A draft recommendation to Congress released by the Medicare Payment Advisory Commission (MedPAC) Thursday has hospital officials concerned about payments for the year. The draft, which can still be revised before the full MedPAC panel votes on it in January, provides for a full "market basket" update for fiscal 2011 outpatient and inpatient hospital payments.
However, even then MedPAC staff project that overall Medicare margins will be -5.9% in fiscal 2010. The commission also reported that hospitals' Medicare margins dropped to -7.2% in 2008—down from -6% the previous year.
The data "reinforces our concerns about the Medicare buy in proposal that's currently part of the Senate health reform bill," said American Hospital Association President and CEO Rich Umbdenstock, in a statement. "For the majority of America's hospitals, Medicare payments cover less than the cost of care for hospital services to seniors, making it more difficult to make ends meet."
MedPAC staff members said, though, that hospitals that have the highest proportion of Medicare and Medicaid patients reported costs that are closer in line with what Medicare pays—suggesting they have found ways to work with Medicare rates. The hospitals with a larger share of private paying patients reported the biggest gap—suggesting that their costs are much higher and that they may not have attempted to cut costs as much as the other hospitals.
Home care and hospice care providers also were concerned about figures developed by the MedPAC staff. The MedPAC data "artificially inflates" the profit margins of the industry, said Val Halamandaris, president of the National Association for Home Care and Hospice in Washington, DC.
Halamandaris said the figures distorted the true financial picture of home health providers. "Home health is and has always been a 'cottage industry,' made up of small to medium sized providers," he said. "In fact, about 23% of free-standing providers lose money in providing Medicare services, and about 30% of them make less than 5% on their Medicare services."
He was critical in part of MedPAC disregarding facility based home health providers' margins in its calculations. In particular, he said roughly 20% of Medicare participating home health agencies are facility based; in some states, especially rural areas, hospital based home health agencies make up a majority of the providers. Those providers have higher costs, resulting in an average Medicare profit margin of -7.82 percent, Halamandaris said.
A team of healthcare organizations is working together to engage the patient and family in the healthcare experience.
As part of the 2009 Accelerating Change and Transformation in Organizations and Networks (ACTION) research grants awarded by the Agency for Healthcare Quality and Research (AHRQ), the following groups will be collaborating to create a Guide to Patient and Family Engagement in Health Care Quality and Safety in the Hospital Setting:
The American Institutes for Research, the team leader
Carilion Health Clinic
Consumers Advancing Patient Safety
The Institute for Family-Centered Care
The Joint Commission
The Health Research and Education Trust
Planetree
The Maryland Patient Safety Center
Aurora Health Care
The research grant is funding the development of a patient and family hospital engagement Guide.
"The project to develop the Guide began in September 2009 and will continue over the next three years as we work to develop and test an evidence-based product that meets the needs of end users," says Jeff Brady, MD, MPH, patient safety portfolio lead in the center for quality improvement and patient safety at AHRQ. The Guide will be publicly available at the conclusion of this project.
This Guide will include training tools and materials for patients and families, as well as hospital clinicians, leaders, and anyone working at a hospital who might be responsible for implementing the guide. The materials included in the guide will address ways that patients and families can be involved in improving healthcare quality, partnering with hospital staff members in their own care, and how changing the culture of an organization is necessary to improve patient-family engagement in care.
Once the Guide is developed, it will be pilot tested in diverse settings to ensure it is able to be implemented and that it is effective. Researchers will look to see that patients and family members find it easy-to-use and that healthcare professionals also find it useful.
After the results from the pilot testing have been assessed, the group will work together to disseminate the guide.
ACTION is a series of field-based research projects funded by the AHRQ. The mission of ACTION is to turn research into innovation within the healthcare industry, and that is done by having the scientific research necessary. More than 15 large partnerships make up ACTION, all of which demonstrate the ability to turn research into practice.
Expanding access to low-cost prescription drugs from overseas might look like a sure winner in the effort to make healthcare more affordable. President Obama supports the idea, as do many Democrats and several Republicans. But the seemingly popular proposal brought the Senate healthcare debate to a standstill Thursday, as Democrats divided over whether they should bow to the drug industry's fierce opposition. Majority Leader Harry Reid (D-NV) temporarily halted consideration of the healthcare bill after three days of inconclusive debate on an amendment by Sens. Byron L. Dorgan (D-ND) and John McCain (R-AZ). The provision would allow pharmacies and wholesalers to import drugs from countries with safety standards comparable to America's. Despite Obama's support for importation, the White House fears that if the amendment is approved, the drug industry will oppose the bill. Industry support is considered a key to passage. That is why the White House negotiated a controversial deal to limit the financial effect of the overhaul on the industry in exchange for its support.
