Total compensation costs for hospital employees rose 0.5% in the first quarter of 2011, slightly below the 0.7% rise in total compensation costs for all workers in private industry, the Bureau of Labor Statistics' Employment Cost Index shows.
For the 12-month period ending March 31, total compensation -- wages, salaries, and benefits -- grew by 2% for the hospital sector, which matches the pace of total compensation cost growth for all private industry workers for the same period, ECI data show.
In the 12-month period ending in March 2011, the Consumer Price Index rose by 2.7%, BLS data show.
A further breakdown of ECI data show that wages and salaries for the hospital sector—which generally make up about 70% of total compensation costs—increased 0.3% in the first quarter of 2011, and 1.7% in the 12-month period ending March 31, slightly above the 1.6% increase in wage and salary growth seen in the larger private industry workforce.
The ECI does not provide a separate breakdown on hospital benefits costs. However, benefits cost growth for all private industry workers grew by 1.6% in the first quarter of 2011, and 3% for the 12-month period ending March 31, ECI data show.
In 2009, hospital total compensation costs rose 2%, including a 2.1% increase in wages and salaries costs. In 2008, hospital total compensation rose 3.2%, and wages and salaries rose 3.6%, ECI data show.
Even with a general slowing trend in compensation costs, hospitals created 19,600 new jobs in the first quarter of 2011, and 50,100 jobs in 2010, nearly double the rate of job creation from 2009. The entire healthcare sector -- everything from allergists to X-ray technicians -- created 265,800 jobs in 2010, Bureau of Labor Statistics preliminary data shows.
In the overall economy, total compensation costsfor private industry workers increased 2% over the year ending March 31, compared to the 1.6% increase for the12-month period ending in March 2010. Wages and salaries increased 1.6% for the March 2011 12-month period, up slightly from the1.5% growth seen in March 2010.
ECI data for the March report were collected from 63,000 occupational observations selected from 12,900 private sector businesses, and 11,500 occupations from 1,800 establishments in state and local governments. The full report may be viewed here.
National Public Radio calls it a "driveway moment." It's when one of their stories is so engrossing that the listener sits in his car, in his driveway, waiting for it to finish before he goes to the house at the end of the work day commute.
The network's Marketplace program provided such a moment last week with a story on "Little Brother," and the new, powerful, ingenious, and inexpensive snooping gadgets that are available to just about anyone interested in violating your privacy.
Here are some of the frightening new snooping technologies mentioned in the piece:
Abrowser plug-in named "Firesheep" that allows snoops to monitor anyone using the wireless networks in their immediate area. The plug-in will display the name and show pictures of other surfers nearby – perhaps someone using Facebook -- and allow the snoop to log-in as that person. According to Marketplace, a hacker could post photos, send messages, pretty much do whatever he wants, all in someone else's name. Firesheep has been downloaded more than 1.3 million times, and its creator told NPR he did it to show how vulnerable we all are.
That same programmer, Eric Butler, told Marketplace he is developing a smartphone app that will let users read trip data off strangers' transit cards – right through their wallets! (Emphasis mine!)
A company called Flexispy allows its customers to surreptitiously load its software onto the phones of their frenemies, acquaintances, or family members. Then starts the spying by listening in on conversations or tracking people via GPS.
For about $1,200 you can buy what Marketplace described as "your own malicious cell phone tower," which will allow you to monitor voice transmissions, texting, even data.
Facial recognition programs for cell phones and other devices are becoming more sophisticated and affordable, as are tiny aerial drones with cameras attached.
Listening to all of this should arouse amazement and dread in equal parts. It's easy to see that many of these new snooping technologies could be used to monitor the conversations and other data of healthcare professionals, or tap into patient healthcare files. Now, with the advent of electronic medical records, that prospect is even more frightening.
Imagine, for example, that a famous movie star is in your hospital. Given what we know about the low scruples and financial wherewithal of the tabloid news industry (remember the Farah Fawcett HIPAA debacle?) they could easily employ any of these strategies to steal information for some sleazy scoop. As far as I know, Tabloids don't pay HIPAA fines. Hospitals do.
Hospitals are labor-intensive worksites with thousands of employees, most of whom probably own a cell phone, many of whom regularly log on to Facebook, or other social media networks. The vast majority of healthcare employees are honorable people who would never willfully violate patient confidentiality. Nonetheless, given the new snooping technology, every single one of those employees represents a potential security breach that could cost your hospital thousands of dollars in HIPAA fines and untold public embarrassment.
