Tag Archives: Hospital

Lifting the Veil of Secrecy in Health Care Prices

Posted on by • Posted in Uncategorized • Tagged , , , , , , , , , , , • Leave a comment

Lifting the Veil of Secrecy in Health Care Prices

Benjamin Franklin's portrair on a one hundred dollar bill peeks out from underneath a puzzle

Stories that caught our attention this week

The late, great Princeton economist Uwe Reinhardt once said that the system for determining prices in the US health care system was “chaos behind a veil of secrecy.” That was in 2006, and clearly, the chaos persists today: In San Francisco, the price for a basic blood test ranges from $80 to $564; in Los Angeles, $12 to $413; and in Portland, $15 to $44.

Why does the price of one of the most common tests in medicine vary so much? Multiple factors like the bargaining power of insurers, provider consolidation, and underlying economic conditions Essential Coverage may explain some of the differences, but the veil shrouding these striking price discrepancies has yet to be completely lifted.

Margot Sanger-Katz writes in the New York Times that health care prices are still hard to uncover because hospitals and insurers set them behind closed doors, and some claim those prices are legally protected trade secrets. She looked at a new analysis by the Health Care Cost Institute (HCCI) that found “enormous swings in price for identical services are common in health care.” To compile the pricing data, HCCI had to pool de-identified health insurance claims submitted to three large insurance companies. “Even the institute can’t say which insurers and providers are attached to the different prices, and it has eliminated certain markets with less competition where it might be easy to guess,” Sanger-Katz writes.

Price transparency is slowly becoming more prevalent. A few online tools exist that allow the public to estimate the price of some medical procedures. The FAIR Health consumer tool has a five-step process for looking up in-network and out-of-network prices for procedures based on a patient’s location. Healthcare Bluebook has a consumer search tool for price information. And HCCI runs guroo.com, a national and regional-level tool that provides average prices for bundles of health care services.

Government Efforts to Make Prices More Transparent

Federal and state policies are starting to complement these efforts. On January 1, 2019, a new national health care transparency policy took effect. The federal government now requires hospitals to post their price lists, called chargemasters, online in a format that can be easily processed by a computer. Critics of the regulation say that chargemasters are virtually incomprehensible to patients, and Vox journalist Sarah Kliff points out that they only lay out the list prices that hospitals charge for services, not the negotiated prices that insurers actually pay. However, the policy still takes the health care system one step closer to being transparent about costs.

In California, work continues on the creation of a new statewide Healthcare Payments Database. Once completed, the database could provide policymakers, patients, and the public with greater insight into the prices charged for medical services. A review committee comprised of health care stakeholders and experts is advising California’s Office of Statewide Health Planning and Development (OSHPD) about the creation, implementation, and administration of the database. The office has until July 1, 2020, to deliver its recommendations to the legislature.

Several other state-level efforts to increase price transparency have been proposed or remain pending in the current legislative session. Assembly member Al Muratsuchi (D-Torrance) authored AB 1038, a recently stalled measure that would have required California physicians to provide OSHPD with information on the rates they charge the public as well as the different rates they negotiate with health plans for the same services. OSHPD would be required to aggregate the negotiated prices compared to Medicare rates by geographic region. State Senator Richard Pan (D-Sacramento) introduced SB 343, which would update current transparency and disclosure requirements for the health care industry to include data from Kaiser Permanente.

The Prices Are the Problem

Despite the fact that Americans do not use health care services at a greater rate than their counterparts in other advanced nations, such as the United Kingdom, Canada, and Australia, the US spends much more on health care than those countries. Researchers from Harvard University and the London School of Economics published a study in JAMA showing that “prices of labor and goods, including pharmaceuticals, and administrative costs appeared to be the major drivers of the difference in overall cost between the US and other high-income countries.”

In other words, health insurance premiums and out-of-pocket costs are high not because Americans are sicker or go to the hospital too much, but because of soaring individual prices for services.

At a time when Californians are more worried about paying for medical bills than housing, policymakers and patient advocates will need to continue pulling back the veil of secrecy that obscures the true causes of inordinately expensive care.

 

 

 

Getting Distracted by the Politics of Healthcare

Posted on by • Posted in Uncategorized • Tagged , , , , , , , , , , • Leave a comment

Image result for strategy

A number of interactions over the past two weeks have convinced me that the political debate over M4A in Congress, amplified by Presidential candidates jockeying for favor with primary voters, is beginning to seriously spook executives across healthcare.

At a health system board meeting in the Southwest last week, a number of physician leaders and board members had questions about the possible timing and dimensions of a shift to “single payer”, clearly convinced that M4A is an inevitability if Democrats take over in 2020. And two separate inbound calls this week, one from the CEO of a regional health system, and the other from a health plan executive, were both sparked by the hearings on M4A in Congress.

