Healthcare Financial News

How do patients feel about the care they receive in U.S. hospitals? A new study by Boston researchers supported by the Commonwealth Fund shows that while patients are generally satisfied with their care, satisfaction levels are not as high as they could be and rise significantly when hospitals have more nurses at the bedside. The study, published in the October 30 New England Journal of Medicine (read abstract), reveals that patients frequently feel hospitals fall short in addressing basic quality issues--controlling pain, communicating about medications, and coordinating discharge planning.

In the first analysis of its kind, Harvard School of Public Health researchers examined patient experience information collected by the federal government through its Hospital Consumer Assessment of Healthcare Providers and Systems (HCAHPS) survey. They examined patient views on communication with doctors, communication with nurses, nursing services, communication about medications, pain control, room conditions, and discharge information. The HCAHPS analysis is based on data from 2,400 hospitals, and illustrates how patients perceive care at U.S. hospitals.

While two-thirds of patients gave their hospital care a high rating, very few hospitals received the highest rating from 90 percent or more of their patients. The performance of for-profit hospitals was worse than that of private and nonprofit hospitals in all areas, but differences between teaching and non-teaching hospitals were small and insignificant.

The U.S. Department of Health & Human Services Office of Inspector General (OIG) has found that the Centers for Medicare & Medicaid Services (CMS) has taken limited actions to ensure adequate implementation of the Health Insurance Portability and Accountability Act of 1996 Security Rule. The HIPAA Security Rule requires an entity such as a health plan or healthcare provider that transmits any health information in electronic form to ensure the integrity and confidentiality of the information, protect against any reasonably anticipated threats or risks to the security or integrity of the information, and protect against unauthorized uses or disclosures of the information.

CMS had no effective mechanism to ensure that covered entities were complying with the HIPAA Security Rule or that electronic protected health information was being adequately protected. The OIG noted that CMS had an effective process for receiving, categorizing, tracking, and resolving complaints.

CMS did not agree with OIG’s findings because it believed that its complaint-driven enforcement process has furthered the goal of voluntary compliance. However, CMS agreed with OIG’s recommendation to establish specific policies and procedures for conducting compliance reviews of covered entities. OIG maintains that adding these reviews to its oversight process will enhance CMS's ability to determine whether the HIPAA Security Rule is being properly implemented.

To support consumer engagement and improved quality in health care, the National Quality Forum (NQF) endorsed guidelines for consumer-focused, Internet-based public reporting. These guidelines will assist report sponsors to present information about hospital quality in an evidence-based and consumer-friendly format that can be used to make informed decisions about health care. 

For the most part, public reports have been difficult to understand and use, have not adequately communicated what quality of care is, and have not convinced consumers to pay attention to quality. Evidence suggests that healthcare quality reports and public report cards that contain conflicting information and are poorly constructed may hinder consumers’ ability to use the information presented and may lead to decisions inconsistent with their goals. This highlights the need to identify effective public reporting strategies to help change these outcomes.

The seven endorsed guidelines are intended for use by organizations that sponsor and publish public reports such as federal and state governments, consumer organizations, hospital accrediting organizations, business coalitions, and hospital associations.  The guidelines are intended to be used for reporting quality performance of U.S. hospitals, but can be adapted for consumer public reporting of care in other settings. For descriptions of the guidelines, read the full NQF press release.

Market growth of electronic medical record (EMR) implementations in ambulatory healthcare settings, such as private medical practices or specialty clinics, continues at a slow but steady pace, according to results from the Ambulatory Healthcare IT Survey, conducted by the Healthcare Information and Management System Society (HIMSS) and HIMSS Analytics. The 2008 survey collected information about key technology use in the ambulatory market, such as EMRs and e-prescribing.

Approximately one-third of respondents noted that functional components of an EMR are in place at their organization. While some respondents mentioned use of specific EMR software brands at their organizations, the research clearly suggests that no dominant market leader exists, and instead, many software vendors are players in this market.

“The survey results show some purchasing hesitation among physicians who don’t yet have an EMR,” said Mike Davis, executive vice president of HIMSS Analytics. “We found that cost continues to be a significant barrier to technology implementation, despite the benefits of improved patient care and fewer medical errors attributed to the EMR.”

The Association of American Medical Colleges (AAMC) has issued six principles to help guide reform of the nation's healthcare system.

Noting that the United States healthcare system faces a crisis of access, cost, and quality, the AAMC document calls for U.S. medical schools and major teaching hospitals to play "a pivotal role in improving health and health care and in achieving positive changes in the healthcare system," given their significant roles as health care providers, educators of future physicians, and discoverers of new scientific knowledge. Such reform must improve both healthcare delivery and financing, while preserving the greatest strengths of the current system. The goal of the new AAMC principles is to guide this process.

The AAMC's six principles of healthcare reform affirm that:
• Affordable, transportable, and continuous healthcare coverage that combines the best of public and private systems should be available to all.
• The U.S. system must be restructured to promote wellness and disease prevention, while providing high-quality, cost-effective diagnosis and treatment of illness, as well as palliative care.
• Healthcare financing mechanisms should be sustainable, equitable, explicit, accountable, and promote efficiency and quality.
• Existing programs that serve defined populations should be maintained until superior alternatives can fully replace them.
• The supply of healthcare practitioners must be adequate and reflect the population and its healthcare needs.
• Any reconfiguration of the healthcare system should acknowledge and support the costs inherent in health research, technology development, and the provision of necessary specialized services.

 “With one out of every four Texans without health insurance, the idea of traveling abroad for cheaper health care is gaining traction,” states the introduction to a series of articles on medical tourism published in The Austin American-Statesman.

