Healthcare revenue cycle management firm Passport Health Communications, Inc. has named Scott MacKenzie, previously with McKesson Corporation, to succeed Jim Lackey as CEO. Lackey will remain chairman of the board of directors. MacKenzie since 2005 was president of RelayHealth Pharmacy Solutions, now part of McKesson. Prior to joining McKesson, MacKenzie spent six years in various executive capacities with Cerner, most recently as vice president and general manager.
Cross Country Healthcare, Inc. has appointed Lori Schutte president of its Cejka Search subsidiary effective this month. Schutte has served as vice president of client services of Cejka Search since 2004. She succeeds Carol Westfall who previously announced her retirement in September 2008.
It's unlikely that most people take the time to read all the way through any kind of commercial contract. All that fine print and paragraph after paragraph of legal jargon seems to be written by and for lawyers.
A federal healthcare contract isn't much different. However, once you receive an award from a government agency, it is important that your organization reads and is familiar with the entire contract, including provisions incorporated by reference. Many of the clauses included "by reference" are "boilerplate" and completely irrelevant to the work to be performed, but by law, must be included. On the other hand, some of the clauses incorporated "by reference," as well as others included in full are indeed important, and warrant careful attention.
Once you begin to perform under the contract, one important rule is to accept direction only from an "authorized" official. The key point here is to know the difference between an authorized and "unauthorized" individual.
In a healthcare contract, while the inclination may be to assume that medical or clinical staff of the government are authorized to provide direction to a contractor, they are frequently not the ones officially vested with the authority to execute a contract or implement changes. Typically, only the contracting officer (CO) and specifically identified designee (often the Contracting Officer's Technical Representative, or COTR) are authorized to give instructions or changes to a contractor.
If you proceed with services at the direction of a government employee who isn't authorized to give such direction, you may find it difficult to be paid for those services. A related rule of thumb is that you shouldn't volunteer to perform extra work in the hope that you'll work out payment later with the government. Make sure that you have written direction from an authorized government official before performing.
What if an authorized government agent directs you to perform work that you believe isn't part of your contract? Organizations that are relatively new to federal contracting are often caught off guard by such requests and assume that because they've been asked to do something, they must comply.
To the uninitiated, the "intimidation factor" can be a powerful deterrent to challenge the directions of an official agency representative. Many inexperienced contractors do not realize that there are a variety of informal and formal ways to resolve questions about whether a requirement is "in scope" (e.g., within the scope of work formally approved as part of their contract), or "out-of-scope" (e.g., not something that was originally part of the scope of work).
Beware of the intimidation factor. Just because you get a request—or even a demand—to perform something, it doesn't mean you must comply without recourse. One of the clauses frequently cited "by reference" in most federal healthcare contracts is the Disputes Clause (FAR 52.212-4(d)), which provides an important mechanism for resolving such issues.
Unless the government has materially breached the contract, the best strategy is to keep performing those services that are not in question, while attempting to resolve other issues with contracting staff informally. If informal avenues are not successful, you have the right to file a claim or other request for relief afterward.
The government ultimately retains the right to terminate a contractor "for default," however, from a practical standpoint, terminations for default are relatively rare, as frequently the parties are able to resolve differences to their mutual satisfaction. Another important difference between federal and commercial contracts is the government's right to unilaterally terminate a contract for their "convenience." This right allows the government to end a contract without being subject to a breach-of-contract suit as could easily occur in the private sector between two parties if one decided to simply walk away from an existing agreement.
While it may initially appear that the government has the upper hand in federal healthcare contracts, federal procurement law provides important rights to the contractor as well. A contractor has the right to submit a claim if the government orders work outside the scope of the contract; a contractor's performance will be excused if performance is impossible or impracticable through no fault of the contractor; and a contractor may assert its right to an excusable delay if it cannot perform on schedule and it is not negligent or otherwise at fault. Finally, the law recognizes that the government has a "duty to cooperate" with a contractor, and cannot "hinder" the contractor's performance. Again, any government failure to uphold this duty may be actionable.
