequently change jobs.

Yet young adults suffer a greater proportion of injuries requiring emergency department visits than the rest of the population, many will get pregnant, and they are at high risk for HIV. The study’s authors recommend that businesses extend parents’ health coverage to dependent children beyond age 18 or 19; that all college students be required to have health insurance and that colleges offer insurance; and that Medicaid and SCHIP continue coverage beyond age 18. Read the study.

posted on 5/25/2006 7:03:29 AM (CST)  Permalink   
Shortage of Intensivists Expected to Grow Worse

Intensivists caring for ICU patients will be in short supply through 2020, predicts a report to Congress by the Department of Health and Human Service’s Health Resources and Services Administration. Aging baby boomers alone are expected to increase demand for the specialty by approximately 38%. And if hospitals maintain optimal staffing of intensivists treating two-thirds of critically ill patients--they currently care for only one-third of ICU patients--there will be a shortage of 1,500 intensivists in 2020, or 129% above the projected supply. According to the report, recruiting physicians to critical care is difficult because of the specialty’s low reimbursement and lifestyle issues. Also, a large percentage of critical care fellows are international medical graduates who leave the United States after their visas expire.

posted on 5/25/2006 7:02:34 AM (CST)  Permalink   
Healthcare IT Improves Quality, Say Hospital Execs

Nearly three-quarters of hospital executives (71%) say that healthcare IT initiatives have been an important factor in enhancing quality, particularly in delivering more timely clinical information, diagnosis, and treatment, according to a survey by Mathematica Policy Research, Inc. The survey assessed use of six types of health IT: electronic lab results, electronic clinical notes systems, electronic images available hospital-wide, electronic lab orders, electronic reminders for guideline-based interventions, and e-prescribing.

Electronic lab results were the most commonly used type of IT (88% of hospitals), while CPOE was least common (21%). Among hospitals that had implemented fewer IT initiatives, 22% said better patient safety through the reduction of medical errors was the most important benefit of IT. Ten percent of executives cited improved communications among staff as the primarily benefit. Larger hospitals were more likely to be using healthcare IT by a wide margin, prompting concern that smaller hospitals were missing out on associated quality improvements. Reduction in the amount of labor required to report quality measures to the Centers for Medicare and Medicaid Services for Hospital Compare was another advantage of healthcare IT, cited by 69% of executives.

posted on 5/25/2006 7:01:27 AM (CST)  Permalink   
22 States Enter Privacy and Security Subcontracts with RTI

The Department of Health and Human Services has announced that 22 states and territories have entered subcontracts with RTI International, Inc., a private, not-for-profit corporation, to address privacy and security policy questions affecting interoperable health information exchange. Additional states are expected to sign subcontracts within the next two weeks. ONC and the Agency for Healthcare Research and Quality jointly manage and fund AHRQ’s contract with RTI for this work.

Subcontractors will be working with healthcare professionals, patients, and others to address privacy and security issues and proposing solutions, including identifying variations in privacy and security practices and laws affecting electronic clinical health information exchange; developing best practices and proposed solutions to address identified challenges; and increasing expertise about health information privacy and security protection in communities. The states will also work to develop implementation plans for future health information exchange activities. The solutions that are ultimately crafted will provide a foundation for future work by ONC and AHRQ and facilitate health information exchange across states.

posted on 5/25/2006 7:00:08 AM (CST)  Permalink   
Wednesday, May 24, 2006
Coalition Aims to Create Electronic Medical Records Network

A coalition based in Annapolis, Md., hopes by early 2007 to develop a prototype of an electronic network that would link physicians and hospitals in Maryland and Washington, D.C. The Washington Business Journal reports that the Maryland/D.C. Collaborative for Healthcare Information Technology wants to implement a secure network to provide practitioners with faster access to patient information and help them reduce medical errors. If the collaborative meets its deadline, it would be one of the nation's leaders in electronic medical record use. President Bush has established the goal of universal electronic medical record adoption by 2014 as a way to reduce between 100,000 and 200,000 deaths annually that are attributed to preventable medical mistakes. Read the Washington Business Journal article.

posted on 5/24/2006 7:52:03 AM (CST)  Permalink   
North Carolina Considers New Community Benefit Guidelines

The North Carolina Hospital Association is considering new guidelines that would ask the state’s 107 hospitals to report the amount of community benefit they provide in terms of costs rather than charges, according to the Triangle Business Journal. Many hospitals give the full retail price of a procedure rather than what it costs them in equipment and physician time when reporting how much free care they provide for indigent patients. Some experts say the practice is misleading because many patients pay discounted fees that are negotiated through insurance carriers. Ken Morris, chief financial officer of the Duke University Health System, was quoted in the Journal as saying that the new guidelines are “long overdue.”

posted on 5/24/2006 7:47:58 AM (CST)  Permalink   
Millions Spent on Unnecessary Screening Tests Each Year

The bill for unnecessary medical tests in the United States could exceed $200 million, according to a new study in the American Journal of Preventive Medicine (view abstract). Researchers from Georgetown University Medical Center and Johns Hopkins University examined how often more than 4,600 adults received screening tests that the U.S. Preventive Services Task Force rates as “C” tests--where evidence isn’t strong enough to recommend for or against their use in asymptomatic patients--and “D” tests--those that aren’t recommended for asymptomatic patients because risks outweigh benefits.

