Category Archives: Health System

619-bed California hospital to join Cedars-Sinai Health System

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Huntington Hospital in Pasadena, Calif., has signed a letter of intent to join Los Angeles-based Cedars-Sinai Health System.

The organizations signed the agreement March 9 after a strategic review by a special committee of Huntington Hospital’s board of directors. The letter of intent calls for investments in 619-bed Huntington Hospital’s information technology, ambulatory services and physician development.

“Huntington Hospital’s longstanding commitment to the community, its reputation for quality and its outstanding physicians, nurses and other staff make it a very good fit for Cedars-Sinai Health System,” Vera Guerin, chair of Cedars-Sinai Health System’s board of directors, said in a news release. “Collaborations and sharing of resources throughout the health system will further strengthen Huntington’s ability to serve the community for decades to come.”

Leaders said Cedars-Sinai Health System and Huntington Hospital are working toward finalizing a definitive agreement. The transaction is subject to closing conditions and regulatory approvals.

 

 

Winners and losers of the HHS interoperability final rule

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HHS released its much-anticipated final rules on EHR interoperability, ruling against “information blocking” tactics by EHR vendors and giving patients more control over their medical records.

The new rule will be applied over the next two years and will make patient records downloadable to smartphones using consumer apps. Overall, members of the healthcare industry applaud these efforts to make patient information more accessible to improve healthcare delivery. However, there are privacy concerns around how patient data can be used once downloaded to third-party consumer apps that weren’t addressed in the final rule.

Here is a brief list of a few potential winners and losers of the new rule.

 

WINNERS

Patients. Patients now have more control over their medical records and will be able to access them through third-party apps for free, which will make it easier for them to take their medical records to new providers outside of their previous provider’s system. As a result, they will have more choice in where they go for healthcare.

Hospitals and physicians. The lengthy process of trying to convert a patient’s medical records will be unnecessary. Patients will no longer need to have their medical records faxed between healthcare facilities in different networks and the rule will streamline workflow around gathering patient data to provide the best possible care. Hospitals participating in Medicare and Medicaid will also be able to send electronic notifications to other facilities or providers when a patient is admitted, transferred or discharged under its new “Coordination of Participation” rule.

App developers and health IT startups. App developers that allow patients to store their health data and medical information will have access to that data, a virtual gold mine. The federal privacy protections limiting how providers and insurers share medical records do not apply when patients transfer data to consumer apps, according to the New York Times.

Apple and Microsoft. Healthcare providers will be required to send medical data in a format that is compatible on third-party apps including Apple Health Records. Microsoft is also working to sell technology in the health sector, and the new rule will make it easier, according to CNBC.

 

LOSERS

Patients. While the rule has many benefits to patients, there is also potential for disaster. Patients who download their medical information on consumer apps may find their information shared or sold. There could also be additional security issues if those apps are hacked. Finally, some patients may become confused by their medical records and notes if the information isn’t stated clearly, causing further anxiety around their care.

Hospitals and clinics. Patient leakage may become more common if it’s easier for patients to take their medical records with them. Healthcare organizations will also need to prepare for an influx of patient data and have strong governance procedures in place as they partner with payers and other organizations to incorporate clinical data with patient-gathered data and potentially social determinants of health data.

EHR vendors. EHR companies must now adopt application programming interfaces so their systems can communicate with third-party apps. EHR companies have two years to comply and face up to $1 million per violation for engaging in “information blocking.” The new focus on interoperability may also pave the way for competitors to gain market share over the two most dominant players, Epic and Cerner.

Epic. Epic was a notable opponent to the HHS interoperability rules, citing patient privacy concerns. If forced to collaborate with other companies, Epic could potentially lose its edge over competitors, according to an op-ed written by former HHS Secretary Tommy Thompson in the Wisconsin State Journal. He contended Epic would have to “give its trade secrets away to venture capitalists, Big Tech, Silicon Valley interests and overseas competitors for little or no compensation.” Epic is also the most dominant EHR, holding 28 percent of the acute care hospital market, which could be threatened by greater interoperability. However, in response to the final rule’s release, Epic issued a statement saying that it would focus on “standards-based scope for meaningful interoperability.”

 

Consolidation increasing stakes for payer-provider contract disputes, study finds

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As more providers and insurers consolidate, the chances that both sides will run into disagreements over their in-network contracts have heightened, according to a report from the Center on Health Insurance Reforms from the Georgetown University Health Policy Institute in Washington, D.C. 

