BETH ISRAEL, LAHEY HEALTH MERGER GETS FTC, MASSACHUSETTS AG’S APPROVAL

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he condition-laden approval stipulates a seven-year price cap that guarantees that the merged health system’s price increases will be kept below the state’s healthcare cost growth benchmarks.


KEY TAKEAWAYS

The Federal Trade Commission calls the merger ‘a close call’ but defers to state regulators.

The merged health system will provide $71 million for care in underserved areas.

The merged, 13-hospital health system will be one of the largest in the Bay State.

The proposed merger of Beth Israel Deaconess Medical Center and Lahey Health System cleared a huge hurdle today when Massachusetts Attorney General Maura Healey announced her conditional support.

The approval comes with what Healey called an “unprecedented” seven-year price cap that guarantees that the merged health system’s price increases will be kept below the state’s Health Care Cost Growth benchmark.

“Through this settlement, Beth Israel Lahey Health will cap its prices, strengthen safety net providers across the region, and invest in needed behavioral health services,” Healey said in a media release.

“These enforceable conditions, combined with rigorous monitoring and public reporting, create the right incentives to keep care in community settings and ensure all our residents can access the high-quality health care they deserve,” she said.

The deal also cleared a key federal hurdle when the Federal Trade Commission voted to close its investigation in light of Healey’s agreement.

“The assessment of whether to take enforcement action was a close call. However, based on Commission staff’s work and in light of the settlement obtained by the Massachusetts AG, we have decided to close this investigation,” the FTC said in a media release.

Kevin Tabb, MD, CEO of Beth Israel Deaconess Medical Center, who will serve as CEO of Beth Israel Lahey Health, called the state and federal approvals “an important step forward in making our vision a reality.”

“We appreciate the enormous effort that the Attorney General, her staff and the Federal Trade Commission have devoted to our proposal.  We share their commitment to health care innovation in Massachusetts, and we are eager to build on the strengths of our legacy organizations and deliver on our promise to our patients, their families and our communities,” Tabb said.

Massachusetts’ Health Care Cost Growth benchmark controls the annual growth of total medical spending in the state and is now set at 3.1%. Over the seven-year term, the cap will avoid more than $1 billion of the potential cost increases projected by the state’s Health Policy Commission.

When finalized, the merged, 13-hospital health system will be will one of the largest in the Bay State.

The merger push began in 2017, with Beth Israel and Lahey justifying the consolidation as a market-based attempt to address rising costs, price disparities, and healthcare access issues.

However, the deal has faced headwinds since its inception.

Even as late as this September, the Massachusetts Health Policy Commission noted that the merger would create a health system roughly the same size as Partner’s HealthCare System, the state’s largest health system, which would “increase substantially” market concentration in eastern Massachusetts.

“BILH’s enhanced bargaining leverage would enable it to substantially increase commercial prices that could increase total healthcare spending by an estimated $128.4 million to $170.8 million annually for inpatient, outpatient, and adult primary care services,” MHPC said.

In addition, the commission said spending on specialty physician services could increase by as much as $60 million annually if the merged health system obtains similar prices increases for those services.

“These would be in addition to the price increases the parties would have otherwise received,” the commission wrote. “These figures are likely to be conservative. The parties could obtain these projected price increases, significantly increasing healthcare spending, while remaining lower-priced than Partners.”

Those concerns appeared to have been alleviated on Thursday, when MHPC Commissioner Martin Cohen said “the investments required by the settlement will have a real impact on access to treatment for mental health and substance use disorders for patients across Eastern Massachusetts.”

Healey’s assurance of discontinuance also includes requirements that the merged Beth Israel Lahey Health pledge $71.6 million to support healthcare services for underserved areas.

The deal also requires BILH to strengthen its commitment to MassHealth; engage in business planning with its safety net hospital affiliates; enhance access to mental health and substance use disorder treatment; and retain a third-party monitor to ensure compliance with the terms.

The deal exempts affiliated safety net hospitals from the price-cap constraints. Lawrence General Hospital CEO Dianne J. Anderson said the exemption for her safety net will “ensure a commitment to joint, long-term planning for distribution of health care resources across the region.”

The $71.6 million that BILH will spend over eight years for underserved areas will include:

  • $41 million to fund affiliated community health centers and safety net hospitals, which guarantees support at the systems’ historic levels.
  • At least $8.8 million in additional financial support for affiliated community health centers and safety net hospitals.
  • At least $5 million in strategic investment to expand access to healthcare for low-income communities through community health centers.
  • At least $16.9 million to develop and expand behavioral health services across the BILH system.