At least one of the “D” tests--urinalysis, electrocardiogram, and x-ray--was ordered against recommendations for 43% to 46% of patients. Extrapolated nationally, the annual cost for these inappropriate tests is between $47 million and $194 million. The “C” tests added another $12 million to $63 million. And the cost of follow-up care for false positive tests add millions more.

posted on 5/24/2006 7:39:23 AM (CST)  Permalink   
Triad Reportedly Planning to Increase Physician Ownership of Hospitals

The publicly traded Triad Hospitals Inc. will give physicians an opportunity to own a share of most of its hospitals, reports Reuters. The chain currently has physician owners in five of its hospitals and will make ownership an option in five to 10 hospitals each year, according to the report. The chain’s CEO is quoted by Reuters as saying that when physicians become owners, the hospital typically has higher efficiency, better outcomes, and greater patient satisfaction. "We see it expanding to every community we work in," said Denny Shelton, Triad's chief executive. "We are finding ways to align ourselves with physicians who are actively seeking ways to supplement their income."

posted on 5/24/2006 7:37:49 AM (CST)  Permalink   
Tuesday, May 23, 2006
House to Entertain Several Healthcare Bills

House Republicans will introduce or consider several bills next month that are in line with the Bush administration’s healthcare agenda, according to The Hill. One bill on health savings accounts would give tax incentives to those who purchase high-deductible plans, a tax credit to those with low income, and increase the yearly maximum contributions to HSAs. Another bill would make HSAs available to seniors. The House will also debate a bill on healthcare information technology sponsored by Nancy Johnson (R-Conn.), chair of the Ways and Means Health Subcommittee. Johnson’s bill is expected to face little opposition from House Democrats and has a chance of passing. Another bill would require hospitals and physicians to publicly post prices, and House Republicans may introduce legislation to cap jury awards in medical malpractice cases and create association health plans. Read the article in The Hill.

posted on 5/23/2006 8:10:06 AM (CST)  Permalink   
Missouri Hospitals Post Amounts of Uncompensated Care on Web Site

The Missouri Hospital Association has posted online dollar amounts for each Missouri hospital in the following categories: uncompensated care costs (charity care and bad debt), unpaid costs of Medicare program beneficiaries, unpaid costs of Medicaid program beneficiaries, free medical services clinics, health professions education costs, financial contributions, and taxes paid. Hospitals participating in this voluntary report submitted data from their 2004 fiscal year on eight common community benefit elements. For the reporting period, the total dollar amount of benefits provided by Missouri ’s hospitals was $1.8 billion in these categories. Individual hospitals’ contributions are provided on the web site. However, each hospital provides additional benefits not listed in the report.

posted on 5/23/2006 8:08:16 AM (CST)  Permalink   
Philadelphia-Area Hospitals’ Infection Rates Questioned

Low infection rates in Philadelphia-area hospitals are questioned by some experts, reports the Philadelphia Inquirer. According to the Pennsylvania Patient Safety Authority’s annual report, Philadelphia hospitals had 149 hospital-acquired infections in 2005 compared to 2,054 for Pittsburgh-area hospitals. Philadelphia hospitals also reported lower rates of serious events. The Delaware Valley Healthcare Council said that Philadelphia hospitals have lower infection rates because they have reduced medication errors and the area has more specialty hospitals, such as psychiatric facilities, where infections are less common. Confusion over what to report may also have skewed the numbers, Andrew Wiggleworth, president of the Council, told the Inquirer.

posted on 5/23/2006 7:57:11 AM (CST)  Permalink   
Evanston Northwestern Appeals Antitrust Decision to FTC

In a widely watched appeal of a hospital antitrust case, Evanston Northwestern Healthcare told the Federal Trade Commission that breaking up its 2000 merger with Highland Park Hospital would damage the suburban community’s patient care, reports the Chicago Tribune. Evanston Northwestern said that in six years it has spent $160 million at Highland Park Hospital, creating new heart and cancer programs and improving quality. But although at least one of the five commissioners who heard the appeal called divestiture “a drastic measure,” the FTC attorney maintained that Evanston Northwestern raised Highland Park’s  prices after the merger, which resulted in higher insurance premiums and could lead to more uninsured patients. 

In a statement, Evanston Health System said, "Today’s oral arguments are yet another step in the process for Evanston Northwestern Healthcare’s appeal of the Federal Trade Commission ruling citing ill effects on select managed care companies as a result of ENH’s merger with Highland Park Hospital. No decisions by the FTC are expected from the presentation of these arguments for some time. What’s important to understand is that we remain confident that the evidence we presented--namely that we have improved the quality of care at Highland Park Hospital, our prices never increased beyond market rates, and competition remains healthy in our service area--will ultimately prevail."

 

posted on 5/23/2006 7:53:36 AM (CST)  Permalink   
Monday, May 22, 2006
Grassley and Baucus Call for CMS to Do More to Restrict Specialty Hospitals

At a hearing on specialty hospitals, Senate Finance Chairman Charles Grassley (R-Iowa) and Sen. Max Baucus (D-Mont.) expressed their displeasure that 40 specialty hospitals have opened since 2004, despite a moratorium on new specialty hospitals, reports The Hill. Grassley told CMS administrator Mark McClellan that, “It is time for CMS to make a serious commitment to oversight of specialty hospitals,” besides CMS merely outlining policies to regulate specialty hospitals. But McClellan said CMS was only charged with denying payment to physician owners who improperly refer patients to their own facilities, not to ban new specialty hospitals. McClellan said that CMS’ new policies will require all institutions defined as hospitals to provide emergency services and treat the uninsured and future payments will remove incentives to cherry-pick patients. Grassley stated that he wants a requirement that physicians must disclose any ownership interests in a hospital when referring patients. Access article in The Hill. Access testimony from the committee hearing. 

posted on 5/22/2006 7:40:51 AM (CST)  Permalink   
House Passes Budget Bill Without Medicare/Medicaid Cuts

Last Thursday, the House passed a $2.7 trillion 2007 budget that did not include the Medicare and Medicaid cuts and health savings account incentives President Bush had proposed, according to an Associated Press story. House legislators passed the budget only after conservatives agreed to moderates’ demands for an additional $3.1 billion in funding for health and education programs, which represents a 2% increase in spending for those programs. Bush had initially proposed a $4 billion cut in spending for labor, health, and education. Yet The New York Times calls the House’s budget approval “more symbolic than substantive,” because the House is unlikely to reconcile its budget with the one the Senate has already passed.

posted on 5/22/2006 7:38:11 AM (CST)  Permalink   
Medicare Advantage Plans No Bargain for the Sick: Study

Beneficiaries in poor health can pay more out of pocket for care in Medicare Advantage managed care plans than in traditional Medicare with Medigap supplemental coverage, a new Commonwealth Fund report finds. (Click here to download the report.) The report says beneficiaries in poor health can spend up to $2,195 more in annual out-of-pocket costs for their care in 19 out of 88 plans than they would have in fee-for-service Medicare with Medigap supplements. Costs for beneficiaries in good health, however, were lower in all 88 MA plans and, for those in fair health, all but two MA plans had lower costs than fee-for-service plans.