Again, the implicit assumption in their questions about timing and impact was the same: M4A, or something like it, is sure to happen if the 2020 elections favors Democrats. My response to all of them: keep an eye on the politics, but don’t get overly distracted. There’s little chance that “single payer” healthcare will come to the US—industry lobbies are simply too powerful to let that happen.

Even if Democrats do win the Senate and the White House in 2020, they’ll have to “govern to the center” to hold onto their majorities, and any major policy shifts will have to be negotiated across the various interests involved. Most likely: measures to strengthen provisions of the ACA, and perhaps a “public option” in the ACA exchanges.

As to Medicare expansion, I believe the most we’d see in a Democratic administration would be a compromise allowing 55- to 65-year-olds to buy into Medicare Advantage plans.

But for now, M4A’s biggest risk to hospitals and doctors is that it becomes a paralyzing distraction, keeping provider organizations from making the strategic and operational changes needed to re-orient care delivery around value.

Regardless of the politics, a focus on delivering value to the consumers of care will prove to be a no-regrets position for providers.

The Financial Impact of Medicare for All on Hospitals

Posted on by • Posted in Uncategorized • Tagged , , , , , , , , • Leave a comment

 

 

With all of the focus on M4A recently, in its many permutations, we’re hearing a growing concern among hospital executives and physician leaders that their economics could be in serious peril. (For more on this, see the below anecdote from “on the road”.) That concern is justified, as you can see from the graphic below.

On the left, we show data on payment-to-cost ratio for hospitals since the start of the 2000s. As you can see, hospitals rely heavily on a cross-subsidy model—Medicare and Medicaid reimbursement covers only 86 to 88 percent of the total cost of inpatient care delivery. Hospitals make up this difference, and generate a positive margin, by negotiating rates for commercially-insured patients that cover almost 145 percent of costs. As health systems have consolidated and built negotiating leverage, that percentage has steadily risen over the past several years, more than offsetting losses on publicly-insured patients.

The problem? Those lucrative commercial patients only account for a third of admissions, as shown at the bottom right. And across the past decade and a half, commercial admissions have dropped by more than 20 percent. In other words, hospitals have been consolidating and raising commercial rates on a declining book of business in order to compensate for underpayment on a growing volume of government-paid cases.

Now imagine that the commercial business disappeared entirely, and you can see what would happen—hospital finances would crater. Under M4A, Medicare rates would have to go up substantially to make up for the lost margin on commercial cases. Even if M4A turned out to be “Medicare Advantage for More”, trading commercial admissions (say, for the 55-65 population) for MA admissions (which are generally paid at Medicare FFS rates), this would create a difficult situation for hospitals.

In our view, this economic reality is not getting discussed enough in the current debate over M4A. 

 

2019Q1 Healthcare Earnings Roundup

Posted on by • Posted in Uncategorized • Tagged , , , , • Leave a comment

Related image

  • Universal Health Services, Inc.: The King of Prussia, Pennsylvania-based hospital management company did not meet its earnings per share or revenue expectations.
  • CVS Health: CVS Health’s still-pending acquisition of Aetna delivered exceptional financials for the company in Q1.
  • Encompass Health: The Birmingham, Alabama-based post-acute care provider attributed its improved revenue metrics to volume and pricing growth.
  • Cigna Corp: The Bloomfield, Connecticut-based insurer rebounded with revenues totalling nearly $38 billion in Q1.

  • Community Health Systems: The for-profit rural hospital operator produced yet another dismal earnings report.
  • Tenet Hospital Corp.: The Dallas-based for-profit hospital operator showed year-over-year improvement on its net losses though revenues slipped to $3.86 billion.
  • Teladoc: Once again, the telemedicine company saw its revenues rise alongside with its net loss.
  • Molina Healthcare: The Long Beach, California-based insurer’s net income rose to nearly $200 million in Q1, a $91 million bounce year-over-year, prompting the company to boost its year-end guidance.
  • Humana: The Louisville-based insurer again raised its earnings per share guidance for 2019, this time due to expected Medicare Advantage growth.
  • WellCare Health Plans: The Tampa-based insurer’s net income and total revenues experienced a significant bump compared to Q1 2018.

  • HCA Healthcare Inc.: The Nashville-based for-profit hospital operator’s revenues topped $12.5 billion but net income dropped below $1.1 billion.

  • Magellan Health: The Scottsdale, Arizona-based for-profit managed care company experienced a horrid Q1 across nearly all financial metrics.

 

Maryland’s Experiment With Capitated Payments For Rural Hospitals: Large Reductions In Hospital-Based Care

Posted on by • Posted in Uncategorized • Tagged , , , , , , , , , • Leave a comment

https://www.healthaffairs.org/doi/abs/10.1377/hlthaff.2018.05366?utm_source=Newsletter&utm_medium=email&utm_content=The+Veterans++Health+Advantage+Program%3B+Capitated+Payments+For+Rural+Hospitals&utm_campaign=HAT+4-29-19

Image result for Welcome to Maryland

ABSTRACT

In 2010 Maryland replaced fee-for-service payment for some rural hospitals with “global budgets” for hospital-provided services called Total Patient Revenue (TPR).

