As consumers take on more of the responsibility of paying for healthcare, the popularity of walk-in retail health clinics is surging. Tenet says it's set to double the number of its retail health clinics this year.
Kyle Burtnett
Senior Vice President, Outpatient Services of Tenet
In a nod to the growing influence of consumer-driven healthcare, Tenet Healthcare Corporation this week announced that it will double the number of walk-in clinics in its MedPost Urgent Care franchise by the end of this year.
Kyle Burtnett, Tenet's senior vice president, outpatient services, says MedPost is a key component in the Dallas-based for-profit hospital chain's push to grow its outpatient facilities. That growth is part of a broader corporate strategy to offer more services in faster-growing, less-capital intensive and higher-margin businesses.
Burtnett says MedPost is addressing healthcare consumer demand for access to more convenient, less-expensive care.
"Consumers are so used to having everything at the touch of their fingers, whether it is on their smartphones or just having things so conveniently located to where you live and work that when people are sick they want to be able to get care in the same day," Burtnett told me.
"The other thing is you also have patients bearing much more responsibility for the financial aspects of their treatment. Rather than go to an emergency department and incur higher costs, consumers bearing more of the responsibility are taking a much closer look at how they are spending their healthcare dollars. That plays right into urgent care's role as a much more affordable solution."
Tenet now operates 23 MedPost Urgent Care centers in Arizona, California, Florida, Georgia, Mississippi, Missouri, Tennessee and Texas. They were all recently rebranded under the MedPost name.
Placed in strip malls or as stand-alone facilities, the new clinics will be open seven days a week with extended daily hours. MedPosts will be staffed by primary care and emergency physicians, nurse practitioners, and other healthcare professionals, and will be equipped with imaging and lab services.
The following is an edited transcript of my conversation with Burtnett earlier this week.
HLM: Did the Patient Protection and Affordable Care Act influence your decision to expand?
Burtnett: We were looking to move forward and start developing urgent care centers before that happened, but I definitely view it as a plus. When you think about people today that don't have health insurance, they are able to access the acute care system by going to an emergency department because of (Emergency MedicalTreatment and Labor Act) requirements.
But the part of the system they are not able to access is the outpatient care area. Obviously, with the ACA, more and more people are getting coverage [and] that is opening up a whole new patient base to your services. So, we think that it's definitely a positive from the outpatient perspective.
HLM: Was part of your rationale for expansion the thought that if you didn't do it, someone else would?
Burtnett: Yes. You see a lot of activity in the urgent care space. The markets where we are operating with the hospital presence or the outpatient presence you are seeing a lot of activity. First of all there are a fair number of urgent care centers up and operating today. But you are also seeing de nouveau development activity in various markets. You are seeing other people expand on a more regional or a national basis as well.
HLM: Emergency departments are an important inpatient access point at many hospitals. Is there any way to estimate how MedPost will affect inpatient admissions at Tenet hospitals?
Burtnett: I don't think there is any firm data on the amount of referrals into the health system. We are making sure that patients receive the appropriate care at the time of service at the urgent care center. If they do need a referral, whether to the ED for a higher level of care or a specialist to follow up on a particular issue, then we are trying to do that within our family of services. That is something we are cognizant of.
HLM: How much does it cost to set up a MedPost clinic?
Burtnett: If you want a ballpark, it is probably between $600,000 and $800,000 to get one built out and operational.
HLM: Do you see MedPost as a low-cost opportunity for Tenet to expand into competitors' service areas?
Burtnett: Right now we are looking in our existing markets. Hopefully they will prove to be so successful that we think it is a great business opportunity and decide to expand. But first and foremost we have a lot of work to do as far as building out a robust network of urgent care centers within our pretty big geographic footprint at this point.
HLM: Can you build Tenet brand loyalty through MedPost?
Burtnett: First and foremost we need to take good care of people when they are there. They need to receive excellent care from our physicians and medical staff. Then hopefully they received not only great care but tremendous patient experience, [and] customer satisfaction. That's what we are counting on to build up brand loyalty.
HLM: How are you addressing price transparency?
Burtnett: I'm not entirely satisfied but we are making progress. The majority of our contracts we have a global rate. If you come into the center it costs you 'X' dollars whether you have an X-ray or not. You are still going to be charged that amount.
So it is very easy to understand and explain to the consumers who walk into the center. Where I would like to get more advanced, and we don't have this today, but we are working on it, is just more transparency related to self-pay or cash pricing and making sure we have that easily accessible on our Web site for consumers to view.
HLM: In what other ways do you expect Tenet will become more consumer-centric?
Burtnett: One of our early forays is just with the Web site and social media efforts. But you will see those types of forays in other areas in the more traditional hospital portfolio. That will be one thing. Focusing on ease of use and access. Making sure that people can not only find us but easily access us, whether that is on-line registration or scheduling. Those are things we are going to be focusing on in the future.
HLM: Are traditional healthcare providers laggards in customer satisfaction behind retail and other sectors of the economy?
Burtnett: As far as customer service and focusing on patient satisfaction, that is something that the healthcare system has done for a long time. It's now moved even more to the forefront with the (Hospital Consumer Assessment of Healthcare Providers and Systems) surveys.
But where I'd say where we've missed, is [in] being a little more retail oriented–outreach to consumers, going direct to consumers. We focused on that patient that comes into our center, making sure they receive good customer service, that they are treated well, etc. But it is that outreach that I think we've missed a little bit.