"These findings raise questions about what Medicare is achieving with extra payments to private Medicare Advantage plans, which totaled more than $2.7 billion in 2005 over fee-for-service costs," said Fund President Karen Davis. The authors note that "if Medicare were to offer a true alternative to private coverage—such as a more comprehensive fee-for-service option—market forces could be expected to work more effectively, and beneficiaries could choose between comparable alternatives on an equal footing."

posted on 5/22/2006 7:32:23 AM (CST)  Permalink   
Friday, May 19, 2006
Leading Health Systems Show Financial, Quality Improvement

“The bars are going in the right direction,” said one CFO, and that summarized the financial presentations of 37 leading healthcare hospitals and systems at the Seventh Annual Non-Profit Health Care Investor Conference in New York May 17 and 18. The conference was sponsored by Citigroup, the American Hospital Association, and HFMA. By and large, the presenting organizations showed modest growth in margin and cash flow, along with plans for new construction to facilitate increased volume and investment in medical and information technology.

In addition, the systems emphasized their focus on clinical quality improvement, with many highlighting performance related to broad-based patient safety and quality indicators, along with specific projects to improve quality. However, keynote speaker Brent James, MD, M.Stat Executive Director of the Institute for Health Care Delivery Research of Intermountain Health Care, strongly asserted the need for a sea change in the approach to quality of care. “American health care gets it right 54.9 percent of the time,” he said, referring to quality and appropriateness of care. “I wonder what we could achieve if we got it right 98 percent of the time.” He challenged hospital leaders to manage the core business of clinical care using the same approach as they use to manage business functions, creating a “shared baseline” that will transform patient care from “craft-based practice” to “profession-based practice.” Hospitals that make that transformation, he said, would be the ones able to demonstrate strong financial performance.

posted on 5/19/2006 7:27:33 AM (CST)  Permalink   
Website Gives Uninsured Access to Discounted Physician Services

California consumers without health insurance can shop online for a doctor who offers discounts and get a price quote based on physicians’ stated rates through a partnership between National Healthcare Exchange Services, Inc. and the California Medical Association. NHXS Direct will allow physicians to build a fee schedule for self-pay patients to view on the web and generate a discount offer at the time of service. “Consumers without health insurance need a way to find affordable care without having to pay a monthly fee to access physicians willing to offer discounts for prompt payment,” said Jack Lewin, CEO of the CMA. “The CMA's goal is to lower access costs for consumers while at the same time give physicians control over the terms under which they offer discounts for services."

posted on 5/19/2006 7:25:25 AM (CST)  Permalink   
Thursday, May 18, 2006
Spending for IT Increasing, Driven by Quality: Fitch

Hospital spending on IT as a percentage of overall capital spending increased over the past few years, regardless of hospitals' revenue base and geography, according to findings released yesterday by Fitch Ratings. The majority of hospitals reported IT spending at about 25% of total capital investment. The spending has focused on electronic medical records, computerized physician order entry, and picture archiving and communication systems. The findings are in a new report, Quality and Patient Safety Spending in the Not-for-Profit Hospital Sector. The report says that although the quest for improved quality and safety motivate this spending, the link between quality of care and reimbursement does not. Hospitals reported that ROI for IT investments is difficult to determine and “almost never” entered into the decision making process for IT spending. For more information on the report, contact Fitch at (212) 908-0684.

posted on 5/18/2006 8:08:49 AM (CST)  Permalink   
Successful Hospitals Must Demonstrate Quality Through Various Measures: Moody’s

Strategies for improving quality and safety will likely improve operating results for hospitals in the short term, according to the Moody’s Investors Service report Improving Clinical Quality and Patient Safety of Greater Importance to Not-for-Profit Hospitals, released yesterday. In the long term, however, Moody’s analysts say hospitals that demonstrate a sustainable link between quality investments and better clinical outcomes will likely gain competitive advantage, thereby improving financial profit and possibly their bond ratings. Demonstrating quality, according to Moody’s, is not just meeting a particular quality indicator, but demonstrating improved consumer demand and preference, which drives market share, and payer reimbursement that rewards better outcomes, which drives performance. For more information on the report, contact Moody’s at (212) 553-4431.

posted on 5/18/2006 8:06:49 AM (CST)  Permalink   
Tenet Pays $21 Million to Settle San Diego Hospital Case

Tenet Healthcare Corporation agreed to a $21 million civil settlement to resolve the long-running criminal case brought by the U.S. Attorney in San Diego against Tenet, one of its hospitals--Alvarado Hospital Medical Center--and Alvardo’s former CEO. Tenet also agreed to close or sell Alvarado Hospital. In return, the U.S. Attorney in San Diego will dismiss criminal charges against all three defendants and will not file any civil litigation.

Two separate federal juries had deadlocked over whether Alvarado had improperly paid physicians excessive relocation packages to entice them to refer patients. While Tenet and Alvardo maintain that physician relocation agreements are a common practice in the hospital industry, as part of the settlement agreement, they stated, “We were distressed to learn that certain host physicians had obtained excessive payments by representing that they needed money to make tenant improvements to accommodate new physicians when, in fact, they never made improvements. We regret that the hospital did not take adequate steps to assure that money provided to relocated doctors, including money earmarked for tenant improvements and office overhead was in fact used for those purposes and in all instances was justified.” The case, said Tenet, has led to “significant reforms” of its physician relocation arrangements.

posted on 5/18/2006 8:05:49 AM (CST)  Permalink   
Legislators Introduce Bills to Waive Medicare Part D Late Penalty