A principal goal was to incentivize hospitals to manage resources efficiently. Using a difference-in-differences design, we compared eight TPR hospitals to seven similar non-TPR Maryland hospitals to estimate how TPR affected hospital-provided services. We also compared health care use by “treated” patients in TPR counties to that of patients in counties containing control hospitals.

Inpatient admissions and outpatient services fell sharply at TPR hospitals, increasingly so over the period that TPR was in effect.

Emergency department (ED) admission rates declined 12 percent, direct (non-ED) admissions fell 23 percent, ambulatory surgery center visits fell 45 percent, and outpatient clinic visits and services fell 40 percent.

However, for residents of TPR counties, visits to all Maryland hospitals fell by lesser amounts and Medicare spending increased, which suggests that some care moved outside of the global budget.

Nonetheless, we could not assess the efficiency of these shifts with our data, and some care could have moved to more efficient locations. Our evidence suggests that capitation models require strong oversight to ensure that hospitals do not respond by shifting costs to other providers.

 

Why Your Doctor’s White Coat Can Be a Threat to Your Health

Posted on by • Posted in Uncategorized • Tagged , , , , , , , , , , , , , , , , , , , , , , , , , • Leave a comment

A defining symbol of a profession may also be teeming with harmful bacteria and not washed as often as patients might hope.

A recent study of patients at 10 academic hospitals in the United States found that just over half care about what their doctors wear, most of them preferring the traditional white coat.

Some doctors prefer the white coat, too, viewing it as a defining symbol of the profession.

What many might not realize, though, is that health care workers’ attire — including that seemingly “clean” white coat that many prefer — can harbor dangerous bacteria and pathogens.

A systematic review of studies found that white coats are frequently contaminated with strains of harmful and sometimes drug-resistant bacteria associated with hospital-acquired infections. As many as 16 percent of white coats tested positive for MRSA, and up to 42 percent for the bacterial class Gram-negative rods.

Both types of bacteria can cause serious problems, including skin and bloodstream infections, sepsis and pneumonia.

It isn’t just white coats that can be problematic. The review also found that stethoscopes, phones and tablets can be contaminated with harmful bacteria. One study of orthopedic surgeons showed a 45 percent match between the species of bacteria found on their ties and in the wounds of patients they had treated. Nurses’ uniforms have also been found to be contaminated.

Among possible remedies, antimicrobial textiles can help reduce the presence of certain kinds of bacteria, according to a randomized study. Daily laundering of health care workers’ attire can help somewhat, though studies show that bacteria can contaminate them within hours.

Several studies of American physicians found that a majority go more than a week before washing white coats. Seventeen percent go more than a month. Several London-focused studies had similar findings pertaining both to coats and ties.

A randomized trial published last year tested whether wearing short- or- long-sleeved white coats made a difference in the transmission of pathogens. Consistent with previous work, the study found short sleeves led to lower rates of transmission of viral D.N.A. It may be easier to keep hands and wrists clean when they’re not in contact with sleeves, which themselves can easily brush against other contaminated objects. For this reason, the Society for Healthcare Epidemiology of America suggests clinicians consider an approach of “bare below the elbows.”

With the use of alcohol-based hand sanitizer — often more effective and convenient than soap and water — it’s far easier to keep hands clean than clothing.

But the placement of alcohol-based hand sanitizer for health workers isn’t as convenient as it could be, reducing its use. The reason? In the early 2000s, fire marshals began requiring hospitals to remove or relocate dispensers because hand sanitizers contain at least 60 percent alcohol, making them flammable.

Fire codes now limit where they can be placed — a minimum distance from electrical outlets, for example — or how much can be kept on site.

Hand sanitizers are most often used in hallways, though greater use closer to patients (like immediately before or after touching a patient) could be more effective.

One creative team of researchers studied what would happen if dispensers were hung over patients’ beds on a trapeze-bar apparatus. This put the sanitizer in obvious, plain view as clinicians tended to patients. The result? Over 50 percent more hand sanitizer was used.

Although there have been fires in hospitals traced to alcohol-based hand sanitizer, they are rare. Across nearly 800 American health care facilities that used alcohol-based hand sanitizer, one study found, no fires had occurred. The World Health Organization puts the fire risk of hand sanitizers as “very low.”

An article in The New York Times 10 years ago said the American Medical Association, concerned about bacteria transmission, was studying a proposal “that doctors hang up their lab coats — for good.” Maybe one reason the idea hasn’t taken hold in the past decade is reflected in a doctor’s comment in the article that “the coat is part of what defines me, and I couldn’t function without it.”

It’s a powerful symbol. But maybe tradition doesn’t have to be abandoned, just modified. Combining bare-below-the-elbows white attire, more frequently washed, and with more conveniently placed hand sanitizers — including wearable sanitizer dispensers — could help reduce the spread of harmful bacteria.