The series tells the stories of Texans who have traveled abroad for medical procedures, looks at companies that connect patients with overseas healthcare facilities, reports on the growing interest of U.S. insurance companies on paying for medical care received abroad, and considers issues that may arise after a patient returns home. The series web site also features an interactive map profiling countries that have emerged as leading destinations for medical tourism.

In the lead-up to the November elections, the Partnership to Fight Chronic Disease (PFCD) has introduced a new national television and online advertising campaign urging women to get answers from the candidates about health care, specifically how each candidate plans to prevent chronic diseases. The 30-second TV spot and 45-second online spot feature Hollywood celebrities such as Mary-Louise Parker, Lauren Bacall, Katey Sagal, and Phylicia Rashad alongside everyday women.

The ad calls on women voters--a particularly influential group in the election--to ask important questions about health care and demand action on an issue that is not only one of the most threatening health concerns to women, but is also jeopardizing the affordability of health care in the U.S. The ad will run on cable networks and online through the November 4 election.

By raising awareness of the costs of chronic diseases, and the impact they have on healthcare cost, quality, and access in this country, the PFCD ad seeks to encourage a substantive, bipartisan discussion of this issue in the context of broader discussions of healthcare reform.

Registered nurses (RNs) are the largest group of healthcare providers employed by the U.S. Department of Veterans Affairs’ (VA) healthcare system. RNs are relied on to deliver inpatient care, but VA medical centers (VAMC) face RN recruitment and retention challenges. The Government Accountability Office (GAO) performed a Web-based survey of all VAMC nurse executives; interviewed VA headquarters officials and VAMC nursing officials, and conducted RN focus groups at eight VAMCs visited by GAO.

The GAO report states that VA’s ability to retain its RNs is adversely affected by two main factors. First, inpatient RNs reported that they spend too much time performing non-nursing duties such as housekeeping and clerical tasks. Second, even though VAMCs were authorized in 2004 to offer RNs two alternate work schedules that are generally desired by nurses--such as working three 12-hour shifts within a week that would be considered full-time for pay and benefits purposes--few nurse executives reported offering these schedules; therefore, few RNs work these schedules.

Specifically, according to nurse executives GAO surveyed, only about one percent of many inpatient units offered alternate schedules and less than one percent of RNs actually worked these schedules. The availability of flexible work schedules--for example, working eight 10-hour shifts over a 2-week period--are more widely available among VAMCs but are still limited, according to GAO’s survey of nurse executives. Nursing officials and RNs noted other factors affecting retention such as reliance on supplemental staffing strategies--for example, RN overtime--and insufficient professional development opportunities.

Medicaid documentation requirements enacted by Congress in 2006 continue to present serious, ongoing problems for health centers and their patients, according to a new analysis issued by the Geiger Gibson/RCHN Community Health Foundation Research Collaborative at The George Washington University School of Public Health and Health Services. This study is the second in a two-part study that looks at the effects of the Medicaid citizenship documentation requirements contained in the Deficit Reduction Act (DRA). The first survey, conducted in 2006, found that the DRA requirements adversely affected eligible patients in nine out of 10 health centers.

Community health centers are the largest source of comprehensive primary care for low-income patients. In 2007, health centers served more than 16 million patients at over 6,200 sites nationwide, including more than 5.6 million Medicaid beneficiaries and 5.8 million low-income children. The study found that documentation requirements appear to have particularly affected access for several specific patient categories, including U.S.-born newborns, whose need for rapid management can become a particularly acute matter. Most troubling, the authors found that despite the fact that the DRA documentation requirements do not apply to State Children’s Health Insurance Programs (SCHIP) when administered as a separate program, one-third of health centers located in states with separate SCHIP programs reported that citizenship documentation requirements are being applied to SCHIP applicants.
 
“This study reinforces our earlier findings regarding the damage done by the law, not only to individual patients and healthcare providers but to the overall quality of care,” said Sara Rosenbaum, JD, Hirsh Professor and chair, SPHHS Health Policy Department and a study co-author. 
 

U.S. medical schools continue to expand their enrollment to meet the country's increasing demand for physicians, according to new data released by the Association of American Medical Colleges (AAMC). First-year enrollment at the nation's medical schools this year increased nearly 2 percent over 2007, to more than 18,000 students--the highest enrollment in history.

"In a time of great economic uncertainty, interest in the healing profession of medicine remains stable," said AAMC President and CEO Darrell G. Kirch, M.D. "As medical schools expand to meet the nation's demand for more doctors, there will be even more opportunities for the most qualified and well-rounded aspiring doctors to pursue rewarding careers in medicine."

After a five-year increase in applicants to medical schools, the number of applicants leveled off this year at more than 42,200. While the overall applicant pool is one of the largest in more than a decade, the number of first-time applicants decreased by 3 percent. On average, there were more than 2 applicants for every available opening at a medical school.

View enrollment data for 2008.

A slumping economy, declining tax revenues, and turbulent financial markets are forcing many states to consider deep budget cuts. Bold new proposals--including a sweeping healthcare reform plan in California--have also fallen by the wayside, reports an article in Stateline.org, a project of the Pew Center on the States.

The article reports that, in addition to stalled healthcare reform in California, proposals to extend healthcare insurance in Illinois, Missouri, New Mexico, and Pennsylvania also failed to gain traction. Next month, legislators in New York will convene in a special session to consider whether reductions are needed in a plan to cover almost 400,000 additional children in the state’s Children’s Health Insurance Program.

Despite the bad news in many states, the article notes that modest gains in healthcare reform were achieved in such states as Maine, Iowa, Colorado, and Florida.
 

A three-part series of articles on the nation’s health insurance crisis in The Los Angeles Times concluded on Thursday, October 23, with a look at the relationship between healthcare providers and insurance companies. The article focused on increasing difficulties that providers face in collecting payments from insurers.