We are going to launch social media platforms that I hope engage consumers and potential patients, build a very robust Web site that will continue to make enhancements, and hopefully that will provide patients with a very easy and efficient way to access our system and find us.
The ability to have your Web site pop up and be easy to use on a mobile device is just incredibly important. That is another area we are focusing on.
More than nine out of 10 federally qualified health centers reported having electronic health records systems in 2013 compared with 30% in 2009.
The adoption and use of electronic health records in federally qualified health centers has grown by 133% in the past five years, thanks in large part to targeted federal funding and incentives, a survey from The Commonwealth Fund shows.
The survey of 679 senior executives and clinicians at FQHCs found that 85% reported advanced HIT capabilities in 2013, which meant that they could perform at least nine of 13 functions, such as ordering pharmacy prescriptions electronically. The rate was 30% in 2009, when The Commonwealth Fund conducted its last survey.
The pace of HIT implementation at many FQHCs has accelerated to the point where it is outstripping that of many larger physicians groups or integrated health systems. In 2013, 78% percent of office-based physicians used electronic health records, up from 48% in 2009.
In addition, 93% of FQHCs have EHR systems compared with 78% for larger practices and 71% for integrated delivery systems. On meaningful use, three-quarters of FQHCs reported that they meet federal criteria, which is about the same proportion as large, non-physician-owned medical practices and integrated systems, The Commonwealth Fund reported.
Survey coauthor Melinda Abrams, The Commonwealth Fund's vice president for delivery system reform, credited the surge in HIT adoption and usage over the past five years to targeted federal funding and incentives put forward under the legislation such as the HITECH Act.
"It is a targeted investment to adopt the electronic medical records and then the financial incentives to use them to help manage complex patients and new patients," Abrams says.
In another survey of FQHC leaders, The Commonwealth Fund found widespread concerns about staffing were a top issue in the near term, with 83% saying that physician recruiting will be problem, and 73% anticipating problems recruiting nurse practitioners and physician assistants.
Abrams says stakeholders must ensure that funding remains in place so that programs such as the National Health Service Corps will continue to provide a vital stream of clinicians to FQHCs and for other underserved areas.
"Recognizing and making sure that we continue to support and grow that program will go a long way in making sure we have enough primary care clinicians to staff our health centers," she says.
"We have generally a problem in this country across the board with attracting medical students into primary care because of the substantial amount of debt that most medical school students acquire and because of the differential in compensation between primary care physicians and specialists. That is something National Health Service Corps addresses. Programs that try to mitigate or provide loan forgiveness can go a long way toward attracting more clinicians to our FQHCs."
Instead of grilling Sylvia Mathews Burwell, who is expected to be confirmed as the next head of the Department of Health and Human Services, many Republican senators on the committee used their allotted time to rail against the Patient Protection and Affordable Care Act.
For the second time in a week, President Obama's nominee to lead the Department of Health and Human Services emerged unscathed from a Senate confirmation hearing.
For the most part, Sylvia Mathews Burwell was subjected to high praise from Senate Finance Committee members from both parties during the two-and-a-half-hour hearing on Wednesday afternoon.
A date for the committee vote has not been scheduled, but Burwell is expected to sail through the nomination process. Last year the Senate approved her nomination as director of the Office of Management and Budget on a 96-0 vote.
Instead of grilling Burwell, many Republican senators on the committee used their allotted time to rail against the Patient Protection and Affordable Care Act, which will be a critical issue in the upcoming midterm elections. Sen. Charles Grassley (R-IA), told Burwell that he was frustrated with what he said was the Obama administration's longstanding lack of accountability with Congress.
"As I said on the day you were nominated, you have a fresh start with the Congress and the public," Grassley told Burwell. "But if you are going to make the most of that opportunity you are going to have to do things differently than they have been done."
"I will use Marilyn Tavenner as an example. She sat in the same chair you're in a few months ago. She committed to do things differently. Now it seems like she's gone into the witness protection program, it's been so long since she was last in that chair or at my door. I hope that doesn't happen with you. I hope you don't disappear into the same bunker. Do you think it is possible for you to change the by-any means-necessary culture at HHS that some of us in Congress view as bordering on lawless?"
Burwell replied in part that her role as director of OMB often means that she has to present Congress with difficult news and that she expected to do the same while leading HHS.
"I take the issues very seriously. This is a space where I actually hope that there will be actually direct communications if there are concerns," she said.
The hearing got somewhat lively when Sen. John Thune (R-SD), questioned Burwell about "selective enforcement" of rules that he said favor political allies of the Obama administration. Specifically, Thune questioned why some labor unions were exempted from a tax imposed on self-administered, self-insured plans and whether other groups outside of the exemption would have to pay more in taxes to make up the difference.
"All I am simply saying is that as a matter of fairness in the way this is implemented, carving out favored groups shouldn't be the modus operandi…. and this particular one was a rule that was issued by OMB under your direction," Thune said.
Burwell replied that legislation as sweeping as Obamacare requires some leeway so that HHS can act on stakeholders' concerns.
"When one finds places where you can implement better within the law you seek to do that," she said. "What we heard was that the private sector was having difficulties in terms of doing the reporting requirements they would need to do to do this accurately. As one moves to implement you do listen and try to implement in a better fashion in terms of trying to hear and listen and make the transition one that is workable."
Burwell, who is well known and admired in the Senate through her work at OMB, nodded attentively and agreed with Senators from both parties when they raised concerns on issues ranging from Medicare solvency to Medicaid expansion, to the 96-hour rule on critical access hospital admissions. However, she adroitly avoided specifics on actions she would take as secretary of HHS.
