Mercy Health and Bon Secours Announce Merger

http://www.healthleadersmedia.com/finance/mercy-health-and-bon-secours-announce-merger?utm_source=edit&utm_medium=ENL&utm_campaign=HLM-Daily-SilverPop_02222018&spMailingID=12986669&spUserID=MTY3ODg4NTg1MzQ4S0&spJobID=1342027713&spReportId=MTM0MjAyNzcxMwS2#

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The Maryland and Ohio health systems announced Wednesday their intention to merge. The joint venture would be the nation’s fifth-largest Catholic health system.

Bon Secours Health System and Mercy Health announced their intention Wednesday to merge, potentially forming the fifth-largest Catholic health system in the country.

The proposed merger would join Mercy, the largest health system in Ohio, with Bon Secours, a Maryland-based Catholic health system with locations throughout the East Coast.

Related: Expect M&A Deluge To Continue Through 2018 And Beyond

If approved, the new system would operate 43 hospitals and more than 1,000 care sites across seven states, while generating close to $9 billion in annual operating revenues. Additionally, the new system would employ more than 2,100 physicians and advanced practice clinicians.

“Our decision to join forces with Bon Secours is rooted in our shared and very deep commitment to delivering compassionate, low-cost, high-quality health care to our communities,” said John M. Starcher Jr., president and CEO of Mercy Health, in a statement. “Working together, our strong faith-based heritage fuels our mutual focus to provide efficient and effective health care for each patient who comes through our doors.”

The proposed merger will need to gain approval from state and federal regulators as well as the Catholic Church, which oversees both systems. Leaders from Mercy and Bon Secours expect the deal to be completed by the end of the year.

“The mission, vision, values and geographic service areas of Bon Secours and Mercy Health are remarkably well-aligned and highly complementary,” said Richard J. Statuto, president and CEO of Bon Secours, in a statement. “This merger strengthens our shared commitment to improve population health, eliminate health disparities, build strength to address social determinants of health, and invest heavily in innovating our approaches to health care.”

Henry Ford Allegiance ‘Reluctantly’ Settles DOJ Antitrust Suit

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The Jackson, Michigan–based health system agrees to stop coordinated anti-competitive business activities with competitors, but insists that it did nothing wrong.

Henry Ford Allegiance Health has settled its three-year antitrust fight with state and federal prosecutors, just weeks before the case was set for trial in federal court.

The Department of Justice and the Michigan Attorney General’s office filed suit in 2015, alleging that Henry Ford Allegiance Health and three other health systems in south central Michigan carved up the territory and insulated themselves from competition by agreeing to withhold outreach and marketing in each other’s respective counties.

The three other health systems, Hillsdale Community Health Center; Community Health Center of Branch County in Coldwater; and ProMedica Health System in Toledo, OH, settled their suits two years ago.

“As a result of Allegiance’s per se illegal agreement to restrict marketing of competing services in Hillsdale County, Michigan consumers were deprived of valuable services and healthcare information,” Assistant Attorney General Makan Delrahim in DOJ’s Antitrust Division said in a media release. “By prohibiting further anticompetitive conduct and educating Allegiance executives on antitrust law, this settlement will ensure that consumers receive the fruits of robust competition.”

The proposed settlement was filed Friday in U.S. District Court for the Eastern District of Michigan, where the case was scheduled to go to trial on March 6.

Allegiance said in prepared remarks that it felt compelled to settle even though it did nothing wrong.

“We reluctantly chose to settle this litigation because continuing to defend ourselves against the United States and State of Michigan became too costly,” the health system said. “This decision, regrettable but necessary, requires us to discontinue our defense of this case before the Court could rule on any of the highly contested issues raised in the litigation.”

DOJ’s settlement with Allegiance expands on the earlier settlements with the other three health systems, which means that Allegiance cannot communicate, coordinate or limit marketing or business development with competitors. The agreement ends the health system’s carve out in Hillsdale County. Allegiance must also file annual compliance reports and submit to compliance inspections, and reimburse state and federal prosecutors for the court costs.

DOJ said the deal includes several new provisions that are now included in all new consent decrees that add greater specificity and accountability.

“The proposed settlement will make it easier and more efficient for the department to enforce the decree by allowing the department to prove alleged violations by a preponderance of the evidence,” Delrahim said. “These provisions will encourage a stronger commitment to compliance and will ease the strain on the department in investigating and enforcing possible violations.”

