In regards to their proposed merger to create Pennsylvania's largest insurer, executives at Independence Blue Cross and Highmark Inc. insist they won't play hardball when it comes to negotiating with doctors and hospitals over payments for their services, despite their market clout. But the head of the Pennsylvania Medical Society, who testified at Insurance Department hearings on the merger, is skeptical. Society president Peter Lund thinks the two companies will have too much negotiating power statewide if they merge.
Aurora Health Care is in talks to buy Comprehensive Cardiovascular Care Group, the largest cardiology group in the Milwaukee area. The potential deal with Comprehensive Cardiovascular Care Group, which employs about 40 cardiologists, would follow two other acquisitions by Aurora this year. The healthcare system bought Radiology Associates of Milwaukee, with 28 radiologists; and also purchased Advanced Healthcare, which employed about 250 doctors.
The Detroit Medical Center has changed the name and expanded the scope of services at its Madison Heights, MI, hospital to include a wide range of specialized pediatric services. The Michigan Orthopaedic Specialty Hospital, which is struggling financially, has been renamed the DMC Surgery Hospital. The adult orthopedic facility will add services for children in orthopedics, plastic and reconstructive surgery, developmental dentistry, otolaryngology, gastroenterology, general surgery and ophthalmology, as well as outpatient physical and occupational therapy.
The annual release of U.S. News & World Report ratings of the nation's best hospitals is good for hospitals like the Cleveland Clinic, which was rated as one of the top-ranked hospitals (No. 4), and as the nation's No. 1 heart hospital for the 14th straight year. But the publication also stirs debate about whether the popular rankings are good for consumers. The rankings of 170 hospitals carry a lot of weight, but they favor large academic centers and lean heavily on reputation instead of the best available quality measures, some say.
GM's Board of Directors is expected to approve a layoff plan in August that will impact thousands of white-collar jobs; they are also considering selling some the company's brands. GM officials are now re-evaluating their strategy and their hope to meet internal projections of returning to profitability by 2010, as the company remains in a sales slump and deals with its lowest stock price in 50 years.
One of the more misleading sayings is that "a rising tide lifts all boats." Reportedly this is an adage that Navy man and yachtsman JFK was fond of saying in his presidential speeches on the economy.
I have heard it pop up more than once recently as industry leaders try to imagine a scenario where a major healthcare reform shift will somehow preserve and strengthen all current players. If only the spectacularly backward reimbursement system were fixed, then everybody would get better, or so the group-think follows.
No one who actually understands the interconnected nature of the healthcare web and its ties to American politics believes that the true path to a better healthcare system would include everyone. To borrow the saying, a rising tide strands some ships and swamps others. And there are some we should scuttle.
Go back and consider the industries that have gone through an era of systematic disruption that did not see significant shakeout. Whether new technology, changing customer expectations, or a government shift in regulation causes the disruption really does not matter. In the end, industries get smaller and the parts of it that were not offering the best service at the best price lose and die off.
The national healthcare expenditure as a percentage of the gross domestic product is $2.3 trillion, eating up an unhealthy 16% of the GDP and rising like a bloated yeast roll. Nothing less than significant cuts and consolidation are going to drive that number down. Certainly the healthcare industry lobbyists and opinion influencers know which way the winds of change are blowing. They are paid to keep their ships—and their ships only—afloat. An article in the Washington Post last month and one from the Associated Press this week identify that the lead players on the hospital, health plan, employer, union and medical sides are lining up funds and communications campaigns for the coming fight. The discourse at this point is still quite civil, and glossed toward some sense of finally fixing underlying flaws in the healthcare economy. None will dare admit that for the kind of drastic change necessary (see 16% of GDP above), someone is going to have to lose and lose big.
If you were to chisel a monument to how dysfunctional healthcare politics are currently, this week's vote to delay again a reduction in Medicare physician fee cuts should be carved in white marble and left on the mall in D.C. Whatever your position on the merits of the proposed cuts, there is little disputing that the vote is one to sustain a payment structure that is broken beyond repair.
It will be interesting in the coming post-election months to see whether there is any linkage between the eventual winners of the debate/PR/lobbying scrum that is brewing and the true flaws that are actually sinking healthcare. Will the ones who eventually sink be the ones that should?
Jim Molpus is Editor-in-Chief of HealthLeaders Media. He can be reached at jmolpus@healthleadersmedia.com.
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