In a typical exchange, Sen. Orrin Hatch (R-UT), asked Burwell if she foresaw any unilateral delays or rules changes from the Obama administration in the rollout for the Patient Protection and Affordable Care Act.
Burwell replied: "With regard to the implementation of such a large and complex thing that is part of such a large part of our economy I am not sure I can sit and predict. But I think what is important is as one moves along and is implementing is listening and learning as you go, making those common sense changes within the context of the law, and when there are changes that require legislative changes to work with the Congress to do it."
Sen. Pat Roberts (R-KS), asked Burwell if she would support repealing the Medicare Independent Payment Advisory Board.
Burwell replied: "With regard to the repeal, one of the things that is hopefully a helpful thing is having belts and suspenders in place to help us all get to the place we all need to with regard to reducing healthcare costs."
"I don't know about a belt and suspenders," Roberts replied. "Maybe barbed wire would be a better way to put it."
A revised federal rule allows registered dieticians who work in hospitals to practice at the top of their license. It's being welcomed by hospital associations as a way to save time and money.
Starting July 11, hospital registered dietitians will have the authority to write therapeutic diet orders for patients without necessarily getting prior approval from physicians.
The enhanced autonomy for RDs is part of sweeping rules changes that the Centers for Medicare & Medicaid Services believes can save about $3.4 billion over five years. The new rules respond to President Obama's 2011 Executive Order 13563 which encouraged the federal bureaucracy to reduce or revise antiquated and unnecessarily burdensome rules and regulations.
CMS says the rules changes for dietitians "save hospitals significant resources by permitting registered dietitians to order patient diets independently, which they are trained to do, without requiring the supervision or approval of a physician or other practitioner. This frees up time for physicians and other practitioners to care for patients."
Provider stakeholders appear to be OK with this new rule. Understandably, the Academy of Nutrition and Dietetics is delighted. The new rule validates their professionalism and expands their scope, allowing them to practice at the top of their license.
"CMS's new rule will eliminate burdensome and superfluous regulations that are adding to our nation's healthcare costs," AND President Glenna McCollum said in prepared remarks. "Allowing registered dietitian nutritionists to independently order therapeutic diets and monitor and manage dietary plans for their hospital patients will save the country hundreds of millions of dollars and also help hospitals provide better multidisciplinary care."
"The Academy and our members could not agree more with CMS's conclusion that 'the addition of ordering privileges enhances the ability that RDs already have to provide timely, cost-effective and evidence-based nutrition services as the recognized nutrition experts on a hospital interdisciplinary team.'" (For an exhaustive review of the new rule, check out AND's FAQ page.)
It appears that the American Medical Association is comfortable with the new rule, even though it nips at direct physician oversight. The AMA responded to my email query with this: "The AMA encourages physician-led healthcare teams where physicians and other health clinicians work together in the best interest of their patients. In this particular case, clear communication between members of the team is necessary as there are instances where patients require clinically appropriate dietary restrictions and the patient's physician has the most knowledge about the planned course of care."
The American Hospital Association is comfortable with the idea, too.
"We are happy with this in line with the general philosophy that we have which is that healthcare professionals ought to be allowed to practice at the top of their license or skill set," says Nancy Foster, AHA's vice president for quality and patient safety policy. "This allows dietitians to use their expertise to recommend and identify the right food regimen for our patients."
"The way CMS has implemented this, of course, means that in each individual organization the medical staff will have to review their criteria for how practitioners are privileged and credentialed to do any service they provide to patients."
In other words, this is not a passive rule change. Each hospital that choses to grant autonomy to its RDs must act to create new procedures to ensure that physicians and other clinicians and dietitians continue to communicate properly about patient nutrition.
"We think this creates the opportunity to provide better care, but it does require that coordination that wasn't required before," Foster says.
The rule is permissive, which means that each hospital can decide whether or not to grant these new privileges to their dietitians. "If a hospital is uncomfortable with that, or that physicians feel strongly that that is not the right way to go, one could chose to not implement the policy because it's up to the medical staff," Foster says.
She says AHA isn't recommending a specific course of action for the new rule because "that is not our area of expertise."
"We will look for guidance from others or best practices as organizations begin to implement this and share those with our hospitals. Many of our hospitals now belong to a patient safety organization that may help them as well with how to keep patients safe as you are making this transition in policy. We would promote those ideas."
CMS should be applauded for making these rules changes. Expanding the authority of RDs passes the common sense test. So too does the permissive nature of this rule change. This is not a mandate because some hospitals might not be in a position to implement this for any number of reasons. Each hospital clinical leadership team should be free to carry out the rules change at a pace that is appropriate with their circumstances.
Because the rule saves time and money, two precious commodities in healthcare, most hospitals will jump on the chance to implement it as soon as possible.
As the result of a multi-city operation, the Medicare Fraud Strike Force has brought charges against scores of people, including doctors, nurses, and other medical professionals allegedly involved in false billing schemes.
Federal prosecutors on Tuesday unveiled charges against 90 people in six cities for their alleged roles in Medicare frauds that resulted in $260 million in false billings.
The defendants include 16 physicians and 11 other people identified as "medical professionals," according to a joint media release from the Departments of Justice and Health and Human Services.
Acting Assistant Attorney General David A. O'Neil said in prepared remarks that the crimes identified in the investigation "represent the face of healthcare fraud today—doctors billing for services that were never rendered, supply companies providing motorized wheelchairs that were never needed, recruiters paying kickbacks to get Medicare billing numbers of patients."