For the report, researchers reviewed insurance laws across six states, based on geographic diversity and recent high-profile payer-provider conflicts that took place there: California, Georgia, Massachusetts, North Carolina, Pennsylvania and Texas. Some high-profile conflicts in the states include UnitedHealthcare and Houston Methodist; Pittsburgh-based Highmark Health and UPMC; Cigna and San Francisco-based Dignity Health; Cigna and Asheville, N.C.-based Mission Hospital; and Cigna and Irving, Texas-based Christus Health.

In interviews with regulators and insurers, researchers found both agreed that the more providers and payers consolidate, the higher the stakes for contract disputes. This will expose more consumers to care disruptions and higher out-of-pocket costs, they said. Several regulators warned that a greater number of high-profile contract disputes will take place in the future. 

State officials and insurers offered several recommendations for improving the patient experience through contract disputes, including providing members with advanced notice of possible contract termination and requiring insurers to hold their enrollees harmless if they can’t access necessary care elsewhere.

 

Trinity Health’s net income jumps $1.1B in first half of fiscal year

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https://www.beckershospitalreview.com/finance/trinity-health-s-net-income-jumps-1-1b-in-first-half-of-fiscal-year.html?utm_medium=em

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Livonia, Mich.-based Trinity Health recorded higher revenue and net income in the first half of fiscal year 2020 than in the same period a year earlier, according to unaudited financial documents released March 6.

During the first half of fiscal 2020, which ended Dec. 31, Trinity reported operating revenue of $9.7 billion, a 2.4 percent increase over the same period of fiscal 2019. Operating expenses climbed 2.5 percent year over year to $9.6 billion.

Trinity ended the first two quarters of fiscal 2020 with operating income of $102.6 million and an operating margin of 1.1 percent. That’s compared to the same period of fiscal 2019, when the health system recorded operating income of $113.4 million and a 1.2 percent operating margin.

The health system said increases in patient volume, higher payment rates and the divestiture of Camden, N.J.-based Lourdes Health System in June helped margins in the first half of fiscal 2020. Those improvements were offset by higher operating expenses and, to a lesser extent, $25 million in costs related to Trinity’s conversion to the Epic EHR platform.

After factoring in nonoperating items, including an increase in investment returns, Trinity reported net income of $805.7 million in the first half of fiscal 2020, compared to an operating loss of $301.5 million in the same period a year earlier.

 

 

 

The latest on the coronavirus

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In less than three months, the novel coronavirus has spread from an unknown pathogen located in a single Chinese city to a global phenomenon that is affecting nearly every part of society.

U.S. stocks closed more than 7% lower on Monday, after a wild day that saw a rare halt in trading, Axios’ Courtenay Brown reports.

  • Why it matters: The sell-off reflects serious fears that the coronavirus could help drive the economy into a recession.

Italy’s prime minister announced that the government has extended internal travel restrictions to the entire country until April 3 and that all public gatherings and sporting events would be banned.

  • Why it matters: It’s an extreme measure that effectively locks down 60 million people in one of the most populated countries in Europe, where more people have tested positive for the coronavirus than in any country outside of China.

Hospitals are reporting that their supplies of critical respirator masks are quickly dwindling, the New York Times reports.

  • Why it matters: Keeping health care workers healthy will be critical as hospitals and other facilities see a surge in patients as the coronavirus spreads.

 

 

 

The Velvet Rope Economy: How Inequality Became Big Business

Posted on by • Posted in 2020 Election Issues, Access, Access & Quality of Healthcare, Health Policy, Health System, Hospital, Hospital Industry, Medicaid, Rural Health, Rural Hospital, Safety Net Hospitals, Safety-Net Providers • Leave a comment

https://mailchi.mp/9e118141a707/the-weekly-gist-march-6-2020?e=d1e747d2d8

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FROM THE GIST BOOKSHELF

Feed your head—read this.

Income inequality has become a central topic in our national political debate in the wake of the financial crisis. The gap between the “haves” and “have nots” has grown steadily, and addressing that gap has become a key priority for a new generation of politicians, economists, and policymakers. But inequality has also become a lucrative business opportunity in many parts of the economy, a phenomenon that New York Times economics reporter Nelson Schwartz entertainingly (and unsettlingly) describes in his new book, The Velvet Rope Economy: How Inequality Became Big Business.

Based on a series of Times articles by Schwartz from the past several years, the book describes life on both sides of the “velvet rope”: how services have become faster, better, and higher quality for those with the ability to pay extra, and how the rest of us are getting left behind. He describes how the familiar amusement-park “Fast Pass” approach has pervaded other parts of our lives, from school sports to social services to travel, and yes, to healthcare.

