A jury has awarded nearly $11 million to a woman who became partially paralyzed after waiting two hours for a hospital brain scan at New York Hospital Medical Center of Queens. Jurors found the medical center was negligent in caring for Candida Diego after she fractured her skull in a fall in September 2004. A spokeswoman said the hospital doesn't believe it is liable for the 71-year-old's condition and is appealing the decision.
Illinois' Medicaid program has decided to cover a genetic test for the first time. The state will now pay for BRCA1 and BRCA2 gene tests and genetic counseling for low-income women considered at high risk of developing hereditary breast or ovarian cancer. The test identifies mutations on the BRCA genes that significantly increase a woman's chance of getting cancer.
Cigna has launched a set of free online courses, games, and podcasts about health issues that can be found on the popular social networking site Facebook as well as on iTunes. The goal is to take confusion out of healthcare and help people make confident healthcare decisions, said Cigna representatives. Cigna also offers interactive charts about the healthcare plans of the Republican and Democratic parties, and how they might affect individuals.
Philadelphia-based Independence Blue Cross will soon add MinuteClinics' health centers of Minneapolis to its PPO network roster of participating healthcare providers. Throughout Southeastern Pennsylvania, there are 17 MinuteClinics, which have locations in CVS pharmacies and are staffed by nurse practitioners who provide routine primary care.
Columbia Memorial Hospital in Hudson, NY, is going ahead with its plans to construct a $2.6 million primary care center in Greene County, despite being denied state funding for the project. The project will consolidate the hospital's currently scattered primary care services into a modern facility. Once completed, the new center will include diagnostic and other specialty services.
Mt. Pleasant, MI-based Central Michigan Community Hospital has announced that Bill Lawrence has been named President and CEO for CMCH effective October 15. The CMCH Board of Directors was unanimous in their selection of Lawrence, a finalist in the national search conducted by healthcare search firm Furst Group. Lawrence comes to CMCH from University Heights, OH, where he served as President for University Hospitals Health System - Richmond Medical Center.
After more than two decades serving as president and CEO of Dunkirk, NY-based Brooks Memorial Hospital, Richard Ketcham will leave his post in December. Ketcham would celebrate 23 years as leader of Brooks in January, but if the formation of the Lake Erie Regional Health System of New York continues on schedule, the recently-chosen Jonathan Lawrence will take the helm of both the Brooks and TLC Health Network campuses when they combine before the beginning of 2009. Although he had an opportunity to be considered for the leadership role with Lake Erie Regional, Ketcham chose not to throw his name into the process.
An advocacy group for older workers believes Gray-Americans can fill a big role in the solution to the healthcare staffing shortages that are plaguing the nation.
Cynthia Metzler, president and CEO of the Arlington, VA-based nonprofit Experience Works, says older workers—generally considered to be people age 50 or older—are excellent candidates to fill any number of jobs in the healthcare arena, including staffing medical, clerical, and administrative positions.
Why?
Well, for starters, there's a potentially large applicant pool, and it's getting bigger every day. In 2006, 37 million Americans were 65 or older. By 2030, that population will grow to 72 million, according to U.S. Census Bureau projections. Of course, that aging population will include the doctors, nurses, and other healthcare professionals practicing today.
Gray-Americans also tend to stay put. Once they get a job, they are far less likely to move elsewhere. And, Metzler says that contrary to popular belief, older workers aren't a significantly larger liability or health insurance risk because they tend to be more careful on the job.
And, they want to work, Metzler says. Fully one-third of retirees reenter the work force, usually because they need the money. Metzler says older Americans also possess a sense of pride and identity that comes with the job.
So, what's the holdup?
Metzler says one of the biggest obstacles against older workers is an unintentional ageism that relies on an out-of-date demographic. "It's a mindset that we've carried over from the last 20 years, a mindset that modern demographics won't allow to continue," Metzler says. "In many parts of the country you have a population that is aging in place and there aren't enough younger people coming along to satisfy those current job needs." Hospitals, physician groups, and other healthcare entities must understand the potential for these older workers, Metzler says.
Yes, it's unlikely that a 55-year-old person will go to medical school. However, that person may have a BS degree, and could possibly become a nurse's assistant or even an RN with a couple years of school and training.
Despite Metzler's enthusiasm, there are legitimate concerns that older workers might not be up to the physical demands that nursing requires. After all, we are hearing plenty of stories about nurses in their mid-40s who quit the field because of physical and emotional exhaustion.