"The fraud was rampant, it was brazen, and it permeated every part of the Medicare system. But law enforcement continues to strike back. Using cutting-edge, data-driven investigative techniques, we are bringing fraudsters to justice and saving the American taxpayers billions of dollars."
The investigations were led by the Medicare Fraud Strike Force in Los Angeles, Miami, Tampa, Houston, Brooklyn, and Detroit.
The defendants face charges including money laundering, conspiracy to commit healthcare fraud, and violations of anti-kickback statutes stemming from a number of schemes involving bogus medical treatments and services for home healthcare, mental health services, psychotherapy, physical and occupational therapy, durable medical equipment, and pharmacy fraud, federal officials said.
In Miami, 50 defendants were charged in various fraud schemes involving $65.5 million in false billings for home healthcare and mental health services, and pharmacy fraud. In one case, two defendants were charged in connection with a $23 million pharmacy kickback and laundering scheme.
In Houston, five physicians were among the 11 people charged with conspiring to bill Medicare for medically unnecessary home health services. The doctors allegedly were paid by co-conspirators to sign off on home healthcare services that were not necessary and often never provided.
In Los Angeles, eight defendants were charged in schemes to defraud Medicare of approximately $32 million. In one case, a doctor was charged for causing almost $24 million in losses to Medicare through his own fraudulent billing and referrals for durable medical equipment, including more than 1,000 expensive power wheelchairs, and home health services that were not medically necessary and frequently not provided.
In Detroit, seven defendants were charged for $30 million in false claims for medically unnecessary services, including home health services, psychotherapy, and infusion therapy. In one case, a physician and three other people were charged in a $28 million fraud scheme, where the physician billed for expensive tests, physical therapy and injections that were not necessary and not provided.
Court documents allege that when the physician's billings raised red flags, he was put on payment review by Medicare. He was allegedly able to evade detection by using the billing information of other Medicare providers, sometimes without their knowledge.
In Tampa, seven people were charged in schemes ranging from fraudulent physical therapy billings to a scheme involving millions of dollars in physician services and tests that never occurred.
In one case, five individuals were charged for their alleged roles in a $12 million healthcare fraud and money laundering scheme that involved billing Medicare using names of beneficiaries from Miami-Dade County for services purportedly provided in Tampa clinics, 280 miles away.
In Brooklyn, Syed Imran Ahmed, MD, was indicted in connection with an alleged $85 million scheme involving billings for surgeries that never occurred. Six other people, including a physician and two billers were charged in an alleged $14.4 million scheme that billed Medicare for medically unnecessary vitamin infusions, diagnostic tests and physical and occupational therapy supposedly provided to patients who allegedly were recruited to take part in the scheme.
Since its inception in March 2007, Strike Force operations in nine locations have charged almost 1,900 defendants who collectively have falsely billed the Medicare program for almost $6 billion.
With more people able to purchase health insurance under the healthcare reform law, a Health Affairs study projects that hospital emergency departments could generate an additional 4.4% in profits in the coming years.
Emergency departments will likely become money makers for hospitals as the Patient Protection and Affordable Care Act gins up and more insured patients walk through the doors, a study in Health Affairs suggests.
Michael Wilson, MD, an emergency physician at Boston's Brigham and Women's Hospital, and a healthcare economist, says the study he coauthored with Harvard economist David M. Cutler estimated that hospital emergency department revenues exceeded costs by $6.1 billion in 2009, representing a profit margin of nearly 8%.
The black ink was due largely to the $17 billion in profits EDs made from privately insured patients that covered underpayments for money-losing Medicare, Medicaid, uninsured and unreimbursed care.
The uninsured represent about 18% of patient volume in EDs and Wilson says that about 25% of those uninsured patients will gain coverage either through the health insurance exchanges or the Medicaid expansion. With more people insured under the PPACA, Wilson's study projects that hospital EDs could generate an additional 4.4% in profits in the coming years.
"Emergency departments have historically been part of the safety net for the American healthcare system," Wilson says. "People without insurance because of EMTALA and because of the history of hospitals know that if they show up in an emergency department they are going to receive care. If you take a look at the people who are uninsured and give them either private insurance or Medicaid then you would expect the revenue to hospitals to increase."
Wilson spoke with HealthLeaders Media about his study. The following is an edited transcript.
HLM: There seems to be confusion about whether or not EDs are profit centers. Why?
MW: Part of it is getting at costs. Getting at revenues is relatively straight forward. You can get Medicare revenue nationally pretty easily. Getting at revenue from private insurance companies you can do in some states. But getting national numbers is a little more difficult for revenue.
The larger problem has to do with costs and both how we use the Medicare cost reports, which I think is the most common way that you would approach a problem like this when you are trying to be nationally representative. But there are intricacies in this in terms of, for instance, when you look at the ED charges for admitted patients.
Hospitals don't get paid separately for the ED care versus the rest of the inpatient care. So, for those visits it becomes difficult to figure out how to disaggregate the revenue that the hospital received for the ED portion of the care versus the remainder of the hospital care.
HLM: Why did you choose 2009 as your primary metric?
MW: We had data from Medicare from 2011, but at the time we started the project, the national emergency department sample data set from 2009 was the latest data we had. HLM: It seems counter-intuitive that ED visits would increase under the PPACA because of its emphasis on population health and proactive care management.