House Speaker Nancy Pelosi endorsed a proposal Thursday that would allow people in late middle age to buy insurance through Medicare, helping to sustain an idea that sprang unexpectedly from the Senate this week. But the California Democrat reiterated that she would prefer to create government-sponsored coverage for Americans of all ages, and questions linger in the Senate about the politics and policy of expanding Medicare by allowing people ages 55 to 64 to buy into the federal insurance program for the elderly. The speaker stopped short of embracing the broader contours of a fragile compromise worked out by liberal and moderate Senate negotiators in an effort to nudge forward broad changes to the healthcare system. Still, she said: "There's certainly a great deal of appeal" to expanding Medicare.
A loophole in the Senate healthcare bill would let insurers place annual dollar limits on medical care for people struggling with costly illnesses, such as cancer. The legislation that originally passed the Senate health committee last summer would have banned such limits, but a tweak to that provision weakened it in the bill now moving toward a Senate vote. As currently written, the Senate Democratic healthcare bill would permit insurance companies to place annual limits on the dollar value of medical care, as long as those limits are not "unreasonable." The bill does not define what level of limits would be allowable, delegating that task to administration officials.
Senate Democrats have provided few details about their latest healthcare proposal, but this much seems clear: Anyone who wants to buy the same health benefits as members of Congress, or to buy coverage through Medicare, should be prepared to fork over a large chunk of cash. According to the Congressional Budget Office, a family of four earning $54,000 in 2016, when the health legislation is fully in effect, would be eligible for a subsidy of $10,100 to help defray the cost of insurance under the health legislation being debated by the Senate. By then, one of the most popular federal plans, a nationwide Blue Cross and Blue Shield policy, is projected to cost more than $20,000. That could leave the family earning $54,000, slightly more than the current median household income, with monthly premium costs of more than $825. The Democrats' proposal would also allow some people ages 55 to 64 to "buy in" to Medicare, starting in 2011. That could cost about $7,600 a year per person or $15,200 for a couple, according to a budget office analysis of an earlier version of the concept. No subsidies would be available until 2014.
The flu in the United States is on track to bottom out by the end of the year, returning to levels seen nine months ago, before the first case of H1N1 hit the U.S. That forecast is from three University of Chicago professors who have created a new method for predicting the spread of the disease. The professors, Nicholas Polson and Hedibert Lopes at the university's Booth School of Business and Vanja Dukic in the Department of Health Studies, are using data from Google Flu Trends, which tracks the flu, and applying a mathematical model that aims to do the one thing Google can't yet do: predict what will happen next. The same modeling approaches, with minor alterations, could be applied to other infectious disease epidemics, such as avian flu, SARS or measles. Google created its Flu Trends tool after it discovered that the searches people conduct when they are sick with the flu can be mathematically tied to the actual spread of the flu.
Federal health officials said Thursday that almost 10,000 people have died of the swine flu since April, a significant jump from mortality numbers released last month. A month ago, the Centers for Disease Control and Prevention estimated that only about 4,000 had died. Officials also said that 50 million Americans, one sixth of the country, have caught the disease, and that 213,000 people have been sick enough to be hospitalized. Several flu experts said they were not shocked by the sudden jump because the new figures were as of Nov. 14, when this fall's wave of swine flu cases was reaching its peak.
A Mississippi hospital has sued Quorum Health Resources, accusing the Brentwood, TN-based management company of violating its contract by providing allegedly misleading information about the medical center's finances to its board. Natchez Regional Medical Center said Quorum hid huge losses at the medical center and touted a phantom financial turnaround at the facility so the board would renew its management contract, the lawsuit contends. The suit was filed this week in a Mississippi federal court. It seeks damages of at least $46 million, plus unspecified punitive damages. Susan Hassell, a spokeswoman for Quorum, said the company was reviewing the lawsuit and doesn't comment on pending litigation. Quorum is owned by Community Health Systems, the Franklin, TN-based hospital chain.
Independence Blue Cross this week began a third wave of personnel cutbacks, with about 200 people expected to lose their jobs in the next several months. This will bring to 855 the number of job losses at the Philadelphia insurer since June. Joseph Frick, Independence Blue Cross' chief executive officer, explained in an annual report distributed to employees that the insurer does not expect to make its annual operating margin goal. Frick blamed many factors contributing to the "unfavorable performance, including higher-than-expected medical costs and a business environment that continues to have an adverse effect on our membership and revenue." Independence Blue Cross had a loss of $78.7 million in 2008, compared with net income of $170.9 million in 2007. Medical membership dropped to 3.3 million as of Sept. 30, compared with 3.4 million last December.