Until these ideas or others are fully rolled out, one thing we can all do right now is ask our doctors about hand sanitizing before they make physical contact with us (including handshakes). A little reminder could go a long way.

 

 

Hospitals Stand to Lose Billions Under ‘Medicare for All’

Posted on by • Posted in Uncategorized • Tagged , , , , , , , , , , , , , , , , , , , , , • Leave a comment

For a patient’s knee replacement, Medicare will pay a hospital $17,000. The same hospital can get more than twice as much, or about $37,000, for the same surgery on a patient with private insurance.

Or take another example: One hospital would get about $4,200 from Medicare for removing someone’s gallbladder. The same hospital would get $7,400 from commercial insurers.

The yawning gap between payments to hospitals by Medicare and by private health insurers for the same medical services may prove the biggest obstacle for advocates of “Medicare for all,” a government-run system.

If Medicare for all abolished private insurance and reduced rates to Medicare levels — at least 40 percent lower, by one estimate — there would most likely be significant changes throughout the health care industry, which makes up 18 percent of the nation’s economy and is one of the nation’s largest employers.

Some hospitals, especially struggling rural centers, would close virtually overnight, according to policy experts.

Others, they say, would try to offset the steep cuts by laying off hundreds of thousands of workers and abandoning lower-paying services like mental health.

he prospect of such violent upheaval for existing institutions has begun to stiffen opposition to Medicare for all proposals and to rattle health care stocks. Some officials caution that hospitals providing care should not be penalized in an overhaul.

Dr. Adam Gaffney, the president of Physicians for a National Health Program, warned advocates of a single-payer system like Medicare for all not to seize this opportunity to extract huge savings from hospitals. “The line here can’t be and shouldn’t be soak the hospitals,” he said.

“You don’t need insurance companies for Medicare for all,” Dr. Gaffney added. “You need hospitals.”

Soaring hospital bills and disparities in care, though, have stoked consumer outrage and helped to fuel populist support for proposals that would upend the current system. Many people with insurance cannot afford a knee replacement or care for their diabetes because their insurance has high deductibles.

Proponents of overhauling the nation’s health care argue that hospitals are charging too much and could lower their prices without sacrificing the quality of their care. High drug prices, surprise hospital bills and other financial burdens from the overwhelming cost of health care have caught the attention (and drawn the ire) of many in Congress, with a variety of proposals under consideration this year.

But those in favor of the most far-reaching changes, including Senator Bernie Sanders, who unveiled his latest Medicare for all plan as part of his presidential campaign, have remained largely silent on the question of how the nation’s 5,300 hospitals would be paid for patient care. If they are paid more than Medicare rates, the final price tag for the program could balloon from the already stratospheric estimate of upward of $30 trillion over a decade. Senator Sanders has not said what he thinks his plan will cost, and some proponents of Medicare for all say these plans would cost less than the current system.

The nation’s major health insurers are sounding the alarms, and pointing to the potential impact on hospitals and doctors. David Wichmann, the chief executive of UnitedHealth Group, the giant insurer, told investors that these proposals would “destabilize the nation’s health system and limit the ability of clinicians to practice medicine at their best.”

Hospitals could lose as much as $151 billion in annual revenues, a 16 percent decline, under Medicare for all, according to Dr. Kevin Schulman, a professor of medicine at Stanford University and one of the authors of a recent article in JAMA looking at the possible effects on hospitals.

“There’s a hospital in every congressional district,” he said. Passing a Medicare for all proposal in which hospitals are paid Medicare rates “is going to be a really hard proposition.”

Richard Anderson, the chief executive of St. Luke’s University Health Network, called the proposals “naïve.” Hospitals depend on insurers’ higher payments to deliver top-quality care because government programs pay so little, he said.

“I have no time for all the politicians who use the health care system as a crash-test dummy for their election goals,” Mr. Anderson said.

The American Hospital Association, an industry trade group, is starting to lobby against the Medicare for all proposals. Unlike the doctors’ groups, hospitals are not divided. “There is total unanimity,” said Tom Nickels, an executive vice president for the association.

“We agree with their intent to expand coverage to more people,” he said. “We don’t think this is the way to do it. It would have a devastating effect on hospitals and on the system over all.”

Rural hospitals, which have been closing around the country as patient numbers dwindle, would be hit hard, he said, because they lack the financial cushion of larger systems.

Big hospital systems haggle constantly with Medicare over what they are paid, and often battle the government over charges of overbilling. On average, the government program pays hospitals about 87 cents for every dollar of their costs, compared with private insurers that pay $1.45.

Some hospitals make money on Medicare, but most rely on higher private payments to cover their overall costs.

Medicare, which accounts for about 40 percent of hospital costs compared with 33 percent for private insurers, is the biggest source of hospital reimbursements. The majority of hospitals are nonprofit or government-owned.

The profit margins on Medicare are “razor thin,” said Laura Kaiser, the chief executive of SSM Health, a Catholic health system. In some markets, her hospitals lose money providing care under the program.

