Category Archives: Hospital Industry

9 hospital deals called off

Posted on by • Posted in Deals Called Off, Divestitures, Health System, Hospital, Hospital Industry, Market Consolidation, Mergers & Acquisitions, Unwind • Leave a comment
https://www.beckershospitalreview.com/hospital-transactions-and-valuation/9-hospital-deals-called-off.html?origin=BHRE&utm_source=BHRE&utm_medium=email&utm_content=newsletter&oly_enc_id=2893H2397267F7G
How to pronounce Called Off - YouTube

In the last six months, several health systems have canceled plans to merge, acquire a hospital or unwind an existing partnership. 

Here is a breakdown of nine of them:

1. Ascension, AdventHealth to unwind partnership
Ascension and AdventHealth are unwinding their Amita Health partnership after working together for nearly seven years, the organizations announced Oct. 21.

2. SSM Health ditches deal to sell Missouri hospital to Quorum
St. Louis-based SSM Health has abandoned its plan to sell a Missouri hospital to Brentwood, Tenn.-based Quorum Health.

3. North Carolina system severs ties with Atrium, joins UNC Health
Carolinas HealthCare System Blue Ridge, a two-campus system in Morganton, N.C., cut ties with Atrium Health and partnered with UNC Health. Carolinas HealthCare System Blue Ridge and UNC Health finalized their management services agreement Oct. 1. Under the partnership, Blue Ridge will be renamed UNC Health Blue Ridge.

4. Tower Health won’t sell hospitals, pursues alliance with Penn Medicine
West Reading, Pa.-based Tower Health abandoned plans to sell the entire health system and instead will remain independent. It also signed a letter of intent to develop a strategic alliance with Philadelphia-based Penn Medicine.

5. Iowa hospital exits MercyOne affiliation
Mercy Iowa City (Iowa) is ending its affiliation with MercyOne’s health network in West Des Moines, Iowa.

6. LifePoint, Prisma Health call off hospital sale
A deal to sell the three hospitals in South Carolina fell through. Brentwood, Tenn.-based LifePoint inked a deal to sell the three hospitals and an ER to Greenville, S.C.-based Prisma Health, but the parties canceled the deal April 9. The health systems said significant delays and challenges with the Federal Trade Commission “made it prohibitive to move forward.” Medical University of South Carolina in Charleston later purchased the three hospitals.

7. Sentara, Cone Health nix merger
Norfolk, Va.-based Sentara Healthcare and Greensboro, N.C.-based Cone Health have abandoned plans to merge into an $11.5 billion system, the organizations said in a joint statement June 2. 

8. CommonSpirit’s plan to sell 14 hospitals to Essentia abandoned
Duluth, Minn.-based Essentia Health and Chicago-based CommonSpirit Health have abandoned a deal that would have added 14 hospitals and three clinics to Essentia Health’s network.

9. 2 hospitals to part ways with U of Kansas Health System
HaysMed, a single-hospital system in Hays, Kan., and Pawnee Valley Community Hospital in Larned, Kan., will depart from the University of Kansas Health System. The organizations mutually agreed to part ways.

ROI realized from pre-bill review of documentation and coding

Posted on by • Posted in Clinical Documentation Improvement (CDI), Health System, Hospital, Hospital Industry, Physician, Return on Investment, Rev Cycle Management, Revenue Cycle • Leave a comment

https://www.healthcarefinancenews.com/news/roi-realized-pre-bill-review-documentation-and-coding

Hospitals can decrease denials by having physicians involved in the mid-revenue cycle review process.

Involving physicians in the mid-revenue cycle process can increase hospital ROI by 700%, according to Enjoin CEO Dr. James Fee.

Hospitals and health systems can improve revenue through a pre-bill review prior to claims submission, according to Fee. Enjoin does this work as a revenue cycle consulting business focused on documentation and coding. 

One of the first things Enjoin physicians check is that the care of the patient has been properly recorded. 

“We’re never taught how to communicate with those who record our work, so it can be captured in the coding system,” said Fee, who continues to practice as a physician in Baton Rouge, Louisiana.

Secondly, hospitals need to check the accuracy of the representation of that patient. 