The article cited statistics that more than 30 cents of every dollar spent on health care goes to administrative costs, almost twice the amount (16.7 percent) that is spent on administrative costs in Canada. It also looked at increasing consolidation in the health insurance industry and the emergence of companies that help providers support original claims that are challenged or denied by insurers.

Earlier in the week, the series examined the decline in employer-provided healthcare benefits and the move of insurers into money management.

Some 2.3 million children a year, mostly from low- to middle-income families, have no healthcare coverage to pay for preventive or other medical needs, even though at least one of their parents is insured, according to a new study supported by the U.S. Department of Health & Human Services' Agency for Healthcare Research and Quality (AHRQ) and the National Center for Research Resources, part of HHS' National Institutes of Health.

The new study, published in the October 22/29, 2008 online issue of JAMA, is one of the first to examine the characteristics of uninsured children under age 19 whose parents were insured all year. These children account for a quarter of the estimated 9 million uninsured children in the United States. Read an abstract of the JAMA article.

Researchers led by Jennifer DeVoe, M.D., of the Oregon Health & Science University in Portland, studied 2002-2005 national data from AHRQ's Medical Expenditure Panel Survey and found that children from low-income families where at least one parent had health insurance were more than twice as likely to be uninsured at some point during the year as were similar children from high-income families. They were also 73 percent more likely to be uninsured for more than 6 months. In 2005, a typical, low-income family of four earned between roughly $24,000 and $39,000, whereas the typical high-income family of four earned more than $77,000 a year.

The Federal Trade Commission will suspend enforcement of the new “Red Flags Rule” until May 1, 2009, to give creditors and financial institutions additional time in which to develop and implement written identity theft prevention programs.

Federal law defines a creditor to be: any entity that regularly extends, renews, or continues credit; any entity that regularly arranges for the extension, renewal, or continuation of credit; or any assignee of an original creditor who is involved in the decision to extend, renew, or continue credit.  Healthcare providers that accept deferred payment are construed as creditors under the law.

The Red Flags Rule was developed pursuant to the Fair and Accurate Credit Transactions (FACT) Act of 2003. Under the rule, financial institutions and creditors with covered accounts must have identity theft prevention programs to identify, detect, and respond to patterns, practices, or specific activities that could indicate identity theft. For more information on the rule and the six-month suspension, read the FTC’s press release.

Most working Americans obtain health coverage through their employers. Neither presidential candidate is proposing to change that, although each of their plans, if enacted, would affect employers substantially. But over a third of U.S. employers (almost exclusively small employers, with fewer than 500 workers) do not sponsor an employee health plan and one of the central questions of the reform debate is how they might be induced to do so. According to a major new employer survey on health care reform released by Mercer, the majority of these employers believe that employee medical coverage is far beyond their means.
 
When asked their primary reason for not offering health coverage, 43 percent of all employers without employee plans answered “I can’t afford it.” Other reasons included employees being covered under other plans (20 percent), high workforce turnover (9 percent), and the perception that employees would rather have more pay than health coverage (9 percent). When asked how much they would be willing to contribute per employee per month if they were to offer a health plan, 59 percent of these employers said that amount ranges from zero to no more than $50. Only 10 percent said they would pay at least $200.
 
“This finding highlights how tough it’s going to be to ask very small employers to voluntarily take on the expense of providing health coverage,” said Linda Havlin, a Mercer worldwide partner. “It also helps explain why even relatively low-cost catastrophic plans like HSAs have not made great inroads with small employers that find it financially challenging to offer coverage.” 
 

With two weeks remaining until Election Day, more people are reporting problems with healthcare bills, and paying for health care retains a solid hold on the public’s list of their top economic concerns, according to the Kaiser Family Foundation’s final election 2008 tracking poll.

About one in three Americans now report their family has had problems paying medical bills in the past year, up from about a quarter saying the same two years ago. Almost one in five (18%) of Americans report household problems with medical bills amounting to more than $1,000 in the past year.

Nearly half (47%) of the public reports someone in their family skipping pills or cutting back on medical care they said they needed in the past year due to the cost of care. “Health care is now every bit as much an economic issue for the American people as job insecurity, mortgage payments and credit card debt,” said Kaiser President and CEO Drew Altman.

Private fee-for-service (PFFS) Medicare Advantage plans will be paid an average 16.6 percent more in 2008 compared to what the same enrollees would have cost in the traditional Medicare fee-for-service program, according to a new report from The Commonwealth Fund. Although Congress made significant revisions to policies that affect how PFFS plans operate in 2011 and thereafter, the legislation is expected to slow enrollment in PFFS plans but not stop the overpayment for each enrollee.

In the new report, Brian Biles, professor of health policy at George Washington University, and colleagues estimate that extra payments to PFFS plans will amount to $1,248 per beneficiary over traditional Medicare costs for each of about 2 million Medicare beneficiaries enrolled in PFFS plans, for a total of more than $2.5 billion in 2008.

"The legislation passed this year does not adequately address the overpayment problem in private fee-for-service Medicare Advantage plans," said Commonwealth Fund President Karen Davis. "While new requirements will eliminate some of the higher payments to plans and strengthen reporting requirements, we need to determine whether these plans are the best use of limited Medicare dollars."

Creating a unique patient identification number for every person in the United States would facilitate a reduction in medical errors, simplify the use of electronic medical records, increase overall efficiency, and help protect patient privacy, according to a new RAND Corporation study.

Although creating such an identification system could cost as much as $11 billion, the effort would likely return even more in benefits to the nation's healthcare system, according to researchers from RAND Health.

"Establishing a system of unique patient identification numbers would help the nation to enjoy the full benefits of electronic medical records and improve the quality of medical care," said Richard Hillestad, the study's lead author and a senior principal researcher at RAND. "The alternative is to rely on a system that produces too many errors and puts patients' privacy at risk."