“THROUGH THIS SETTLEMENT, BETH ISRAEL LAHEY HEALTH WILL CAP ITS PRICES, STRENGTHEN SAFETY NET PROVIDERS ACROSS THE REGION, AND INVEST IN NEEDED BEHAVIORAL HEALTH SERVICES.”

 

Trump signs spending bill into law: Here are health IT’s biggest wins

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HIMSS Senior Director of Congressional Affairs broke down how the massive spending bill will boost telehealth, Medicaid and other crucial health IT.

Congressional leaders passed the spending bill last night, after a 5-hour government shutdown. Senate passed the spending bill around 1:45 a.m. with a 71-28 vote, while the House pushed through the legislation at about 5:30 this morning with a 240-186 vote.

The shutdown was caused by a one-man protest by Sen. Rand Paul, R-Kentucky, who opposed adding another $320 billion to the federal budget deficit. Indeed the massive spending bill adds hundreds of billions of dollars for the military, disaster relief and domestic programs.

While budget appropriators will have until Mar. 23 to determine how to specifically dole out the funding, there are a lot of wins for healthcare, according to Samantha Burch, senior director of congressional affairs for HIMSS.

The bipartisan agreement will raise the budget cap to allow the total budget allocation for defense, non-defense and non-discretionary items, which is “a big win for HIMSS priorities,” Burch said. Those caps will not only help federal agencies with military needs, but it will support health needs and threats for the country.

One of the biggest gains from the budget was the inclusion of the CHRONIC Care Act, which unanimously passed the Senate in September. HIMSS provided technical feedback on for developing the bill, which Burch said is aimed at modernizing Medicare to streamline care coordination and improve outcomes.

Not only will the bill expand telehealth to Medicare beneficiaries, it will also generate patient data on those beneficiaries.

“We’ve been huge supporters of the CHRONIC care act,” said Burch. “Getting that bill over the finish line is an important first step. There’s all of this momentum around health IT on Capitol Hill, but it’s been incredibly hard to get bills across the finish line and signed into law.”

“This is really the first time that we’re seeing a complete package that would expand telehealth access to Medicare beneficiaries,” she continued. “It’s an incredible step forward.”

The spending bill also included provisions for Community Health Centers, National Health Service Corps and Medicare programs that help rural area providers, said Burch. CHIP was also extended for a longer period than anticipated, which provides some stability and certainty to the industry as a whole.

The budget also provides at least $2 billion for the National Institutes of Health for two years and $6 billion for the opioid epidemic.

What’s incredibly valuable is that the two-year budget gives appropriators a “longer runway for the FY19 budget.”

“But there’s much more work to be done,” said Burch. “It’s never a silver bullet… like with the CHRONIC Care bill, we’re trying to bridge this major gap where technology and innovation is, and where regulation and policy is.”

“The bill takes us a little way there, but there’s certainly more to do,” she added.

HIMSS will be continuing to work on progressing these needs moving forward, while concentrating on cybersecurity, interoperability and infrastructure.

Although the industry has come a long way, cybersecurity continues to be a major issue for healthcare, said Burch. HIMSS played a major part of Sec. 405 of the Cybersecurity Act of 2015, which it developed with the Senate HELP committee.

“[That work] got the attention of the Department of Health and Human Servicesand got the ball rolling, which created a more active relationship between HHS and the private sector,” said Burch.

But one of the biggest needs — and perhaps the biggest push — will continue to be around infrastructure needs. Burch explained that while Congress continues to have these conversations around infrastructure and public and rural health, there’s a lot of work to be done.

“We’re still trying to impress upon lawmakers that yes, our roads and bridges may be crumbling, but we still have those with no access to broadband,” said Burch. And that has some of the best use cases for health IT and telehealth.

Bipartisan Senate Budget Deal Boosts Health Programs

Bipartisan Senate Budget Deal Boosts Health Programs

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In a rare show of bipartisanship for the mostly polarized 115th Congress, Republican and Democratic Senate leaders announced a two-year budget deal that would increase federal spending for defense as well as key domestic priorities, including many health programs.

Not in the deal, for which the path to the president’s desk remains unclear, is any bipartisan legislation aimed at shoring up the Affordable Care Act’s individual health insurance marketplaces. Senate Majority Leader Mitch McConnell (R-Ky.) promised Sen. Susan Collins (R-Maine) a vote on health legislation in exchange for her vote for the GOP tax bill in December. So far, that vote has not materialized.