“You want to make sure the severity of the patient is justified to get appropriately reimbursed,” Fee said.

WHY THIS MATTERS

Documentation and coding falls in the middle of the revenue cycle. Through a pre-bill review of the estimated 30-50% of cases that are chosen for review at this stage because of their complexity, organizations can ensure the documentation supports coding compliance, MS-DRG accuracy, quality performance data and other measures.

Results have shown an impressive 700% percent ROI on average and in some cases, 1,000%, according to Fee. On average, the process shows a 17% decline in denial rates.

Hospitals already have clinical staff in the rev cycle. Physicians add a layer of review. 

“We have practicing physicians who understand the disease process,” Fee said. “We look at a case to make sure the diagnosis is correct. What was the focus of care for that hospital stay? That takes a level of clinical interpretation.”

Enjoin, which has been around for about 30 years, does not offer a software product, but uses an analytics platform. It partners with clients as consultants in a technically agnostic way.  

Fee will speak on the topic “Mid-Revenue Cycle Drives Financial Stability During COVID19: How One Academic Medical Center Prospered,” in-person during the Healthcare Financial Management Association annual conference, Monday, November 8, in Minneapolis. 

AUTOMATION

As revenue cycle directors look to automate, this is more easily done on the front and back ends of the revenue cycle rather than the mid-cycle process, according to Fee. This is one area that will have to wait until AI makes it possible to interpret the data seen by physicians and other clinicians, he said.

“Automation is easy to say as one-stop shopping for an easy solution, but you need to understand what you’re automating,” he said.

There can be an automation component to the prioritization of reviews, something Enjoin plans to bring to market soon.

“Automation will continue to rapidly grow,” Fee said, “but there will always be that people component.”

THE LARGER TREND

As in other areas of healthcare, COVID-19 brought a level of uncertainty about the proper testing and diagnosis recorded in the revenue cycle.

During the most recent wave of COVID-19, many hospital ICU beds were again full, and health systems once again were canceling elective surgeries, with a resulting loss of revenue. 

Higher expenses for labor, drugs and supplies, as well as a continuation of delayed care, are projected to cost hospitals an estimated $54 billion in net income over the course of this year, according to Kaufman Hall analysis released last month by the American Hospital Association.

“The biggest impact for reimbursement was the loss of patient care,” Fee said. “We were in a fee-for-service model and margins were driven by elective surgeries.”

COVID-19 also shifted the commercial dominance of margins to lower-paying government reimbursement as employees lost their jobs, according to Fee.

During the first COVID-19 wave in 2020, CFOs were asking he said, “How do I adapt to that?” Many looked to prevent financial leakage in employing resources they already had. 

“That’s where CDI (Clinical Documentation Improvement) is helpful,” Fee said.

HCA’s profit more than triples to $2.3B in Q3

Posted on by • Posted in For-Profit, Health System, Hospital, Hospital Industry, Net Income, Nonoperating Income, Operating Expenses, Operating Income, Operating Margin, Operating Metrics, Operating Performance, Operating Revenue • Leave a comment
https://www.beckershospitalreview.com/finance/hca-s-profit-more-than-triples-to-2-3b-in-q3.html?origin=BHRE&utm_source=BHRE&utm_medium=email&utm_content=newsletter&oly_enc_id=2893H2397267F7G
HCA's profit more than triples to $2.3B in Q3 - NewsBreak

Nashville, Tenn.-based HCA Healthcare saw strong growth in revenue and profit in the third quarter of 2021 compared to the same period last year. 

The 183-hospital system posted revenue of $15.3 billion in the quarter ended Sept. 30, up 14.8 percent from the $13.3 billion recorded in the third quarter of 2020.

Compared to the third quarter of 2020, HCA said same-facility admissions increased 6.8 percent; emergency room visits increased 31.2 percent; inpatient surgeries declined 4.9 percent; and same-facility outpatient surgeries increased 6.4 percent.

Revenue per equivalent admission increased 5.2 percent because of increases in the acuity of patients and favorable payer mix, HCA said.

After factoring in expenses and nonoperating items, HCA’s net income totaled $2.3 billion in the third quarter of 2021, more than triple the $688 million recorded in the third quarter last year. 