Patricia Wagner, an antitrust attorney with Epstein Becker Green and a disinterested observer, said DOJ is applying more rigorous benchmarks for its consent decrees.

“When you do your annual report you have to document that everybody got their four hours of training and you have to provide the materials that were used in those training sessions. If DOJ asks, you’d have to provide a lot of who had what conversations, and when,” Wagner said. “Instead of just having a general ‘you will comply with this consent order and verify annually that you are doing so,’ it is giving organizations the steps that DOJ thinks they need to take in order to comply with the consent judgements.”

“If I am a CEO of a hospital maybe I am thinking about how to get ahead of this situation. Should I have someone who is responsible for antitrust compliance?” she said. “All hospitals have large compliance programs that are usually focused, as they should be, on fraud and abuse and licensure issues. It seems like a natural evolution to say ‘maybe we should be thinking about including antitrust in that larger compliance program.'”

Henry Ford Allegiance Health operates the only hospital in Jackson County, MI. The system also operates primary care, physical rehabilitation, and diagnostic facilities in several counties in south central Michigan. Allegiance joined Henry Ford Health System in 2016.

Allegiance’s statement in full reads as follows:

Allegiance Health and the Department of Justice have settled an antitrust case brought by the DOJ against Allegiance Health in 2015. The original complaint alleged that Allegiance Health entered into an agreement with Hillsdale Community Health Center to limit marketing in Hillsdale County.

We reluctantly chose to settle this litigation because continuing to defend ourselves against the United States and State of Michigan became too costly. This decision, regrettable but necessary, requires us to discontinue our defense of this case before the Court could rule on any of the highly contested issues raised in the litigation. 

We still deny unlawful conduct of any kind, and the settlement does not include any admission of liability. Despite almost three years of litigation, there was no finding of wrong doing by the Court, and, as recently as December, the Court contemplated dismissing the action in its entirety.  In addition, the Court has never ruled that the citizens of Hillsdale County were harmed by our marketing strategy.

We reaffirm our belief that we promoted competition in south central Michigan and benefitted the citizens of Hillsdale County in undeniable ways. The terms of the settlement allow us to continue our marketing strategies in order to best serve the people of south central Michigan including Hillsdale County.

 

 

Northwestern Medicine to open $399M hospital

https://www.beckershospitalreview.com/facilities-management/northwestern-medicine-to-open-399m-hospital.html

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Northwestern Medicine Lake Forest (Ill.) Hospital will open its $399 million replacement facility March 3, reports the Chicago Tribune.

Set on a 160-acre campus, the new 500,000-square-foot hospital houses 114 private inpatient rooms, 72 outpatient care spaces, 106 clinic examination rooms and eight operating rooms.  The surrounding campus has 7,000 feet of bicycle paths, 700 trees and a six-acre bond.

The new facility will replace the existing, aging Lake Forest Hospital. The old hospital will be partially demolished, while other parts may be repurposed.

Construction on the replacement facility began in August 2014.

 

 

North Carolina treasurer asks UNC Health Care for $1B bond to ensure cost savings from pending merger

https://www.beckershospitalreview.com/finance/north-carolina-treasurer-asks-unc-health-care-for-1b-bond-to-ensure-cost-savings-from-pending-merger.html

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North Carolina Treasurer Dale Folwell is calling for Chapel Hill, N.C.-based UNC Health Care to issue a $1 billion performance bond to guarantee cost savings from the health system’s pending merger with Charlotte, N.C.-based Atrium Health, according to The News & Observer.

UNC Health Care and Atrium Health, previously named Carolinas HealthCare, signed a letter of intent to merge in August 2017, but the systems have released few details about the proposed deal.

“With a lack of details on this merger and little evidence that mergers like this have generated savings for the public, I feel I have a fiduciary responsibility to pursue this guarantee that will protect North Carolina taxpayers,” Mr. Folwell said in a statement to The News & Observer.

UNC said it will work with the state treasurer to develop ways to meet state employees’ healthcare needs at the lowest cost. However, cutting costs is not the system’s top priority. “Our No. 1 job is taking care of patients. We do not control inflation or other variables associated with the cost of care,” UNC said in a statement to The News & Observer.