Across the economy, businesses increasingly cater to the top tier of customers, providing privileged access, concierge services, and special perks. As Schwartz describes it, “This pattern—a Versailles-like world of pampering for a privileged few on one side of the velvet rope, a mad scramble for basic service for everyone else—is being repeated in one sphere of American society after another.”

It’s a phenomenon we see in healthcare every day, as rural hospitals are shuttered, access to care is restricted for Medicaid patients, and wait times for new primary care appointments soar to six weeks or more, while concierge physician practices and cash-based, on-demand services proliferate. Most troubling, in Schwartz’s view: this intentional, class-based separation causes those on one side of the “velvet rope” to misunderstand, and even denigrate, those on the other.

That aptly describes our current political dynamic—Schwartz provides a useful (and highly readable) window into how businesses seek to profit from that division. Worth a read.

 

 

Health plans ramp up physician practice acquisitions

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Health systems and private equity firms aren’t the only ones aggregating physician practices—many large insurers are rapidly acquiring or affiliating with physician groups, especially to support their Medicare Advantage (MA) strategies.

As the map below shows, most insurers are focusing this vertical integration in states like Florida, Texas, and California—places where they also have large populations of MA beneficiaries. Astonishingly, UnitedHealth Group—through its Optum division—is likely the largest employer of physicians in the US, employing or affiliating with 50,000 physicians—roughly 5,000 more than HCA Healthcare and nearly double the number of Kaiser Permanente. The number of Optum-controlled physicians has increased rapidly in recent years, the result of many large-scale deals, including the $4.3B acquisition of DaVita Medical Group.

When it comes to leveraging this growing physician network, United is setting its sights well beyond Medicare Advantage, as demonstrated by its recent introduction of Harmony, a commercial narrow network health plan in Southern California based almost exclusively on a network of Optum physicians.

Meanwhile, Humana’s physician strategy has focused more on affiliations with non-traditional groups serving MA patients, including Iora Health and Oak Street Health—though Humana also has two large primary care groups, Conviva and Partners in Primary Care, the latter of which just secured a $600M private equity investment to expand.

Notably absent from this map is Aetna, which has been pursuing a different strategy, focused around steering its MA population to its advanced practice provider-run HealthHUBs in CVS pharmacies.

This trend of insurer acquisition of physicians is obviously worrisome for health systems, as the health plans they negotiate with for payment are now directly competing with them at the front end of the delivery system.  

 

 

Settling in for a long fight against coronavirus

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As of Friday, the number of confirmed cases of the novel coronavirus, or COVID-19, has surpassed 100,000 worldwide, with over 3,400 deaths. In the US, there have been 250 confirmed cases and 14 deaths reported so far—although the actual number of cases is certainly many times higher, with testing yet to be widely available and many patients exhibiting only mild to moderate symptoms.

Vice President Mike Pence, who was put in charge of federal response efforts last week, conceded Thursday that the country does not yet have enough coronavirus tests to meet demand, and the administration will not meet its goal of having 1M tests ready by the end of the week; perhaps the $8B emergency funding package approved by Congress will help expedite efforts.

Public worry and concern among officials hit new levels, with the Director-General of the World Health Organization warning that time to contain the virus may be running out, and expressing concern that countries may not be acting fast enough. New levels of containment effort have begun to take shape. Schools shut down in areas of the country most affected by the virus, including Seattle and some New York City suburbs. All told, the New York Times reports that 300M students are out of school around the world. Companies began to cancel conferences and other large gatherings—next week’s Health Information and Management Systems Society (HIMSS) conference was called off despite a planned appearance by President Trump, given rising cancellations and vendor exits.

Hospitals around the nation have rallied to prepare for a growing wave of patients that has yet to hit. Experts expressed concerns about whether hospitals have enough open capacity, but even more critical will be gaps in the supply of staff and equipment—especially the ICU beds and ventilators necessary for critically ill patients, and the nurses and respiratory therapists needed to care for them.

The vast majority of hospitals report having a coronavirus action plan in place; however, a recent survey of nurses suggests that critical information may not be making its way to frontline clinicians. Only 44 percent of nurses reported that their organization gave them information on how to identify patients with the virus, and just 29 percent said there is a plan in place to isolate potentially infected patients.

Worries about patient financial exposure to the costs of diagnosis and treatment intensified, with fears that individuals could be held accountable for the cost of government-mandated isolation. Most patients with high-deductible plans saw their deductibles “reset” at the beginning of the year, raising concerns that individuals might refrain from seeking treatment.

The heightened worry is palpable as we connect with hospital and physician leaders around the country, and we are deeply grateful for their around-the-clock efforts, and the willingness of doctors, nurses and other caregivers to put their own safety at risk to provide the best possible care to patients under increasingly difficult circumstances.