Metzler says the physical demands of nursing and other healthcare jobs can be mitigated with a little planning. "Look at the jobs as they have been historically designed and see if they have to remain that way moving forward," she says. "Yes, somebody is going to have to be strong enough to move a patient, but I'm not sure that everybody on the ward needs to be able to do that."
So, there will have to be some adjustments made in the hiring process and job parameters if older Americans are to have a part.
"It has to be an attitude of looking at everybody based on skills and life experiences and potential," says Metzler, "and not have filters because somebody may have gray hair."
John Commins is the human resources and community and rural hospitals editor with HealthLeaders Media. He can be reached at jcommins@healthleadersmedia.com.
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It is probably safe to say that healthcare delivery planning has never been easy. Still, it is equally safe to assume that it has never been more demanding than it is today. So far in 2008 we have endured turmoil in the credit markets, a sea change in regulations and payments affecting physician-hospital relations, and dare we mention the "R" word? If yours is not one of the growing number of healthcare organizations that has formally integrated its strategic and financial planning processes, now is the time. Beyond arguing for the necessity for integrating strategic and financial planning, we have come up with a practical approach for achieving the necessary integration.
Why integrate?
Historically, most providers have actively engaged in two critically important, but often separate, processes: strategic planning and financial planning. Strategic planning processes typically are visionary and involve a wide breadth of constituents—hospital management, the board of trustees, physician leadership, and sometimes the public. The strategic plan takes an all-encompassing view of the hospital and its market and seeks to set a vision and course of action for the mid- or long-term.
By contrast, the financial plan is traditionally developed by the hospital's "number crunchers" with little input from these other constituencies and tends to focus on short-term demands rather than long-term or anticipated needs. More significantly, the two plans are often developed in isolation—with strategic priorities set with insufficient knowledge of their financial impact and financial plans developed with limited knowledge of the hospital's strategic vision. As a result of the disconnect between the strategic and financial plans, hospitals often find themselves short on the capital capacity to invest in strategic priorities. To ensure long-term success, strategic and financial planning must be integrated.
What is an integrated strategic financial plan?
An integrated strategic financial plan includes the following core characteristics:
The process is inclusive. Key financial data and projections are shared with the broader strategic planning group, and preliminary strategic rationale and priorities are understood by mid-level financial managers.
The strategic and financial components of the plan build on each other in a step-by-step manner. For example, the strategic environmental assessment informs the financial projections, and the financial capability assessment is a factor in framing key strategic issues.
The strategic priorities resulting from the plan are demonstrably affordable and are likely to improve the long-term financial viability of the organization. Likewise, the long-term capital plan represents an allocation of financial resources that best supports the strategic direction.
How can strategic and capital planning be effectively integrated?
The answer to this simple question is for the hospital to create a strategic financial plan that aligns and coordinates the strategic goals of the organization with its available resources. The two plans, in essence, become one.
The following provides an outline of what a typical integrated strategic planning process might look like.
Step 1: An environmental assessment is conducted that examines both the hospital's internal trends and external market.
Step 2: Baseline financial projections are prepared that outline the hospital's utilization, financial performance, and economic position based on the findings from Step 1.
Step 3: The hospital's current and future financial capability is determined. Specifically, the hospital seeks to answer the question, "What funds are now and will be available for investment in strategic initiatives?" This step includes an assessment of internally-generated funds, as well as an assessment of untapped debt capacity and philanthropy. At this point, it is wise to determine how much capital will be allocated for strategic initiatives versus the hospital's other needs (e.g., replacement or maintenance capital, mission capital, and safety stock or capital reserves).
Step 4: The outcomes of Steps 1 through 3 are used as a backdrop for identifying strategic issues and implications; setting mission, vision, and value statements; and developing enterprise-wide goals and metrics.
Step 5: Utilizing the goals and metrics developed in Step 4, investment criteria and tools for ranking and selecting potential strategies are developed. Criteria should include not only the traditional financial metrics, but also strategic and mission criteria such as market and community impacts. This is a critical and iterative process that requires continuous input and communication between all constituencies to the strategic financial plan.
Step 6: Preliminary strategies are developed, revised, and prioritized based on the criteria developed in Step 5.
Step 7: Updated financial projections that incorporate the prioritized strategic initiatives are developed to ensure acceptable financial outcomes. Sensitivities are developed to assess the risks of key assumptions and formulate contingencies.
Step 8: Tactical plans are developed to guide the broad-based implementation of strategic initiatives.
Step 9: An integrated strategic financial plan is created that incorporates the strategic vision and initiatives typically associated with a strategic plan with the financial implications and requirements of a financial plan.