Whatever patient identity protections your healthcare organization has installed, it's hard not to have a sneaking suspicion that the snoops will always be one step ahead in the game. Take a look at some of the devices identified by Marketplace, and imagine how they could be used against your healthcare organization.
Perhaps it's time to remind employees of this brave new world of identity theft and eavesdropping, the devices that are becoming available to just about anyone, and the dangers they pose to patients and the people and organizations who heal them.
Calling it a "best and final offer," Community Health Systems, Inc. on Monday morning raised its all-cash bid to acquire all common stock of rival Tenet Healthcare Corp. to $7.25 per share – up from $6 per share – and gave the Tenet board one week to make a decision.
The deal will expire on May 9 if Tenet has not begun good-faith discussions, and Franklin, TN-based CHS said in a media release that it will withdraw its slate of nominees for the Tenet board, and end its six-month-long bitter and public hostile takeover attempt.
"We are making this offer to bring this matter to a prompt conclusion in the best interests of all concerned," Wayne T. Smith, chairman/president/CEO of CHS, said in a prepared statement. "We call on the Tenet Board to uphold its fiduciary duties and enter into good-faith discussions with us to conclude a mutually beneficial transaction. Unless we see meaningful engagement by May 9, 2011, we will withdraw the offer and move on to the many other compelling growth opportunities available to us."
Tenet issued a statement Monday morning confirming that it will review the new bid to "determine the course of action that it believes is in the best interests of the Company and its shareholders. Tenet’s shareholders are advised to take no action at this time pending the review of the revised proposal by the Tenet Board of Directors."
Smith told the Tenet board in a letter Monday that the $7.25 per share cash offer "offer provides your shareholders a 69% premium to the unaffected stock price when we made public our initial proposal on Dec. 9, 2010, and is our best and final offer based on information currently available to us. It is time to move beyond lawsuits and rhetoric."
CHS has been defending itself against a federal complaint filed by Tenet, alleging that CHS overbilled Medicare by as much as $377 million.
On Dec. 9, 2010, CHS made public an offer to acquire Tenet for $6 per share, including $5 per share in cash and $1 per share in CHS stock. The offer was made in a letter to Tenet's board on Nov. 12, 2010, and rejected on Dec. 6, 2010. On Jan. 14, 2011, CHS told Tenet that it would nominate a full slate of 10 independent director nominees to wrest control of the board at its 2011 Annual Meeting. Tenet delayed the meeting until Nov. 3. On April 18, CHS amended its offerto $6 per share in cash, which Tenet rejected on April 22.
API Healthcare and Kronos Inc. have terminated a previously announced merger after the Justice Department raised concerns that the deal would reduce competition and raise prices for healthcare-specific workforce management technology.
DOJ officials applauded the news and noted that if the purchase of API had been completed, Kronus would have acquired its biggest competitor for healthcare-specific time and attendance software and related technology, creating a single company controlling 70% of the time and attendance healthcare market.
"We welcome the decision to abandon this deal, which will preserve competition in the market for time and attendance technology in the healthcare industry," Christine Varney, Assistant Attorney General in charge of the Justice Department's Antitrust Division, said in a media release. "The abandonment of this transaction means that consumers will continue to receive the same benefits of competition, including greater innovation and lower prices, they're now receiving."
API, based in Hartford, WI, and owned by investment firm Francisco Partners II L.P., operates in more than 1,000 healthcare sites and had 2010 revenues of $52 million. Kronos, based in Chelmsford, MA, is owned by investment firm Hellman & Friedman Capital Partners VI L.P. and provides workforce management software to tens of thousands of organizations in 60 countries in the healthcare industry and in other industries, according to portfolios issued by both companies.
In a brief statement posted on its Web site, API, said the decision to end the merger agreement "enables API Healthcare to continue to focus on the innovation and delivery of workforce management solutions that allow healthcare providers to effectively balance quality of care and cost."
Kronus officials did not immediately return calls seeking comment.
Community Health Systems has launched another defense of its Medicare billing practices.
In a letter to shareholders on Friday, CHS Chairman/CEO/President Wayne T. Smith dismissed what he called "erroneous allegations" brought forward in April by CtW Investment Group, a major investor at CHS that also has ties to the Service Employees International Union.