She says the industry is working to bring costs down. “We’re all uber-responsible and very fixated on managing our costs and not being wasteful,” Ms. Kaiser said.

Over the years, as hospitals have merged, many have raised the prices they charge to private insurers.

“If you’re in a consolidated market, you are a monopolist and are setting the price,” said Mark Miller, a former executive director for the group that advises Congress on Medicare payments. He describes the prices paid by private insurers as “completely unjustified and out of control.”

Many hospitals have invested heavily in amenities like single rooms for patients and sophisticated medical equipment to attract privately insured patients. They are also major employers.

“You would have to have a very different cost structure to survive,” said Melinda Buntin, the chairwoman for health policy at the Vanderbilt University School of Medicine. “Everyone being on Medicare would have a large impact on their bottom line.”

People who have Medicare, mainly those over 65 years old, can enjoy those private rooms or better care because the hospitals believed it was worth making the investments to attract private patients, said Craig Garthwaite, a health economist at the Kellogg School of Management at Northwestern University. If all hospitals were paid the same Medicare rate, the industry “should really collapse down to a similar set of hospitals,” he said.

Whether hospitals would be able to adapt to sharply lower payments is unclear.

“It would force health care systems to go on a very serious diet,” said Stuart Altman, a health policy professor at Brandeis University. “I have no idea what would happen. Nor does anyone else.”

But proponents should not expect to save as much money as they hope if they cut hospital payments. Some hospitals could replace their missing revenue by charging more for the same care or by ordering more billable tests and procedures, said Dr. Stephen Klasko, the chief executive of Jefferson Health. “You’d be amazed,’ he said.

While both the Medicare-for-all bill introduced by Representative Pramila Jayapal, Democrat of Washington, and the Sanders bill call for a government-run insurance program, the Jayapal proposal would replace existing Medicare payments with a whole new system of regional budgets.

“We need to change not just who pays the bill but how we pay the bill,” said Dr. Gaffney, who advised Ms. Jayapal on her proposal.

Hospitals would be able to achieve substantial savings by scaling back administrative costs, the byproduct of a system that deals with multiple insurance carriers, Dr. Gaffney said. Under the Jayapal bill, hospitals would no longer be paid above their costs, and the money for new equipment and other investments would come from a separate pool of money.

But the Sanders bill, which is supported by some Democratic presidential candidates including Senators Kirsten Gillibrand of New York, Cory Booker of New Jersey, Elizabeth Warren of Massachusetts and Kamala Harris of California, does not envision a whole new payment system but an expansion of the existing Medicare program. Payments would largely be based on what Medicare currently pays hospitals.

Some Democrats have also proposed more incremental plans. Some would expand Medicare to cover people over the age of 50, while others wouldn’t do away with private health insurers, including those that now offer Medicare plans.

Even under Medicare for all, lawmakers could decide to pay hospitals a new government rate that equals what they are being paid now from both private and public insurers, said Dr. David Blumenthal, a former Obama official and the president of the Commonwealth Fund.

“It would greatly reduce the opposition,” he said. “The general rule is the more you leave things alone, the easier it is.”

 

 

 

HEALTHCARE INDUSTRY MOST FOCUSED ON CONSOLIDATION, CONSUMERISM IN 2019

Posted on by • Posted in Uncategorized • Tagged , , , , , , , , , , , , , , , , , , , , , • Leave a comment

https://www.healthleadersmedia.com/finance/healthcare-industry-most-focused-consolidation-consumerism-2019?spMailingID=15535559&spUserID=MTg2ODM1MDE3NTU1S0&spJobID=1621654766&spReportId=MTYyMTY1NDc2NgS2

A new Definitive Healthcare survey polled healthcare leaders on the most important trends of the year.

KEY TAKEAWAYS

Industry consolidation was listed as the most important trend of the year, leading the way with 25.2% of the votes, followed by consumerism at 14.4%.

Definitive tracked 803 mergers and acquisitions along with 858 affiliation and partnership announcements last year, a trend that is not expected to slow in 2019.

Thirty-five percent of healthcare M&A activity occurred in the long-term care field, according to CEO Jason Krantz.

Widespread industry consolidation as well as the growing influence of consumerism registered as the most important trends healthcare leaders are paying attention to in 2019, according to a Definitive Healthcare survey released Monday morning.

Industry consolidation was listed as the most important trend of the year, leading the way with 25.2% of the votes, followed by consumerism at 14.4%.

Other topics that received double-digit percentages of the vote were telehealth at 13.8%, AI and machine learning at 11.4%, and staffing shortages at 11.1%. Cybersecurity, EHR optimization, and wearables rounded out the list.

The top results are generally in-line with some of the top storylines from the past year in healthcare, including focus on several vertical megamergers and longstanding business models being redefined by consumer behavior.