MW: We assumed that patients who would go from being uninsured to having private insurance behaved similarly to current patients with private insurance in terms of utilization of the emergency department. There is a misunderstanding that the emergency department is primarily being used by the uninsured for low or moderate acuity visits.
In fact, people with all kinds of insurance will sometimes chose the ED for a low- or moderate-acuity ED visit despite having a primary care provider. Sometimes that is because it's afterhours, weekends, evenings, and the primary care provider is not available.
Sometimes these are visits that when you look at administrative records they appear to be low-acuity visits because the final diagnosis is gastritis. But at the time the patient was making the decision about where to go, he was thinking 'I am a 60-year-old man with diabetes and I'm having chest pains. I should probably be in the ED.'
Or they will call their primary care physician who will tell them to go to the ED.
HLM: Won't high-deductible plans discourage ED use?
MW: I don't know if the high-deductible plans include ED care or not. Let's say there is no carve out for ED. Then I think it will have an impact on utilization. But again, I am concerned about those types of attempts at controlling demand for ED care. It is difficult for the patient's physician sometimes to make a decision about if this is something the patient should go to the ED [for] or wait to be seen by [the primary care provider] the following day.
And now we will be asking patients to make these decisions for themselves. For the absolute lowest acuity, say for an ankle sprain, yes you could safely decide to wait until the following morning. But I'd be surprised if that had a very large impact on overall ED utilization.
HLM: Based on your study, what will the ED look like in five years?
MW: In general, ED visitation rates will continue to increase as they have in the past as patients get insurance. There seems to be more of a consensus now that ED utilization in the short term will increase. In the five-year timeframe if you take people who had no insurance and give them insurance then both ED and inpatient utilization will increase.
HLM: Did anything in your findings surprise you?
MW: How dependent the overall profitability of the emergency department is on the privately insured patients.
The purchase of Health Management Associates by Community Health Systems for $7.6 billion and the sale of Vanguard Health Systems to Tenet Healthcare for $4.3 billion were healthcare's two largest deals last year.
Hospital mergers and acquisitions in the United States declined in 2013, but the number of hospitals and hospital beds involved in those transactions hit a five-year high, according to the 2014 Health Care Services Acquisition Report.
M&A activity in 2013 was paced by the acquisition of Health Management Associates by Community Health Systems for $7.6 billion and the sale of Vanguard Health Systems to Tenet Healthcare for $4.3 billion, the year's two largest Hospital sector deals.
"Those two acquisitions alone accounted for more than one-third of the hospitals sold in the U.S. in 2013," said Lisa E. Phillips, an editor at Norwalk, CT-based Irving Levin Associates, which compiles the annual report.
Usually, Phillips said, beds owned by not-for-profits dominate the hospital M&A market, but because of those two billion-dollar deals last year, 78% of the target hospitals in 2013 were for-profit, compared with between 25% and 30% in a more typical year.
Globally, the dollar value of M&A activity across nine healthcare industry service sectors, including managed care and pharmaceuticals, increased by 1.8% to $52.7 billion in 2013. However, the number of transactions declined by 5.8% to 598 publicly announced healthcare services mergers and acquisitions in 2013.
In terms of number of M&A transactions, all but the long-term care and home health/hospice sectors posted declines in 2013 compared with 2012. The hospital sector declined 21.5% in deal volume to 84 announced acquisitions, which includes one large transaction in Germany, the report said.
"Without the strong performance of the long-term care sector, which had a 20% increase in transaction volume in 2013, health care services would have had a less robust year," Phillips said.
Here's a look at some more recent deals:
St. Tammany Parish Hospital Partners with Ochsner Health
St. Tammany Parish Hospital and New Orleans-based Ochsner Health System will form a strategic partnership to bolster healthcare access in the Northshore area of Lake Pontchartrain, the two providers have announced jointly.
"We looked at a variety of different models and really felt like the partnership, which is more like a Joint Operating Agreement, was the right structure," Warner Thomas, president/CEO of the 10-hospital Ochsner Health System, said this week.
"It allows flexibility for St. Tammany and Ochsner, yet we are committed to working together in that marketplace, expanding services, and we are going to be exploring opportunities for reducing costs, and growth initiatives. There will be a lot of coordination between our organizations."
"St. Tammany is not in a situation where they need to be acquired or merged with a larger entity. They are in a strong position," Thomas says. "We have a significant physician base in that market. They have a very successful hospital in that market. It really is synergistic from that perspective."
No money will change hands with the deal, but Thomas says there will be "financial integration going forward."
STPH is a service district hospital under local governance. The partnership agreement does not change the governance, employees or medical staff relationships of St. Tammany Parish Hospital Service District #1 or of Ochsner Health System. Each organization will retain its name, assets and staff.
Michigan's Ascension Health, CHE-Trinity Launch Integrated Network
Physicians with Ascension Health and CHE-Trinity Health have created a statewide clinically integrated network of healthcare providers. This new company, called Together Health Network, will include 27 hospitals and hundreds of ambulatory centers and physician offices.
"We believe this one-of-a-kind collaboration between two of the state's largest healthcare organizations will set a new standard for providing value-based healthcare in Michigan," Patricia Maryland, president of Health Care Operations and COO of Ascension Health, said in prepared remarks.
"Both Ascension and CHE Trinity Health have been performing at benchmark levels in terms of quality, while at the same time delivering care at cost levels well below the state average. This collaboration will allow us to combine our outstanding performances in terms of cost and quality into one, state-wide product unlike any other."