CtW, which owns about 470,000 shares of CHS common stock has asked fellow shareholders to vote against the re-election of three board members, including CFO W. Larry Cash, for their alleged improper oversight of Medicare billing practices.
The April 21 letter to shareholders from CtW Executive Director William Patterson was disclosed Thursday in a CHS filing with the SEC. In the letter, Patterson urged shareholders to vote against the re-election of board members Cash, James S. Ely III, and John A. Fry, at CHS' annual shareholder meeting on May 17, "given their culpability for the growing scandal surrounding proper oversight of Medicare billing practices, which has precipitated a 25% decline in Community's market value."
On Friday afternoon, Smith fired back with a three-page letter to shareholders, urging them to reject "CtW's meritless and self-serving allegations and to express our firm belief that voting against the re-election of these incumbent directors is contrary to your best interests."
"We believe CtW's erroneous allegations are not based on valid stockholder concerns — but rather reflect its support for both SEIU's ongoing union organizing campaign, and Tenet's ongoing smear campaign, against CHS," Smith said in his letter, making reference to the Service Employees International Union.
Smith's letter continued, "CtW's professed concerns about allegedly inappropriate admissions practices are based on inaccurate data and lead to implausible conclusions. Furthermore, CtW's faulty conclusions fail to take into account the single most important aspect of admission decisions — the critical role of physician judgment and decision-making in the treatment of patients. The fact is that CtW's allegations are simply not true."
Smith's Friday letter to shareholders was the latest twist in CHS's bitter hostile takeover bid for Tenet. Last Thursday, CHS issued a 109-page rebuttal of allegations raised in the Tenet suit. "We believe that the analysis prepared by Tenet Corp. contains contrived statistics that lead to faulty and irresponsible conclusions," Smith said in a conference call with the media and financial analysts.
"The analysis and allegations contain unreliable and inaccurate statements and represent a direct attack on the ethics and judgment of our 16,000 physicians and 85,000 employees. At the end of the day the ultimate decision to admit a patient into a hospital is based on a physician's judgment and medical necessity," Smith said. "Be assured we will defend our reputation. We will dedicate whatever resources are required to reach an ultimate resolution to these matters. And we will work tirelessly to restore any erosion of confidence or trust that may have been caused by these accusations."
Tenet officials said last week they were not impressed by CHS' rebuttal. "Nothing we heard (Thursday) from Community Health diminishes our confidence in our analysis or allegations. We plan to vigorously pursue our claims in court," Tenet spokesman Rick Black said in a media release.
A major investor with Community Health Systems, Inc. is urging fellow shareholders of the for-profit hospital chain to vote against the re-election of three board members --- including CFO W. Larry Cash –- for their alleged improper oversight of Medicare billing practices, according to a filing with the Securities and Exchange Commission.
The April 21 letter from William Patterson, executive director of CtW Investment Group was disclosed Thursday morning in a CHS regulatory filing with the SEC.
Patterson asked fellow shareholders to vote "against" the re-election of board members Cash, James S. Ely III, and John A. Fry, at CHS' annual shareholder meeting on May 17 "given their culpability for the growing scandal surrounding proper oversight of Medicare billing practices, which has precipitated a 25% decline in Community's market value."
Tenet Healthcare Corp. earlier this month made allegations that CHS overbilled Medicare by as much as $377 million using medically unnecessary admissions that improved its bottom line and appeal to investors.
Patterson said CHS failed to act on specific complaints that CtW – the owners of about 470,000 shares of CHS common stock -- raised in a Sept. 28, 2010 letter concerning widespread and improper admitting practices. Those alleged irregularities are at the center of a federal lawsuit filed against CHSbyrival Tenet Healthcare Corp., which is fighting CHS' hostile takeover bid. News of the lawsuit earlier this month precipitated a 36% one-day drop in CHS share prices.
Franklin, TN-based CHS has since recovered some of its value but is still trading about 25% lower than before the suit was announced, Patterson said.
On April 8, CHS was subpoenaed by the Department of Health and Human Services' Office of the Inspector General in connection with the issues raised in the Tenet suit. The Texas Attorney General's Office launched a similar investigation last November.
Fry and Ely, as members of the board's Audit and Compliance Committee, are responsible for the failure to address the compliance risks created by CHS' excessive rate of emergency department admissions and to respond to shareholder concerns outlined in the CtW letter, Patterson said.
