Tag Archives: Hospital

Florida Medicaid managed care demonstration gets 5-year extension

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http://www.healthcaredive.com/news/florida-medicaid-managed-care-demonstration-gets-5-year-extension/448610/

Dive Brief:

  • CMS approved a five-year extension of Florida’s section 1115 demonstration of a capitated Medicaid managed care program and low-income pool to support uncompensated care.
  • The uncompensated care pool will receive about $1.5 billion annually, based on the most current data on hospitals’ charity care costs, according to an Aug. 3 letter from CMS Administrator Seema Verma to Justin Senior, secretary of the Florida Agency for Health Care Administration.
  • The Managed Medical Assistance (MMA) demonstration, which now runs until June 2022, is the first to include simplified reporting requirements. CMS said it will monitor progress toward state-selected benchmarks and partner with the state to develop a meaningful program evaluation.

Dive Insight:

The modifications are in line with President Donald Trump’s administration’s pledge to reduce what it sees as burdensome or duplicative state reporting activities and with the CMS’ commitment to partner with states to improve their Medicaid programs.

In a March 14 letter, HHS Secretary Tom Price and Verma reminded states they can apply for waivers that would allow for significant changes to their Medicaid programs. States must show their waiver promotes the objectives of the Medicaid program, but HHS has broad authority for approval and Price has indicated he intends to broaden their use.

The CMS had been winding down funding for the Florida program under President Barack Obama’s administration. Officials at the time said the state should expand Medicaid under the Affordable Care Act to help with uncompensated care costs. They gave Florida $600 million for the final year of the program, far less than the about $2 billion requested.

The amount of funding now being provided offers a pretty clear indication the CMS under Trump thinks Florida is on the right track without expansion.

More than 30 states currently have waivers. Alabama received CMS approval in February for a section 1115 demonstration waiver to shift a majority of its Medicaid beneficiaries into regional care organizations, akin to accountable care organizations. While there are other states using this strategy, Alabama is unique in that it’s being administered by provider-run nonprofit organizations rather than a major insurer.

Patient advocacy groups have voiced alarm at potential steep cuts to Medicaid. Trump’s proposed $4.1 trillion budget would slash $610 billion from Medicaid plus 20% of funding for the Children’s Health Insurance Program. Robert Greenstein, president of the Center on Budget and Policy Priorities, said Trump’s budget would increase the number of uninsured and narrow Medicaid benefits and eligibility. This would lead to higher uncompensated care costs for hospitals.

5 hospitals with strong finances

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http://www.beckershospitalreview.com/finance/5-hospitals-with-strong-finances-080117.html

Here are five hospitals and health systems with strong operational metrics and solid financial positions according to recent reports from Fitch Ratings, Moody’s Investors Service and S&P Global Ratings.

Note: This is not an exhaustive list. Hospital and health system names were compiled from recent credit rating reports and are listed in alphabetical order.

1. Coral Gables-based Baptist Health South Florida has an “AA-” rating and stable outlook with S&P. The system maintained key balance sheet metrics and generated better-than-projected financial results in fiscal year 2016, according to S&P.

2. Carolinas HealthCare System has an “Aa3” rating and stable outlook with Moody’s. The Charlotte, N.C.-based system has a track record of good financial performance, strong balance sheet metrics and a large scope of operations with multiple hospitals. Moody’s expects Carolinas HealthCare System to maintain stable leverage metrics while continuing to generate financial results at current levels.

3. Children’s Healthcare of Atlanta has an “Aa2” rating and stable outlook with Moody’s. CHOA is a leading provider of high acuity pediatric care in the Atlanta area and has favorable leverage metrics and a track record of strong margins and liquidity, according to Moody’s.

4. Cleveland Clinic Health System has an “Aa2” rating and stable outlook with Moody’s. The system has a track record of meeting operating challenges to sustain strong cash flow, exceptional fundraising capabilities, strong liquidity and a growing ability to leverage an international brand into revenue diversification, according to Moody’s. The debt rating agency expects Cleveland Clinic to manage execution risks of multiple strategies, as demonstrated in the past.

5. Broomfield, Colo.-based SCL Health has an “AA-” rating and stable outlook with Fitch. The system’s operating performance improved in fiscal year 2015, and SCL has sustained those results, according to Fitch. The system has manageable capital needs in the near term, a stable liquidity position and geographic diversity, with 12 hospitals in five markets across three states.

