Hospital Impact—The only thing clear about healthcare policy is the continued lack of clarity

http://www.fiercehealthcare.com/hospitals/hospital-impact-only-thing-clear-about-healthcare-policy-continuing-lack-clarity?utm_medium=nl&utm_source=internal&mrkid=959610&mkt_tok=eyJpIjoiWldFeE1XUXlPRFE0TlRneCIsInQiOiJ5dzRsZ1IwekxcL2FMZnN3NkJIOHZGbnpNV1RPcmtMNmdPd1MwV0RLUXNBSXl6QzJnK0s0NktPVzBLOUtRRjF1K0puZzZMZG95dERnN2VUcVRpeForakRVZVJsXC9GWllyU1g1Rk9ZY2pERVRQcjVyT1wvQkMycXdobjd5UnNKa2p3NiJ9

Executive looking out window

For healthcare leaders, it’s discouraging that federal policy decisions seem to be made at the last minute without much planning or consideration of unintended consequences.

I spent my Labor Day vacation in Monterrey, California, watching the waves crash into the sand and wondering what the future of healthcare will look like in the coming months and years. Some clarity is emerging that we have not seen in the past, and I feel comfortable making some observations and predictions:

  • Congress will not revisit the repeal and replacement of the Affordable Care Act before the end of the year. It is simply dealing with far too many other issues—passing a budget, raising the debt ceiling, approving disaster aid for Harvey and Irma, not to mention its desire for tax reform—that lawmakers must address.
  • While the Senate HELP committee is attempting a bipartisan effort to shore up the ACA, the issues listed above will make it almost impossible for such a law to be passed during this session.
  • The leadership of the Department of Health and Human Services ideologically opposes the very concept of the ACA and is also responsible for implementing the law. The tension between those two facts will lead to confusion and uncertainty for those of us in healthcare.
  • The passage of the ACA changed the terms of debate around healthcare reform. Granting health insurance to more than 20 million Americans has now shifted public opinion so that a solid majority believes the federal government should ensure that its citizens have insurance.
  • The ACA is not failing, but going forward it can be undermined without congressional action.

As a former anatomic pathologist, I am always interested in postmortem examination of failures, and the failure of Republicans to repeal the ACA ranks high in any list of stunning political disasters. Pundits have identified several possible causes:

  • Republicans never had a clear replacement plan or goal.
  • Taking away benefits from 22 million Americans is politically unpopular.
  • The ACA was not in a “death spiral.”
  • The president did not exert necessary leadership to get GOP senators to support his unpopular position.
  • Republican governors who had expanded Medicaid did not support the effort.
  • Organized opposition to repeal led to most Americans not supporting repeal.

Autopsy results always arrive too late for those of us who are still alive, and it is more important for those of us in healthcare to interpret the mixed messages coming out of HHS and Congress so that our organizations can continue to care for patients under the current system.

HHS seems willing and eager to let states experiment with healthcare reform. Alaska has received approval for $323 million over five years to subsidize insurance carriers and stabilize its individual ACA marketplace. Iowa is likely to receive approval for a radical 1332 waiver approach to healthcare reform in the Hawkeye state, and other states are preparing waiver submissions.

Meanwhile, HHS actions that seem to undermine the ACA include refusing to guarantee cost-sharing reduction subsidies to insurance companies and slashing the budget to support ACA enrollment for 2018. HHS recently announced advertising budget cuts of 90% for 2018 and the navigator program cuts of 40%.

A recent study—detailed in a post on The Incidental Economist blog—compared Kentucky ACA enrollment under a Democratic governor who supported advertising and a Republican governor who cut advertising. It found that lack of TV advertising led to 450,000 fewer page views on the ACA website and 20,000 fewer unique visits to the enrollment website.

ACA supporters, meanwhile, have recently put together a private enrollment campaign for 2018 to fill in the gap created by HHS decisions, Axios reported.

Last week, the Senate HELP Committee heard from state insurance commissioners and governorsabout ideas to stabilize the ACA marketplaces. They include:

  • Funding the cost-sharing reduction subsidies to insurance companies.
  • Facilitating reinsurance programs.
  • Expanding the ACA 1332 waiver programs to let states innovate.
  • Funding enrollment activities such as advertising and navigator programs.