Jason Krantz, CEO of Definitive Healthcare, told HealthLeaders that healthcare is becoming increasingly more complicated and leaders are looking at a host of business strategies to navigate industry challenges or emerging market conditions.

“Something that’s on the mind of all of the people that [Definitive Healthcare] has been talking to, whether they are pharma leaders, healthcare IT companies, or providers, is that they’re constantly grappling with all of these new regulations, consolidation, and new technologies,” Krantz said. “[They’re asking] ‘What does that mean for my business and how do I address my strategy as a result?'”

In 2018, Definitive tracked 803 mergers and acquisitions along with 858 affiliation and partnership announcements, a trend Krantz does not expect to slow in 2019.

While Krantz cited some of the major health system mergers from last year as examples, he said another area that is experiencing widespread M&A activity is the post-acute care side.

Thirty-five percent of healthcare M&A activity occurred in the long-term care field, according to Krantz, and this is indicative of hospitals seeking to control costs and drive down rising readmission rates.

It also relates to another issue likely to accelerate in the coming years, which are the staffing shortages facing providers.

The sector currently suffering the most are long-term care facilities, which struggle to maintain an adequate nursing workforce due to the advanced age of most doctors and nurses in the face of the rapidly aging baby boomer generation. Krantz warns that all providers are likely to face these issues going forward.

Krantz also expects consumerism to hold steady as a top issue facing healthcare, citing the growing popularity of urgent care centers and the interconnection of telehealth services to provide patients with care outside of the traditional delivery sites.

However, the growth of these are reliable business options are all dependent on figuring out an adequate reimbursement rates for telehealth services rendered, Krantz said, which has not been fully addressed.

“I think until [telehealth reimbursement rates] get completely figured out, it’s hard for the providers to invest heavily in it,” Krantz said. “This is why you see a lot of non-traditional providers getting into telehealth, but I think it is something that people are thinking about and they know they need to adjust to, though nobody’s stepping up and being first in [telehealth] right now.”

For AI, machine learning, wearables, and cybersecurity, though the responses are split into smaller amounts, Krantz emphasized their combined score, which encompasses more than 25% of total votes, as a sign that healthcare leaders are paying attention to the area despite market complexity.

He added that they are all interconnected issues that deal with technological changes health systems are aware they will have to address in the coming years.

One issue related to harnessing technological change is EHR optimization, which Krantz believes leaders on the provider side are finally starting to gain excitement around. He said most leaders who have waited years to set up a comprehensive EHR system and input data are in-line to now utilize the data in their respective system.

“There’s a lot of great data in there and people are starting to figure out how to utilize that and improve patient outcomes based on the sharing of data,” Krantz said. 

 

 

 

CMS opening up options for states to better manage dual-eligible patients

Posted on by • Posted in Uncategorized • Tagged , , , , , , , , • Leave a comment

CMS opening up options for states to better manage dual-eligible patients

Image result for medicare dual eligible

According to data from CMS, while dual-eligible patients make up only 15 percent of Medicaid enrollees, they are responsible for 33 percent of the program’s expenditures.

The Centers for Medicare & Medicaid Services is looking to partner with states to determine better models to treat the 12 million dual-eligible Medicaid and Medicare beneficiaries in the country.

CMS and states spend more than $300 billion annually on this patient population, many of whom suffer from multiple chronic conditions made more difficult to treat by social and economic barriers.

The cost for dual-eligible population is outsized when compared to its size. According to data from CMS, while dual-eligible patients make up only 15 percent of Medicaid enrollees, they are responsible for 33 percent of the program’s expenditures.

“Less than 10 percent of dually eligible individuals are enrolled in any form of care that integrates Medicare and Medicaid services, and instead have to navigate disconnected delivery and payment systems,” CMS Administrator Seema Verma said in a statement.

“This lack of coordination can lead to fragmented care for individuals, misaligned incentives for payers and providers, and administrative inefficiencies and programmatic burdens for all.”

The goal from the agency is to promote new models which can better integrate Medicare and Medicaid services and create a more seamless experience for both beneficiaries and providers working across the two programs.

One major goal is to allow states to share in savings and benefits gained from investment in better care for the dual-eligible population.

In a letter addressed to state Medicaid leaders, Verma laid out a few potential payment approaches to address the issue of dual eligible patients, including a capitated payment model which would provide the full array of Medicare and Medicaid services with a set dollar reimbursement amount.

Nine states are currently piloting the model, which creates a three-way contract between the state, CMS and Medicare-Medicaid Plans. So far, CMS said state savings for states have averaged 4.4 percent in these test markets.

Through the experiments, Verma said the agency has been able to foster a competitive marketplace with multiple offerings that incentivizes health plans to invest in services that address the patient population.

CMS said it is currently open to extending the initial state pilots and expanding the geographic scope of the capitated programs.

For states that administer dual-eligible patients on a fee-for-service basis, Verma laid out a merged managed care model that would allow states to share in Medicare savings for metrics like reducing hospital readmissions.

