Click to access MerrittHawkins_RevenueSurvey_2019.pdf
Monthly Archives: May 2019
Dems tee up new document fight with DOJ over Obamacare
https://www.politico.com/story/2019/05/14/democrats-doj-obamacare-1318932
House Democrats are mounting yet another confrontation with the Justice Department that could lead to subpoenas, but this time it’s not about special counsel Robert Mueller’s report — it’s about health care.
Five committee chairman foreshadowed a possible subpoena as soon as May 24 if Attorney General William Barr declines to provide documents related to his decision to stop defending the constitutionality of the Affordable Care Act — the health care law signed by President Barack Obama in 2010.
In letters to Barr and White House Counsel Pat Cipollone, the chairmen say they’ve been asking since April 8 for documents connected to the decision, as well as testimony from four key officials involved in the effort. The request, they said, sought a response by April 22 but that the reply fell short. Now, they’ve giving the Justice Department two more weeks to meet the committees’ demands. They’re also asking the White House to make budget director Russ Vought available for an interview.
“If we do not receive a response by this date, we will have no choice but to consider alternative means of obtaining compliance,” the lawmakers wrote.
The letters are signed by Oversight Chairman Elijah Cummings (D-Md.) , Energy and Commerce Chairman Frank Pallone, Jr. (D-N.J.), Ways and Means Chairman Richard Neal (D-Mass.), Education and Labor Chairman Bobby Scott (D-Va.) and Judiciary Chairman Jerry Nadler (D-N.Y.).
Nadler’s committee has already voted to hold Barr in contempt for refusing to provide an unredacted version of Mueller’s report to Congress as well as Mueller’s underlying evidence. But the full House has yet to consider the committee’s effort. Speaker Nancy Pelosi indicated last week that other committees may want to combine similar contempt proceedings into one overarching floor vote that could come in the next few weeks.
Democrats are also locked in confrontations with the Trump administration over accessing Trump’s tax returns — a request made by Neal’s Ways and Means Committee. The House Intelligence Committee has demanded access to Mueller’s report as well on national security grounds and issued a subpoena for his files last week.
The new effort on health care could become part of the broader strategy, if they continue to accuse the Justice Department of stonewalling by the time the new deadline arrives on May 24. But convincing other lawmakers to wait until June — following a weeklong Memorial Day recess — for a comprehensive contempt vote could be difficult. Rank-and-file Democrats have been clamoring for punitive measures against Barr for weeks for his handling of Mueller’s report.
Unlike the other demands, though, Democratic leaders, though, believe that picking a fight on health care is better politics — and it shows their efforts to confront the Trump administration has policy dimensions, not just Trump-focused investigations.
Democrats have attributed the Trump administration’s efforts to overturn the health care law, known familiarly as Obamacare, to “politically motivated forces” in the White House. The Obama White House took a similar step in 2011 when the Justice Department, at Obama’s urging, stopped defending the Defense of Marriage Act, which barred federal recognition of same-sex marriages — a move social conservatives denounced at the time.
The Department of Justice declined to comment.
Doctors bring in a lot of money for hospitals
https://www.axios.com/newsletters/axios-vitals-f3febfe2-1e33-46ad-993e-dc47d3fa3638.html
Doctors are generating a lot of revenue for hospitals — much more than those doctors receive in salary, according to a recent survey by physician staffing firm Merritt Hawkins.
Why it matters: It’s easy to see why hospitals view acquiring physician practices as a lucrative opportunity — which hospitals are doing at a rapid pace.
- “This is [a] good reminder that doctors are the gateway to the rest of the health care system. It’s doctors that make the decisions about whether people get admitted to the hospital, or get a lab test, scan, or prescription,” the Kaiser Family Foundation’s Larry Levitt said.
Go deeper: A recent survey by the American Medical Association found that for the first time ever, the U.S. has more physicians who work as employees than those who run their own practice.
Click to access MerrittHawkins_RevenueSurvey_2019.pdf
Healthcare Triage News: Infants and the Medicaid Expansion
What can we do about infant mortality and disparities in health care? This week we take a look at a recent study in JAMA that may have an answer.
7 Cardinal Rules for Life
Earthquake regulations may rock S&P ratings for California hospitals
Achieving full compliance with rules to make their facilities operational after an earthquake by 2030 could strain ratings for many California acute care hospitals and health systems, S&P Global Ratings said in a new report.
California law requires hospitals to upgrade buildings to reduce their risk of collapse during earthquakes by 2020 and to remain operational after an earthquake occurs by 2030. The 2030 rules include structural and nonstructural components.
S&P said most organizations have met the 2020 seismic compliance deadline, but many will face challenges as they invest in achieving full seismic compliance by 2030.
“As many rated California providers invest in the next round of compliance, they will have ongoing capital expenditures, although for some organizations it will likely be less than the updates leading up to the 2020 deadline,” the ratings agency wrote. “Nevertheless, many will face mandated capital spending that will compete with other strategic priorities, and many will face potential operating challenges related to making nonstructural updates while minimizing patient care disruption.”
