A not-for-profit Medicaid managed care plan in Ohio agreed this week to pay that state and the federal government $26 million to resolve whistleblower allegations by former employees that for six years the plan falsely billed for special needs assessments and case management services that weren’t provided, the Department of Justice announced.
CareSource, and its related CareSource Management Group Co. and CareSource USA Holding Co., acknowledged the settlement in a statement but denied any wrongdoing. The company is headquartered in Dayton, and provides managed care benefits to about 880,000 Medicaid and Medicare Advantage beneficiaries in Ohio, Indiana and Michigan.
The settlement resolves allegations that between January 2001 and December 2006, CareSource knowingly failed to provide required screening, assessment and case management for adults, and children with special healthcare needs, even though the plan billed and was paid millions of dollars for those services, state and federal prosecutors said.
CareSource allegedly submitted false data to the state of Ohio so that it appeared they were providing the required services to improperly retain incentives received from Ohio Medicaid and to avoid penalties, prosecutors said.
“Cash-strapped Medicaid programs, such as Ohio’s, can ill afford conduct such as this, designed to improve this company’s bottom line at the expense of a program benefitting the poor and disabled,” said Tony West, assistant attorney general for the Civil Division.
CareSource President /CEO Pamela Morris said the plan denied the allegations throughout the litigation process. “In the end, we chose to reach a financial settlement, bringing the matter to a close, and continuing to focus on our mission of making a difference in the lives of underserved people by improving their healthcare,” she said.
Morris said that because it is a mission-driven organization, CareSource “has always dealt with our relationship with the State of Ohio and the management of Medicaid funds with the highest integrity.”
“We have proven our not-for-profit model works in a growing for-profit health care environment. Our model is highly member-focused and demands being great stewards of taxpayer dollars spending more than 90% of every dollar we receive on quality healthcare for our members, while saving the State of Ohio hundreds of millions of dollars and providing predictability of budget. We are extremely unique in the industry,” Morris said.
The settlement resolves a federal whistleblower action filed by two former employees at CareSource, Laura Rupert and Robin Herzog, who will receive a $3.1 million share of the federal portion of the settlement.
The Justice Department has used the False Claims Act recover approximately $5.3 billion since January 2009 in cases involving fraud against federal healthcare programs. Total recoveries in False Claims Act cases since January 2009 have topped $6.8 billion.
Blue Cross and Blue Shield of Illinois and the Illinois Hospital Association have launched a four-year joint initiative to reduce some of the nation's highest hospital readmission rates, the two organizations announced Tuesday.
"This collaboration leverages IHA's experience and relationships with hospitals, the expertise of the academic community and resources from BCBSIL," said Scott Sarran, MD, BCBSIL vice president/CMO. "We expect this collaboration to have a positive impact on improving the way hospitals, physicians, and other healthcare providers transition patients to outpatient care in the community."
The Commonwealth Fund State Scorecard 2009 ranked Illinois 44th in the nation for its high rate of Medicare 30-day readmissions as a percentage of admissions. The state had a readmissions rate of 20.3%, an increase from 19.6% in 2007. Nationally, the median is 17.5% and the average for the top five states is 13.8%.
In 2009, there were more than 50,000 readmissions to Illinois hospitals, with each patient spending, on average, five additional days in the hospital. Sarran said improving the Illinois readmission rate to the current national average has the potential to save or avoid costs of approximately $150 million dollars in the first year.
BCBSIL expects to invest up to $1 million a year over the next four years to reduce preventable hospital readmissions. "Our commitment to this program is part of our ongoing efforts to work with health care providers to improve the quality of care and slow increasing health care costs," Sarran said.
More than 200 Illinois hospitals have pledged to reduce readmissions by the end of 2013 with the goal of raising the state's performance from the bottom quartile to an upper quartile, IHA President Maryjane A. Wurth said.
"Over time, these savings will go back to the taxpayers and businesses in Illinois, as the state (Medicaid), the federal government (Medicare), employers, and individual policy holders in the form of lower healthcare costs," Wurth said. "More importantly will be the improved health and safety of patients, and the satisfaction hospital and physician partners receive from being able to deliver improved care."
The initiative—Preventing Readmissions through Effective Partnerships – will team with the Division of Hospital Medicine at Northwestern Memorial Hospital, and Northwestern University Feinberg School of Medicine and the Society of Hospital Medicine, to reduce readmissions by 2014, focusing on:
PREP will stress patient education—assessing a patient's needs before discharge, and making sure they have the information they need for a smooth transition. This patient/provider partnership includes standardized discharge planning that highlight medications, follow up, pending tests, self-management instructions, and goal setting, IHA and BCBSI said.