It is important to note that, unlike a strategic plan that is often created or modified every three to five years, the strategic financial plan requires annual maintenance. This does not mean that the entire plan needs to be reworked each year, but rather that "tweaks" may be necessary to ensure that fundamental assumptions related to the environment and financial outcomes are on target.
Lessons learned
For most hospitals, developing a strategic financial plan represents a departure from current processes and, as such, may hit a few snags along the way. In an effort to minimize the number and severity of these snags, we offer the following lessons we have learned.
The integrated strategic financial planning team should include representatives from all of the major constituencies of the hospital—the board of trustees, hospital management, finance, and physicians.
The hospital must allow adequate time for the integrated process. Our experience is that an effective planning process may require nine or more months to complete.
The process should be "data-driven" enough to facilitate a common understanding of the current situation and support assumptions about the future, but not so detailed as to create "analysis paralysis."
The team must be willing to make the hard decisions and remember that this is not a popularity contest.
It is critical that the team understand its capital availability upfront. Capital availability provides the foundation for all of the decisions that follow. Further, the team must ensure that there is consensus on how capital should be allocated between mission, replacement, safety stock, and strategic initiatives.
The process outlined should be followed sequentially. There really is a method to this madness!
The hospital must recognize that the integrated strategic financial plan is a "living" plan that needs to be followed, updated, and refined on an ongoing basis. This is not an academic exercise.
Monitoring the plan may be as important as developing it. The hospital should design metrics and dashboards to monitor progress against the plan and actively use them to ensure success.
The creation and implementation of a strategic financial plan can be an exhausting but invigorating exercise. The extra steps to integrate strategic and financial planning may seem cumbersome at first, but should pay significant dividends in both the short- and long-run.
Francine Machisko and Scott Clay, FHFMA are senior principals at the Noblis Center for Health Innovation in Atlanta, GA. They may be reached at francine.machisko@noblis.org and scott.clay@noblis.org, respectively.For information on how you can contribute to HealthLeaders Media online, please read our Editorial Guidelines.
Chief financial officers are becoming well-versed in the problem of methicillin-resistant staphylococcus aureus in hospitals. Who'd have thunk it?
It's because MRSA now affects the bottom line. Of course, no hospital wants to be responsible for making a patient sicker than when they came in to get treated. But it happens, and until recently it was a clinical problem. But now, thanks to Medicare's "never events" list and other insurers' focus on quality, it's a cost problem. And MRSA isn't your only cost problem when it comes to infections and other conditions that crop up in the hospital.
It's no secret that CMS and other insurers have stepped up the pressure on hospitals to avoid so-called "never events" and otherwise improve quality. That pressure, at least this year, comes in the form of nonpayment to the hospital should a patient acquire one of eight conditions while in the hospital. CMS has a list of several more for 2009.
Oh, and one more thing: Hospitals won't get paid at the highest Medicare rate if they don't participate on the hospital quality measure reporting program.
This new focus on accountability is prompting hospital CFOs and others in the finance department to get a crash course in quality. These decrees by CMS on cost and quality are forcing important conversations about how to prevent patients from getting sicker in the hospital than they were before they arrived. How should we do it? Could we test for MRSA internally so we can document whether the patient carried the bacteria before admission? Should we outsource that testing so that it's more reliable and cost-effective?
Dennis Grimaud, CEO of Diatherix Laboratories Inc., has his own opinion about the subject, because he runs a company that does outsourced testing of patients for the MRSA bacteria. But he says he's having more discussions with hospital financial people involved than ever, whereas in the past, he might have only met with clinicians.
"Does the hospital want to make an investment in equipment, personnel, and products?" he asks rhetorically. "Investment in equipment and personnel is very costly."
And there it is.
Though some conspiracy theorists surmise that the Medicare quality reporting program and the associated "never events" are an unsubtle way for CMS to cut its gargantuan costs and has little to do with a focus on quality, one unintended consequence could actually be a good thing. Ever since I started covering healthcare, the people who work in the sector have complained vociferously about the "silos" that exist in the business.
Here are just a couple of the myths associated with silos that I've heard over the years:
Doctors don't know how their decisions affect hospital finances, nor do they care.
Hospital financial people don't care about anything but the bottom line, nor do they care much about clinical quality.
Of course, neither of these statements is true. No one wants to give substandard care, and doctors likely don't want to bankrupt the hospital in which they practice. But perhaps the best thing about CMS and insurers' new focus on quality is the conversations they're encouraging among departments that once never talked to each other, but just grumbled about how decisions in each camp negatively affected the others.
And that's something to build on.
Philip Betbeze is finance editor with HealthLeaders magazine. He can be reached at pbetbeze@healthleadersmedia.com.
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