HCA said the results of the third quarter include more than $1 billion in gains on the sale of four hospitals in Georgia and other money from investments. 

For the nine months ending Sept. 30, HCA recorded a net income of $5.1 billion on $43.6 billion in revenue. In the same nine-month period in 2020, HCA saw a net income of $2.3 billion on $37.2 billion in revenue.  

“During the third quarter we experienced the most intense surge yet of the pandemic, and our colleagues and physicians delivered record levels of patient care to meet the demand caused by the delta variant,” said Sam Hazen, CEO of HCA Healthcare. “Once again, the disciplined operating culture and strong execution by our teams were on display. I want to thank them for their tremendous work and dedication to serving others.”

The growing burden of mental health on emergency departments

Posted on by • Posted in Access, Access & Quality of Healthcare, Behavioral Health, Deferred Healthcare, Emergency Care, Health Insurance Coverage Adequacy, Health Policy, Health System, Hospital, Hospital Industry, Mental Health, Pandemic • Leave a comment

https://mailchi.mp/9d9ee6d7ceae/the-weekly-gist-october-22-2021?e=d1e747d2d8

The stress, disruption, isolation, and lives lost during the pandemic have exacerbated longstanding challenges in access to mental healthcare. In the graphic above, we highlight how COVID has impacted the state of mental health across generations. 

Younger Americans are faring much worse. This week, the nation’s leading pediatric professional societies declared a national mental health emergency for children and adolescents, and nearly half of “Generation Z” reports that their mental health has worsened during COVID. 

Mental health-related emergency department (ED) visits increased in 2020 across all age groups, with the steepest rise among adolescents. Because of a national shortage of inpatient psychiatric beds, patients with mental health needs are increasingly being “boarded” in the ED—even as nearly two-thirds of EDs lack psychiatric services to adequately manage patients in crisis.

Case in point: research on behavioral health access in Massachusetts shows one in every four ED beds is now occupied by a patient awaiting psychiatric evaluation. ED boarding of patients in mental health crisis not only delays necessary care, but leads to throughput backups in hospitals, and increases caregiver stress and burnout. 

Access to inpatient treatment is most challenged for children and adolescents, as well as “med-psych” patients, who also have significant physical health needs that must be managed. New solutions have emerged during the pandemic: burgeoning telemedicine platforms don’t just increase access to outpatient therapy, they also enable psychiatrists to evaluate emergency patients virtually.

In the long term, a three-part approach is needed—new virtual solutions, expanded inpatient capacity, and greater community resources to address the social needs that often accompany a behavioral health diagnosis.

Hospitals paying $24 billion more for labor during the COVID-19 pandemic

Posted on by • Posted in Employee Burnout, Employee Compensation, Employee Overtime, Employee Retention, Employee Satisfaction, Employee Staffing, Employee Staffing Shortage, Health System, Hospital, Hospital Industry, Labor Relations, Labor Shortages, Labor Spend Management, Labor Strike, Labor Temporary, Nurse Agency Staffing, Nurses Shortage, Pandemic • Leave a comment

https://www.healthcarefinancenews.com/news/hospitals-paying-24-billion-more-labor-during-covid-19-pandemic

Clinical labor costs are up by an average of 8% per patient day, translating to $17 million in additional annual labor expenses.

As the delta variant pushes COVID-19 caseloads to all-time highs, hospitals and health systems across the country are paying $24 billion more per year for qualified clinical labor than they did pre-pandemic, according to a new PINC AI analysis from Premier.

Clinical labor costs are up by an average of 8% per patient day when compared to a pre-pandemic baseline period in 2019. For the average 500-bed facility, this translates to $17 million in additional annual labor expenses since the beginning of the public health emergency.

The data also shows that overtime hours are up 52% as of September. At the same time, the use of agency and temporary labor is up 132% for full-time and 131% for part-time workers. The use of contingency labor – positions created to complete a temporary project or work function – is up nearly 126%.

Overtime and the use of agency staff are the most expensive labor choices for hospitals – usually adding 50% or more to a typical employee’s hourly rate, Premier found.