Duke University Health System, Inc. and LifePoint Hospitals have partnered to create "flexible affiliation options" that will range from joint ventures to outright ownership of community hospitals in North Carolina, the two healthcare providers have announced.
The joint venture -- DLP Healthcare, LLC -- combines Brentwood, TN-based LifePoint's financial resources and experience managing community-based hospitals with Durham, NC-based Duke's development of clinical services and quality measures. The partnership is one of the first between an academic health system and a for-profit hospital company, Duke/LifePoint said.
"This is a challenging time for many community hospitals as the healthcare environment undergoes significant change and costs continue to rise," said William F. Carpenter III, chairman/CEO of LifePoint Hospitals. "Duke/LifePoint has the ability to help hospitals not only weather the months and years ahead, but also prosper and offer their communities even better care."
Maria Parham Medical Center, a private, non-profit, hospital in Henderson, NC, this week signed a nonbinding memorandum of understanding that would make it the first hospital in the new network. Under the partnership, MPMC would retain 20% ownership and Duke/LifePoint would have 80% ownership, but governance would be shared 50/50, "giving the community an equal and long-term voice in the strategic direction of the hospital," MPMS said.
MPMC assets and the proceeds from the transaction would eliminate MPMC's debt, and the remaining assets -- approximately $30 million -- would create a locally governed charitable foundation to fund new programs and services in the service area, which includes north central North Carolina and southern Virginia.
"For the last year, MPMC has explored the possibilities of a partnership or affiliation that would allow us to strengthen our hospital," said W. Beverly Tucker, MD, chairman of the MPMC board, and family physician. "After lengthy consideration, the MPMC board unanimously determined that a partnership with Duke/LifePoint has the potential to bring a powerhouse of clinical and operational resources that could enhance our ability to grow and provide more services to patients."
LifePoint brings to the venture access to investment capital for new technology and facility renovations. Duke will help MPMC and other affiliated hospitals develop clinical services, support enhancing quality systems, and provide access to specialized medical services and best practices.
"Duke and LifePoint share a commitment to working collaboratively with communities, physicians and hospital staffs to optimize the availability of innovative healthcare services locally, while applying proven operational strategies that are more important than ever in the era of healthcare reform," said William J. Fulkerson, Jr., MD, executive vice president of Duke University Health System.
Jone L. Koford, president of strategic growth and development at LifePoint, said the "flexible affiliations" with other hospitals "really range from full acquisition, you could do a long-term lease of the facility, or a joint venture with the facility, like we are doing with Maria Parham."
There is no predetermined target number of hospitals that Duke/LifePoint would like to see in the partnership, Koford said. "The number of hospitals that we believe will want to consider partnership will need access to capital, will want operational expertise or resources they currently don't have, and would love to have the relationship with Duke and their reputation," she said.
"The combination of what we bring to the table, our operational excellence, our access to capital, our commitment to quality, Duke's reputation, their clinical expertise, you couple those and offer them to a stand-alone community hospital that is facing many challenges, more so in the future with health reform and the increases in regulation, and the capital commitments that will have to be made for IT, those kinds of things, they need a strong partners going forward. We believe the DLP partnership offers them the best of both worlds," she said.
Koford said LifePoint is also "in discussions" with other health systems in other states about setting up similar partnerships. "We look for those systems that have a strong market position and a very solid reputation for quality," she said.
LifePoint Hospitals operates 52 hospitals in 17 states, and specializes in community hospitals in non-urban markets where the hospital is the sole provider in most of the communities it serves. Duke University Health System has inpatient and ambulatory locations across North Carolina and surrounding areas, and has partnered with hospitals in its region to establish specialized medical services in their communities.
A federal judge in Pensacola, FL on Monday threw out as unconstitutional the entire Patient Protection and Affordable Care Act because of the inseverable individual mandate provision that requires people to carry health insurance or else pay a penalty.
"This case is not about whether the Act is wise or unwise legislation. It is about the Constitutional role of the federal government," Senior U.S. District Judge Roger Vinson wrote in a 78-page ruling. "Because the individual mandate is unconstitutional and not severable, the entire Act must be declared void."
The ruling will likely be appealed by the federal government at the U.S. Court of Appeals in Atlanta, and the case is expected to be heard eventually by the U.S. Supreme Court.
The suit was filed last March minutes after President Obama signed the reforms into law. The 26 states' attorneys general – almost all of them Republicans – who joined the suit complained that the federal government had overstepped its authority by mandating insurance coverage in the healthcare reforms.
Vinson agreed.
"I must reluctantly conclude that Congress exceeded the bounds of its authority in passing the Act with the individual mandate," wrote Vinson, who was appointed to the court by President Ronald Reagan. "That is not to say, of course, that Congress is without power to address the problems and inequities in our healthcare system. The healthcare market is more than one-sixth of the national economy, and without doubt Congress has the power to reform and regulate this market. That has not been disputed in this case. The principal dispute has been about how Congress chose to exercise that power here."
