Health systems facing an uphill battle for MA lives

https://mailchi.mp/66ebbc365116/the-weekly-gist-june-11-2021?e=d1e747d2d8

Fighting an Uphill Battle? - Zeteo 3:16

A number of the regional health systems we work with have either launched or are planning to launch their own Medicare Advantage (MA) plans. The good news is the breathless enthusiasm among hospitals for getting into the insurance business that followed the advent of risk-based contracting has been tempered in recent years.

Early strategies, circa 2012-15, involved health systems rushing into the commercial group and individual markets, only to run up against fierce competition from incumbent Blues plans, and an employer sales channel characterized by complicated relationships with insurance brokers. 

Slowly, a lightbulb has gone off among system strategists that MA is where the focus should be, given demographic and enrollment trends, and the fact that MA plans can be profitable with a smaller number of lives than commercial plans. It’s also a space that rewards investments in care management, as MA enrollees tend to be “sticky”, remaining with one plan for several years, which gives population health interventions a chance to reap benefits.

But as systems “skate to where the puck is going” with Medicare risk, they’re confronting a new challenge: slow growth. Selling a Medicare insurance plan is a “kitchen-table sale”, involving individual consumer purchase decisions, rather than a “wholesale sale” to a group market purchaser. That means that consumer marketing matters more—and the large national carriers are able to deploy huge advertising budgets to drive seniors toward their offerings. 

Regional systems are often outmatched in this battle for MA lives, and we’re beginning to hear real frustration with the slow pace of growth among provider systems that have invested here. Patience will pay off, but so will scale, most likely—the bigger the system, the bigger the investment in marketing can be. (Although even large, national health systems are still dwarfed by the likes of UnitedHealthcare, CVS Health, and Humana.)

Look for the pursuit of MA lives to further accelerate the trend toward consolidation among regional health systems.

Healthcare M&A heats up in first quarter

https://mailchi.mp/66ebbc365116/the-weekly-gist-june-11-2021?e=d1e747d2d8

Judging from the level of deal activity across healthcare in the first quarter of this year, post-pandemic euphoria is truly taking hold. After a substantial, COVID-related dip across most of last year, healthcare M&A began to accelerate in the fourth quarter of 2020, and hit a new high in the first quarter of 2021—up 19 percent. While all sectors saw an uptick in deal flow, the level of activity was particularly high among physician groups, as well as in the behavioral health and “e-health” spaces.

Although hospital deal activity waned somewhat in the first quarter, the average value of deals increased: the average seller size by revenue was $676M, around 70 percent above historical year-end averages. This reflects a shift from bolt-on acquisitions by health systems looking to add isolated assets, to larger health systems seeking to combine their portfolios. Private equity continues to fuel a large portion of deal activity, especially in the behavioral health and physician group space, contributing to an 87 percent surge in the physician sector

We’d expect this flurry of M&A activity to persist—especially among physician groups and hospitals—as organizations seek financial security after a turbulent year, and as larger players look to scale their market presence and diversify revenue streams. 

In first federal ruling on vaccine mandates, judge sides with Houston hospital, dismissing claims from staff resisters

https://www.yahoo.com/news/federal-judge-sides-houston-hospitals-020713664.html

178 staffers at Houston Methodist hospital suspended for not complying with  COVID-19 vaccine mandate - ABC News

In the first federal ruling on vaccine mandates, a Houston judge Saturday dismissed a lawsuit by hospital employees who declined the COVID-19 shot – a decision that could have a ripple effect across the nation.

The case involved Houston Methodist, which was the first hospital system in the country to require that all its employees get vaccinated. U.S. District Judge Lynn N. Hughes said federal law does not prevent employers from issuing that mandate.

After months of warnings, Houston Methodist had put more than 170 of its 26,000 employees on unpaid suspension Monday. They were told they would be fired it they weren’t vaccinated by June 21.

The hospital already had made it clear it means what it says: It fired the director of corporate risk – Bob Nevens – and another manager in April when they did not meet the earlier deadline for bosses.

In recent weeks, a few other major hospitals have followed Houston Methodist’s lead, including the University of Pennsylvania, University of Louisville, New York Presbyterian and several major hospitals in the Washington, D.C. area.

Houston Methodist’s CEO Marc Boom predicts more hospitals soon will join the effort. Many hospitals and employers were waiting for legal clarification before acting.

“We can now put this behind us and continue our focus on unparalleled safety, quality, service and innovation,” Boom said after the ruling. “Our employees and physicians made their decisions for our patients, who are always at the center of everything we do.”

The lawsuit was filed by 117 workers led by Jennifer Bridges, a nurse at Houston Methodist’s Baytown hospital who declined the vaccine because she considers it experimental and dangerous. The judge disagreed, writing: “This claim is false, and it is also irrelevant.”

Learning of the dismissal from USA TODAY, Bridges vowed not to give up. She has initiated a change.org petition that as of Saturday had drawn more than 9,000 signatures and a GoFundMe to pay for the lawsuit that has raised $130,000.

“This doesn’t surprise me,” she said. “Methodist is a very large company and they are pretty well protected in a lot of areas. We knew this was going to be a huge fight and we are prepared to fight it.”

The lawsuit claimed that federal law prohibits employees from being required to get vaccinated without full U.S. Food and Drug Administration approval of the vaccines. Currently, the FDA has authorized the Moderna, Pfizer and Johnson & Johnson vaccines under a special provision for emergencies.