People enrolled in consumer-directed health plans (CDHP) are more likely to budget for healthcare costs and participate in health and wellness programs, according to new survey results presented by the Blue Cross and Blue Shield Association (BCBSA) at the Consumer Driven Healthcare Summit in Washington, D.C.

The industry-wide BCBSA 2008 "CDHP Member Experience Survey" also found that CDHP enrollees are 30 percent more likely to track their health expenses than those in more traditional health insurance plans and 27 percent more likely to ask their doctors about the cost of treatment.

When it comes to health and wellness, CDHP enrollees appear more engaged and proactive in preventive health measures.  The survey found they are slightly more likely to have regular checkups, physicals, and preventive screenings than non-CDHP enrollees.  CDHP consumers also are more likely than people in traditional health plans to participate in health and wellness programs, including disease management, health coaching, nutrition and diet, smoking cessation, stress management, and exercise.

Under current law, spending on Medicaid is expected to substantially outpace the rate of growth in the U.S. economy over the next decade, according to a new annual report by the Centers for Medicare & Medicaid Services.

The report projects that Medicaid benefits spending will increase 7.3 percent from 2007 to 2008, reaching $339 billion, and will grow at an annual average rate of 7.9 percent over the next 10 years, reaching $674 billion by 2017. That compares to a projected rate of growth of 4.8 percent in the general economy. 

"This report should serve as an urgent reminder that the current path of Medicaid spending is unsustainable for both federal and state governments. We must act quickly to keep state Medicaid programs fiscally sound," U.S. Department of Health and Human Services Secretary Mike Leavitt said. "If nothing is done to rein in these costs, access to health care for the nation's most vulnerable citizens could be threatened."

In August, the U.S. Census Bureau released data indicating that number of uninsured Americans under age 65 fell by 1.5 million from 2006 to 2007. The Kaiser Commission on Medicaid and the Uninsured looks at why this decline happened and whether it can last in a new issue paper.

The paper estimates that over 20 percent of the decline reported by the Census Bureau was the result of legislation passed by Massachusetts in 2006 that intends to achieve universal coverage in the state. By 2007, the number of uninsured in Massachusetts had fallen by more than 300,000. National employer coverage rates remained the same from 2006 to 2007, while public coverage increased. The increase in public coverage was most likely the result of improving state revenues, which enabled states to expand eligibility and ease enrollment restrictions.

The paper concludes that a decline in the number of the uninsured “is quite unlikely to continue,” given the economic downturn and an increasing unemployment rate. It projects that the number of uninsured will increase by at least 2 million in 2008.

The vast majority of people have neither seen nor used comparative quality information about healthcare-related providers. That’s the conclusion of findings from a poll by the Kaiser Family Foundation.

Overall, only about one in seven respondents (14%) said they had seen and used information comparing the quality of different health insurance plans, doctors, or hospitals in the past year. Many also favor familiarity over expert ratings, especially for doctor or hospital choices.

The poll also found that fewer than half of Americans perceive that there are “big” differences in quality among different health-related providers. Perceptions of differences in quality increased from 1996 to 2000, but have fallen in recent years.

The poll was based on interviews of a randomly selected nationally representative sample of 1,517 respondents 18 years or older, conducted by telephone from July 29 to August 6, 2008.

The level of patient activation—a person's ability to manage his or her health and health care—varies considerably in the U.S. population, with less than half of adults (41.4%) at the highest level, according to a national study released today by the Center for Studying Health System Change (HSC).

The Patient Activation Measure (PAM) was designed to assess individuals’ knowledge, skill and confidence in managing their health and consists of a 13-item scale that asks people about their beliefs, knowledge, and confidence for taking an active role in their health and health care. HSC's 2007 Health Tracking Household Survey is the first large nationally representative survey--information on 13,500 adults--to include the PAM to assess the level of activation in the U.S. population. HSC is a nonpartisan health policy research organization funded in part by the Robert Wood Johnson Foundation, which funded the survey and the study.
 
Activation levels are especially low for people with low incomes, less education, Medicaid enrollees, and people with poor self-reported health. Higher activation levels are associated with much lower levels of unmet need for medical care and greater support from healthcare providers for self-management of chronic conditions, according to the study. "Because activation is changeable, it is a potentially important lever for change in the healthcare system," said Judith Hibbard, Dr. P.H., of the University of Oregon, coauthor of the study with HSC Senior Fellow Peter J. Cunningham, Ph.D.

U.S. employers have had an 80-year relationship with health insurers, sponsoring health plans that today cover 160 million Americans and their dependents. But as health costs continue to rise annually at near double-digit rates, the nation's employers are looking for more from health insurers to help them better manage their health benefit programs. A new report released by PricewaterhouseCoopers Health Research Institute finds mixed satisfaction ratings with insurer-sponsored services and meaningful differences between what small and large companies want.

According to a survey of 250 small employers (those with fewer than 250 employees) and 100 of the large multi-national companies (with an average of 8,000 employees) small employers are less satisfied with their insurer-provided health services than larger employers.  Small businesses with less than 500 employees represent 99.9 percent of all employers in the United States according to the Small Business Association. Small business respondents reported greater dissatisfaction than big companies in 12 critical areas of service, including claims accuracy/timeliness, administration fees, provider discounts, wellness programs and online tools such as personal health records.

"Small employers could be the canaries in the coal mine for the employer-based model," said Michael J. Thompson, principal of PricewaterhouseCoopers' human resources services group.  "Given that the majority of American workers are employed by small business and that the erosion of insurance coverage is among small employers, insurers are keenly interested in understanding what all employers want and how they can adapt plan designs and service offerings to better meet their needs."