 

 

 

 

14 health systems with strong finances

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Here are 14 health systems with strong operational metrics and solid financial positions, according to reports from Fitch Ratings, Moody’s Investors Service and S&P Global Ratings.

Note: This is not an exhaustive list. Health system names were compiled from credit rating reports and are listed in alphabetical order.

1. Roanoke, Va.-based Carilion Clinic has an “Aa3” rating and stable outlook with Moody’s and an “AA-” rating and stable outlook with S&P. The health system has a leading market position, strong operating cash flow and healthy debt metrics, according to Moody’s.

2. Wilmington, Del.-based ChristianaCare has an “AA+” rating and stable outlook with S&P, and an “Aa2” rating and stable outlook with Moody’s. The health system has excellent cash flow and a light debt burden, according to S&P. The credit rating agency expects ChristianaCare’s operational performance to remain near recent levels over the next two years, as the health system capitalizes on its cost containment initiatives and strong business position.

3. Santa Barbara, Calif.-based Cottage Health has an “AA-” rating and stable outlook with Fitch. The health system has a leading market position and strong profitability and cash flow, according to Fitch. Going forward, the rating agency expects Cottage Health to see moderate revenue growth.

4. Honolulu-based Hawaii Pacific Health has an “AA-” rating and stable outlook with Fitch. The health system has a solid market position and healthy operating profitability, according to Fitch. The credit rating agency expects the health system to sustain continued capital and strategic investments without the need for incremental debt in the foreseeable future.

5. Baltimore-based Johns Hopkins Health System has an “Aa2” rating and stable outlook with Moody’s. The six-hospital system has a national and international brand that supports resilient clinical demand, according to Moody’s. The rating agency expects the health system to continue to see benefits from its strong regional market position.

6. Philadelphia-based Main Line Health has an “Aa3” rating and stable outlook with Moody’s and an “AA” rating and stable outlook with S&P. The health system, which operates four acute care hospitals and a rehabilitation hospital, is a leading provider in the Philadelphia suburbs, according to Moody’s. The credit rating agency expects the health system to maintain recently improved cash flow margins, which are driven by better patient volume trends.

7. Dallas-based Methodist Health System has an “Aa3” rating and stable outlook with Moody’s. The health system has healthy balance sheet measures and operating performance as well as favorable leverage metrics, according to Moody’s. The credit rating agency expects Methodist Health System’s expense control initiatives and revenue growth opportunities to continue to drive sustainable operating performance.

8. Evanston, Ill.-based NorthShore University HealthSystem has an “AA-” rating and stable outlook with S&P and an “Aa3” rating and stable outlook with Moody’s. The health system has a strong balance sheet, good market presence and a management team that continues to execute its strategic plan, according to S&P. The rating agency expects NorthShore to maintain strong balance sheet metrics and low leverage.

9. Columbus-based OhioHealth has an “AA+” rating and stable outlook with Fitch. The 12-hospital system has a leading market position and solid liquidity, profitability and leverage metrics, according to Fitch.

10. Fort Wayne, Ind.-based Parkview Health System has an “AA-” rating and stable outlook with S&P. The nine-hospital system has stable operating performance and an excellent liquidity profile, according to S&P.

11. Chicago-based Rush University System for Health has an “AA-” rating and stable outlook with Fitch. The health system has a broad reach for high-acuity services as a leading academic medical center and its operating risk profile is strong, according to Fitch. The credit rating agency expects Rush to maintain strong capital-related ratios over the next five years.

12. Norfolk, Va.-based Sentara Healthcare has an “Aa2” rating and stable outlook with Moody’s. The health system has a leading market position in its core service area, strong patient demand, and solid margins, according to Moody’s. The credit rating agency expects Sentara’s liquidity and debt metrics to remain at recent levels.

13. Livonia, Mich.-based Trinity Health has an “AA-” rating and stable outlook with Fitch and S&P. The health system has a significant market presence in several states and a strong financial profile, according to Fitch. The credit rating agency expects the health system’s operating margins to continue to improve.

14. Madison, Wis.-based UW Health has an “Aa3” rating and stable outlook with Moody’s. UW Health has healthy margins from a large and growing clinical footprint, according to Moody’s. The rating agency expects UW Health’s margins to remain strong.

 

Coronavirus Covid-19 Global Cases by Johns Hopkins CSSE

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128 cases have been reported in the U.S., along with nine related deaths, all in Washington state, as of 9 a.m., March 4. Eight people have recovered from the disease.