A group of U.S. senators and representatives said they would launch legislation to waive the financial penalty for Medicare beneficiaries who enroll in Medicare Part D later this year, The New York Times reports. The program is providing drug coverage for 29 million Medicare beneficiaries. Charles Grassley (R-Iowa), chairman of the Senate Finance Committee, and Max Baucus (D-Mont.) authored the Senate bill, and Nancy Johnson (R-Conn.) said she would introduce a bill in the House. Grassley compared enrollment in Medicare Part D with getting employees to contribute to 401(k) plans, saying, “It takes time for people to learn about benefits available to them.” The Bush administration has not been in favor of extending the enrollment deadline, and officials said that although 4.5 million seniors are currently without drug coverage, as many as two-thirds are low-income beneficiaries who would be exempt from late enrollment penalties.

posted on 5/18/2006 8:04:39 AM (CST)  Permalink   
Wednesday, May 17, 2006
Almost One-Third of Medicare Spending for Chronically Ill Unnecessary: Study

Hospitals that treat patients more intensively and spent more Medicare dollars did not get better results, according to a new study by the Center for the Evaluative Clinical Sciences at Dartmouth Medical School. The Dartmouth Atlas Project compiled a database of claims data for 4.7 million Medicare enrollees who died during the period of 2000 to 2003 and had at least one of 12 chronic illnesses and were treated at one of 4,300 hospitals in 306 regions. The database allows, for the first time, a comparison of how states, regions, and individual hospitals and associated physicians treat patients with chronic illness.

The study found that patients in regions with low-cost, high-quality care --such as Salt Lake City, Utah; Rochester, Minn.; and Portland, Oreg.--are admitted less frequently to hospitals, spend less time in intensive care units, and see fewer specialists. If over the four-year period, every hospital and all physicians used practice patterns like those in Salt Lake City--primarily based on care provided by Intermountain Healthcare--the $123 billion Medicare spent for these patients would have been reduced by $40 billion, nearly one-third. The study report calls for a reimbursement system that rewards, rather than penalizes, provider organizations that successfully reduce excessive use of services, and proposes that hospitals take leadership in redesigning how they care for the chronically ill. The study also emphasizes the need for academic medical institutions and federal agencies, such as the National Institutes of Health, to perform patient-level studies to produce detailed evidence defining efficient clinical practices.

posted on 5/17/2006 7:55:19 AM (CST)  Permalink   
Third Hospital Association to Post Prices

New Hampshire’s hospital association became the few in the country to publicly post its state’s hospital charges for inpatient services, according to the Nashua Telegraph. Hospital associations in Wisconsin and Oregon also have web sites that provide comparative price data for hospitals. The New Hampshire Hospital Association’s web site details the number of patients who received a particular inpatient service at each of the state’s 26 hospitals; the average length of stay and average and median charges for that hospital; and aggregate payments by Medicare, Medicaid, and other payers, so consumers can see how hospitals’ charges compare with the amount of revenue hospitals actually collect for those services. The Telegraph article, however, cautions readers that the web site lists charges, not the actual price they will pay for an inpatient procedure. The NHHA told the Telegraph that the web site is a first step to greater price disclosure for all providers and that, eventually, it hopes to offer pricing information that is tailored to individual consumers. 

posted on 5/17/2006 7:42:04 AM (CST)  Permalink   
Pain Patients Not Satisfied with Treatment at EDs

Patients who seek relief at emergency departments for intense pain often experience long waits, receive inadequate treatment, and feel physicians did not take their symptoms seriously, according to MedPage Today reporting on presentations at the American Pain Society meeting. In one study of 842 patients who had come to the ED for out-of-control pain, only 61% of patients received analgesics, the mean wait time was 90 minutes, and staff typically did not reassess patients’ pain. Patients need to do a better job of communicating pain to ED staff, said the researcher, but ED physicians are also at fault for discharging 40% of the patients who continued to have pain. An online study of 258 patients conducted by the American Pain Society found that 47% described their ED experience as “poor,” “terrible,” or “the worst experience of my life.” Twenty-one percent of pain patients waited more than three hours to be treated, 30% said the ED physician didn’t believe they were in severe pain, and only 44% of patients said they were treated with dignity. ED physicians, say pain experts, often don’t have a good understanding of pain, and they react suspiciously to reports of chronic pain, suspecting that the patient is abusing pain drugs.

posted on 5/17/2006 7:31:37 AM (CST)  Permalink   
Health Care “Out of Control” in New Orleans

Health care in New Orleans post-Katrina continues to be a nightmare for patients, physicians, and hospitals, reports the Baltimore Sun. With many residents losing their jobs after the hurricane, the ranks of the city’s uninsured have doubled to 40% and now include professionals like teachers, who must, for the first time, rely on charity care. A mere 1,200 of the city’s 4,500 physicians have returned to New Orleans, 2,300 beds have been reduced to fewer than 500 as more than half the city’s hospitals remain closed, and estimates are that heart attacks have increased by 25% because patients with cardiac problems can’t get care.

The situation for suburban hospitals isn’t much better as they cope with overcrowding and providing large amounts of uncompensated care. East Jefferson General Hospital, for example, says it has lost approximately $3 million each month treating uninsured patients after Katrina. East Jefferson’s CEO warns that without federal help, the hospital will have to turn away patients. Emergency-department waits at suburban hospitals are twice or three times what they were before the storm, and with most of the nursing homes and home health aides gone, hospitals are having trouble discharging patients. John Matessero, CEO of the Louisiana Hospital Association, told the Sun that the federal government has provided scant help to repair hospitals and bring physicians back to the city. “There’s no quick solution, but we have to do something quick,” said Matessino. “The whole situation is getting out of control.” 

posted on 5/17/2006 7:28:42 AM (CST)  Permalink   
Tuesday, May 16, 2006
CMS Proposes New Rule for Occupational Mix Adjustment to Wage Index

On May 12, CMS issued a proposed rule that replaces the occupational mix section of the proposed FY07 hospital inpatient prospective payment system rule of April 12. To comply with a Court of Appeals order, the proposed rule applies the occupational mix adjustment to 100% of the wage index for FY07 using new data collected on the 2006 Medicare Wage Index Occupational Mix Survey. The proposed rule also modifies hospitals’ procedures for withdrawing requests to reclassify for the FY 2007 wage index and for supplementing the FY 2009 reclassification application with official data used to develop the FY 2007 wage index. The 30-day public comment period expires on June 12, 2006. Click here to download the proposed rule.

posted on 5/16/2006 7:41:13 AM (CST)  Permalink   
CMS Proposes Changes for Inpatient Rehabilitation Facilities

CMS has issued a proposed rule that would update payment rates for services by inpatient rehabilitation facilities and modify payment policies for fiscal year 2007. The proposed rule would update the IRF PPS by the full market basket of 3.4%, but most of that increase will be reversed by a 2.9% reduction in the standard payment amount for FY07 to offset the effect of changes in coding that do not reflect real changes in patient acuity. Payments to IRFs would remain virtually flat in 2007, increasing by $40 million for the approximately 1,240 IRFs. The proposed rule would also increase the outlier threshold for high cost outlier cases from $5,129 to $5,609.