By now, you realize the importance of record keeping when doing work on a government contract. It's best to communicate with the government in writing, or at least keep detailed notes of phone conversations and meetings. In addition, the contract itself will instruct you on what types of records you must keep, and for how long. It's a good practice to have and follow a written record-keeping policy, and to keep a log of any contract documents you destroy, including the date of destruction. Good record keeping will simplify government audits, and will help if you or the government assert a claim concerning contract performance and administration.
In next month's article, we will discuss "set-asides" (e.g., contracts that are set aside for certain socioeconomic categories of businesses) for healthcare services within the federal marketplace.
Scott Honiberg is president and Jeff Weinstein is counsel at Potomac Health Associates, Inc. They can be reached at S.Honiberg@PHAInc.com or J.weinstein@PHAInc.com , respectively.For information on how you can contribute to HealthLeaders Media online, please read our Editorial Guidelines.
While the quest to reform healthcare and promote affordable medical care steadily moves forward on Capitol Hill, a gap remains on how healthy Americans actually are—and how healthy they could be in the future. By failing to take proven steps to promote better health throughout communities—including discouraging smoking and promoting healthy foods and physical activity—children today face having sicker, shorter lives than their parents, according to recommendations released Thursday by a panel of healthcare experts.
A new definition of health reform is needed that addresses people's daily lives, said Mark McClellan, MD, PhD, co-chair of the Commission to Build a Healthier America that was launched by the Robert Wood Johnson Foundation just over a year ago. "The evidence is clear that how we live, learn, work and play has a much greater influence over how well and how long we live than our healthcare."
"It's time to take a wider view of what we need to do to improve our health," added McClellan, the former administrator of the Centers for Medicare and Medicaid Services and the Food and Drug Administration, who is now director of the Engelberg Center for Healthcare Reform at the Brookings Institution, Washington.
The commission called for individuals to take more responsibility for their health choices. But, it also recognized that many individuals face obstacles in making healthy choices outside the healthcare system. For instance, the lack of grocery stores in various lower-income communities may hinder attempts to include more fresh fruits and vegetables in daily diets.
To help break through these barriers, the commission called for initiatives that promote a "national culture of health"—especially among children. They include:
Banning junk food from schools.
Getting children to be physically active at least an hour every day.
Designing public programs that support the needs of hungry families for nutritious foods.
Eliminating smoking and promoting a smoke-free nation.
Giving children, especially those from low-income families, a healthy start by ensuring that they have high-quality education and child care.
Commission member Gail Warden, MD, president emeritus of the Henry Ford Health System in Detroit, suggested that emphasis needs to be placed on creating sophisticated school-based health programs in which "all aspects of the mental and physical needs of individual students are taken into consideration."
These programs should "put great emphasis on wellness and prevention" and "educate [children and parents] about their own personal responsibilities about their health," he said. A recent example of these programs involve getting childhood immmunizations that have received high compliance rates nationwide.
The full report, "Beyond Healthcare: New Directions for a Healthier America," which includes examples of community programs successfully addressing various health issues, is available at the Commission's website (www.commissiononhealth.org).
Minnesota-based Fairview Health Services suffered a net loss of $114 million in 2008, largely because of investment losses and higher interest rates on debt, according to unaudited numbers. Even without investment losses, the chain of hospitals and clinics had a tough year because of fewer inpatient visits and more unpaid medical bills. Net operating income was $20.8 million, down 57% from 2007. That translated to an operating margin of just 0.8%, compared with 2.1% in 2007.
The economic downturn has put a Band-Aid on one of the most vexing problems in healthcare: a shortage of nurses that has slowed care at some hospitals and forced others to turn away the ill. With some nurses postponing retirement and others resuming their careers for financial reasons, many hospitals across the region and the nation say they have few, if any, openings. After more than a decade when hospitals struggled to maintain sufficient staffing, the want ads have virtually disappeared, and only acute-care and emergency-room nurses remain in great demand.