Washington and Colorado are currently testing out the model. In one instance, providers in Washington are using Medicaid health homes to deliver high-intensity care to high-risk beneficiaries and sharing in the cost savings.

CMS said preliminary data from Washington’s program has been positive, with gross savings for Medicare Part A and Part B of 11 percent over three years. This has resulted in $36 million in performance payments to the state.

The letter from CMS also opens up the opportunity to potentially partner on state-specific models developed internally meant to better serve dual eligible patients and reduce Medicare and Medicaid expenditures.

CMS has made payment delivery reform a key initiative, with the ultimate goal of moving towards a outcomes-based payment system and reducing expenditures as Medicare faces an uncertain future.

A few recent initiatives include the launch of the agency’s Primary Cares Model, as well as the recent expansion of supplementary benefits for Medicare Advantage beneficiaries meant to tackle social determinants of health.

 

 

 

Living Like a Leader: A day with Scripps Health CEO Chris Van Gorder

Posted on by • Posted in Uncategorized • Tagged , , , , , , , , , , , , , • Leave a comment

https://www.beckershospitalreview.com/multimedia/living-like-a-leader-series/living-like-a-leader-a-day-with-scripps-health-ceo-chris-van-gorder.html?origin=qualitye&utm_source=qualitye

CVG Headshot 2.jpg

“Healthcare is always going through a lot of change, and sometimes employees, managers and even physicians think we are making those changes because somebody in administration decided it’s the right thing to do. The reality is, we’re reacting to what’s changing in the marketplace or what we believe will be coming in the marketplace. If we don’t adjust fast enough then it will negatively affect our organization and employees.”

From police officer to healthcare executive, Chris Van Gorder’s career trajectory is far from ordinary.

Mr. Van Gorder began his career as a police officer in a town bordering Los Angeles. After being injured on the job and retiring from the police force, Mr. Van Gorder had to reinvent himself.

He eventually took a job as a hospital security director for the facility where he received care for his injury. This job, unbeknownst to him at the time, would shape the rest of his work life.

After spending time in the hospital as a guard and observing leadership, Mr. Van Gorder decided to return to school to get a degree in healthcare administration.

Since, Mr. Van Gorder has held several prominent healthcare leadership positions, including vice president, COO and CEO of Anaheim Memorial Hospital and CEO of Long Beach (Calif.) Memorial, the flagship facility of MemorialCare Health System in Fountain Valley, Calif.

Now Mr. Van Gorder serves as CEO of one of the top medical institutions in the U.S., San Diego-based Scripps Health, a $3.1 billion integrated network with 15,000 employees and 3,000 physicians. He has held the role since 1999.

Here, Mr. Van Gorder spoke with Becker’s Hospital Review for our “Living like a leader” series, which examines influential decision-maker’s daily routines to offer readers an idea of how they manage their energy, teams and time.

Question: What is the first thing that you do when you wake up?

Chris Van Gorder: Get a cup of coffee. Then I go to my home office and prepare what I call “market news.” I do this every day of the year, including holidays, vacations and weekends. The market news is a summary of all the major healthcare and business articles that I think may have an impact on Scripps Health. I’ll scour several websites, including The San Diego Union Tribune, The Los Angeles Times, The New York Times, The Washington Post and Becker’s, among other healthcare publications. I’ll put those links into a document and send them to my senior leadership team, most doctors and the alumni of our leadership academies. It takes me about an hour.

My rationale for sending the relevant links to my team is that healthcare is always going through a lot of change, and sometimes employees, managers and even physicians think we are making those changes because somebody in administration decided it’s the right thing to do. The reality is, we’re reacting to what’s changing in the marketplace or what we believe will be coming in the marketplace. If we don’t adjust fast enough then it will negatively affect our organization and employees.

Q: What is the first thing you do when you arrive at work?

CVG: I will grab another cup of coffee. Then I log onto the computer and start answering emails. Daily, I will answer every email that comes to me. I don’t go to bed at night without looking at my iPhone and making sure I’ve responded to every email that came to me during the day. So the first thing I do when I get to work is respond to any emails that came during the middle of the night. One of our core values is respect, and I think it is a sign of respect when I am responsive to the people who work in this organization and people outside of it.

Q: Is there any work that you like to get done before lunch or work that you save for the afternoon?

CVG: Unless it’s a lunch meeting, I never eat lunch. What I usually do is read my own market news, because when I put it together, I don’t have enough time to thoroughly read the articles. But my daily routine is so variable. Sometimes we have board meetings that start at 7:00 a.m. It’s rare if I don’t have something that starts very early in the morning. From there, my schedule is packed, but it is always different.

Q: Is there anything that makes your physical office setup unique?

CVG: I have a Microsoft hub on the wall that allows me to have video meetings with anybody in leadership across the system. In the case of a natural disaster, the hub also allows me to monitor what’s going on inside and outside of Scripps.