Vinson's ruling is the fourth by a federal judge on the constitutionality of the healthcare reform law. A Republican-appointed federal judge in Virginia struck down the individual mandate provision of the law, while two Democratic-appointed federal judges have upheld it.
The White House and the Department of Justice did not immediately respond to the ruling.
Republicans in Florida, however, applauded the decision. Attorney General Pam Bondi, who took office in January, called the ruling "an important victory for every person who believes in the freedoms granted to us by our Constitution."
"This proves that the federal government requiring Americans to purchase health insurance is in fact unconstitutional," Bondi said. "In addition, the bipartisan effort from Attorneys General across the country shows the federal government that we will not back down from protecting the constitutional rights of our citizens."
Florida Gov. Rick Scott, who also took office in January, said Vinson has "confirmed what many of us knew from the start; ObamaCare is an unprecedented and unconstitutional infringement on the liberty of the American people."
Online job ads for healthcare practitioners and technical workers surged in January by 78,500 listings, and ads for healthcare support jobs also grew by 16,600 listings, as healthcare jobs led a strong first month of 2011 that saw 438,000 new job listings in the overall economy, The Conference Board reports.
June Shelp, vice president at The Conference Board, called the January surge "welcome news" after relatively flat job growth during the second half of 2010, but she cautioned that it's too early to call it a trend. "Last year, after a promising start (up about 350,000 in January 2010), labor demand fizzled, and the last half of 2010 was actually flat with no appreciable gains in job demand," Shelp said. "Hopefully the January 2011 increase suggests that employers are seeing a pickup in their businesses and labor demand will continue to improve throughout this year."
The board's Help Wanted Online Data Series tracks more than 1,000 online job boards across the United States. Forty-nine states posted gains in online job listings. Rhode Island reported a decline of 200 job postings.
The surge in skilled healthcare practitioner job listings was fueled by a demand for registered nurses, and family and general practitioners. There were three job listings for every healthcare practitioner job seeker, with the average salary of $33.51.
Healthcare support saw an increase in many areas including home health aides, nursing aides, orderlies,and attendants. However, there are still 2.4 workers seeking positions in healthcare support for every advertised vacancy, with pay averaging $12.84 an hour.
Hospitals created 50,100 jobs in 2010, nearly double the rate of job creation from 2009, and the entire healthcare sector - everything from allergists to X-ray technicians -- created 265,800 jobs for the year, Bureau of Labor Statistics preliminary data shows.
Overall, the healthcare sector employed 13.9 million people at the end of 2010, including 4.7 million jobs at hospitals, 6 million jobs in outpatient ambulatory services, and 2.3 million jobs in physicians' offices, BLS preliminary data show.
For December, the healthcare sector recorded 35,700 payroll additions, including 8,000 hospital jobs. However, ambulatory healthcare services continues to be the major driver of healthcare job creation, with 20,600 payroll additions in December, and 160,200 payroll additions recorded in 2010, BLS preliminary data show.
The Conference Board reports that in the overall economy, online advertised vacancies grew by 438,000 in January, to 4.2 million listings, following a decline of 9,400 listings in December. With the January increase, labor demand has risen 1.44 million job postings since the series low point in April 2009. This increase now offsets approximately 80% of the 1.76 million drop in ad volume during the two-year downturn period from April 2007 through April 2009.
Even with the uptick, however, the nation's supply/demand rate stood at 3.78 unemployed people for every advertised vacancy in December (the last available unemployment data), down from a peak of 4.73 in October 2009. Nationally, there are 10.6 million more unemployed than advertised vacancies, The Conference Board reports.
The American Hospital Association issued a report this month on the status of wellness programs at the nation’s hospitals. It’s worth reading, even though the findings are less than encouraging.
As my HealthLeaders Media colleague Cheryl Clark notes, the AHA’s report, A Call to Action: Creating a Culture of Health, finds that most healthcare systems in the U.S. offer wellness programs of varying intensity and enthusiasm to their employees. Few, however, measure outcomes and fewer still have engrained healthy behaviors as part of their employees’ culture.
That sounds discouraging, but it shouldn’t be. The wellness movement in the workplace is a relatively new but simple concept: Improving employee health will reduce the growth of healthcare costs, and other ancillary costs, like absenteeism. The problem is not the wellness concept. That’s easy. Tens of millions of people who’ve tried to lose weight, or take up exercise, or quit smoking to improve their health understand the importance and desirability of wellness.