WellPoint, Inc., the WellPoint Foundation, and the X PRIZE Foundation have announced a landmark collaboration to develop a $10 million or more competition designed to generate new ways to address the nation's serious health care system challenges.

As part of this collaboration, WellPoint and the X PRIZE Foundation will solicit participation from employers, health care providers, consumers, government partners and any other interested parties to develop competition guidelines that reflect the health care industry's most pressing challenges. In addition, WellPoint has committed to test the selected finalists' entries in its state markets, in order to test their ability to result in viable, creative and achievable health care system changes. Transparency will be emphasized throughout the process, from development of the prize to the conclusion of the competition. All results will be shared publicly, with the knowledge gained considered non-proprietary.

At this time, WellPoint, the WellPoint Foundation and the X PRIZE Foundation are announcing their intention to collaborate to develop a prize; the actual award amount, competition rules and guidelines are expected to be finalized in early 2009. More information about the competition is available at www.xprize.org/wellpoint.

The Wednesday New York Times (Oct. 15, 2008) cites HFMA President and CEO Richard L. Clarke and National Chairman-Elect Catherine A. Jacobson in an article on the effects of disappearing credit on hospitals.
 
In the article, Clarke notes that hospitals “are not immune” from the current squeeze on credit, as they are in the same position as any other business in relying on credit for capital projects and to maintain overall liquidity.
 
Jacobson, senior vice president of strategic planning & finance, CFO, and treasurer for Rush University Medical Center in Chicago, discusses the impact of the financial crisis on her organization’s existing debt and its investment portfolio. But she also notes that Rush recently broke ground on a major new construction project and plans to move ahead with it.

The Internal Revenue Service’s community benefit standard allows nonprofit hospitals broad latitude to determine the services and activities that constitute community benefit. Furthermore, state community benefit requirements that hospitals must meet in order to qualify for state tax-exempt or nonprofit status vary substantially in scope and detail. For example, 15 states have community benefit requirements in statutes or regulations, and 10 of these states have detailed requirements.

A new report by the Government Accountability Office, based in part on HFMA sources, finds that among the standards and guidance used by nonprofit hospitals, consensus exists to define charity care, the unreimbursed cost of means-tested government health care programs, and many other activities that benefit the community as community benefit. However, consensus does not exist to define bad debt and the unreimbursed cost of Medicare as community benefit. Variations in the activities nonprofit hospitals define as community benefit lead to substantial differences in the amount of community benefits they report.

Even if nonprofit hospitals define the same activities as community benefit, they may measure the costs of these activities differently, which can lead to inconsistencies in reported community benefits. For example, standards and guidance vary on the level at which hospitals may report their community benefit (e.g., at an individual hospital level or a health care system level) and the method hospitals may use to estimate costs of community benefit activities. State data demonstrate that differences in how nonprofit hospitals measure charity care costs and the unreimbursed costs of government health care programs can affect the amount of community benefit they report.

A pay-for-performance program may increase referrals to tobacco quitline services, particularly among clinics who have not previously participated in quality improvement activities.

Lawrence C. An, M.D., of the University of Minnesota, Minneapolis, and colleagues randomly assigned 24 primary care clinics to participate in a program offering $5,000 for 50 quitline referrals. Between Sept. 1, 2005, and June 31, 2006, these clinics referred 11.4 percent of eligible smokers, compared with 4.2 percent among 25 clinics offering usual care. The results of the study are reported in the October 13 issue of Archives of Internal Medicine (read abstract).

"Quitlines are widely available, and application of pay-for-performance strategies to encourage healthcare provider referral should be strongly considered by healthcare organizations seeking to reduce the health and economic burden of tobacco-related disease," the authors write.

The Healthcare business of Thomson Reuters has announced the publication of a new research report which analyzes the impact of cost on the cancer treatment decisions of individuals.

Entitled “The Cost of Cancer,” the report aggregates survey responses from 1,767 adults currently being treated for cancer. It finds a clear link between patients’ annual income and their decisions to curb cancer treatments due to cost — even among patients with late-stage cancers.

The report notes that among the 569 survey respondents with late-stage cancer, 12.3 percent said they have passed up recommended treatment because it was too expensive. This figure varies dramatically by patient income level. Twenty-five percent of late-stage cancer patients who earn less than $40,000 a year said they have chosen not to undergo a recommended treatment due to cost — compared with 11.2 percent of those earning between $40,000 and $80,000 per year and 4.8 percent of those earning more than $80,000 annually.

A Wisconsin group has launched an aggressive physician recruitment campaign geared at alleviating a shortage by attracting new physicians and drawing practicing physicians in other states back to the Badger State.

At the forefront of the recruitment effort is a new Web site, www.wisconsinphysiciancareers.org, which gives physicians a single source for browsing career opportunities in Wisconsin’s hospitals, clinics and in academic medicine. The Web site is exclusive to Wisconsin, and it lists only physician career opportunities. The site is supported by the Wisconsin Council for Medical Education and Workforce and was developed for them by the Wisconsin Hospital Association.

Wisconsin hospitals, clinics and academic medical centers have already posted over 500 positions for physicians to the Web site that opened today to job candidates. The sheer number of positions that are now vacant indicates that the demand for physicians is threatening to outstrip supply in almost all parts of the state.

The nation's immunization coverage rates for preteens and teens are increasing for routinely recommended vaccines, but most still do not have all of the recommended immunizations, according to 2007 estimates released today by the Centers for Disease Control and Prevention.

The survey provides estimates for three vaccines recommended at 11 or 12 years of age: the tetanus-diphtheria-acellular pertussis vaccine, the meningococcal conjugate vaccine, and the human papillomavirus vaccine for girls and young women. It also includes estimates of the percentage of 13- through 17-year-old teens who should have received the recommended immunizations for measles, mumps and rubella vaccine, hepatitis B vaccine, and varicella vaccine earlier in life.