I also have a picture of a patient’s heart hanging on my wall. I was working in trauma with our physicians one night and a younger patient came to the hospital with a stab wound to the heart. We cracked this patient’s chest open, stapled the heart shut and took the patient upstairs to heal. The patient came into our hospital almost dead, but the patient went home a week later. I have a picture of that heart on my wall to remind me of the work that we do every single day — the most important work we do.

I also have a few awards and about 100 challenge coins that law enforcement, fire and military units have given me. I also have my own challenge coin that I give out to employees when they’ve done something extraordinary outside their normal work responsibilities.

Q: How often do you meet with clinical staff or perform rounds?

CVG: Several times a week. I’m in a corporate office but not far from the hospitals, so I spend a lot of time with them. I also teach our leadership academies and most of the people in attendance are clinical staff. Usually rounds are on Fridays.

Q: How much of your time is spent with direct reports?

CVG: I do not have standing regular meetings with my direct reports. They are all on the same floor as me and I have an open-door policy. Some of them will schedule meetings with me to brief me on certain items, but I’m a big believer in not having redundant meetings that are just happening because they’re scheduled. I want people to meet with me when they need to meet with me. My staff are in and out of my office all day long. I see all of them daily. I have one scheduled meeting with all of them as a group once a week, but the rest of the meetings are ad hoc.

Q: How do you think your routine is different from that of other healthcare executives?

CVG: I spend a lot of time with management and employees. I suspect more than most CEOs do, because I’ve made it a personal commitment since joining Scripps. I spend a lot of time with the front-line staff and our front-line management team. The key leaders in an organization are those front-line supervisors and managers. Because of that belief, I created the Scripps Leadership Academy 18 years ago, the Front-Line Leader Academy in 2015 and The Employee 100 in 2010. These academies help develop leaders at every level.

I also spend a lot of time teaching. And after I teach, I stay. I don’t teach, make a presentation and leave. My understanding of most CEOs is that they’re very busy, and I don’t blame them, but most would depart to make it to the next meeting on time. I will never leave right at the end of the class. The reason for that is it builds trust and gives employees who may have been too shy in the lecture a chance to ask questions.

Additionally, things are constantly changing in healthcare. The “whats” and “whys” this year will likely be different next year, so I also make a point to meet with the alumni of the leadership academies once a month where we just do a Q&A about leadership and any changes.

Q: What is the hardest part of your day?

CVG: Running a big organization like Scripps is like running a city. There are great things that are happening all the time, and there are bad things that happen occasionally. That burden falls on me, and that’s probably the worst part of the job. Fortunately, those bad things don’t happen often, but when something happens to a patient that shouldn’t have happened or if one of my employees is attacked by a patient, those days are difficult. At Scripps, we’re trying to push forward legislation on workplace violence, because I’m very concerned that workplace violence is on the rise in hospitals. CMS has very strict rules about what we’re allowed to do to protect our staff, because they’re looking out for the wellbeing of the patients, as are we, but we have an obligation to protect both. That’s a very difficult thing to do.

Q: What is the most rewarding part of your day?

CVG: Any time the organization succeeds, one of our employees thrives or I get a chance to award a challenge coin — those are the rewarding moments. A few weeks ago, one of our environmental service workers broke up a fight where one patient was choking another. He broke it up and called the police. He could have very easily stood back and done nothing. He would not have been in trouble, because he’s not trained to intervene in situations like this, but he did and in a safe way. He prevented people from getting hurt or killed. That was one of our environmental service employees, who is phenomenal. So, when our employees excel and go beyond what was expected of them, it is extraordinarily rewarding. Additionally, I’m going to go visit a patient who struggled and was very sick but is now getting better. This patient and the family are thrilled with the care they received and they asked to see me. Obviously, those moments with patients are also highlights.

Q: What is the last thing you do before you leave the office?

CVG: Mother Mary Michael Cummings started the Catholic side of the health system in 1890. Ellen Browning Scripps founded the Scripps side of the system in 1924. Today, we are one system. One of the funny things I do when I get in the car at the end of the day is pause for a minute I and just ask myself, “Would Mother Mary Michael Cummings and Ellen Browning Scripps be proud of what we did today?” And the answer is almost always, “Yes.” When I answer that question, I feel good about that day. Then I drive home and start my post-work routine.

Q: Do you do any work at home?

CVG: Yes. Beyond checking emails and creating the market news reports, I also take home longer reports if I didn’t have time to read them at work. So often, I’ll just take those home and read and study those at night when I have more time.

Q: How do you unwind at the end of the day?

CVG: I volunteer with the sheriff’s department. A lot of that work is done in the evenings and on weekends. I’m a reserve assistant sheriff, which means I’m in charge of the reserves and the search and rescue team. I’m also an instructor of first aid and CPR at the search and rescue academy. My volunteer work is a complete diversion because I’m very often the caregiver, not the supervisor. It’s a great mental change from what I do on a day-to-day basis. I think that creates some balance. I also have family time. I have two boys and a wife. I always consider the weekends my family time.