 

9 recent hospital, health system outlook and credit rating actions

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http://www.beckershospitalreview.com/finance/9-recent-hospital-health-system-outlook-and-credit-rating-actions.html

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The following hospital and health system credit rating and outlook changes and affirmations took place in the last week, beginning with the most recent.

1. Fitch assigns ‘A+’ rating to Regional Health’s bonds
Fitch Ratings assigned an “A+” rating to Rapid City, S.D.-based Regional Health’s proposed $214.4 million series 2017 revenue bonds to be issued by the South Dakota Health & Educational Facilities Authority.

2. Moody’s downgrades Midland County Hospital District’s debt rating to ‘Aa3’
Moody’s Investors Service downgraded Midland (Texas) County Hospital District’s general obligation debt rating to “Aa3” from “Aa2,” affecting $101.1 million of general obligation debt.

3. Moody’s assigns ‘Baa3’ rating to SoutheastHealth’s bonds
Moody’s Investors Service assigned its “Baa3” rating to Cape Girardeau, Mo.-based SoutheastHealth’s proposed $86.9 million series 2017A and $6.29 million series 2017B revenue bonds, to be issued through the Industrial Development Authority of the County of Cape Girardeau and the Industrial Development Authority of Stoddard County. The bonds will mature in 2042.

4. Moody’s affirms ‘A1’ rating on Sarasota County Public Hospital District’s bonds
Moody’s Investors Service affirmed its “A1” rating on Sarasota (Fla.) County Public Hospital District’s outstanding bonds, affecting $192 million of debt.

5. S&P revises NorthShore University HealthSystem’s outlook to stable
S&P Global Ratings affirmed the “AA” rating on Evanston, Ill.-based NorthShore University HealthSystem’s series 2010 revenue refunding bonds, issued by the Illinois Finance Authority.

6. S&P upgrades HealthEast Care System’s bond rating to ‘A+’
S&P Global Ratings upgraded the rating to “A+” from “BBB+” on St. Paul, Minn.-based HealthEast Care System’s series 2017A bonds, issued by the Redevelopment Authority of the City of Saint Paul.

7. Moody’s assigns ‘A2′ rating to Fairview Health Services’ bonds
Moody’s Investors Service assigned its “A2” rating to Minneapolis-based Fairview Health Services proposed $197 million series 2017A revenue bonds to be issued through the Housing and Redevelopment Authority of the City of St. Paul, Minn. The bonds will be fixed rate and will mature in 2047.

8. Moody’s assigns ‘A3’ rating to North Valley Hospital’s bonds
Moody’s Investors Service assigned its “A3” to Tonasket, Wash.-based North Valley Hospital’s proposed $8.5 million unlimited tax general obligation refunding bonds. The expected sale date is Aug. 16.

9. Moody’s downgrades Lucile Packard Children’s Hospital’s credit rating
Moody’s Investors Service downgraded Palo Alto, Calif.-based Lucile Packard Children’s Hospital’s credit rating to “A1” from “Aa3.”

Kaiser’s operating income jumps 57% to $772M

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http://www.beckershospitalreview.com/finance/kaiser-s-operating-income-jumps-57-to-772m.html

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Oakland, Calif.-based Kaiser Permanente reported higher revenue and operating income for its nonprofit hospital and health plan units in the second quarter of 2017.

Kaiser saw revenue climb to $18.1 billion in the second quarter of this year. That’s up 14.6 percent from revenue of $15.8 billion in the same period of 2016.

That boost was attributable, in part, to the system’s health plan unit. In the first half of 2017 Kaiser added 1.1 million health plan members. This growth was partially attributable to Kaiser’s acquisition of Seattle-based Group Health Cooperative in February. As of June 30, Kaiser had about 11.7 million members.

Kaiser reported operating income of $772 million in the second quarter of this year, up 57.2 percent from $491 million in the same period of 2016.

After factoring in non-operating income, Kaiser ended the second quarter of 2017 with net income of $1 billion, up from net income of $707 million in the second quarter of the year prior.