Although health policy experts largely support these recommendations, it is hard to see how such a divided Congress could pass such proposals. Even if such legislation were approved, it would likely come too late to impact health insurance company decisions for 2018.

So, as of early September, we are left with the ACA continuing to be the law of the land, but with those in charge of the federal government not entirely supporting its success. Healthcare organizations have difficulty caring for patients when the rules keep changing and when clarity is hard to come by. It is also discouraging that decisions seem to be made at the last minute without much planning or consideration for unintended consequences.

That said, we still need to keep taking care of patients. My advice is to:

  • Continue to prepare for the transition from fee-for-service to value-based payments, but be aware that the Trump administration might slow down this process.
  • Continue to cut unnecessary costs.
  • Continue to improve the measurable quality of the care you give.
  • Participate in efforts in your individual states to innovate through waiver programs.
  • Collaborate with your physicians who are confused by all the uncertainty.
  • Keep up to date with the frequent changes that nobody can predict.

 

 

Moody’s downgrades UPMC to ‘A1’

http://www.beckershospitalreview.com/finance/moody-s-downgrades-upmc-to-a1.html

Image result for university of pittsburgh medical center

 

Moody’s Investors Service downgraded Pittsburgh-based UPMC from “Aa3” to “A1,” affecting $2.9 billion of debt.

In addition, Moody’s downgraded UPMC-Hamot’s bonds, which are parity obligations for UMPC, from “Aa3” to “A1.”

The downgrade is a result of several factors including UPMC’s rapid expansion project, high execution risk following the acquisition of Harrisburg, Pa.-based PinnacleHealth and a new service area with high competition. Moody’s also acknowledged UPMC’s increased debt burden, below average financial performance and suppressed margins. Offsetting an additional notch downgrade is UPMC’s strong market position, integration of various hospital acquisitions and core competency in acute care management.

The outlook is negative, reflecting Moody’s expectation that UPMC’s rapid expansion may pose financial and cultural stress.

Banner Health secures $550M bond to finance construction of two hospitals

http://www.beckershospitalreview.com/facilities-management/banner-health-secures-550m-bond-to-finance-construction-of-two-hospitals.html

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Phoenix-based Banner Health secured a $550 million revenue bond issue to finance the construction of two new teaching hospitals in Tucson, Ariz., and Phoenix, according to Az Central.  

The bonds will be used to help finance $325 million of a new 16-story patient tower currently under construction at Banner University Medical Center in Phoenix, and another $225 million will finance the construction of a nine-story tower at Banner University Medical Center in Tucson.

When the construction is completed in Phoenix, the tower will house 256 inpatient beds, an emergency department, trauma center, operating rooms and lab space. The 16-story tower is expected to be completed by October 2018.

The new hospital tower in Tucson will replace the current hospital, include 200 patient rooms and provide new laboratories, operating rooms and diagnostic centers, according to The Daily Wildcat.

The Maricopa County Board of Supervisors approved the bond issue Sept. 6. Banner Health is obligated to pay off the bonds, under the agreement.

Supreme Court exempts church-affiliated hospitals from federal pension law: 5 things to know

http://www.beckershospitalreview.com/legal-regulatory-issues/supreme-court-exempts-church-affiliated-hospitals-from-federal-pension-law-5-things-to-know.html

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The U.S. Supreme Court on Monday held that church-affiliated hospitals do not have to comply with the federal Employee Retirement Income Security Act, which governs employee pensions.

Here are five things to know about the case and the high court’s ruling.

1. The Supreme Court agreed in December to take up appeals filed by religiously affiliated hospital systems that were accused of underfunding their employee pension plans.

2. In three lawsuits, which were consolidated into one case, the high court was asked to decide whether the health systems can rely on their church affiliations to avoid complying with ERISA, which requires pension plans to have adequate funding to pay their promised benefits.

3. The lower courts said each of the three hospital systems — Saint Peter’s HealthCare System in New Brunswick, N.J., Dignity Health in San Francisco and Advocate Health Care in Downers Grove, Ill. — misclassified their pensions as “church plans” exempt from ERISA.

