The following hospital and health system rating and outlook changes and affirmations took place in June, beginning with the most recent.
Tag Archives: Health System
CHS divests 9 hospitals
Franklin, Tenn.-based Community Health Systems has completed its sale of nine hospitals.
CHS divested four hospitals to Harrisburg, Pa.-based PinnacleHealth System. The following hospitals are included in the transaction:
100-bed Memorial Hospital of York (Pa.)
214-bed Lancaster (Pa.) Regional Medical Center
148-bed Heart of Lancaster Regional Medical Center in Lititz, Pa.
165-bed Carlisle (Pa.) Regional Medical Center
CHS also divested hospitals in Louisiana, Texas and Washington. The company sold Spokane, Wash.-based Rockwood Health System, which includes two hospitals and a multi-specialty clinic, to Tacoma, Wash.-based MultiCare Health System. CHS divested 88-bed Lake Area Medical Center in Lake Charles, La., to Irving, Texas-based Christus Health and sold two Texas hospitals — 350-bed Tomball (Texas) Regional Medical Center and 67-bed South Texas Regional Medical Center in Jourdanton — to Nashville, Tenn.-based HCA Healthcare.
With the transactions completed, CHS operates 11 hospitals in Pennsylvania, two in Washington, two in Louisiana and 13 in Texas.
CHS divested the hospitals as part of a turnaround plan it put into place last year, which involves the company selling 30 hospitals to trim its debt load.
Healthcare CEOs: Senate healthcare bill would have dire consequences
Cleveland Clinic, Kaiser, NewYork-Presbyterian executives are all concerned over the Senate’s bill.
Healthcare CEOs made the rounds of news shows in this week to air their grievances with the Better Care Reconciliation Act, the Senate GOP bill intended to replace Obamacare.
The American Hospital Association, American Medical Association, AARP, and several other organizations have registered their opposition to the proposed bill.
But, it’s healthcare CEOs who are working to mitigate the anticipated changes who are anticipating how the proposed legislation would affect their organizations.
Among healthcare chief executives weighing in on the topic in recent days are Cleveland Clinic CEO Toby Cosgrove, MD, New York Presbyterian CEO Steven J. Corwin, MD, and Kaiser Permanente CEO Bernard Tyson.
Cleveland Clinic CEO Toby Cosgrove
With the anticipated greater numbers of uninsured patients coming into hospitals, “you’re going to have hospitals that are in very deep financial trouble,” Cosgrove told CNBC’s “Squawk Box” on Wednesday. “And this is particularly true of rural hospitals and safety net hospitals, which are very dependent on Medicare and Medicaid for their returns.”
As he sees it, legislators are not looking at the “root cause of the problem.” It’s not how you divide the money,” he said. “The problem really is the rising cost of healthcare.”
“I think if we came together and dealt with the root cause there’d be plenty of money to go around to look after people,” Cosgrove said. “But if we don’t deal with it now, we’re going to have the same problem going 10 years from now.”
“We’re really headed in the wrong direction,” Cosgrove said. We’re talking about payment reform; we’re not talking healthcare reform.”
Kaiser Permanente CEO Bernard J. Tyson
Bernard J. Tyson, chairman and CEO of Oakland, Calif.-based Kaiser Permanente, wrote in a LinkedIn post that although the ACA – also known as Obamacare – is an imperfect legislation, future healthcare reform must build on its progress, rather than undo it.
“We need to pause and ask policymakers to answer the most fundamental question: What does progress on healthcare look like for the people in America?”
In his view, it should cover more people, not fewer people; be affordable.
Without question, we must make healthcare more affordable; provide the best quality of care and best health outcomes.
Tyson points out that the U.S. has among the poorest health outcomes compared to the other developed nations. The healthcare industry can improve quality if “we commit to moving from a predominantly ‘sick care,’ episodic, fee-for-service model to a predominantly preventive model with incentives for value, integrated care and, most important, keeping people healthy.”
“The draft bill does not expand coverage; it does not do enough to protect people in need of care, nor does it provide enough assistance to those who need help in paying for health care and coverage,” he writes.