Machine learning is a big idea, but hospitals need business plans first

http://www.healthcareitnews.com/news/machine-learning-big-idea-hospitals-need-business-plans-first

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Elizabeth Clements, business architect at Geisinger Health, will be hosting a session at HIMSS18 on March 7.

Don’t get lost in the complexity of large-scale use cases.

Machine learning has the potential to transform healthcare through new knowledge discovery and improved productivity, but many health systems do not have a business plan in place to support advanced analytics beyond research and development.

As health systems consider how best to leverage machine learning and artificial intelligence, it will require a shift in IT strategy to focus on not just data, but managing the model itself. This means, among other things, defining the value of machine learning and providing a framework for evaluation and application.

Health systems need to keep things simple when moving into machine learning, said Elizabeth Clements, business architect at Geisinger Health.

“When working with new technology and developing a service from scratch, it can be easy to get lost and slow progress down with the complexity of a large use-case,” Clements said. “If you keep your scope narrow and define near-term goals, you will find you are able to make more meaningful progress in a short amount of time.”

And healthcare professionals dealing with machine learning must themselves learn how to partner with the business.

“Understanding the current and future state use of the machine learning solution is critical,” Clements said. “If you don’t consciously determine how much you want or need human intervention with the model, it will make your solution much more difficult to implement and gain buy-in.”

Clements said a simple framework for thinking about machine learning in the context of the business is needed. That includes understanding its value and use-cases before embarking on this type of analytics advancement, as well as knowing the basic challenges and how to design a program that takes those into account.

“Machine learning is the next wave of advanced processing technology offering us new avenues for information discovery and productivity enhancement,” she said. “It has the potential to transform how we conduct business; however, it will require a shift in our IT strategy.”

It is not just about the data or the application, it is also about the model itself. IT leaders should consider how to complement their existing IT and data scientist teams with new skill sets and consider how machine learning can advance existing task execution, she added.

Clements will be speaking in the HIMSS18 session, “Managing Machine Learning: Insights and Strategy,” at 11:30 a.m. March 7 in the Venetian, Palazzo D.

Senate poised to approve budget redistributing state Medicaid funding

http://www.tampabay.com/florida-politics/buzz/2018/02/07/senate-poised-to-approve-budget-redistributing-state-medicaid-funding/

 

The Senate proposal, which would funnel away higher state Medicaid payments to hospitals with a large fraction of Medicaid patients, would need to be reconciled with the House’s budget preserving the current policy.

Safety net hospitals in Florida could see their state Medicaid payments decrease by $170 million under a proposal in the budget the state Senate is poised to approve Thursday. The proposal, which would target about $318 million in payments that currently go to 28 hospitals with a higher percentage of Medicaid patients, would funnel those funds into the base rates paid to all hospitals instead.
The reshuffling in the Senate budget would largely affect safety net hospitals, which include public and teaching hospitals, while for-profit hospitals could gain more than $63 million, according to the Safety Net Hospital Alliance of Florida.
Miami’s Jackson Memorial Hospital would lose $59 million, Broward Health would lose about $17 million and Tampa General would lose $14 million, according to Safety Net’s analysis. Nicklaus Children’s Hospital in Miami and Johns Hopkins All Children’s, which each see about 70 percent of patients covered by Medicaid, would lose $10.5 million and $5 million respectively. In contrast, for-profit chain HCA could see its reimbursements rise more than $40 million.
Senate Health and Human Services Appropriations Chairwoman Anitere Flores, R-Miami, said the new system would more fairly distribute funds to all hospitals, which she said also provide charity care like the 28 hospitals that currently meet the 25 percent threshold of Medicaid patients to receive automatic rate enhancements.
“We’re making sure that the dollars actually follow the patient that is being served,” she said.
Flores contended that the new proposal corrects an “arbitrary” formula that set the higher payment rates in past years, and that the hospitals that had been reimbursed at a higher rate would be able to recoup their losses through federal Low Income Pool funding, which reimburses hospitals for charity care serving the uninsured.
But Lindy Kennedy, vice president of the Safety Net Alliance, told the Senate Democratic Caucus that the policy is needed because Medicaid rates do not cover the cost of care. Those 28 hospitals, which largely comprise public or not-for-profit private institutions in the state, lose proportionately more money because a larger slice of their patients are covered by Medicaid, she said.
“If Medicaid would pay these costs and if didn’t go into the red for every Medicaid patient we had, we wouldn’t need this policy,” she said. “This puts us back to status quo.”
“These hospitals cannot afford this type of cut,” she added.