The Latest Motion In House v. Price Has A Significant Impact On The Future Of CSR Payments

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http://healthaffairs.org/blog/2017/08/01/the-latest-motion-in-house-v-price-has-a-significant-impact-on-the-future-of-csr-payments/

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On August 1, 2017, the United States Court of Appeals for the District of Columbia granted the motionof the attorneys general of 17 states and the District of Columbia to intervene in House v. Price. House v. Price is before the D.C. Circuit on appeal from the ruling of a district court judge in favor of the House of Representatives in its lawsuit claiming that the reimbursement of insurers for reducing cost sharing for low-income qualified health plan enrollees is illegal because Congress had not appropriated funding for the payments. The judge enjoined the payments but stayed her order pending an appeal and the Obama administration in fact appealed. The states had moved to intervene, claiming that they had an interest in the action and that the Trump administration was not adequately defending their interest.

The three-judge appellate panel held first that the states had demonstrated that they had standing to intervene because they “would suffer concrete injury if the court were to grant the relief the plaintiffs seek.” The states established that a judgment for the House terminating the payments would “lead directly and imminently to an increase in insurance prices, which in turn will increase the number of uninsured individuals for whom the States will have to provide health care.” This would in turn result in state-funded hospitals suffering financially when they have to cover emergency care for uninsured individuals.

The court further held that the states had established a right to intervene in the action. First, the states had established an interest in the subject matter of the lawsuit.

Second, the court held that allowing the injunction of the court below would impair the states’ rights. The court observed that the administration’s “claim that it could unilaterally suspend payments is a debated legal question, not an answer to the injury the States have evidenced. The injunction sought, which would forbid the payments at issue, would erect a roadblock to the States’ goal of either persuading or compelling the Department to make the payments.”

Third, the court held that the states had raised a sufficient doubt concerning the adequacy of the administration’s representation of their interest. The court noted that the administration had nowhere argued that it would protect the states’ interest or continue to pursue the appeal.

Fourth, the court held that the motion to intervene was timely. The states, the court held, “had filed within a reasonable time from when their doubts about adequate representation arose due to accumulating public statements by high-level officials both about a potential change in position and the Department’s joinder with the House in an effort to terminate the appeal.” The court, in short, took President Trump’s threats to terminate the cost-sharing reduction (CSR) payments seriously.

Finally, the court held that permissive intervention was also warranted in the case.

The court further ordered that the case would continue to be held in abeyance, with status reports at 90-day intervals and the next one due on October 30, 2017. With their status as parties to the case, however, the states may well next seek to get the case moving again.

The decision does not mean that the Trump administration is barred from ending the cost-sharing reduction payments. It does mean, however, that the administration cannot unilaterally stop the CSR payments, dismiss the appeal, and claim judicial imprimatur for its doing so. If the administration does stop making the payments, the states—or insurers, or possibly consumers—would be able to sue to require the payments to be made and the injunction entered by the lower court would not be as much of a “roadblock” to their prevailing. Finally, if the states ultimately convince the appellate court that the CSR funding has in fact been appropriated, the administration would be required to pay it. The decision is, therefore, a major development in the ongoing CSR saga.

The New Metrics

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http://www.healthleadersmedia.com/leadership/new-metrics?spMailingID=11626424&spUserID=MTY3ODg4NTg1MzQ4S0&spJobID=1220355864&spReportId=MTIyMDM1NTg2NAS2

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The business and clinical intelligence that are necessary for healthcare leaders to better manage their organizations are changing rapidly. Returns may be greatest for organizations that are able to measure outcomes and show value.

An old saying from Six Sigma and other process improvement regimes is that “what gets measured gets done.” That’s important for senior healthcare executives to remember. But that truth leaves out the critical question of what should be measured.

The options are literally endless, but determining the most important metrics to measure in an era in which healthcare is transforming is no trivial decision.

The move toward reimbursement based on the value the healthcare organization provides to the patient and the payer, which is happening at vastly different rates in some geographical areas compared to others, means that asking and answering that question at regular intervals is crucial.

If that’s the case, what are the metrics that leaders need to watch to ensure clinical, financial, and strategic success?

This special issue of HealthLeaders examines how high-performing organizations are instilling and adapting to new performance measures that healthcare leaders need to track to “get value done.”

Our editorial team talked with more than a dozen organizations in a variety of sectors, from leaders of hospital inpatient organizations to payer leaders, from leaders of postacute care organizations to information technology, nursing, and finance leaders; all have measurements they find useful to achieve value in a rapidly transforming healthcare business environment.

Some metrics may be familiar, such as admissions or readmissions per thousand patients. Other metrics may be unfamiliar, such as a “user resource metric,” part of which incorporates the speed with which patient calls are answered at a call center.

Many more important metrics are clinical in nature, but are often monitored and reported by the financial arms of the organization, as they provide a proxy for customer satisfaction, a growing component of the value equation.