NewYork-Presbyterian CEO Steven J. Corwin
Speaking to Bloomberg on Tuesday, Steven J. Corwin, CEO of NewYork-Presbyterian said, “Just remember this: One in three children in this country is insured by Medicaid. One in three.”
Corbin noted that two-thirds of the expense of Medicaid are for people who are in nursing homes.
“So, you can work all your life, be a grandma, or ma, and then go through your assets, and then you have to be on Medicaid to go into a nursing home,” he said. “This is going to be devastating to so many people.”
Asked whether he would prefer having something concrete done in Congress or just see the proposed bill go away, Corbin said: “I’d like to see it go away. And, I’d like to see the Medicaid expansion remain, and I’d like to see the insurance market stabilized.”
68% of Consumers Did Not Pay Patient Financial Responsibility
The number of consumers failing to pay full patient financial responsibility to hospitals increased 15 percentage points from 2015 to 2016, a study showed.
About 68 percent of patients with medical bills of $500 or less did not fully pay their patient financial responsibility to hospitals in 2016, according to a recent TransUnion Health study.
The proportion of individuals failing to pay off full medical bill balances increased from 53 percent in 2015 and 49 percent in 2014.
“There are many reasons why more patients are struggling to make their healthcare payments in full, the most prominent of which are higher deductibles and the increase in patient responsibility from 10% percent to 30 percent over the last few years,” stated Jonathan Wiik, TransUnion Principal for Healthcare Revenue Cycle Management. “This shift in healthcare payments has been taking place for well over a decade, but we are seeing more pronounced changes in how hospital bills are paid during just the last few years.”
• 63 percent of hospital medical bills were $500 or less between 2014 and 2016 and 68 percent of these bills were not paid in full by 2016
• 14 percent of hospital medical bills between 2014 and 2016 were $3,000 or more and hospitals did not receive full patient financial responsibility for 99 percent of the bills in 2016
• 10 percent of hospital medical bills were between $500 and $1,000 from 2014 to 2016 and patients did not pay the full balance on 86 percent of them in 2016
The TransUnion Health analysis confirmed that as patient out-of-pocket costs increase, hospital patient financial responsibility collection rates drop. A recent Crowe Horwath study also revealed that patient collection rates for accounts with balances exceeding $5,000 were four times lower than patient collection rates for accounts with low-deductible health plans.
For patient balances between $1,451 and $5,000, hospitals reported a 25.5 percent collection rate. In contrast, hospitals saw collection rates drop to just 10.2 percent for patient balances between $5,001 and $7,500.
Consequently, patients are more likely to partially pay hospitals for their financial responsibility. The TransUnion Health analysis showed that the proportion of individuals making partial payments toward their hospital medical bills rose from about 89 percent in 2015 to 77 percent in 2016.
Hospitals may see these patient collection trends continue, researchers stated. They projected the percentage of individuals neglecting to fully pay their patient financial responsibility to grow to 95 percent by 2020.
Researchers pointed to the popularity of high-deductible health plans as the primary driver of increased hospital patient collection challenges. In 2015, almost one-quarter of all workers belonged to a high-deductible health plan with a savings options versus just 8 percent in 2009, a 2016 Health Affairs blogpost stated.
The number of employees enrolled in high-deductible health plans is likely to increase, the blogpost continued. More than four of ten employers are considering offering only high-deductible health plans over the next three years.
Provider organizations continue to feel the pressure from increased patient financial responsibility under high-deductible health plans. About 72 percent of providers in a recent InstaMed survey cited patient financial responsibility and collection as their top healthcare revenue cycle management concerns in 2016.
The greatest challenge impacting healthcare revenue cycle management was the growth of patient financial responsibility with 29 percent of respondents, followed by cash flow issues with 21 percent, longer days in accounts receivable with 14 percent, and rise in bad medical debt due to insufficient patient collections with 8 percent.
With unpaid patient financial responsibility reducing hospital revenue, TransUnion Health researchers reported that hospitals wrote off about $35.7 billion as bad medical debt or charity care in 2015. Although overall uncompensated care costs declined in 2015, they added.