Together Health Network is a Michigan LLC that will work with payers to develop health plan products, including those purchased on the Health Insurance Marketplace and private exchanges. Together Health Network is designed to achieve a state-wide presence with numerous access points and advanced care coordination services without merging assets.
Together, the Michigan footprint of CHE Trinity Health and Ascension Health Michigan creates a geographic provider network that spans a majority of the state – it is estimated that 75% of Michiganders will be within 20 minutes of a Together Health Network provider. Together Health Network will have a physician-majority board, a physician CEO, and physician led committees.
Lawrence (MA) General Joins Beth Israel Deaconess Care Organization
Lawrence General Hospital has joined Boston-based Beth Israel Deaconess Care Organization as part of a risk-sharing agreement aimed at improving population health, the two providers have jointly announced.
Dianne J. Anderson, RN, president/CEO of LGH, said the affiliation will strengthen and expand medical services available for the Merrimack Valley and Southern New Hampshire.
"Patients will see expanded and strengthened medical services, keeping more care local and coordinated from the doctor's office, to Lawrence General, and, if necessary, to an academic medical center," Anderson said in prepared remarks.
With BIDCO support, LGH can provide population health management and access to specialty care at BIDMC. LGH and its affiliated physicians also accept some of the financial risk for keeping patients as healthy as possible. The arrangement is subject to review by the Massachusetts Health Policy Commission.
Tenet, Texas Tech to Establish New Teaching Hospital
Dallas-basedTenet Healthcare Corporation and Texas Tech University Health Sciences Center at El Paso will develop a new teaching hospital and an 110,000 square foot medical office building in west El Paso, the providers have jointly announced.
The new 140-bed hospital will operate as a part of the Sierra Providence Health Network, Tenet's system of hospitals and outpatient centers in El Paso. It will be a teaching hospital for medical students, nursing students, resident physicians and faculty from TTUHSC's Paul L. Foster School of Medicine, eventually offering training for approximately 75 medical residents across a multi-year program.
Construction is scheduled to begin in 2014 and be completed in the fall of 2016.
"With today's announcement, Tenet's recently completed and planned investments in the community will exceed $550 million over a 10 year period, and we are pleased to continue our commitment to the health and wellbeing of this important region," Tenet President/CEO Trevor Fetter said in prepared remarks.
Last year, Sierra Medical Center and Providence Memorial Hospital announced a $120 million investment in upgraded technology, expanded service lines and aesthetic remodeling, in addition to a $67 million expansion at Sierra Providence East Medical Center that was announced in 2012.
Port Huron (MI) Hospital joins McLaren Health Care
Port Huron Hospital has finalized a deal that makes it the twelfth hospital in Michigan's McLaren Health Care system.
Under the agreement, the 186-bed Port Huron Hospital will be renamed McLaren Port Huron. The hospital will retain its local board of trustees and leadership, and will remain locally governed.
The agreement also provides capital funding for the construction of a new cancer center and a new inpatient tower. The hospital expects to break ground for the cancer center early in 2015 with construction of the inpatient tower beginning later in 2015. Financial terms of the acquisition were not disclosed.
Civil tone notwithstanding, several Republican senators say they will demand more transparency about the successes and failures of Obamacare from Sylvia Mathews Burwell than from her predecessor, Kathleen Sebelius.
Thursday's U.S. Senate confirmation hearings for Sylvia Mathews Burwell had all the makings for a donnybrook.
Instead, it was more like a love fest as several Republicans joined every Democrat on the Senate Health, Education, Labor, and Pensions Committee in voicing support for President Obama's nominee to lead the Department of Health and Human Services.
The two-hour hearing came as Republicans and Democrats fight to establish their campaign narratives on the success or failure of the Patient Protection & Affordable Care Act in the months before November's mid-term elections.
And while Republicans on the 22-member committee frequently criticized the PPACA, President Obama, and departing HHS Secretary Kathleen Sebelius, they lobbed no direct shots at Burwell, who is well known to members of Congress through her most recent work as director of the Office of Management and Budget.
"Many of in this room… disagree about the merits of Obamacare and what the path forward should be to reform our healthcare system," Sen. John McCain (R-AZ), told the committee during his introduction of Burwell. "I know of no one who does not have but the highest praise for her work as director of OMB [which makes] her well qualified to be secretary of HHS."
The committee did not vote on the nomination. That is the task of the Senate Finance Committee later this month, and there is no indication that the nomination is in trouble.
Sen. Richard Burr (R-NC), praised Burwell's experience leading both the Global Development Program for the Bill and Melinda Gates Foundation, and the Walmart Foundation, along with her service as deputy chief of staff in the Clinton White House, and her service on OMB.
"I support her nomination and I will vote for it in the Finance Committee," Burr told the committee. "And it is for one primary reason. It's because she doesn't come with a single experience that would make her a good secretary. She comes with a portfolio of experience that would make her a tremendous asset at addressing some of the challenges that that agency specifically and uniquely has. I look forward to her confirmation being quick."
Even with the civil tone that surrounded the questioning, several Republicans said they will demand more clarity and transparency about the successes and failures of Obamacare from Burwell than from her predecessor.
Sen. Tim Scott (R-SC), told Burwell that he voted for her as director of OMB and that he respects her integrity and intellect, but he wanted assurances that as HHS secretary she would not become a shill for the Obama administration.
"I'd ask you simply, as secretary of HHS," Scott said, "would you in fact be the Health and Human Services secretary for the American people or will you be, as your predecessor has been, the ambassador of Obamacare?"