The deal does appear to include almost every other health priority Democrats have been pushing the past several months, including two years of renewed funding for community health centers and a series of other health programs Congress failed to provide for before they technically expired last year.

“I believe we have reached a budget deal that neither side loves but both sides can be proud of,” said Senate Minority Leader Chuck Schumer (D-N.Y.) on the Senate floor. “That’s compromise. That’s governing.”

Said McConnell, “This bill represents a significant bipartisan step forward.”

Senate leaders are still negotiating last details of the accord, including the size of a cut to the ACA’s Prevention and Public Health Fund, which would help offset the costs of this legislation.

According to documents circulating on Capitol Hill, the deal includes $6 billion in funding for treatment of mental health issues and opioid addiction, $2 billion in extra funding for the National Institutes of Health, and an additional four-year extension of the Children’s Health Insurance Program (CHIP), which builds on the six years approved by Congress last month.

In the Medicare program, the deal would accelerate the closing of the “doughnut hole” in Medicare drug coverage that requires seniors to pay thousands of dollars out-of-pocket before catastrophic coverage kicks in. It would also repeal the controversial Medicare Independent Payment Advisory Board (IPAB), which is charged with holding down Medicare spending for the federal government if it exceeds a certain level. Members have never been appointed to the board, however, and its use has not so far been triggered by Medicare spending. Both the closure of the doughnut hole and creation of the IPAB were part of the ACA.

The agreement would also fund a host of more limited health programs — some of which are known as “extenders” because they often ride along with other, larger health or spending bills.

Those programs include more than $7 billion in funding for the nation’s federally funded community health centers. The clinics serve 27 million low-income people and saw their funding lapse last fall — a delay advocates said had already complicated budgeting and staffing decisions for many clinics.

And in a victory for the physical therapy industry and patient advocates, the accord would permanently repeal a limit on Medicare’s coverage of physical therapy, speech-language pathology and outpatient treatment. Previously, the program capped coverage after $2,010 worth of occupational therapy and another $2,010 for speech-language therapy and physical therapy combined. But Congress had long taken action to delay those caps or provide exemptions — meaning they had never actually taken effect.

According to an analysis by the nonpartisan Congressional Budget Office, permanently repealing the caps would cost about $6.47 billion over the next decade.

Lawmakers would also forestall cuts mandated by the ACA to reduce the payments made to so-called Disproportionate Share Hospitals, which serve high rates of low-income patients. Those cuts have been delayed continuously since the law’s 2010 passage.

Limited programs are also affected. The deal would fund for five years the Maternal, Infant and Early Childhood Home Visiting Program, a program that helps guide low-income, at-risk mothers in parenting. It served about 160,000 families in fiscal year 2016.

“We are relieved that there is a deal for a 5-year reauthorization of MIECHV,” said Lori Freeman, CEO of advocacy group the Association of Maternal & Child Health Programs, in an emailed statement. “States, home visitors and families have been in limbo for the past several months, and this news will bring the stability they need to continue this successful program.”

And the budget deal funds programs that encourage doctors to practice in medically underserved areas, providing just under $500 million over the next two years for the National Health Service Corps and another $363 million over two years to the Teaching Health Center Graduate Medical Education program, which places medical residents in Community Health Centers.

 

Senate strikes 2-year budget deal: 5 takeaways for healthcare leaders

https://www.beckershospitalreview.com/hospital-management-administration/senate-strikes-2-year-budget-deal-5-takeaways-for-healthcare-leaders.html

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Republican and Democrat Senate leaders unveiled a two-year budget deal Wednesday that would boost federal spending for several health programs.

Here are five things to know about the budget agreement.

1. The budget deal includes an additional four-year extension of the Children’s Health Insurance Program. That extension is on top of the six years of CHIP funding Congress approved in late January.

2. The plan includes more than $7 billion in funding over two years for the nation’s community health centers. Federal funding for community health centers, which serve more than 27 million people, expired Sept. 30.

3. The spending deal would delay payment cuts to Disproportionate Share Hospitals mandated by the ACA, which have been pushed back since 2010, according to Kaiser Health News.

4. The budget deal includes $2 billion in additional funding for the National Institutes of Health and $495 million for the National Health Service Corps.

5. The budget deal would repeal the ACA’s Independent Payment Advisory Board, which was intended to hold down Medicare payments if the program’s spending exceeded a certain threshold. Members have never been appointed to the IPAB, according to Kaiser Health News.