In addition, the proposed rule would amend existing regulations regarding the three-year phase-in of a 75% compliance threshold, which requires at least 75% of an IRF’s patient population have one of the 13 designated medical conditions, as well as a need for intensive inpatient rehabilitation services. As provided in the Deficit Reduction Act, the proposed rule delays the imposition of the full 75% threshold by one year.

posted on 5/16/2006 7:40:05 AM (CST)  Permalink   
In Consumers’ Eyes, Hospitals Have Top Quality

Hospitals and wireless phone service providers showed significant improvements in customer perceptions of quality during the first quarter of 2006 compared to the first quarter of 2005, while energy utilities and airline industries received low overall quality marks, according to the Quarterly Quality Report released today by the American Society for Quality. The report is based on data from the American Customer Satisfaction Index produced by the University of Michigan.

Hospitals increased their perceived quality score by nearly four percentage points--from 78 to 81 on the ACSI’s 100-point scale--this quarter compared with the first quarter of 2005. The jump in consumers’ perception of quality was among the highest for all industries measured during the quarter. The report credits hospitals as having the highest commitment to and actual measurement of performance management among industries studied. And consumers have become aware that hospitals are measuring and making transparent meaningful outcomes from CMS’s Hospital Compare website and from increasing numbers of pay-for-performance plans. In contrast, utilities’ reputation has been tarnished by rising fuel costs and disruptions in energy supplies as a result of last season’s record number of hurricanes, and airline bankruptcies have resulted in airlines cutting passenger amenities, flying smaller jets, booking more passengers per flight, and reducing flights on many routes.

posted on 5/16/2006 7:37:59 AM (CST)  Permalink   
Target Considering Dropping Traditional Health Coverage

While considering eliminating its traditional insurance plan, Target Corporation--with 338,000 employees--is currently offering workers two new options: a high-deductible plan with a health savings account and a high-deductible plan with a health reimbursement account, reports the Minneapolis Star Tribune. Although Target has said it hasn’t yet decided to drop traditional coverage for which the corporation picks up 80% of the cost, employees received a health plan guide earlier this year stating that the tradition plan will be offered for a “limited time in the future.”

For employees who choose a high-deductible plan with an HSA, Target would contribute $400 for individuals and $800 for families, and employees would pay premiums of about $20 a month for individual coverage. Deductibles, however, would be as high as $5,000 for families, with Target paying 80% of expenses after the deductible has been met and 100% after the family maximum out-of-pocket of $8,800. The HRA option has higher premiums but lower deductibles. Critics, however, say Target employees who are less than in perfect health or who are pregnant will unlikely be able to pay the high deductibles and will either drop insurance or leave Target. 

posted on 5/16/2006 7:36:14 AM (CST)  Permalink   
Monday, May 15, 2006
Association Health Plan Bill Blocked by Democrats in Senate

The association health plan bill, sponsored by Sen. Michael Enzi (R-WY), stands little chance of being passed after a vote in the Senate failed to reach the approval of 60 senators needed to move it forward, reports the Los Angeles Times. The legislation, which would have allowed small businesses to collectively purchase health insurance for their employees at lower premiums, was opposed by groups such as the AARP, the American Cancer Society, state attorneys general, and medical societies for bypassing state laws requiring specific coverage for certain diseases and for prevention. The Times attributes the impasse to “election-year mistrust between the political parties.” Robert J. Blendon, a public opinion expert at the Harvard School of Public Health, told the Times, "The partisan nature of Washington politics has just gotten so extreme that you have a sense people don't want to move on a problem unless it's done completely on the terms of their own party." Although Enzi said he would reintroduce his bill later this year with concessions to Democrats, observers are not hopeful the bill will be revived. (Access the Los Angeles Times story.)

posted on 5/15/2006 7:51:42 AM (CST)  Permalink   
Study Finds 40% of Medical Malpractice Lawsuits Without Merit

Forty percent of medical malpractice cases filed in the U.S. are baseless, according to a study published in the New England Journal of Medicine. But contrary to public opinion that frivolous suits result in large payouts or verdicts, the study found that most of the groundless suits are dismissed. Still, 15% of malpractice settlements or jury awards go to plaintiffs who have filed groundless suits, and the overhead costs of litigation are very high, reports the AP. The AMA responded to the study by saying that access to care is decreased as physicians spend significant time and money defending meritless lawsuits. The Association of Trial Lawyers for Americas, however, called the study biased and objected to the researchers using claims data from insurers who are defendants in malpractice suits.

posted on 5/15/2006 7:48:12 AM (CST)  Permalink   
U.S. Years Behind Other Countries in Developing Health Information Technology

Although per capita healthcare spending in the U.S. is 2 ½ times more than the median spending of other industrialized countries, health systems abroad are four to 13 years ahead of the U.S. in using health information technology to control costs, according to a study published in Health Affairs. (View abstract.) Germany launched its national health IT network in 1993 and expects to complete it by 2006, Canada says it will have electronic health records for half its population by 2009, the UK has the most comprehensive system, and Norway and Australia have a six-year jump on the U.S. in developing health IT systems. Few question that health IT will lead to cost savings; estimates are that an electronic health record would save $371 billion in U.S. hospitals alone over the next 15 years. The study examines how various countries have overcome some of the health IT obstacles plaguing the U.S. and urges policy makers to look at lessons learned abroad to shorten health IT implementation time here. For example, health IT initiatives abroad are usually subsidized by public funds so government has a say in how systems interconnect. Germany has built its health IT network on smart-card technology, which allows healthcare workers access a centralized patient database storing complete medical histories. And other countries have spent considerable time and effort educating physicians on how to transition to an electronic system.