“Higher deductibles and the increase in patient responsibility are causing a decrease in patient payments to providers for patient care services rendered,” stated John Yount, TransUnion Vice President for Healthcare Products. “While uncompensated care has declined, it appears to be primarily due to the increased number of individuals with Medicaid and commercial insurance coverage.”
Why Geisinger’s health plan stays on the ACA exchange
Danville, Pa.-based Geisinger Health Plan has maintained a steady presence in Pennsylvania’s individual ACA exchange, despite other insurers leaving the state’s marketplace.
Over the last two years, a number of U.S. insurers decided to exit states’ ACA exchanges, citing financial losses as well as concerns regarding future stability of the individual market. Pennsylvania’s individual ACA exchange is no exception. Hartford, Conn.-based Aetna, for instance, pulled out of ACA exchanges for 2017 in 11 states, including Pennsylvania. Additionally, Minnetonka, Minn.-based UnitedHealthcare left ACA exchanges in Pennsylvania and nearly 30 other states for 2017.
Ultimately five insurers remained on Pennsylvania’s individual ACA exchange for 2017 and will remain in the market for 2018 — Geisinger Health Plan, Pittsburgh-based UPMC Health Plan, Harrisburg, Pa.-based Capital BlueCross, Philadelphia-based Independence Blue Cross and Pittsburgh-based Highmark.
Because some insurers left the state’s individual ACA exchange, Geisinger Health Plan experienced an increase in membership, says Kurt Wrobel, the plan’s CFO and chief actuary. The plan currently has 47,000 members, up from more than 30,000 in 2016. About 60 percent of the plan’s enrollment is individuals with Medicaid, Medicare or plans on the state’s individual ACA exchange.
Geisinger Health Plan also requested a rate increase for 2018 that it says is consistent with other insurers in the state. According to the Pennsylvania Department of Insurance, the five insurers that will continue selling on Pennsylvania’s individual ACA exchange for 2018 requested average statewide rate increases of 8.8 percent for individual plans.
Regarding Geisinger Health Plan’s choice to stay on the ACA exchange in Pennsylvania, Mr. Wrobel says it comes down to Geisinger’s commitment to the people of central Pennsylvania. “As a nonprofit, our primary stakeholders are the people, so with that we’re going to have a different calculation as far as our interest in staying in a program. While policy improvements are still needed, we’ve stayed in the program and we believe it’s workable as it stands now.”
One significant advantage Geisinger Health Plan has is its connection with Geisinger Health System. Geisinger Health Plan representatives said that connection allows it to develop programs such as care management programs for members, and many of the plan’s case managers work directly with physicians’ offices to provide more support and connectivity to members’ physicians.
“We think that’s a really clear differentiator. Within that, we have more robust care management systems and programs that allow us to control costs and improve outcomes, especially relative to traditional insurance companies,” Mr. Wrobel says.
As far as the future, the health plan will remain on Pennsylvania’s individual ACA exchange as long as it has a workable program.
Mr. Wrobel says Geisinger Health Plan wouldn’t rule out expanding to ACA marketplaces in other states at some point, but it’s not a high priority right now.
Overall, without the elimination of cost-sharing reductions, which help insurers subsidize the cost of coverage for low-income Americans, Mr. Wrobel believes Geisinger Health Plan could see greater stability moving forward.
“It’s our hope we can move beyond discussions, beyond all the financial issues with the program and really get to the meat of what we try to do as a health plan, which is provide cost-effective quality care,” he says. “I think we all look forward to the day when there’s sufficient stability — and that’s what we have in the Medicare and Medicaid program as well as the employer group program — where the focus is on that operational excellence of providing cost-effective quality care and we can move beyond these discussions about financial issues.”
What Keeps Healthcare Finance Executives Up at Night?
Like the AHCA, the Senate’s health care bill could weaken ACA protections against catastrophic costs
Editor’s Note:This analysis is part of USC-Brookings Schaeffer Initiative on Health Policy, which is a partnership between the Center for Health Policy at Brookings and the USC Schaeffer Center for Health Policy & Economics. The Initiative aims to inform the national health care debate with rigorous, evidence-based analysis leading to practical recommendations using the collaborative strengths of USC and Brookings.