As CFO, Patterson charges, Cash failed in his responsible to guide the company's financial stability, as evidenced by the declining value of CHS stock, Patterson said.
"In our view, rebuilding credibility with regulators, shareholders and providers begins with holding these directors to account for their failure to address these concerns before the implications of the billing practices rose to such alarming proportions," Patterson said in the letter.
Five national healthcare organizations this week issued an updated "how-to" guide for healthcare professionals transitioning from paper to e-prescribing systems.
The 2011 edition of A Clinician's Guide to Electronic Prescribing is a collaborative by the American Medical Association, the American Academy of Family Physicians, the American College of Physicians, the Medical Group Management Association, e-Health Initiative, and The Center for Improving Medication Management, the healthcare organizations said in a joint media release.
"Whether a physician practice is just beginning to e-prescribe or is already using the technology, this guide is an important resource for all physicians," AMA Board Secretary Steven J. Stack, MD, said in the statement. "This updated guide includes information about the federal e-prescribing incentive program and can help physicians understand the requirements so they can receive incentives and avoid penalties."
First issued in 2008, the updated guide examines the rapidly changing landscape for e-prescribing that has come about with the Health Information Technology for Economic and Clinical Health Act, the Drug Enforcement Administration's rule allowing e-prescribing of controlled substances, and healthcare reform.
An executive summary says the guide will examine the impact of the federal government's push to encourage the use of electronic medical records, and the implications for physician practices, including:
• Financial incentives for physicians, especially those available through the HITECH Act, and the concept of"meaningful use" as it relates to this incentive program.
• Requirements for e-prescribing doctors will face in 2011, especially, the Medicare Fee Schedule for 2011, published in November of 2010, which explains the financial penalties in 2012 and 2013 associated with the failure to adopt e-prescribing in 2011.
• Recent Drug Enforcement Administration rule changes that now give prescribers the option
of prescribing controlled substances electronically. The rule removes a key barrier to e-prescribing and will likely lead to more adoption and use of the technology once the healthcare industry is in compliance.
"When this tool was first developed three years ago, it proved immensely valuable to clinicians," said William F. Jessee, MD, president/CEO of MGMA and board chair for e-HI, in the release. "The 2011 revisions bring the guide up to date with the rapid changes in this arena and make it essential reading for every prescriber."
The guide was issued after input from healthcare stakeholders, including Quincy Medical Group, Healthcare Information and Management Systems Society, Excellus, Walgreens, and the American Academy of Pediatrics.
Community Health Systems Inc. defended its admitting practices for Medicare beneficiaries on Thursday with a 109-page rebuttal of allegations raised by rival Tenet Healthcare Corp. in a lawsuit this month.
"We believe that the analysis prepared Tenet Corp. contains contrived statistics that lead to faulty and irresponsible conclusions," Wayne T. Smith, president/CEO/chairman of CHS said in a conference call with the media and financial analysts on Thursday afternoon.
"The analysis and allegations contain unreliable and inaccurate statements and represent a direct attack on the ethics and judgment of our 16,000 physicians and 85,000 employees. At the end of the day the ultimate decision to admit a patient into a hospital is based on a physician's judgment and medical necessity," Smith said. "Be assured we will defend our reputation. We will dedicate whatever resources are required to reach an ultimate resolution to these matters. And we will work tirelessly to restore any erosion of confidence or trust that may have been caused by these accusations."
Smith declined to take questions about the Tenet suit during the nearly two-hour conference call, which also detailed the Franklin, TN-based hospital chain's first quarter earnings.
Tenet, which is fighting a hostile takeover attempt by CHS, said in a statement that it was not impressed by CHS' defense. "Nothing we heard today from Community Health diminishes our confidence in our analysis or allegations. We plan to vigorously pursue our claims in court," Tenet spokesman Rick Black said in a media release.
Also Thursday, in a filing with the Securities and Exchange Commission, CHS said it saw first quarter 2011 net operating revenues of $3.4 billion, up 9% from the $3.1 billion reported for same three months in 2010. Income from continuing operations increased to $91.1 million for Q1, compared with $86.5 million for 1Q 2010.
And in a separate filing with the SEC on Thursday, CHS released a letter last week from one of its major investors that urged fellow shareholders to vote against the re-election of three board members --- including CFO W. Larry Cash –- for their alleged improper oversight of Medicare billing practices.