"I am here to serve the American people," Burwell replied. "I am part of the President's administration and I am honored to be appointed. But first and foremost I serve the American people. I believe the president and his policies are aligned with that, but I am here to serve the American people."
On the Issues
The Senators used their allotted time to assess Burwell on key issues before HHS. A career bureaucrat, Burwell ably avoided specifics.
HIX and the Single Payer
Sen. Pat Roberts (R-KS), asked Burwell if she supports expanding the PPACA beyond the exchanges and to a single-payer system.
"If I am confirmed, I will implement the law and the law is a system that has a market-based system and that is why the exchanges are up and running and putting people in systems that are private insurance systems," Burwell replied.
Interstate Commerce and Medicaid
Sen. Lamar Alexander (R-TN), the ranking Republican on the committee, asked Burwell if HHS would support allowing consumers to purchase health insurance across state lines.
"If I am confirmed, that is something I want to look into and understand," Burwell replied. "When one looks into that question what you have to consider is can the markets work in each of the states. When you go across states can you still keep the system up and working and care being provided?"
Alexander also asked about giving states more flexibility to design their Medicaid programs.
"There have been a number of examples where flexibility has been granted," Burwell replied. "Flexibility is important. Principles are important. Where you meet in that space, having enough standardization that meets the principles, but flexibility to meet the varying needs of states is something that I think is important in how I would think about it."
Resistance to Reform
Sen. Chris Murphy (D-CT), asked Burwell how she would work with states that are less than enthusiastic or even hostile toward the PPACA.
"Flexibility is one of the points. What is important is to send a signal that folks are willing to have the conversations," she replied, adding that states that have rejected Medicaid expansion money may warm to the idea when they see success stories from other states that have embraced the reforms.
Technology
Sen. Kay Hagen (D-NC), asked Burwell what lessons could be learned from the technical failures in the Obamacare rollout. Burwell stressed a need for individual ownership and accountability for IT projects, improved communication between stakeholders and their IT teams, and a new model for building IT systems.
"Generally, in procurement, we have had a waterfall approach, a building approach," she said. "When one is doing information technology, a more iterative approach where one tests in small pieces and moves and learns is a better approach to [the way of] doing procurement. We are not set up to do that in terms of how we set standards and do expectations."
Bundled Payments
Sen. Elizabeth Warren (D-MA), asked Burwell if she would exercise her statutory authority under the PPACA to expand the use of bundled payment models that have been shown to reduce costs and improve quality.
"You want to find the models which are the most successful and which are the most likely to scale, because that is what we need across the nation," Burwell replied.
"You have to consider both questions when considering what you would scale because you want to get the largest impact you can. That impact is a combination of both what the measures are of success, but it is also your ability to make it go broadly across the nation."
The interim CEO of a small Mississippi hospital survived a devastating tornado, but his hospital did not. Though he mourns the loss of life and property, his outlook is strategic: "Let's make the best of it and come out of it better."
It's been 10 days since an EF4 tornado corkscrewed down from the black skies over Winston County, MS, and changed everything on the ground for the people who live there.
The storm's 160-mph winds cut a swath of death and destruction across Winston County, located about 90 miles northeast of Jackson. It killed nine people and wreaked millions of dollars in property damage as part of violent weather front that claimed 34 lives in six states on April 28.
Winston Medical Center in Louisville, pop. 6,600, the county seat, was in the path of the funnel cloud. The 27-bed hospital sustained heavy interior damage and has since closed its doors.
One patient suffered a laceration to the back of his head, but otherwise none of the 11 patients or staff huddled inside the hospital hallways were seriously injured when the twister blew out windows, ripped down ceiling tiles, and tossed debris throughout the interior.
Interim CEO Paul Black, on the job for less than one week, was in the hospital emergency room that afternoon monitoring the storm on local media and hoping for the best. Right about then things took a turn for the worst.
"It was a direct hit, or we were on the outer edge of the funnel but we were in the funnel. When you've got cars turned upside down on top of each other in the parking lot, it was a real hairy situation," Black said in a telephone interview.
"We had enough warning to where we had all of the patients up on the floors in the hallways in safe places. Then we were sitting there on hold, watching where it was going. It was going along a path that looked like it was going to miss us. It was almost like it got to a road sign on one of the highways and then it turned left and headed right at us. And minutes later it was right on us. It was hairy at that point. When it turned, we knew we were in trouble."
The storm damage forced the closure of the hospital, and an abutting 120-bed nursing home. Black and his team spent most of their time in the immediate aftermath finding new housing for the hospital patients and the nursing home residents while providing triage medical services for the many injured people in the shattered community.
Temporary Hospital Imminent
"If your staff is well trained then you will go off of instincts and trust the staff to do the right thing but you can never really prepare," he says. "Everybody knows what to do when you get the tornado warning. You get them in the hallways and wait for things to ride out. And maybe the lights will go off or something like that. But you don't expect the windows to go out and stuff to start flying everywhere."
Winston County got immediate help from an emergency response team from the University of Mississippi Medical Center, and in days immediately after the storm, crews and aid have arrived from the Mississippi National Guard, other state emergency responders, and the Federal Emergency Management Agency.
A modular hospital, on loan from FEMA, was shipped down from North Carolina and is now under construction. It is expected to be operational within two weeks. "When that is done we should have a functioning hospital," Black says. "We are excited about that. A functioning modular temporary hospital that at least gives us the opportunity to start providing care for the people of Winston County again."