And hospital workers aren’t just putting in more hours – they’re also working harder. The analysis shows that productivity, measured in worked hours per unit of departmental volume, increased by an average of 7% to 14% year-over-year across the intensive care, nursing and emergency department units, highlighting the significance of the increases in cost-per-hour.

Another complicating factor is that hospital employees are more exposed to COVID-19 than many other workers, with quarantines and recoveries requiring the use of sick time. The data shows that use of sick time, particularly among full-time employees (FTEs) in the intensive care unit, is up 50% for full-time clinical staff and more than 60% for part-time employees when compared with the pre-pandemic baseline.

WHAT’S THE IMPACT

The combined stressors of working more hours while under the constant threat of coronavirus exposure are pushing many hospital workers to the breaking point. In fact, the data shows clinical staff turnover is reaching record highs in key departments like emergency, ICU and nursing. 

Since the start of the pandemic, the annual rate of turnover across these departments has increased from 18% to 30%. This means nearly one-third of all employees in these departments are now turning over each year, which is almost double the rate from two years ago.

This is a number that could increase as new vaccination mandates take effect. Already, one Midwestern system reported a loss of 125 employees who chose not to be vaccinated, while a New York facility reported another 90 resignations. Overall, staffing agencies are predicting up to a 5% resignation rate once vaccine mandates kick in. 

While a minority of the overall workforce, losses of even a few employees during times of extreme stress can have a ripple effect on hospital operations and costs.

THE LARGER TREND

According to the American Hospital Association, hospitals nationwide will lose an estimated $54 billion in net income over the course of the year, even taking into account the $176 billion in federal CARES Act funding from last year. Added staffing costs were not addressed as part of CARES and are further eating into hospital finances. 

As a result, some are now predicting that more than half of all hospitals will have negative margins by the end of 2021 – a trend that could be dire for some community hospitals. 

Prior to the pandemic, about one quarter of hospitals had negative margins, the Kaufman Hall data showed. At the beginning of 2021, after almost a year of COVID-19, half of hospitals had negative margins.

Meanwhile, the most potentially disruptive forces facing hospitals and health systems in the next three years are provider burnout, disengagement and the resulting shortages among healthcare professionals, according to a March survey of 551 healthcare executives.

Possible strike looms for 28,000 Kaiser workers in Southern California

Posted on by • Posted in Employee Morale, Employee Retention, Employee Satisfaction, Employee Staffing, Employee Staffing Shortage, Employee Strike, Health System, Hospital, Hospital Industry, Labor Shortages, Labor Spend Management, Labor Strike, Labor Union • Leave a comment
https://www.beckershospitalreview.com/hr/possible-strike-looms-for-31-000-kaiser-workers-in-southern-california.html?origin=BHRE&utm_source=BHRE&utm_medium=email&utm_content=newsletter&oly_enc_id=2893H2397267F7G
80,000 Kaiser Permanente workers to strike nationwide in October | Fox Business

Nurses and other healthcare workers have voted to authorize a strike at Kaiser Permanente in Southern California, according to a union news release.

The vote covers 21,000 registered nurses, pharmacists, midwives, physical therapists and other healthcare professionals represented by the United Nurses Associations of California/Union of Health Care Professionals, as well as 7,000 members of United Steelworkers. It does not mean a strike is scheduled. However, it gives bargaining teams the option of calling a strike. Unions representing the workers would have to provide a 10-day notice before striking.

The vote comes as Oakland, Calif.-based Kaiser is negotiating for a national contract with UNAC/UHCP, along with about 20 other unions in the Alliance of Health Care Unions. The alliance, which has been in negotiations with Kaiser since April, covers more than 50,000 Kaiser workers nationwide.

UNAC/UHCP said union members are facing “protracted understaffing” amid record levels of burnout during the COVID-19 pandemic.

“While healthcare workers are facing record levels of burnout after 18 months of the COVID pandemic, they continue to deal with protracted understaffing. Talks at the table center on how to recruit to fill open positions that impact patient care and service,” the union said in a news release. “Kaiser Permanente … wants to slash wages for new nurses and healthcare workers and depress wages for current workers trying to keep up with rising costs for food, housing and other essentials.”