posted on 5/15/2006 7:44:53 AM (CST)  Permalink   
VA Gets High Marks for Health IT Adoption

The Veterans Health Administration, says Fortune magazine, is the “most wired and cost-effective health system in the land.” The article credits the VA’s embrace of health information technology with its consistently higher quality and patient satisfaction scores than many private-sector hospitals. By 1999, all of the VA’s 1,300 hospitals, clinics, and other facilities had an electronic medical record and by 2000, every VA hospital was using bar-code scanners to ensure that the right patients were receiving the correct drugs. In the mid-90s, when poor quality rather than high tech was a more apt description of the VA, only 29% of VA patients received pneumonia vaccinations. In 2005, 94% did, which reduced hospital admissions by 4,000 patients per year. Screening for cervical cancer jumped from 64% in 1995 to 91% in 2005. The VA’s EMR system also allowed VA patients displaced by Hurricane Katrina to receive seamless medical care at any VA facility. The VA is also applauded for delivering high quality at lower cost. The average cost of healthcare spending for a VA patient is $5,000 compared to $6,300 for other Americans. The VA’s adoption of health information technology is made even more remarkable, according to the article, because the U.S. government is spending only $111 million this year to fund EMR projects—small sums compared to health IT budgets of $10 billion for England and $2 billion for Canada.

posted on 5/15/2006 7:39:51 AM (CST)  Permalink   
Friday, May 12, 2006
Charitable Giving Reforms Likely Slated for Pension Reform Bill

Although Sen. Chuck Grassley (R-IA), chairman of the Senate Committee on Finance, and Rep. Bill Thomas (R-CA), chairman of the House Committee on Ways and Means, support legislative reforms on charitable giving, the final agreement they reached on the tax reconciliation bill does not contain the charitable giving incentives and reforms urged by the Independent Sector, a nonprofit coalition of more than 500 charitable and philanthropic groups. The provisions to strengthen government oversight and accountability and transparency of charitable organizations, said IS, will likely be added to the pension reform bill, which has passed both chambers of Congress. IS predicts that Thomas may add new proposals, while Grassley has expressed interested in enhanced electronic filing requirements and funding for community education. “These recent developments may provide a window of opportunity to see a more complete package enacted,” says IS’ website.

posted on 5/12/2006 7:43:55 AM (CST)  Permalink   
Company Sued over Hospital Price Confidentiality

The nonprofit Emergency Care Research Institute, which publishes pricing information on medical devices, filed suit against cardiac device-maker Guidant Corporation for attempting to keep its prices to hospitals confidential, reports Red Herring. Approximately 400 hospitals voluntarily provide ECRI with prices they pay for medical devices--data ECRI sells to hospitals so they can make informed purchasing decisions. In its complaint, ECRI said that Guidant is using the confidentiality clauses in its contracts with hospitals to prohibit hospitals from disclosing prices to ECRI and that Guidant has demanded that ECRI “cease and desist” from publishing the information. Withholding the data, alleges ECRI, is a “disadvantage to consumers and the detriment of public health,” and ECRI is asking the court to affirm its First Amendment right to publish the information. Guidant maintains that confidential pricing is “a fairness issue. We simply don't want the price negotiated privately with one hospital based on one set of circumstances used against us in negotiations with another hospital with an entirely different set of circumstances,” said Guidant in a prepared statement.

posted on 5/12/2006 7:42:56 AM (CST)  Permalink   
Thursday, May 11, 2006
Democrats Threaten to Filibuster Association Health Plan Bill

As the U.S. Senate moved to consider the Republican-backed association health plan bill that allows small employers to band together to purchase affordable health insurance, Democrats threatened to filibuster the bill if they are not allowed to add amendments to it, reports the Los Angeles Times. The bill, sponsored by Sen. Michael Enzi, R-Wyo., is expected to provide health insurance for 600,000 uninsured workers, but Democrats argue that the bare-bones insurance would be exempt from prevention and disease coverage requirements mandated by individual states. Enzi counters that large companies are also exempt from state insurance requirements, and that his legislation would require insurers to provide coverage comparable to what public employees receive in the five largest states. The Democrats will offer their own bill, sponsored by Sen. Richard Durbin of Illinois, which they say will cover three times more individuals than Enzi’s bill while adhering to state coverage rules. Durbin’s bill would provide tax credits to help small businesses offer insurance and would be administered by the Office of Personnel Management. (View the Los Angeles Times article.)

posted on 5/11/2006 7:36:37 AM (CST)  Permalink   
Informed Consumers No Silver Bullet for Healthcare Cost Crisis

Consumer information about healthcare costs, quality, and treatment alternatives could help stem health costs, but some are overselling the potential of consumer empowerment to reshape the healthcare system, testified Paul Ginsburg, PhD, president of the Center for Studying Health System Change, at Congress’ Joint Economic Committee hearing on “The Next Generation of Health Information Tools for Consumers.” Policy discussion “about price and quality transparency downplays the complexity of decisions about medical care and the dependence of consumers on physicians for guidance about what services are appropriate,” said Ginsburg. Markets for self-pay health services, such as LASIK, are often cited as a model for consumer engagement, but HSC research indicates that consumers’ experiences with self-pay markets have been romanticized and do not offer much encouragement as a roadmap for effective healthcare shopping without either regulation or a large role for insurers.