"We will have an emergency area, X-ray, lab pharmacy, about 10 to 12 acute care beds where we can house patients overnight. It is going to be on-site and offering 24-7 [care] just like normal."
Once the temporary hospital is open and healthcare access is stabilized, the people of Winston County will have to make a decision about their hospital. Black says stakeholders are looking at their options and "we are leaning real heavily toward tearing it down and building new."
"We are getting close to a decision. There are some variables we have to figure out. A lot of the facility is old, some of it is 50 years old. It's at the end of its useful life anyway," he says.
"The fact that we have a three-story tower and there is structural damage to it makes it real difficult to decide if it is safe or not, or if we're even able to renovate and make it useful. It might be more economical to tear that building down and build something new and make it more modern and a lot more useable."
From a Makeshift Office, an Eye Toward 'Triumph'
Black had been CFO at Winston Medical Center for several years. He was named Interim CEO on April 22, but the job description changed abruptly six days later. His new office is the front seat of a loaner pick-up truck. His personal car was destroyed by the tornado in the hospital parking lot. He conducted this interview on his cell phone.
"It's been hectic, to say the least," he says. "You get up every morning and you just start doing. You start talking to people. I am relying on a lot of people. I have learned real quick that I can't do everything. I have a good group of people and I lean on them. As far as how the staff handled this situation, I don't think anybody could have done a better job."
And now Black finds himself torn with conflicting emotions. On the one hand, he mourns the loss of life and the destruction sown by the tornado. On the other hand, as a professional hospital administrator, he is excited about his critical role in helping to reformulate how healthcare will be delivered in Winston County for the next 50 years or longer.
"It's one of those things that you are excited about what could be in the future and at the same time you want to temper that with thinking about how you got there," he says.
"You don't like how we've gotten into this situation but now that we have been dealt this hand let's make the best of it and come out of it better. Let's have state-of-the-art hospital for all the citizens so we can say we took a tragedy and turned it into a triumph. It sounds corny, but that is about all I can think of right now."
Under the proposed prospective payment scheme, Medicare will pay Federally Qualified Health Centers a single encounter rate per beneficiary per day for all services provided, with some exceptions.
Community health advocates are applauding the federal government's newly announced plan to boost Medicare payments to Federally Qualified Health Centers by as much as 32%.
"Generally we are very pleased with it," says Dan Hawkins, senior vice president of policy at the National Association of Community Health Centers.
"CMS clearly sees this as a fair payment for the comprehensive services that health centers provide to Medicare beneficiaries and they are aware that this new PPS system they are proposing is very similar to the PPS under which health centers are paid under Medicaid."
The Centers for Medicare & Medicaid Services recently issued the final rule for the new Medicare prospective payment scheme that was outlined under the Patient Protection and Affordable Care Act, which mandates consideration of factors such as the type, intensity, and duration of services provided in these settings. The new payment system will be implemented on Oct. 1, and FQHCs will transition to it throughout 2015, CMS said.
"The new payment system helps increase the ability and capacity of federally qualified health centers to provide essential and affordable services for even more patients who need care," CMS Administrator Marilyn Tavenner said in prepared remarks. "These FQHCs are essential to countless patients in local communities who depend on them for getting their primary and preventive care."
Health centers provide care to more than 22 million people, of whom 1.7 million are Medicare beneficiaries. By law no one can be denied care based on an inability to pay. A 2010 report from the Government Accountability Office found that most FQHCs health centers lose money on Medicare patients.
"Under the old payment system, health centers were subject to restrictions and an overall payment cap that reduced the Medicare payment to about 60% of their costs. They were losing 40 cents on the dollar every time they saw a Medicare beneficiary," Hawkins says.
Under the new PPS, Medicare will pay FQHCs a single encounter rate per beneficiary per day for all services provided, with some exceptions.
The rate will be adjusted for geographic variation in costs, for higher costs associated with furnishing care to new patients at FQHCs, and when FQHCs furnishes an initial preventive physical examination or an annual wellness visit to a Medicare beneficiary. Services paid for by Medicare in the past will continue to be covered under the new system, CMS said.
The initial proposal floated by CMS last September raises concerns among community health center advocates, but Hawkins says many of those concerns have been addressed.
"They eliminated the payment cap," Hawkins said.
"Yes, this will put it on a prospective payment system and the payment adjuster will be limited because the Medicare Economic Index is only about 2% or 3% annually increased. So it is not going to keep up with healthcare costs. But at the start, it is going to get close to 80% of costs and from the old 60% and in that context it is a much more fair payment rate and will allow health centers not to have to dip into the grants and other funding they get to serve their uninsured patients in order to subsidize Medicare underpayments. So in that sense it is a very good rule."
The feds also struck out a provision that would allow only one visit per day of any kind.
"We noted that there are a good number of folks who have a comorbidity such as depression associated with their medical condition. In this final rule they changed that and would allow health centers to bill for more than one visit in a single day," he says.
"You can appreciate, for seniors especially, asking them to come back on a separate day when they are there for care for one condition. It not only inconveniences them, but also increases the chances that they may not come back for that second service."
The final rule was published in the Federal Register on Friday, May 1 and CMS has asked for public comments on modifications of proposals including:
A simplified method for calculating coinsurance when a preventive and non-preventive service is on the same claim;
The establishment of Medicare-specific payment codes to be used for Medicare encounter-based payment under the new PPS; and
Ways in which payment for chronic care management services could be adapted for FQHCs and rural health clinics.
The comment period closes on July 1, with the final rule to be issued later in the year.