Lidia Amoretti, a spokeswoman for Jackson Health System, called the Senate’s plan “alarming,” though she added “it is still early in the process.”

“We trust that the Miami-Dade delegation will fight fiercely – as it always does – to protect the people who rely upon Jackson for world-class care,” she said in a statement. 
Sen. Jose Javier Rodriguez, D-Miami, proposed an amendment that would revert the Senate proposal to match the House’s version this year, though it was rejected on the floor.
Tony Carvalho, president of the Safety Net Hospital Alliance, said that the Senate plan would also cut $94 million from three of the four largest teaching hospitals — UF’s Shands in Gainesville, Jackson Memorial and Tampa General.
“All hospitals lose money, and I appreciate that, but the average annual margin for the three largest teaching hospitals is $57 million over the last five years…for the operation of in-patient out-patient services in hospitals,” he said. “The Senate bill would cut them $95 million — that’s $30 million more than their operating margin in the last five years.”
By contrast, he said, HCA makes an operating margin, on average over the last five years, of $868 million per year.
Carvalho said one of the biggest cuts to hospitals are employees and this would be “damaging some of your premier medical institutions.”
“Their slogan is the money follows the patient,” he said. “That would be pertinent if all hospitals were paid their cost of care or all hospitals did the same percentage of Medicaid. That’s not the case. If you are going to pay hospitals way below the cost of care, our position is — and it has been the legislative position for years — is that you make a special adjustment when one of four of their patients are in the Medicaid pool.”
The Senate is expected to pass its budget tomorrow, setting up a clash with the House, whose version of the budget preserves the higher reimbursement system. The Senate’s plan also includes $130 million in nursing home funding, which differs from the House plan.

Carolinas HealthCare is changing its name — here’s why

https://www.beckershospitalreview.com/hospital-management-administration/carolinas-healthcare-is-changing-its-name-here-s-why.html

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Carolinas HealthCare System, a 40-hospital system based in Charlotte, N.C., has changed it name to Atrium Health.

Officials said the new name reflects the system’s evolution from a single hospital to a health system with a strong regional footprint.

“It’s quite remarkable to think back to our humble beginnings in 1940, when a group of ambitious, young clinicians answered the call to serve everyone and opened our doors as Charlotte Memorial Hospital,” said Atrium Health President and CEO Gene Woods. “Now, nearly 80 years later, our doors remain open, and we’ve helped our community thrive. As we have maintained our mission to serve all, we have also evolved. Our new name reflects our organization today and where we are going in the future to make a greater impact for the people we will serve.”

The health system evaluated more than 100 names and conducted consumer research on a few of them before making a decision. The system said Atrium was selected because of its meaning: a place filled with light; the chamber of the heart where every heartbeat begins; and a gathering ground where diverse thinkers come together and connections are made.

Although the system is changing its name, the organization will keep elements associated with the Carolinas HealthCare System brand, including an updated “Tree of Life” icon.

“Our Tree of Life is strong and our mission to provide care for all will not change,” Mr. Woods said. “Atrium Health will allow the organization to grow and impact as many lives as possible and deliver solutions that will help even more communities thrive.”

The system said full implementation of the new name would take about two years, and changes to signage at hospitals and other care locations will begin at the end of 2018. Advertisements will immediately begin to carry the new name.

The name change comes as Atrium Health is pursuing a merger with Chapel Hill, N.C.-based UNC Health Care. The two systems signed a letter of intent to merge in August 2017. The combined entity would control more than 50 hospitals.

 

Alta Bates emergency center will close, but Sutter Health says not as soon as people think

Alta Bates emergency center will close, but Sutter Health says not as soon as people think

People exit and enter Alta Bates Medical Center in Berkeley, Calif., on Friday, Feb. 2, 2018. Legislators, city officials and health care professionals will continue their public campaign against the closure of emergency care services at Alta Bates Medical Center, even as its parent organization, Sutter Health, insists it will keep the center open for the next decade, dispelling what it says is misinformation that has circulated about the hospital closing in 2019. (Ray Chavez/Bay Area News Group)

BERKELEY — Hospital services at Alta Bates Medical Center’s Berkeley campus will end, but not as soon as people think, company officials said this week.