Also critical is the latency of such measurements. For example, it’s less valuable to learn about line infection rates and sepsis diagnoses after the patient has been discharged, because little can be done to influence the statistics by that time.

6 California urgent care centers file for bankruptcy

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http://www.beckershospitalreview.com/finance/6-california-urgent-care-centers-file-for-bankruptcy.html

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Six urgent care centers in Southern California filed for Chapter 11 bankruptcy Wednesday, according to The Orange County Register.

The bankruptcy case includes the following six facilities:

  • Cypress (Calif.) Urgent Care
  • Hoag Urgent Care-Anaheim (Calif.) Hills
  • Hoag Urgent Care-Huntington Harbour (Huntington Beach, Calif.)
  • Hoag Urgent Care-Orange (Calif.)
  • Hoag Urgent Care-Tustin (Calif.)
  • Laguna Dana Urgent Care (Dana Point, Calif.)

Robert C. Amster, MD owns the facilities. He is the founder of Your Neighborhood Urgent Care, which includes a network of 10 urgent care centers in Southern California.

Four of the urgent care facilities that entered bankruptcy are leased from Hoag Memorial Hospital Presbyterian in Newport Beach, Calif.

Dr. Amster’s attorney, Ashley McDow, told The OC Register the bankruptcy will help “restructure our affairs with the landlord and the bank.”

Hoag Urgent Care-Orange closed in 2016. The other five urgent care centers are expected to remain open and conduct business as normal during the bankruptcy case, according to the report.

Red October: CMS Details Process for Billions in DSH Cuts

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http://www.healthleadersmedia.com/leadership/red-october-cms-details-process-billions-dsh-cuts?spMailingID=11619096&spUserID=MTY3ODg4NTg1MzQ4S0&spJobID=1220267507&spReportId=MTIyMDI2NzUwNwS2#

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With Congressional delays in Medicaid disproportionate share funding cuts set to expire Sept. 30, CMS issues a proposed rule that details billions in reductions that will begin in 2018.

As the Senate tries repeatedly to repeal the Affordable Care Act, so far without success, CMS is moving ahead with detailing how cuts in disproportionate share funding will be administered under a political deal the hospital lobby agreed to in exchange for getting more people covered by health insurance under the ACA.

The first step of the DSH cuts, which were supposed to have been implemented in stair-step fashion beginning in 2014 and running through 2020, had been delayed by Congress until 2018 after hospitals successfully argued that uncompensated care costs weren’t declining as much as expected under the ACA.

The cuts will now begin in 2018 with $2 billion, with $1 billion in cuts added each year until 2024, when DSH payments will be cut by $8 billion. Another $8 billion in cuts is scheduled for 2025.

Cuts will total $43 billion over the eight years.

The proposed rule lays out the DSH Health Reform Methodology (DHRM) that will be used to implement DSH funding reductions by state, in an attempt to target more heavily hospitals that experience the least financial impact from uncompensated care.

The DHRM will incorporate several sources of data to determine the amount by which each state’s DSH funding will be reduced for each year, in an attempt to account for a variety of factors that influence the financial impact of uncompensated care burdens in each state.

The methodology must, according to CMS “impose a smaller percentage reduction on low-DSH states.”

The largest reductions will be imposed on states with the lowest percentage of uninsured during the most recent year data is available, to states that do not target their DSH payments to hospitals with high volumes of Medicaid inpatients and to states that do not target DSH payments to hospitals with high levels of uncompensated care.

Data that will influence the DHRM will include United States Census Bureau Data and Medicaid DSH audit and reporting data submitted by the states.

The proposed rule is open for public comment until August 28.

Shift in physician workforce towards specialists fuels primary care shortage, potential spending growth

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http://www.healthcarefinancenews.com/news/shift-physician-workforce-towards-specialists-fuels-primary-care-shortage-potential-spending?mkt_tok=eyJpIjoiTXpOa01qUXhaVGd5TnpkaiIsInQiOiJudFozOHVLS1VVNXZZRE42Y0RmTWdIZHpkOU0yNERUSmlXU0VCMlJDMEFyMmVTUUc4aVwvcXRVc0gzXC9ndUdJVjhHT1drZkkzdDhBVFhHZ3BHVjI1NmhIVHY1RmNXSENVdWtwb3RVVnVtaFNWbXNFdnBzb0JVenRcL1ZuR1p0MW0zRyJ9

Areas with more primary care physicians have lower spending per beneficiary, better care, patient satisfaction and lower death rates, authors say.