Engaging consumers to be more aware of cost and quality issues, however, can increase the value of health care for the U.S. population as a whole, said Ginsburg. Insurers will be a powerful consumer ally as they develop more sophisticated benefit structures and information tools to support consumers in choosing effective treatments from higher-quality, lower-cost providers. By investing in research on medical effectiveness, government can also empower consumers, said Ginsburg, adding that an untapped information resource to assess physician efficiency and quality is the Medicare Part B claims files.

posted on 5/11/2006 7:35:18 AM (CST)  Permalink   
Specialty Hospitals Not Causing General Hospitals to Make Changes: GAO

The changes that specialty hospitals are exacting on the healthcare landscape have been largely anecdotal, prompting the Government Accountability Office to survey general hospitals to determine how competition from specialty hospitals has affected them. In a new report, the GAO found that all general hospitals made an average of 22 operational changes and eight clinical service changes from 2000 to 2005 to remain competitive in a marketplace with many rivals. But contrary to claims from specialty-hospital advocates that competition from specialty hospitals will force general hospitals to improve their quality and efficiency, the GAO found that the presence of a specialty hospital in a market had no influence on the number of changes general hospitals made. “There were no substantial differences in the average number of operational and clinical service changes made by general hospitals in markets with and without specialty hospitals,” said the report. (Click here to download the report.)

posted on 5/11/2006 7:34:24 AM (CST)  Permalink   
Bill Grants Critical Access Hospitals Continuation of FHA Mortgage Insurance

Under a U.S. House bill passed May 9, critical-access rural hospitals will receive a five-year continuation of an exemption that allows them to apply for Federal Housing Administration mortgage insurance, reports CQ Today. In 2003, critical access hospitals--institutions with a maximum of 25 beds and located 35 or more miles from other hospitals--were granted an exemption to qualify for low-interest-rate FHA mortgage insurance, which would have expired July 31. The exemption will now extend until July 31, 2011. “Recent healthcare statistics show a huge backlog of capital improvement needs for hospitals across the country, and nowhere is this situation growing more critical than in rural America, where they are often treated differently from those in urban areas,” the bill’s sponsor, Bob Ney, R-Ohio, told CQ Today.

posted on 5/11/2006 7:33:12 AM (CST)  Permalink   
Wednesday, May 10, 2006
Comment Deadline Nearing for HFMA’s Exposure Draft on Reporting Uncompensated Care

The period to comment on an exposure draft of revisions to HFMA’s guidance on reporting charity care and bad debt will expire on May 26. HFMA’s Principles and Practices Board Statement No. 15, Valuation and Financial Statement Presentation of Charity Service and Bad Debts by Institutional Healthcare Providers, discusses key issues surrounding the valuation and reporting of charity care and bad debt, including the criteria for charity care; the valuation, recording, and disclosure of these two types of uncompensated care; and the classification of receipts relating to charity care. The updates in this exposure draft address current questions raised in relation to charity care reporting practices and also incorporate principles of HFMA’s PATIENT FRIENDLY BILLING® project. To download the draft and comment instructions, click here.

posted on 5/10/2006 7:33:25 AM (CST)  Permalink   
Some West Virginia Medicaid Beneficiaries Will Need to Adhere to Contract to Receive Care

West Virginia is free to require Medicaid recipients to fulfill terms of their “personal responsibility contracts” to be eligible for some medical services now that the Bush administration has approved the state’s plan, reports The Charleston Gazette. After choosing a physician or clinic as a “medical home,” beneficiaries enter contracts that may include provisions such as agreeing to take medications, keeping medical appointments, exercising, and eating well. If the recipient breaks the contract, he or she will lose certain services, such as dental care, substance abuse treatment, or prescription drug coverage. Those who honor the contracts will earn points toward optional health services. Disabled Medicaid recipients are excluded from the responsibility contracts and no benefits will be cut for children. What officials have yet to figure out, however, is whether an individual who desperately needs a medical service will be denied if a contract is breached. The Bush administration approved West Virginia’s new Medicaid program within a week under the streamlined process established under the Deficit Reduction Act passed in February.

posted on 5/10/2006 7:32:20 AM (CST)  Permalink   
Malpractice Premiums No Cause for Crisis, Says Study

Despite numerous reports that medical malpractice premiums rising in excess of 20% per year are driving doctors out of business, a study published in Health Affairs found that premiums have always been a small percentage of total practice expenses. The double-digit premium increases stem from reports based on advertised malpractice insurance rates, not the actual rates doctors pay, write the study’s authors. In actuality, for all doctors nationally, premiums increased from 1970 to 2000 an average of $416 per year. From 1986 to 1996, premiums decreased $122 per year, and they increased $731 per year from 1996 until 2000, but they were still lower in 2000 than they were in 1986. In 2000, premiums made up 7% of total practice expense. Practice revenue, however, did decline from 1996 to 2000 due in part to increases in nonpremium expenses. Frustration with the practice of medicine and falling incomes have likely caused physicians to seize on the emotional issue of malpractice as the cause of their dissatisfaction. “Claims that the level of malpractice premiums justify a tax credit to prevent physicians from leaving the practice of medicine are hyperbole, especially when a physician’s income is viewed compared with that of others,” write the authors. View the abstract.

posted on 5/10/2006 7:31:24 AM (CST)  Permalink   
Tenet Notified that Alvarado Hospital Will Be Excluded from Medicare and Medicaid

The Office of Inspector General has told Alvarado Hospital Medical Center in San Diego, and parent company Tenet HealthSystem Hospitals, Inc., that it intends to exclude Alvarado from participating in federal healthcare programs based on the OIG’s allegations that the hospital paid kickbacks to physicians for patient referrals. According to the OIG, Alvarado paid excessive relocation packages to ostensibly help physicians relocate to San Diego, but the relocation agreements primarily benefited the established practices where the new doctors were placed and were used to buy referrals. Although Alvarado was indicted on felony kickback charges, two jury trials deadlocked on whether Alvarado intended to violate the law.