The judge dismissed this argument as well, saying that law does not apply to private employers. He also dismissed an argument that anyone who gets the vaccine is effectively a human subject in an experimental trial.

“The hospital’s employees are not participants in a human trial,” he wrote. “They are licensed doctors, nurses, medical technician, and staff members. The hospital has not applied to test the COVID-19 vaccines on its employees.”

The lawsuit originally was filed in Texas state court but was moved to federal court at Houston Methodist’s request. The federal judge ruled Saturday that Texas state law only protects workers from being fired if they are forced to commit a crime.

Sutter Health to lay off 400 workers

Sutter Health fined again over not notifying nurses about COVID-19 exposure

As part of a financial restructuring plan, Sacramento, Calif.-based Sutter Health will issue another round of layoffs this year, according to the Sacramento Business Journal.  

The health system said it plans to lay off 400 more employees. These newly announced layoffs are in addition to 277 information technology jobs that were cut April 2. 

Sutter said most of the new layoffs affect employees in administrative positions in benefits, human resources, data services and accounting. The layoff notice said many of these employees were working remotely or in the field. 

Sutter told the Business Journal that it’s working to evaluate every aspect of its business model.

“Moving forward, we will continue to work to minimize staff reductions and their impact on our dedicated employees as we look for ways to eliminate variation, streamline resources and more efficiently manage our indirect costs,” Sutter told the Business Journal.

Sutter ended 2020 with a $321 million operating loss, including $800M in funding from the Coronavirus, Aid, Relief and Economic Security Act. Without the funding, Sutter’s operating loss would have been $1.1 billion. As a result, Sutter initiated a sweeping review of its finances in March 2021. 

Sutter Health also gave voluntary severance packages to 800 workers in 2020.

North Carolina AG gets 116 complaints about Mission Health

A concerning number,' Attorney General describes recent Mission Health  complaints filed | WLOS

The North Carolina attorney general’s office received 116 complaints about Asheville, N.C.-based Mission Health over a 12-month period, WLOS reported June 8. 

WLOS reported that most of the complaints were related to billing issues, 23 percent were concerns over quality of care, 16 percent were related to cost of service, 7 percent were from employees or former employees of Mission Health and 5 percent were related to charity care requirements.

“It’s a concerning number, 116 over a year,” Attorney General Josh Stein told WLOS. “That’s a lot, so we’re sharing our serious concerns with the management of the health system and we are going to be on top of this to the extent we possibly can.”

Mr. Stein told the publication that his office recently dedicated one of his employees to keeping track of all the complaints about Mission Health.

Mission Health was acquired by Nashville, Tenn.-based HCA Healthcare in 2019. HCA agreed to certain commitments as part of the deal, including keeping major Mission Health facilities open and continuing to provide certain services.

Since the acquisition, there have been a number of physician exits from the health system, and an independent monitor is looking into the reason behind the exits.

Mission Health shared the following statement with WLOS:

“Since January of 2021, we are aware of 15 complaints made to the Attorney General’s office, nine of which were related to billing and all of which have been resolved. We address every issue the Attorney General’s office brings to our attention promptly—both with them and the patient. Our patient care is our first priority. We strongly encourage everyone to contact us directly any time there is a concern so we can address it with them immediately and personally.

Going back to 2020, the majority of billing concerns were made shortly after acquisition of Mission and primarily regarded questions around changes to medical practice operations and a variety of billing issues all of which were resolved. Any patient or guarantor with billing questions or concerns should contact 833-323-0834 and we are happy to discuss, answer any questions you may have, and seek resolution where needed. Further, we have an email address, contactmission@hcahealthcare.com, where people can reach out to us on any matter.”

Wisconsin pharmacist who intentionally damaged 570 vaccine doses sentenced to 3 years in prison

Wisconsin pharmacist arrested after allegedly deliberately ruining hundreds  of COVID-19 vaccine doses | KTLA

An Advocate Aurora Health pharmacist who intentionally damaged 570 doses of COVID-19 vaccine was sentenced to three years in prison, according to NBC affiliate WTMJ of Milwaukee.

Steven Brandenburg worked at Aurora Medical Center in Grafton, Wis., when he removed Moderna COVID-19 vaccine vials from refrigeration twice in December. He told investigators he believed the vaccine could harm patients or change their DNA. 

He was arrested Dec. 31 on charges of first-degree recklessly endangering society, adulterating a prescription drug and criminal damage to property. 

Fifty-seven people received the vaccines after they were left out, but they will likely experience no harm, according to officials with Aurora Health Care, based in both Milwaukee and Downers Grove, Ill.

After Aurora Health Care investigated the incident, Mr. Brandenburg was fired. He and the Wisconsin Pharmacy Examining Board agreed on his license suspension during a Jan. 13 meeting. 

Mr. Brandenburg on Jan. 26 agreed to plead guilty to two counts of attempting to tamper with consumer products with reckless disregard.

On June 8, Mr. Brandenburg was sentenced to three years in prison. After serving his sentence, he will face another three years of supervised release.

Mr. Brandenburg told the court he was “desperately sorry and ashamed” about tampering with the vaccines. He also said Aurora Health Care is a “pillar of the community” and “did not deserve” the incident, according to WTMJ.