William Patterson, executive director of CtW Investment Group, asked fellow shareholders to vote "against" the re-election of board members Cash, James S. Ely III, and John A. Fry, at CHS' annual shareholder meeting on May 17 "given their culpability for the growing scandal surrounding proper oversight of Medicare billing practices, which has precipitated a 25% decline in Community's market value."
Patterson said CHS failed to act on specific complaints that CtW – the owners of about 470,000 shares of CHS common stock -- raised in a Sept. 28, 2010 letter concerning widespread and improper admitting practices.
Three Miami-area medical professionals were ordered to prison this week for their roles in a $23 million Medicare fraud scheme involving bogus billings for HIV infusion therapy, the U.S. Departments of Justice and Health and Human Services has announced.
Physician assistant Jose Diaz, 62, and medical assistants Lisandra Aguilera, 40, andEstrella Rodriguez, 43, received prison terms Monday of four-and-a-half years, five years, eight months, and four-years, eight months, respectively, after pleading guilty in U.S. District Court in Miami to one count of conspiracy to commit healthcare fraud, DOJ and HHS said in a media release.
The trio worked at Metro Med of Hialeah Corp., a purported HIV infusion clinic that paid kickbacks to Medicare beneficiaries in exchange for the use of their Medicare identification numbers. From April 2003 through October 2005, Metro Med submitted $23 million in false claims related to the bogus treatments, of which Medicare paid $11.7 million, DOJ and HHS said.
Diaz instructed Metro Med owner Damaris Oliva which medications and in what amounts to bill Medicare to ensure a maximum reimbursement. Diaz, Aguilera and Rodriguez falsified patient files to indicate that the treatments were medically necessary. Aguilera and Rodriguez signed medical records falsely indicating that treatments were provided. Aguilera and Rodriguez also fabricated medical records to show that Metro Med patients had received specific dosages of medications. Aguilera manipulated patient blood samples to make it appear that unnecessary injection and infusion treatments were medically necessary, federal prosecutors said.
The trio was aware that beneficiaries were getting cash kickbacks in exchange for allowing Metro Med to bill Medicare using their ID numbers, DOJ and HHS said.
All three were charged in a July 2010 indictment, along with Oliva and Rene De Los Rios, MD. All five defendants now have pleaded guilty or been convicted. Oliva was sentenced in December to six years, eight months in prison. De Los Rios was convicted on April 14 of five felony counts by a federal jury for his role in the scam and will be sentenced on June 27, DOJ and HHS said.
Cardinal Health Inc. will pay the federal government $8 million to resolve whistleblower claims that it paid kickbacks to pharmacy owners to induce referrals for the distributor's prescription drugs, the Department of Justice said.
The settlement with Dublin, OH-based Cardinal Health resolves a whistleblower False Claims Act lawsuit filed by former pharmacy owner R. Daniel Saleaumua and pharmacy consultant Kevin Rinne.
Saleaumua alleged that Cardinal paid him $440,000 in exchange for an agreement that he purchase from Cardinal prescription drugs for his pharmacies. Saleaumua and Rinne will receive a combined $760,000 as their share of the government's recovery.
"American taxpayers are the victims of illegal kickback schemes that result in Medicare and Medicaid paying millions of dollars more than they should for prescription drugs," said Beth Phillips, U.S. Attorney for the Western District of Missouri, whose office led the investigation. "Today's $8 million settlement underscores our commitment to combating healthcare fraud and protecting taxpayers."
Cardinal Health issued a statement acknowledging the settlement with the federal government, but denied any wrongdoing and referred to the alleged kickbacks as an "upfront discount."
"The transaction did not result in the Government paying more than it was obligated to pay for pharmaceuticals provided by the customer to federal health care program beneficiaries. Cardinal Health strongly believes that it acted appropriately and complied with all applicable laws and regulations," Cardinal Health said in a prepared statement. "In the settlement agreement, Cardinal Health explicitly denies the contentions of the Government and the Plaintiffs. In addition, Cardinal Health contends that the complaint by the plaintiffs contains numerous inaccuracies. While Cardinal Health believes it would have prevailed in litigation, the Company settled for the purpose of avoiding the time and expense of protracted litigation."
The Department of Justice has used the False Claims Act to recover more than $5.5 billion since January 2009 in cases involving fraud against federal healthcare programs.