Kaiser has defended its pay amid a challenging pandemic, saying its proposal includes wage increases for current employees “on top of the already market-leading pay and benefits,” as well as a market-based compensation structure for those hired in 2023 and beyond.

In a statement shared with Becker’s Oct. 11, the system also emphasized its continued focus on high-quality, safe care.

“In the event of any kind of work stoppage, our facilities will be staffed by our physicians along with trained and experienced managers and contingency staff,” the system said. 

This strike would affect Kaiser hospitals and medical centers in Anaheim, Bakersfield, Baldwin Park, Downey, Fontana, Irvine, Los Angeles, Ontario Vineyard, Panorama City, Riverside, San Diego, West Los Angeles and Woodland Hills, as well as various clinics and medical office buildings in Southern California.

Hospitals still spending more on PPE, labor as result of COVID-19

Posted on by • Posted in Coronavirus, Coronavirus Delta Variant, Coronavirus Mutation, Health System, Hospital, Hospital Industry, Labor Shortages, Labor Spend Management, Nurse Agency Staffing, Nurse Staffing, Nurses Shortage, Pandemic, Personal Protective Equipment (PPE), Supply Chain, Talent Competition, Talent Identification, Talent Imperative, Talent Management • Leave a comment
https://www.healthcaredive.com/news/ppe-labor-costs-expenses-pandemic-hospitals-premier/608144/?utm_source=Sailthru&utm_medium=email&utm_campaign=Issue:%202021-10-13%20Healthcare%20Dive%20%5Bissue:37318%5D&utm_term=Healthcare%20Dive

Dive Brief:

  • Hospitals across the country have spent more than $3 billion on personal protective equipment since the start of the COVID-19 pandemic, though costs have steadily declined since the worst shortages experienced during the second quarter of 2020, according to an analysis from Premier, a group purchasing organization.
  • Before the pandemic, hospitals normally spent about $7 on PPE costs per patient per day. That figure shot to $20.40 during the second quarter of last year, and during the first quarter of this year was around $12.45 per patient per day, according to Premier.
  • Hospitals are also still paying more for qualified clinical labor — roughly $24 billion more in total per year compared to before the pandemic, according to another Premier analysis out last week.

Dive Insight:

PPE was in short supply early in the pandemic, spurring bidding wars and financially straining hospitals as they suffered from the budgetary fallout of canceled elective surgeries and other lucrative services.

While supply chain challenges have since eased and costs are down since their peak, hospitals are still spending more on PPE than before the pandemic, and consumption and demand remains strong in light of the delta variant, according to the report.

Premier used a database representing 30% of U.S. hospitals across all regions from September 2019 through last month to track spending trends, looking at costs for eye protection, surgical gowns, N95 respirators, face masks, exam gloves and swabs. It then calculated total costs measuring quantities used per patient, per day, multiplied by the percent change in pricing for the quarter.

Ultimately, hospitals are still using far more N95 respirators than they were prior to the pandemic.

Demand is still up for eye protection, surgical gowns and face masks, though pricing is close to pre-pandemic levels for those items. Costs for surgical gloves and N95 respirators are still above pre-pandemic levels, according to the analysis.

While most PPE costs have steadily declined for hospitals, other expenses have not, namely labor costs.

Contract labor costs have fluctuated, though they reached record highs amid COVID-19 surges, commanding record rates from providers. And nursing shortages, especially, have been so dire that hospitals are spending more on recruiting and retaining for the positions, boosting benefits and offering steep sign on bonuses.

Clinical labor costs are up 8% on average per patient, per day compared to before the pandemic, according to the earlier Premier analysis. That translates to about $17 million in additional annual labor expenses for the average 500-bed facility.

As of last month, overtime hours are up 52% since before the pandemic. The use of agency and temporary labor is up 132% for full-time employees and 131% for part-time employees.

The most expensive labor choices for hospitals are contract labor and overtime, typically adding 50% or more to an employee’s hourly rate, according to Premier.

For that report, Premier used a database with daily data from about 250 hospitals, bi-weekly data from 650 hospitals and quarterly data for 500 hospitals from October 2019 through August to analyze workforce trends among employees in emergency departments, intensive care units or nursing areas.