On Thursday, Senate Republicans unveiled the Better Care Reconciliation Act (BCRA), its Affordable Care Act (ACA) repeal bill. One provision of that legislation would greatly expand states’ ability to waive a range of provisions of federal law that affect health insurance. As both my Brookings colleague Jason Levitis and Nicholas Bagley have explained in pieces published earlier today, states would need to meet only very weak standards in order to obtain a waiver under the Senate bill, and waivers could have wide-ranging implications for the extent and affordability of insurance coverage.
One potential effect of these state waivers is weakening a pair of protections against catastrophic costs included in the ACA. In particular, states can directly use this expanded waiver authority to eliminate the requirement that individual and small group plans cap annual out-of-pocket spending. States can also indirectly weaken or effectively eliminate both the ACA’s requirement that plans limit out-of-pocket spending and its ban on individual and lifetime limits by setting a definition of “essential health benefits” that is weaker than the definition under current law. Both of these protections against catastrophic costs apply only with respect to care that is considered essential health benefits, so as the definition of essential health benefits narrows, the scope of these protections narrows as well.
Allowing states to change the definition of essential health benefits unavoidably weakens these protections against catastrophic costs in waiver states’ individual and small group markets. But waivers’ effects could also cross state lines and weaken these protections for people covered by large employer plans in every state.[1] Under current regulations, large employer plans are allowed to choose the definition of essential health benefits in effect in any state in the country for the purposes of determining the scope of these protections against catastrophic costs. If the Trump Administration maintains that approach as it implements the BCRA and even one state uses the waiver process under the BCRA to set a lax definition of essential health benefits, then these protections against catastrophic costs could be weakened or effectively eliminated for people working for large employers nationwide.
The potential effects of the the BCRA waiver provisions on the ACA’s protections against catastrophic costs are essentially identical to those of a waiver provision included in the House-passed American Health Care Act (AHCA), which I have written about previously. The only substantive difference is that the Senate version would allow states to directly waive the out-of-pocket maximum requirement for some plans; under the House-passed bill, states could only affect this requirement indirectly by changing the definition of essential health benefits.
The remainder of this blog post examines these issues in greater detail.
Hospitals Pan Senate ACA Repeal Plan
he hospital sector offers unanimous thumbs down to the Senate’s proposal to repeal and replace the Affordable Care Act.
The nation’s largest hospital associations united in rejecting the Senate’s proposal to repeal and replace the Affordable Care Act, and urged lawmakers to “hit reset” and “go back to the drawing board.”
Senate Airs Obamacare Repeal ‘Draft’
The response to the Senate plan released Thursday was virtually identical to the unanimous disdain shown this spring for the House Republicans’ American Health Care Act.
That is not surprising because the two bills are fundamentally the same on key points. They both eliminate the individual mandate, slash Medicaid, and eliminate a 3.8% tax on investment income above $200,000 that is a key funding source for Obamacare.
Moody’s Investors Service said Thursday the Senate bill would hurt hospitals.
“Under the proposed Senate bill, both for-profit and not-for-profit hospitals would face weaker demand for services and higher rates of uncompensated care expense, with the most significant impact on the sector occurring after 2020 when the changes to federal Medicaid funding are phased in,” said Daniel Steingart, a vice president at Moody’s.
“Transitioning federal Medicaid payments to a per-capita, or block grant system, and freezing Medicaid expansion would reduce the number of people with insurance and increase hospitals’ exposure to bad debt and uncompensated care costs.”
The nonpartisan Congressional Budget Office has yet score the bill, but by some estimates as many as 11 million people who gained coverage under the Medicaid expansion would be booted from the rolls under the Senate plan.
Hospitals Say ‘Hit Reset’
Rick Pollack, president and CEO of the American Hospital Association, said the Senate Better Care Reconciliation Act “moves in the opposite direction” from “key principles” the AHA had set down to protect health insurance coverage, particularly for vulnerable patients.