In an ongoing debate over the future of emergency services at the campus, legislators, city officials and health care professionals will continue their public campaign against the closure while the hospital’s parent organization Sutter Health insists it will keep the campus open for at least a decade.

Nurses and local leaders will gather for a community forum Saturday on the Ed Roberts campus, calling on Sutter Health to keep Alta Bates open as a full hospital with inpatient and emergency care. Sutter Health, citing a California law that requires hospitals to complete seismic upgrades by 2030, announced in 2016 its plans to move inpatient care and emergency services from the Alta Bates site in Berkeley to an expanded, retrofitted Oakland campus.

This week, Sutter Health released a statement saying the emergency room and inpatient hospital services provided at the Alta Bates campus will remain in Berkeley until they are available in full at the Summit Medical Center campus in Oakland, which could take up to 10 years to build.

The memo was intended to clarify what Sutter Health leaders say is misinformation about the timing of the Alta Bates closure. While many people thought the hospital’s emergency care and inpatient services could close as early as 2019, the organization said this week it will be a decade before that happens.

“The memo is intended to highlight our commitment to community and do this gradually,” said Alta Bates Summit CEO Chuck Prosper by phone on Friday. “The last thing we want to do is create a shock.”

But for many health care workers and community advocates, the memo was not reassuring. They do not want the hospital and emergency room to close at all.

“Even in its own statement, Sutter admitted its plan is not to retain Alta Bates as a full service acute care hospital, and that it fully intends to force patients from Berkeley to Vallejo along the densely populated I-80 corridor to travel even farther to Oakland, further delaying life-saving emergency treatment,” said an email message from organizers from the California Nurses Association and Save Alta Bates Hospital campaign about Saturday’s public forum.

Sutter Health plans to enlarge its Oakland campus with a second building and will build urgent care clinics and outpatient services in Berkeley either at its Alta Bates campus on Ashby Avenue or the Herrick campus on Dwight Way.

Rochelle Pardue-Okimoto, a registered nurse at Alta Bates and El Cerrito’s mayor pro tem, said she’s concerned about the impact on care across hospitals in the area if Alta Bates’ acute care services close. She said her colleagues at hospitals around the East Bay have already seen busier emergency rooms following the closure in 2016 of Doctors Medical Center in San Pablo after years of financial loss. That hospital recorded about 33,000 visits per year, and its closure has left the area between Vallejo and Berkeley with only one hospital — Kaiser Permanente in Richmond.

“If you concentrate all the emergency care in Oakland, it’s just too many people,” Pardue-Okimoto said. “There will be increased wait times.”

According to the most recent data available online from the Office of Statewide Health Planning and Development, the Alta Bates campus had 45,336 emergency room visits in 2016.

When asked on Friday about how Sutter Health plans to ensure that people throughout the area can access emergency care, Prosper said he believes that offering more robust outpatient services could help cut down on the number of emergency room visits.

“We believe today that people come to the emergency room often not needing emergency care,” he said. “Some people come for primary care or other services because they do not have other access to medical care.”

He could not specify what percentage of emergency visits include people seeking non-emergency care, but said Sutter Health is interested in finding more information about that as it plans for the future. He also said that the movement of people who seek care is more “fluid” than people might believe, noting that people already “are routinely leaving Berkeley” to go to hospitals in Oakland or elsewhere.

Sutter Health officials have said they have no choice but to eventually close the acute care services at Alta Bates, as almost all of the Berkeley campus cannot be retrofitted to meet new state seismic standards for inpatient hospital care, and rebuilding would be too expensive.

Berkeley Mayor Jesse Arreguin, who started a task force to discuss the potential impacts of closing Alta Bates said there has been a lack of transparency around the closure of the hospital that makes it difficult to work with Sutter Health on future planning. While Sutter Health executives have said the buildings are not seismically safe, city officials do not know, for example, how much it would cost to retrofit or rebuild them.

“I believe Sutter needs to either save the hospital or sell it,” Arreguin said in an interview Friday. “We cannot make the East Bay a hospital desert.”