The nation's Healthy People 2010 goals for preteens and teens ages 13-15 years are not being met for any of the vaccines for which goals were set. The Healthy People 2010 goals are for 90 percent coverage for preteens and teens 13 to 15 years of age with three doses of hepatitis B vaccine, two doses of measles, mumps and rubella vaccine, one dose of either tetanus-diphtheria or tetanus, diphtheria and acellular pertussis vaccine, and one dose of varicella vaccine for those who have not previously had chickenpox. There is not a Healthy People 2010 goal for HPV vaccination, which was first licensed and recommended in 2006.

The Centers for Medicare & Medicaid Services (CMS) has announced that beneficiaries, their caregivers, and family members can begin to review 2009 Medicare prescription drug plan and health plan information online.

“Some beneficiaries may see significant premium increases or changes, such as reduced coverage in the gap, if they stay in the same prescription drug plan in 2009,” said CMS Acting Administrator Kerry Weems. “Yet, almost 97 percent of beneficiaries enrolled in a stand-alone prescription drug plan (PDP) will have access to Medicare drug and health plans in 2009 whose premiums would be the same or less than their coverage in 2008.”

The 2009 Plan Finder allows beneficiaries to compare prescription drug coverage from both stand-alone PDPs and Medicare Advantage plans that provide prescription drug coverage and to view premiums, formularies, and availability of coverage in the gap. Additionally, the 2009 Medicare Options Compare tool allows beneficiaries to compare Medicare health plan options, such as HMOs and PPOs.

In an effort to help prevent the six most important healthcare-associated infections (HAIs), five healthcare organizations have published A Compendium of Strategies to Prevent Healthcare-Associated Infections in Acute Care Hospitals. The compendium was announced Oct. 8.

Six of the most important preventable HAIs with the greatest impact on morbidity and mortality were identified: Methicillin-resistant Staphylococcus aureus infection, Clostridium difficile infection, central line-associated bloodstream infection, ventilator-associated pneumonia, catheter-associated urinary tract infection, and surgical site infection. Recommendations are prioritized into two categories--minimum basic practices that should be adopted by all acute care hospitals, and special approaches for use in locations and/or populations within hospitals when infections are not controlled using basic practices.

The compendium was produced by the Society for Healthcare Epidemiology of America and the Infectious Diseases Society of America, in partnership with the American Hospital Association; the Association for Professionals in Infection Control and Epidemiology, Inc.; and The Joint Commission. Access the compendium.

The Department of Health and Human Services (HHS) on Oct. 8 issued new interim guidance that outlines how to become a patient safety organization (PSO).

The Patient Safety and Quality Improvement Act authorized the creation of PSOs to improve safety through the collection and analysis of data on patient safety events. By providing both privilege and confidentiality, PSOs are intended to create a secure environment where clinicians and healthcare organizations can voluntarily collect, aggregate, and analyze data that help identify and reduce the risks and hazards associated with patient care. “Patient safety work product”--the data submitted by healthcare providers to a listed PSO and the data developed by the listed PSO during the interim guidance period--will remain privileged and confidential under the Patient Safety Act during and after the interim period.

The interim guidance allows HHS’s Agency for Healthcare Research and Quality (AHRQ) to begin receiving applications from qualified entities that wish to become PSOs. This guidance will remain effective until HHS issues a final rule for PSOs, expected to be released by the end of 2008. Read the interim guidance.

Hispanic adults from both poor and wealthy communities are much more likely than whites to be hospitalized for health problems that good-quality outpatient care can prevent or control, such as uncontrolled diabetes and heart ailments, according to the latest News and Numbers from the Agency for Healthcare Research and Quality, Potentially Preventable Hospitalizations among Hispanic Adults, 2006. Wealthy communities in this report have average annual household incomes of $62,000 or greater.

AHRQ’s analysis found that in 2006, Hispanic adults were more than two times as likely as white adults to be hospitalized for uncontrolled diabetes and its complications, and they were almost 1.5 times more likely than whites to be hospitalized for congestive heart failure, high blood pressure, and angina.

In wealthy communities, Hispanics were 1.8 times more likely to be hospitalized for diabetes complications and nearly one-fifth more likely to be admitted for heart ailments than whites. The ratios were similar in the poorest communities. Read the statistical brief.

The eHealth Initiative (eHI), in collaboration with the American Medical Association, the American Academy of Family Physicians, the American College of Physicians, the Medical Group Management Association, and the Center for Improving Medication Management (Center), issued a “how-to” guide to help clinicians make informed decisions about how and when to transition from paper to electronic prescribing systems. A Clinician’s Guide to Electronic Prescribing, released at the Centers for Medicare & Medicaid Services (CMS) National e-Prescribing Conference in Boston on Oct.7, follows the agency’s decision earlier this year to offer financial incentives--beginning in 2009--to providers who adopt e-prescribing.

The guide is designed to meet the needs of two target audiences. The first section targets office-based clinicians who are new to the concept of e-prescribing and who seek a basic understanding of what e-prescribing is, how it works, and what are its benefits and challenges. The second section targets office-based clinicians who are ready to bring e-prescribing into their practices; it presents steps to follow in planning for, selecting, and implementing an e-prescribing system. The guide also provides a list of key references and resources. Download the guide.

Spending on mental health and substance abuse (MHSA) treatment is projected to double between 2003 and 2014, according to new forecasts by the federal government’s Substance Abuse and Mental Health Services Administration, reported in an article published Oct. 7 on the Health Affairs web site. Nevertheless, growth in spending for MHSA treatment during this period is expected to lag behind growth in overall health spending.