The composition of the healthcare workforce is shifting towards specialty physicians while primary care growth has gone flat, and according to a Health Affairs blog post, this trend could mean healthcare spending goes up not down.

Labor represents more than half of health care costs, and clinical workforce is a major driver of use and pricing, authors wrote, and there is plenty of support establishing a link between primary care-centered health systems and lower spending. Specifically, areas with more primary care physicians have lower spending per beneficiary, better care and patient satisfaction and lower death rates.

“Given this, many existing payment reform strategies prioritize primary care, and the success of these reforms will require a vibrant–and likely growing–primary care workforce,” the authors wrote.

Health Affairs delved into the Bureau of Labor Statistics’ Occupational Employment Statistics files between 2005 and 2015, focusing their analysis on limited our analysis to ambulatory health care services, hospitals, and nursing and residential care facilities. There was an overall net increase of 2.6 million jobs over this period, six percent of them being physicians. While the number of primary care jobs rose by roughly eight percent, the number of specialist jobs increased six times faster. Also, the overall share of the physician workforce constituted by primary care fell from 44 to 37 percent, the blog said.

These trends raise concerns for access to care and spending. While in theory, the presence of more specialists in a given market could give way to more competition, lower prices and spending and better outcomes, public payer fees are set administratively and not necessarily susceptible to competition. Hospital/physician integration, patient preference could also hinder competition.

The trend of more specialists working in health systems that charge facility fees on top of already expensive prices for care, and the notoriously large salaries specialists make will also likely drive spending upward, authors said.

In light of the aforementioned belief that the strong presence of primary care providers reduces healthcare spending, the workforce trends may be cause for concern. Moreover, they add urgency to previous recommendations from various agencies aimed at bolstering primary care, like MedPac‘s suggestion that the Medicare fee schedule be altered to reflect the value of primary care and close disparities in the fee schedule that overcompensate certain specialists. HRSAhas recommended in the past the medical school funding be funneled toward students who will work in family medicine and other categories.

“If we are to bend the cost curve, we likely need to move more aggressively on fee schedule changes, payment reform, and workforce policies,” the authors said.

CHS announces hospital sales worth $1.5B in revenue amidst ‘disappointing’ 2nd quarter losses

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http://www.healthcarefinancenews.com/news/chs-announces-more-hospital-sales-amidst-disappointing-2nd-quarter-losses?mkt_tok=eyJpIjoiTXpOa01qUXhaVGd5TnpkaiIsInQiOiJudFozOHVLS1VVNXZZRE42Y0RmTWdIZHpkOU0yNERUSmlXU0VCMlJDMEFyMmVTUUc4aVwvcXRVc0gzXC9ndUdJVjhHT1drZkkzdDhBVFhHZ3BHVjI1NmhIVHY1RmNXSENVdWtwb3RVVnVtaFNWbXNFdnBzb0JVenRcL1ZuR1p0MW0zRyJ9

System is already knee deep in the planned divestitures of 30 hospitals; additional sales are part of shift to “smaller stronger” portfolio.

In addition to the planned divestitures of 30 hospitals,  struggling Franklin, Tennessee-based Community Health Systems announced during an earnings call Wednesday that they are looking at the additional sale of a group of hospitals that carries a combined $1.5 billion in annual net operating revenue.

CHS has already completed 20 of the 30 other planned sales, with 11 being sold in May and another nine deals having closed as of July 1st. The remaining 10 hospital sales are expected to close by September 30th, CHS said.

CHS’ financial health continued its downward slope, with a net loss of $137 million or $1.22 per diluted share in the second quarter of 2017. Their net operating revenue was down 9.7 percent to $4.1 billion. The company’s operating results for the second quarter reflected a 10.8 percent decrease in total admissions. On a same-store basis, both admission and adjusted admission dropped 2.5 percent year over year from 2016, financial documents showed.

Wayne T. Smith, chairman and chief executive officer of Community Health Systems said their focus is now on shifting to a “smaller, stronger portfolio of assets.”

“Obviously, we are disappointed with our performance during the second quarter. Our financial results reflect weaker than expected volumes, which negatively affected our net revenue and Adjusted EBITDA performance. We are seeing better results in certain areas, and we continue to work on a number of initiatives to drive operational and financial improvements.”