S&P — which based its analysis on more than 40 rated California-based acute care hospitals and health systems as of Dec. 31, 2018 — said it believes most of the California hospitals and health systems it rates, especially those with higher ratings, should be able to absorb the capital spending and operating expenses related to achieving full seismic compliance by 2030.
However, full compliance by 2030 could be difficult for providers with lower ratings that already have challenges related to accessing capital at a reasonable cost, said S&P.
“Moreover, the additional potentially prohibitive costs for this next round of compliance needs, combined with ongoing industry pressures, could contribute to some shifting strategies, such as mergers and acquisitions, rebalancing of strategic priorities, and potentially closures for those hospitals without the means to finance the project and absorb increased expenses,” the agency wrote.
Access S&P’s full report here.
Kaiser’s net income more than doubles to $3.2B in Q1
Oakland, Calif.-based Kaiser Permanente reported higher revenue and net income for its nonprofit hospital and health plan units in the first quarter of 2019.
Kaiser saw operating revenue increase to $21.3 billion in the first quarter of 2019. That’s up 5.3 percent from operating revenue of $20.3 billion in the first quarter of last year.
The boost was partly attributable to the system’s health plan unit. Kaiser saw health plan membership increase year over year to 12.3 million.
“We are pleased that our membership increased by more than 150,000 members in the first quarter, as more people are choosing Kaiser Permanente for their care and coverage,” Kaiser Executive Vice President and CFO Kathy Lancaster said in a press release. “We normally see our largest membership growth in the first quarter due to the fall open enrollment cycle.”
After factoring in operating expenses, which increased 3 percent year over year, Kaiser reported operating income of $1.5 billion in the first quarter of 2019. That’s up from $1.1 billion in the first quarter of 2018.
“This year-over-year increase in Q1 operating income was significantly impacted by several accounting estimates that were favorable when compared to the same period last year,” Kaiser said.
Kaiser’s nonoperating income, generated largely by returns on investments, was $1.6 billion in the first quarter of this year, up from $334 million in the same period a year earlier.
Under an accounting change that took effect Jan. 1, Kaiser reported unrealized gains on certain equities as net nonoperating income, which added $896 million to the organization’s nonoperating income in the first quarter of this year.
Kaiser reported net income of $3.2 billion in the first quarter of 2019, more than double its net income of $1.4 billion in the first quarter of last year.
Ms. Lancaster said Kaiser’s strong first-quarter performance will allow for more strategic investments in facilities, people and technology. During the first quarter of 2019, Kaiser said it spent $834 million on technology and upgrading and opening new facilities.
Uninsurance of children, parents inched back up in 2017, report finds
Dive Brief:
- After improving for several years, insurance gains and participation in Medicaid and the Children’s Health Insurance Program tilted downward in 2017, a new Urban Institute report shows.
- In the first three years following implementation of the Affordable Care Act, the uninsurance rate dropped from 7% to 4.3% among children and from 17.6% to 11% among parents, or about 40% for both groups. In 2017, however, the children’s uninsurance rate inched back up to 4.6%, or an additional 281,000 uninsured children, and parents’ coverage rate stalled.
- Uninsurance rates rose both in states with and without the ACA’s Medicaid expansion, but the increase was more pronounced in states without expansion programs.
Dive Insight:
The findings jibe with recent data from the Centers for Disease Control’s National Health Interview Survey, which showed more than 1.1 million Americans lost health coverage in 2018, pushing the total number of uninsured from 29.3 million in 2017 to 30.4 million last year. Among surveyed adults between 18 and 64 years old, 13.3% were uninsured, 19.4% had public health coverage and 68.9% had private coverage.
The trend coincides with Trump administration efforts to weaken the ACA by eliminating several mechanisms meant to stabilize payers participating in ACA exchanges and pushing stripped-down, noncompliant health plans. The result has been rising premiums and a resurgence in the number of uninsured.
Adding to uncertainty about the ACA’s future is the U.S. Department of Justice’s support for a Texas federal district court that ruled the law unconstitutional without its individual mandate penalty, which a Republican-led Congress removed in 2017. A previous Urban Institute report estimated up to 20 million Americans would lose health insurance if the lawsuit prevails — a majority of whom are currently covered through Medicaid expansions and ACA exchanges.
While the ACA remains in legal jeopardy, Democrats and presidential candidates are looking at ways to increase the numbers of insured Americans, from shoring up the ACA to implementing some type of single-payer system or “Medicaid for All.”
According to the Urban Institute, participation in Medicaid/CHIP among children increased from 88.7% in 2013 to 93.7% in 2016, and from 67.6% to 79.9% for parents. Those gains reversed in 2017, however, with Medicaid/CHIP participation dropping to 93.1% among children and remaining unchanged for parents.
Among those who did not enroll in Medicaid/CHIP in 2017, 2 million children and 1.7 million parents were eligible for the programs — versus 1.9 million and a steady 1.7 million, respectively, in 2016.
More than half of the uninsured children and parents who were eligible for the Medicaid/CHIP lived in California, Florida, Georgia, Illinois, Indiana, New York, Pennsylvania and Texas, according to combined 2016-2017 data.