84% of Execs: Artificial Intelligence Will Transform Healthcare
Artificial intelligence has the potential to completely revolutionize the way healthcare systems interact with their patients.
More than 80 percent of healthcare executives polled by Accenture believe that artificial intelligence is on track to completely revolutionize healthcare, and a similar number believe that the advent of machine learning and digital healthcare is driving a significant restructuring of industry economics.
“AI is the new UI,” proclaims the report. “It’s a new world where artificial intelligence is moving beyond a back-end tool for the healthcare enterprise to the forefront of the consumer and clinician experience.”
“AI is taking on more sophisticated roles, with the potential to make every technology interface both simple and smart – setting a high bar for how future interactions work.”
The report envisions a healthcare environment where AI can take over the majority of processes currently overseen by humans. Consumer relations and patient engagement are likely to be among the first tasks to undergo the shift.
Eighty-four percent of executives believe that AI will fundamentally alter how they gain information from patients and interact with consumers. A similar number have prioritized the implementation of centralized platforms that take advantage of messaging bots and other services.
More than three-quarters believe that these decisions will make or break their ability to develop a competitive advantage over their peers in the near future. Eighty-two percent agree that industry leadership will be defined by how well healthcare organizations architect comprehensive, seamless digital ecosystems that truly understand what motivates the choices of their patients.
“The new frontier of digital experience is technology specifically designed for individual human behavior,” the report asserts. “Healthcare leaders recognize that as technology shrinks the gap between effective human and machine cooperation, accounting for unique human behavior expands not only the quality of the experience, but also the effectiveness of technology solutions.”
Collaboration, Big Data Help Phoenix Children’s Focus on Value-Based Care
Phoenix Children’s collaborative approach to value-based care relies on community input, big data analytics, and a physician-driven quality measurement program.
Mergers, acquisitions, and new partnerships can be a scary prospect for healthcare organizations, no matter which side of the negotiating table they are occupying.
In addition to potential cultural changes, staffing adjustments, and new workflows to adopt, organizations joining forces in the era of value-based care often have to adopt to new electronic health record systems and accept different strategies for measuring their quality, productivity, and outcomes.
While a successful union can rescue revenue cycles, and bring renewed vitality to flagging providers, healthcare organizations must carefully navigate the delicate acquisition process to ensure that new members of the team have the skills and tools required to reach their full potential.
At Phoenix Children’s, one of the largest pediatric health systems in the country, a desire to offer comprehensive care to the community has led to a firm reliance on big data analytics to gather actionable financial and clinical insights from a rapidly growing provider network.
Over the last three years, Phoenix Children’s has brought more than 100 independent practices into the fold, says Chad Johnson, Senior Vice President and Executive Director of the Phoenix Children’s Care Network – and full data transparency is a fundamental requirement for each and every new member of the team.
The ability to use big data analytics to measure productivity, quality, and financial success within a comprehensive network of care will be vital for Phoenix Children’s as it continues an ambitious move into value-based reimbursements.
“During 2017, we’re moving around 100,000 lives into fully risk-based models,” Johnson explained to HealthITAnalytics.com. “We’re doing this because we believe that the way to truly influence outcomes is to own the medical management of our populations. Hospitals will need to have a much larger footprint – a larger, integrated network – that includes independent primary care and specialty groups under one umbrella.”
“We want to move aggressively down this path because we feel that unless you’re willing to take that step, you’re never going to be able to really bend that cost curve,” he added. “We’re confident that we can step up to the plate and succeed in a risk-based environment with the strategies we’re cultivating.”
Number one on the list of challenges as the health network shoulders more financial risk is how to accurately and consistently measure quality across so many disparate locations and provider types.
“We’ve had to integrate data from these practices, which are all using a variety of EHRs, and then figure out how to consume that data and present it so that it can be used for optimizing care and to verify quality improvements across the network,” Johnson said.
“We use this data to target interventions, and to improve the management of our populations, our performance on quality metrics, our utilization, and total cost of care. That data becomes the number one essential driver of many of the decisions that we’re going to make within our pediatric health enterprise.”
HENRY KOTULA 