4. In an 8-0 ruling issued Monday, the Supreme Court overturned the lower court decisions that could have cost the health systems billions of dollars combined. Supreme Court Justice Neil Gorsuch did not participate in Monday’s decision, as he joined the court after arguments were presented in the case.

5. Justice Elena Kagan, writing for the court, said ERISA’s religious exemption applies to pension plans established by churches themselves and those established by organizations affiliated with churches.

“Because Congress deemed the category of plans ‘established and maintained by a church’ to ‘include’ plans ‘maintained by’ principal-purpose organizations, those plans — and all those plans — are exempt from ERISA’s requirements,” wrote Ms. Kagan.

Ascension to pay $29.5M settlement in pension lawsuit

http://www.beckershospitalreview.com/legal-regulatory-issues/ascension-to-pay-29-5m-settlement-in-pension-lawsuit.html

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St. Louis-based Ascension Health ended a class-action lawsuit filed against the system and subsidiary Wheaton Franciscan Services in Glendale, Wis., alleging Wheaton erroneously treated its pension plan as a “church plan” exempt from the federal Employee Retirement Income Security Act, Bloomberg BNA reports.

Under the settlement, Ascension will pay $29.5 million in benefit payments for Wheaton’s retirement plan and up to $2.25 million in legal fees and expenses. Court papers filed Sept. 1 show the deal mandates Ascension to guarantee payment of the $29.5 million for the benefits if the plan cannot cover the costs, the report states.

Ascension and Wheaton denied the allegations in filed court papers, St. Louis Business Journal reports. The settlement requires court approval before it is finalized.

In June, the U.S. Supreme Court held church-affiliated hospitals are not required to comply with ERISA, which governs employee pensions.

 

Irma forces 35 hospitals across 3 states to evacuate: 9 things to know

http://www.beckershospitalreview.com/patient-flow/irma-forces-35-hospitals-across-3-states-to-evacuate-9-things-to-know.html

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Hurricane Irma hit southwest Florida Sunday and continued its destructive march north, forcing at least 35 hospitals across Florida, Georgia and South Carolina to evacuate patients or shut down. Downgraded to a tropical storm Monday morning, Irma still presents a major threat to many healthcare facilities.

Here are nine things to know.

1. As of Saturday afternoon, most of Florida’s hospitals remained open, the Florida Hospital Association told STAT. In advance of the hurricane, healthcare facilities across the state evacuated nearly 1,900 patients.

2. Four hospitals in the Florida Keys — Lower Keys Medical Center in Key West, Fishermen’s Hospital in Marathon, Mariners Hospital in Tavernier and Depoo Hospital in Key West — were among the first healthcare facilities in the state to close last week ahead of the hurricane, according to STAT.

3. In Miami, Mercy Hospital, part of Nashville, Tenn.-based HCA Healthcare, closed Friday after evacuating 200 patients. The patients were transferred to other HCA facilities. The Miami Cancer Institute, part of Coral Gables-based Baptist Health South Florida, also closed.

4. Mt. Sinai Hospital in Miami opened two conference rooms to house 30 expectant couples who were unable to leave during the hurricane. The women are 36 or more weeks pregnant and unable to travel, according to WHDH.

5. Naples, Fla.-based NCH Healthcare System stayed open during the hurricane and provided shelter for hundreds of evacuees, according to the Naples Daily News.

6. On Florida’s west coast, at least five hospitals have closed. Tampa General Hospital, the region’s only Level 1 trauma center, stayed open. As of Sunday, about 650 patients were in the hospital. A group of physicians, nurses and other staff will care for patients throughout the remainder of the storm, according to the Tampa Bay Times.

7. In central Florida, Cape Canaveral Hospital closed after evacuating patients last week, according to STAT.

8. In Georgia, Candler Hospital in Savannah transferred patients to St. Joseph’s Hospital in Savannah. Officials said St. Joseph’s Hospital “is better equipped to handle the long-term needs of our caregivers, medical staff and any patients who are too sick to be discharged or evacuated.”

9. In South Carolina, Hilton Head Hospital evacuated all patients and suspended services.