Spending on MHSA treatment is expected to increase from $121 billion in 2003 to $239 billion in 2014, essentially duplicating the 6.4 percent growth rate in behavioral health spending that prevailed between 1986 and 2003. From 2003 to 2014, overall health spending is expected to grow 0.8 percentage points faster than the rate of growth in spending for MHSA treatment. As a result, behavioral health spending is predicted to decline as a share of total health spending, from 7.5 percent in 2003 to 6.9 percent in 2014.

The bulk of MSHA spending goes toward the treatment of those with mental illnesses. In 2014, spending on mental health treatment is expected to be $203 billion--85 percent of all behavioral health spending. And Medicaid is expected to remain the single largest payer for mental health treatment, accounting for 27 percent of that spending in 2014. Read the abstract.

Americans continued to be assailed by rising healthcare costs this year, with 55 percent of those with health insurance reporting they experienced higher costs. Some said the U.S. healthcare system is so flawed that it should be completely overhauled (20 percent), and 51 percent believe major changes are needed, according to the 2008 Health Confidence Survey (HCS) by the Employee Benefit Research Institute (EBRI), a nonpartisan, not-for-profit research group. The survey report, released Oct. 7, is the 11th annual assessment of the American public regarding the U.S. healthcare system.

Despite concerns about costs, confidence about various aspects of today’s healthcare system has also remained fairly level with findings from the 2007 HCS. One-half (51 percent) report being extremely or very confident that they are able to get the treatments they need, and 42 percent are confident they have enough choice about who provides their medical care. However, 42 percent are not too or not at all confident about the affordability of health care, an increase from 36 percent in 2007. While half of Americans (49 percent) remain extremely or very satisfied with healthcare quality, far fewer are satisfied with the cost of health insurance (17 percent) or with costs not covered by insurance (15 percent).

Virtually all respondents said that extremely or very important goals when reforming the U.S. healthcare system should be to provide high-quality health care (93 percent) and to make health care more affordable (90 percent). Read the executive summary.

The Centers for Medicare & Medicaid Services (CMS) announced on Oct. 6 that it has awarded contracts to four permanent recovery audit contractors (RACs). The new RACs, selected under a full and open competition, are CGI Technologies and Solutions, Inc., of Fairfax, Va.; Connolly Consulting Associates, Inc., of Wilton, Conn.; Diversified Collection Services, Inc., of Livermore, Calif.; and HealthDataInsights, Inc., of Las Vegas.

The RACs identify improper overpayments or underpayments made on claims of healthcare services provided to Medicare beneficiaries. Healthcare providers that might be reviewed include hospitals, physician practices, nursing homes, home health agencies, durable medical equipment suppliers, and any other provider or supplier that bills Medicare Parts A and B. The new RACs will be paid on a contingency fee basis on both the overpayments and underpayments they find.

Additional states will be added to each RAC region in 2009. Before work begins, the RACs will hold town hall-type meetings in each state with healthcare providers and CMS staff and RAC representatives in October and November. Healthcare providers can get more information about these meetings and the date the program will begin in their states by checking the CMS RAC web site. Read the fact sheet.

E-prescribing and consumer privacy are critical to advancing healthcare reform, according to a report released Sept. 23 by the State Alliance for e-Health. In its inaugural report, Accelerating Progress: Using Health Information Technology and Electronic Health Information Exchange to Improve Care, the group of bipartisan health policy and technical experts called for accelerating adoption and use of health IT and electronic health information exchange (HIE) to speed improvements in the U.S. healthcare system.

The report examines the challenges states face in implementing health IT and HIE, including provider concerns about implementation costs, variations in technical standards for interoperability, and consumer concerns about data privacy and security. E-prescribing is cited as a landmark gateway to stimulating other advances in e-health, but progress in this and other e-health areas should move simultaneously with increased scrutiny and attention to protect the privacy of consumers’ health information.

The National Governors Association Center for Best Practices created the State Alliance for e-Health in 2006. Download the report.

Health plans’ quality of care improved in 2007--the ninth consecutive year of continued improvements--according to a study released Oct. 2 by the National Committee for Quality Assurance (NCQA).

NCQA found that commercial health plans showed improvement in 44 of 54 measures, including better treatment for high blood pressure and postpartum depression. Private Medicare plans showed improvement in 24 of 45 measures, including an increase of heart attack patients being treated with beta-blockers. The quality of care through Medicaid plans has remained relatively unchanged over the past two years, according to the report.

The report suggested that all health plans should be required to measure and publicly report on quality of care measures. It also called for the healthcare system to be overhauled and said that the next president should set regional targets for health improvement and grant federal money accordingly. Access the report.

Family healthcare premiums rose an estimated 17.1 times faster than earnings for Michigan’s workers from 2000 to 2007, according to a report issued Oct. 2 by the consumer health organization Families USA. In that eight-year period, family healthcare premiums rose by 78.2 percent, while median earnings rose by only 4.6 percent.

According to the report, the disproportionately high increases in insurance premiums occurred despite the provision of “thinner coverage” to workers--coverage that offers fewer benefits and/or that comes with higher deductibles, copayments, and co-insurance.

The Families USA report, Premiums versus Paychecks, is based on data from the U.S. Census Bureau, the Department of Labor, and the Department of Health and Human Services. State-specific reports are being released September through October 2008. Access the reports.

In its most recent update of recovery audit contractor (RAC) appeals, the Centers for Medicare & Medicaid Services (CMS) reported that the RAC demonstration program has corrected more than $1.03 billion of Medicare improper payments. Approximately 96 percent of those payments were overpayments collected from providers; the remaining 4 percent were underpayments repaid to providers.

From the inception of the RAC demonstration through June 30, 2008, providers appealed only 19.6 percent (102,705) of the RAC determinations; of those appealed, 34.9 percent (35,819) were decided in the provider’s favor.