Parents were more than twice as likely to be uninsured as children in 2017. For example, children’s uninsurance rate was less than 5% in most states and under 10% in nearly every state, while parents’ uninsurance was less than 5% in just four states and over 10% in close to half the states, the report says.
The decline in improvement was worse among certain subgroups. “In 2017, the uninsurance rate was nearly 6% or higher among adolescents, Hispanic and American Indian/Alaska Native children, citizen children with noncitizen parents, and noncitizen children,” according to the report. “And consistent with prior years, one in six parents or more who were ages 19 5o 24, Hispanic or American Indian/Alaska Native, below 100 percent of FPL [federal poverty level], receiving SNAP [Supplemental Nutrition Assistance Program] benefits, or noncitizen were uninsured in 2017.”
Number of uninsured adults reaches post-ACA high
https://www.healthcaredive.com/news/number-of-uninsured-adults-reaches-post-aca-high/546653/
Dive Brief:
- The uninsured rate in the U.S. is at a four-year high, having reached 13.7% in the fourth quarter of 2018, according to a new Gallup poll. That rate is the highest since the Affordable Care Act’s individual mandate was implemented in 2014.
- Despite the rise in the uninsured rate, it’s still below the peak of 18%, recorded in the third quarter of 2013. That figure then dropped to an all-time low of 10.9% in 2016. The elimination of the individual mandate penalty, cost-sharing reductions and other policy decisions made under the Trump administration have helped boost the rate back up.
- According to Gallup, the uninsured rate has increased most among women, young adults and low-income Americans. Separate research has shown the number of uninsured children in the U.S. has also increased for the first time in over a decade.
Dive Insight:
The Affordable Care Act helped the U.S. reach historical lows for the rate of uninsured adults, but that figure has continued to tick back up as the Trump administration has undermined the law.
In all, the 2.8 percentage point increase since 2016’s low point represents about 7 million more uninsured Americans. Most of those 7 million became uninsured in 2017, which experienced the largest single-year increase (1.3 percentage points) since Gallup began polling Americans on the question in 2008.
The continued rise in the uninsured rate is reversing the gains made under the Affordable Care Act.
The ACA ushered in a time when people could buy insurance not tied to a job — without having to worry about being denied for having a pre-existing condition such as diabetes or cancer. Plus, it allowed states to expand Medicaid to low-income residents who otherwise could not afford to purchase private coverage on their own.
During that time of record-low uninsured rates, many Americans were required to have health insurance or risked incurring a financial penalty.
But once President Donald Trump was elected he began working to overturn the law. In December 2017, the GOP’s tax bill eliminated the financial penalty for not having insurance.
A separate Commonwealth Fund report found that the uninsured rate was up significantly among working adults in states that did not expand Medicaid.
‘Who’s going to take care of these people?’
The hospital had already transferred out most of its patients and lost half its staff when the CEO called a meeting to take inventory of what was left. Employees crammed into Tina Steele’s office at Fairfax Community Hospital, where the air conditioning was no longer working and the computer software had just been shut off for nonpayment.
“I want to start with good news,” Steele said, and she told them a food bank would make deliveries to the hospital and Dollar General would donate office supplies.
“So how desperate are we?” one employee asked. “How much money do we have in the bank?”
“Somewhere around $12,000,” Steele said.
“And how long will that last us?”
“Under normal circumstances?” Steele asked. She looked down at a chart on her desk and ran calculations in her head. “Probably a few hours,” she said. “Maybe a day at most.”
The staff had been fending off closure hour by hour for the past several months, ever since debt for the 15-bed hospital surpassed $1 million and its outside ownership group entered into bankruptcy, beginning a crisis in Fairfax that is becoming familiar across much of rural America. More than 100 of the country’s remote hospitals have gone broke and then closed in the past decade, turning some of the most impoverished parts of the United States into what experts now call “health-hazard zones,” and Fairfax was on the verge of becoming the latest. The emergency room was down to its final four tanks of oxygen. The nursing staff was out of basic supplies such as snakebite antivenin and strep tests. Hospital employees had not received paychecks for the past 11 weeks and counting.
The only reason the hospital had been able to stay open at all was that about 30 employees continued showing up to work without pay, increasing their hours to fill empty shifts and essentially donating time to the hospital, understanding what was at stake. Some of them had been born or had given birth at Fairfax Community. Several others had been stabilized and treated in the emergency room after heart attacks or accidents. There was no other hospital within 30 miles of two-lane roads and prairie in sprawling Osage County, which meant Fairfax Community was the only lifeline in a part of the country that increasingly needed rescuing.
“If we aren’t open, where do these people go?” asked a physician assistant, thinking about the dozens of patients he treated each month in the ER, including some in critical condition after drug overdoses, falls from horses, oil field disasters or car crashes.
“They’ll go to the cemetery,” another employee said. “If we’re not here, these people don’t have time. They’ll die along with this hospital.”
“We have no supplies,” Steele said. “We have nothing. How much longer can we provide quality care?”
As emergencies rise across rural America, a hospital fights for its lifeAs emergencies rise across rural America, a hospital fights for its life
HENRY KOTULA 