He said city officials have met with other hospital operators to discuss options for building another hospital with acute care services. But short of that happening, he hopes Sutter Health will work with the city to develop a plan.

“While it’s reasurring that Sutter said they were not closing next year, they did say they were going to close in 10 years,” Arreguin said. “We are still concerned with Sutter’s plans to close the hospital (at all), which they reaffirmed.”

 

Sepsis: the Achilles’ heel of health care

Sepsis: the Achilles’ heel of health care

As health care systems look to lower costs and improve patient outcomes, controlling sepsis is a great place to start. Ignoring that opportunity is a huge mistake.

Sepsis is caused by the body’s exuberant response to an infection. It is the No. 1 inpatient hospital expense in the United States, with costs tripling over the last decade to $27 billion. Nearly half of all hospital deaths are caused by sepsis. And the problem is growing — it’s now one of the top five causes of hospitalization in age groups over 18. This is why a comprehensive plan to detect, treat, and prevent sepsis must be an essential pillar of any serious effort to improve care and drive down costs.

When a patient spikes a fever for an unknown reason, doctors usually send blood samples to be cultured. But it can take an enormously long time — up to six days — to get the results. In addition, these cultures miss 35 percent to 50 percent of infections.

Given the possible delay and uncertainty of blood cultures, if a patient is at high risk for sepsis, his or her clinician will immediately prescribe antibiotics. Doctors know that this represents overtreatment, since sepsis can be indistinguishable from other less-serious health concerns. But you can’t guess wrong if you suspect sepsis, because a patient’s risk of dying rises as much as 8 percent per hour if the infection is improperly treated.

If the patient does not respond to the antibiotic and the fever does not break after 12 to 24 hours, clinicians usually switch to a different antibiotic, and then maybe another, and then possibly to an antifungal drug.

Hospitals are getting better at combating sepsis. Doctors and nurses across the country have done incredible work to improve sepsis awareness. They are preventing more sepsis-causing infections before they ever occur, and they are reaching for antibiotics quicker when sepsis is suspected.

Yet advances in sepsis treatment protocols are fueling another massive health care issue: the rise of drug resistance and superbugs. On the individual level, even one exposure to an antimicrobial drug can reduce the therapy’s effectiveness for that same patient later on. The overuse of antibiotics and other antimicrobial drugs also kills beneficial bacteria and microbes, which can weaken the immune system and lead to hospital readmission. On the global level, drug-resistant infections are predicted to kill more than 10 million people per year by 2050.

To solve the sepsis problem, we need a three-pronged solution: continued improvements in hospital processes to prevent sepsis; improved diagnostics to get patients on targeted treatment faster; and development of new antibiotics.

Hospitals need to aggressively pursue sepsis initiatives. Huntsville Hospital in Alabama is one of many hospitals on the leading edge of refining their processes around sepsis. Clinicians at Huntsville went on the offense, catching suspected sepsis cases early, improving protocols and education, and creating clinical teams focused on sepsis. The result was a reduction of sepsis mortality by more than 50 percent and a significant decrease in hospital readmissions.

Improving the detection of sepsis is bounded by the limitations of current diagnostic tools. The current standard of care for diagnosing sepsis has remained the same since the 1930s — the lengthy process of culturing blood to detect infection-causing organisms. Diagnostic companies must provide new breakthrough technologies to minimize the one- to six-day dark period in which clinicians work without strong diagnostic information. Without better diagnostic tools, solutions to improve sepsis care and fight drug resistance will remain on a collision course.

Our team at T2 Biosystems is one of many trying to support hospitals in this effort by developing blood tests that can detect the microbes that cause sepsis within hours, not days, and with more than 90 percent sensitivity. Instead of culturing blood, our tests use magnetic resonance technology to identify microbes directly in blood, a much faster approach.

Finally, we need to develop new drugs to combat sepsis. While antimicrobial resistance limits the effectiveness of many existing drugs, the number of new ones to address this problem have dwindled in recent years. We must accelerate clinical trials to develop and release antimicrobial drugs faster and help clinicians apply the best one to the right patient at the right time.

For too long, combating sepsis has been an unspoken problem in health care, taking lives and driving up costs. With thousands of lives and billions of dollars at stake, it is time to place a greater emphasis on new models for sepsis prevention, detection, and treatment.