Tenet claims that the OIG’s decision could cause Alvarado to close. “We believe that nothing in the hospital’s practice of recruiting physicians to eastern San Diego County warrants a forced sale or closure of the hospital--especially given the lack of any evidence that any physician compromised his or her medical judgment when referring a patient to Alvarado,” said a statement by Tenet. Alvarado has 30 days to submit documentary and other evidence concerning the proposed exclusion and whether it is warranted.

posted on 5/10/2006 7:30:16 AM (CST)  Permalink   
Many Hospitals in San Diego County Not Qualified to Participate in Heart Attack Network

As San Diego County attempts to create a heart attack treatment network that will route patients only to designated hospitals with rapid-response cardiac catheterization labs and high-volume cardiologists, critics maintain that the county is setting standards too low for participating hospitals, reports The San Diego Union-Tribune. Ideally, only 90 minutes should elapse between the time the patient arrives at the emergency department with a STEMI (ST segment elevation myocardial infarction) and undergoes catheterization. But only two of the county’s 13 nonmilitary hospitals meet Medicare’s looser standard of 120 minutes between arrival and catheterization for at least 62% of patients. And only five hospitals qualify as heart centers under national benchmarks that specify that hospitals perform at least 400 percutaneous coronary interventions annually. After years of heated debates, the committee developing the county’s guidelines said it will have to accept hospitals that perform far fewer procedures and hope that constant monitoring will force cardiologists to improve their quality. Hospitals, meanwhile, are worried that if they are not included in the network, they’ll lose prestige as well as significant revenue. Dr. Timothy Henry, director of research at the Minneapolis Heart Institute Foundation, told the Union-Tribune that it is patients who should worry, however. “It sounds like San Diego is creating a system that is not a system because it’s not eliminating anybody,” he said. Other heart attack networks are being planned in Boston; Des Moines, Iowa; Austin, Texas; Springfield, Ill.; and the whole state of North Carolina.

posted on 5/10/2006 7:28:14 AM (CST)  Permalink   
Tuesday, May 09, 2006
5.1% Decline in Employees Accepting Health Insurance

Approximately 3 million fewer workers who were eligible for employer-sponsored health insurance enrolled in 2003 compared with 1998--from 85.4% of workers to 80.3%--according to Shifting Ground: Changes in Employer-Sponsored Health Insurance, a new report by the Robert Wood Johnson Foundation. Although employers continued to pay 82% of the cost of health insurance during that five-year period, the portion of the premiums employees paid skyrocketed 42% after being adjusted for inflation. Twenty-five states experienced a significant decrease in the percent of private-sector employees who accepted their employers’ offer of health insurance during this period, such as New Jersey (-12 percentage points), Nebraska (-11 percentage points), Wisconsin (-9 percentage points), Colorado (-9 percentage points), and Iowa (-9 percentage points). “With premiums rising each year for companies and their employees, millions of workers are no longer accepting the health insurance offered through their jobs,” said Risa Lavizzo-Mourey, president and CEO of the Robert Wood Johnson Foundation. “If trends continue, this could dramatically increase the number of working but uninsured people in this nation.” Read the report.

posted on 5/9/2006 7:42:17 AM (CST)  Permalink   
Hospitals Charging Higher Rates to Uninsured No Grounds for Class-Action Suit

A Wisconsin circuit court judge ruled that an uninsured couple cannot bring a class-action lawsuit against a hospital on the basis that the hospital charges higher rates to those without insurance, reports the Milwaukee Journal Sentinel. A full-time day trader and his wife filed suit in May 2005 alleging that a $25,000 medical bill for inpatient and outpatient procedures at Oconomowoc Memorial Hospital in Waukesha, Wis., was unreasonable and improper. Waukesha County Circuit Judge Patrick Haughney ruled that Wisconsin hospitals are allowed to have variable pricing, and that the couple, who dropped their $3,000-a-year health insurance while amassing a $280,000 portfolio, were uninsured by choice rather than economic circumstances. The judge, however, did let stand the allegation that the hospital’s charges were unreasonable. “If a jury trial is held in this matter, it will be for the jury to determine whether the amount is reasonable,” said Haughney.

posted on 5/9/2006 7:41:23 AM (CST)  Permalink   
Concern Over Drop in HIPAA Compliance: Study

Hospitals and health systems that say they are less than 85% compliant with Health Insurance Portability and Accountability Act privacy and security regulations increased to 15% in 2006 from 9% in 2005, according to a survey by the American Health Information Management Association. (Click here to download the report.) The slight increase raises concerns because without institutions’ commitment to ongoing HIPAA training and monitoring, “all the work that has been put into the HIPAA compliance efforts of the last few years may be undone over time,” said the survey report. Lack of resources to ensure compliance with HIPAA regulations was a major barrier for 55% of respondents, who said they fear losing budgeting support from senior management. Another disturbing trend is that 22% of respondents said patients had refused to sign release-of-information forms. Hospitals will have to do a better job explaining to patients how information will be protected in order for electronic health records and health information networks to move forward, said AHIMA. “Consumers will be watching the healthcare industry to see how well it complies with the HIPAA rules before they put their trust in a national health information exchange.” HIPAA security regulations have been easier to implement than privacy rules, however. Twenty-five percent of respondents said they were fully compliant with security regulations and 75% said they are nearly completely compliant.

posted on 5/9/2006 7:40:29 AM (CST)  Permalink   
Tenet to Offer Free HealthGrades Reports About Its Doctors

Tenet Healthcare Corporation entered a multiyear agreement with HealthGrades, Inc., to offer detailed reports about physicians affiliated with Tenet hospitals on the HealthGrades web site at no cost to consumers, beginning June 1. Besides listing basic information about physicians’ board certification and any disciplinary actions, Tenet physicians will be able to add details to their profiles, such as education, office hours, areas of practice specialization, and insurance plans accepted. The HealthGrades web site will also include detailed profiles of Tenet hospitals with which the physicians are affiliated. The hospital profiles will include an overview of the hospital’s services, areas of expertise, and role in the community, as well as HealthGrades’ quality ratings and designations. HealthGrades, which normally charges consumers for its physician reports, says 2.9 million unique visitors use its web site each month to make healthcare decisions. HealthGrades provides ratings and profiles of hospitals, nursing homes, and physicians to consumers, corporations, health plans, and hospitals.

In other news, Tenet is focusing on developing a robust outpatient strategy to increase its outpatient services, which were responsible for 29% of its revenue in 2005, reports the Dallas Business Journal. Tenet currently operates 20 ambulatory surgery centers and more than 40 imaging and diagnostic centers.

posted on 5/9/2006 7:39:17 AM (CST)  Permalink   
Monday, May 08, 2006
Number of Doctors Who Shun Managed Care Contracts Increases

After remaining stable since the mid-1990s, the proportion of U.S. physicians without any managed care contracts rose from 9.2% in 2000-01 to 11.5% in 2004-