As of June 30, there are an additional 1,607 claims (valued at $12 million) pending. Access the report.

A final rule that would allow more Medicaid beneficiaries to be in charge of their own personal assistance services, including personal care services, instead of having those services directed by an agency, was announced Sept. 29 by the Centers for Medicare & Medicaid Services (CMS).

The rule guides states who wish to allow Medicaid beneficiaries who need help with the activities of daily living to hire, direct, train, or fire their own personal care workers. Beneficiaries could also hire qualified family members who may already be familiar with the individual’s needs to perform personal assistance (not medical) services.

The notice of final rule is published in today's issue of the Federal Register. The final rule will be effective Nov. 3, 2008. Download the final rule.

As of Nov. 1, healthcare organizations will be required to have in place a policy on identity theft, under the Fair and Accurate Credit Transactions Act of 2003 (FACTA).

The law requires every financial institution--and creditor that holds any account for which there is a reasonably foreseeable risk of identity theft (including hospitals)--to develop and implement a written identity theft prevention program. The program must include reasonable policies and procedures for detecting, preventing, and mitigating identity theft, including identifying relevant patterns, practices, and specific forms of activity that are “red flags” signaling possible identity theft (such as unusual account activity, fraud alerts on a consumer report, or attempted use of suspicious account application documents); detecting and responding appropriately to any red flags that are detected; and ensuring the program is updated periodically to reflect changes in risks from identity theft.

Though FACTA doesn’t target the healthcare industry, it is clear hospitals and other healthcare organizations that collect huge amounts of identifying personal information must address identity theft for the protection of their customers, as well as the enterprise.

According to the rule, creditors have the opportunity to design and implement a program that is appropriate to the size, complexity, and nature of their business. Read the Federal Trade Commission alert. Read more in the September 2008 issue of hfm magazine.

The Agency for Healthcare Research and Quality (AHRQ) has awarded nearly $3 million for a contract to help reduce central line-associated bloodstream infections in hospital intensive care units (ICUs) by spreading the knowledge gained from a previous AHRQ-funded project. The new three-year project is part of an AHRQ initiative to reduce healthcare-associated infections.

The comprehensive program, designed to survey and improve an ICU’s patient safety culture, includes tools to help healthcare professionals identify opportunities to reduce potential healthcare-associated infections and implement policies to make care safer. Within three months of implementation in Michigan, the program helped reduce infection rates to zero in more than 50 percent of participating hospitals. Read the press release.

The federal government allocated $2.56 trillion in domestic spending for FY07, up 4.4 percent from 2006, according to the U.S. Census Bureau. This and additional information on federal funding is included in two new reports being released today. Consolidated Federal Funds Report: 2007 provides a broad overview of how and where the federal government distributes funds. Statistics are broken out by federal department and agency, as well as by state, county, and subcounty area. Federal Aid to States for Fiscal Year 2007 contains data on federal grants to state and local governments.

Retirement and disability payments to individuals accounted for $783 billion (more than 30 percent) of total federal spending. Of that amount, 80 percent, or $623 billion, went to Social Security recipients. Nearly half of all domestic government spending (excluding interest on the federal debt) went to Social Security, Medicare, and Medicaid, accounting for $1.22 trillion. The one-year increase in spending for these three programs was approximately $198 for every person in the United States.

The Centers for Medicare & Medicaid Services (CMS) yesterday announced that, beginning Oct. 1, 2008, it will publish most of the edits used in its Medically Unlikely Edit (MUE) program to improve the accuracy of claims payments. The Oct. 1, 2008, version of MUE was to contain edits for about 9,700 HCPCS/CPT codes that have been assigned unit values for MUEs. The edits are published on the CMS web site.

CMS established the MUE program to reduce payment errors for Medicare Part B claims. Claims processing contractors use these edits to ensure that providers and suppliers do not report excessive services; the edits are applied during the electronic processing of all claims. Studies have identified significant Medicare overpayments because provider or supplier claims sometimes report services with too many units of service. These errors may be caused by numerous factors, including clerical or coding errors. Read the press release.

Hospital-acquired infections, hospital-acquired injuries, objects left in surgery, and pressure ulcers account for one out of every six claims, according to the 2008 Hospital Professional Liability and Physician Liability Benchmark Analysis, released Sept. 29 by risk management services provider Aon Corporation in conjunction with the American Society for Healthcare Risk Management.

The study includes an analysis of professional liability costs for the surgery, obstetrics, and emergency departments. Various supplementary database segments appear in this year’s analysis as well, including facility ownership, number of beds, and teaching hospitals.

The benchmark database includes 77,705 claims representing $9.3 billion of incurred losses, and contains historical claims information for 10 accident years (1998 to 2007). Read the press release.

New supplemental compliance program guidance (CPG) for nursing facilities, published in the Sept. 30 Federal Register, is intended to help nursing facilities develop compliance programs that address major Medicare and Medicaid fraud and abuse problems related to poor quality of care, billing federal healthcare programs, and kickbacks. The new CPG responds to developments in the nursing facility industry, including significant changes in the way nursing facilities deliver and receive reimbursement for healthcare services, evolving business practices, and changes in the federal enforcement environment.

A goal of the new CPG is fostering quality of care in nursing facilities. The CPG will help compliance professionals address areas such as staffing, resident care plans, medication management, appropriate use of psychotropic medications, and resident safety. The new guidance also emphasizes the importance of submitting accurate claims and discusses issues related to reporting resident case-mix data, therapy services, screening for excluded individuals and entities, and restorative and personal care services. The guidance also urges nursing facilities to consider the risks of improper kickback payments associated with their business arrangements, including those involving free goods and services, as well as those with physicians and suppliers. Download the CPG.