The problem is changing people’s less-than-healthy habits, like poor diet or sedentary lifestyle, learned over decades, and reinforced in everyday life – mostly during the two-thirds of the day that they’re away from work. (That’s why they’re called "habits," after all.) These habits took years to develop and it’s unrealistic to think that people will change their lives in the span of a few weeks or months with a "biggest loser" diet contest or discount rates at the local gym.
John Bluford, CEO of Truman Medical Center which has 4,000 employees in Kansas City, wrote the AHA report, and he was spot on when he told HealthLeaders Media: "This is not the program of the month. It’s a culture," and "You can’t do this for a year and think it’s a done deal."
In addition to the many suggestions that Bluford lists in his report – which you can read in Cheryl’s account -- I would also suggest that a little empathy goes a long way. If you are a hospital executive, not everyone on staff will have the same ability to embrace wellness.
Imagine how a low-wage, manual worker in environmental services at your hospital might view the idea. Maybe that worker has to get up at 4 a.m. every day to take a bus to work, where he’s on his feet all day wrestling with heavy objects. Maybe that worker has a second job to make ends meet, or he’s a single parent with two kids at home. That worker is probably not going to take advantage of your lunchtime Jazzercise class, or spend a couple hours after work running a treadmill.
Bluford talks about how important it is to have top leadership on board, leading your wellness program by example. He is right. However, I would suggest that while any wellness program should be led from the top, it should be designed from the ground up to be accessible for the lowest-paid employees.
Low-wage workers are often the ones who have the most to gain from wellness programs, because studies have shown that health issues like obesity – and all the ancillary problems overweight create -- disproportionately affect lower-wage workers. If you’re going to offer financial incentives for employees to get eat better, or exercise more, it’s unfair not to design programs readily available to everyone on your staff in a practical way.
You want staff to eat better, but do all of your workers have ready access to fresh fruits and vegetables, or even a decent supermarket? You’re offering a rebate to cover a partial cost of a health club, but what good is a rebate if you don’t live near a health club, or if you don’t make enough money to sign up for a health club in the first place?
That $60 a month for a gym membership might not seem like a lot to a hospital executive or clinician, but it can be out of reach for some folks on support staff. Exercise more? It’s hard to take a walk around the block if you live in a crummy neighborhood, or you don’t have sidewalks, or the streets aren’t lighted when you get home from work at night.
None of these problems is insurmountable, of course, and anybody who wants to improve his health has to take most of the initiative on exercise and diet. However, bad habits can be more easily overcome when everyone on staff feels a sense of ownership with the wellness movement.
If you want employees to embrace wellness, talk to them, all of them, including the environmental staff folks working the graveyard shift. Explain what you want to achieve with your wellness program, find out what is important to them, how they’d like to improve their lives, what they’d like to see in the program, and what limitations their lifestyle may impose. You probably won’t resolve all of their problems, but you’ve at least listened to their concerns, and made it clear to them what you’re doing. That’s a good start.
People want to be healthy. How many people enjoy being overweight, or enjoy smoking? If you want your wellness program to work for everyone, design it with everyone in mind.
Total compensation costs – wages, salaries, and benefits – for hospital employees rose 2.1% in 2010, just above the 2% rise in total compensation costs for all workers in the larger economy, the Bureau of Labor Statistics' Employment Cost Index shows.
Wages and salaries for the hospital sector—which generally make up about 70% of total compensation costs—increased 1.6% in 2010. The ECI does not provide a separate estimate on hospital benefits costs. 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 shows.
Over the last decade, the growth in total compensation in the hospital sector has slowed each year, from 6.3% in 2001, to 2.1% in 2010. In that time, hospital wages and salary growth has steadily declined from 5.9% in 2001, to 1.6% in 2010, ECI data show.
In the larger economy, compensation costs for all civilian workers increased 2% in 2010, as compared with a 1.4% increase in 2009. Wages and salaries increased 1.6% in 2010 and 1.5% in 2009, while benefit costs grew by 2.9% in 2010, compared with 1.5% increase in 2009. BLS attributed the near doubling of the rate of increase to retirement costs.
A further breakdown of the civilian workforce showed that private sector overall compensation grew by 2.1% in 2010, compared with 1.2% in 2009. Private sector wages and salaries grew 1.8%, up from a 1.3% increase in 2009, while benefits costs grew 2.9% in 2010, compared with a 0.9% increase in 2009. Employer costs for health benefits grew 5% in 2010, compared with 4.3% in 2009, ECI shows.
Compensation costs for state and local government workers fell from 2.3% in 2009, to 1.8% in 2010, owing largely to salary and wage reductions. Benefits costs increased 2.9% for the year, ECI shows.
Despite the trend of slowing growth in total compensation, hospitals continue to be job creation machines. Hospitals created 50,100 jobs in 2010, nearly double the rate of job creation from 2009, and the entire healthcare sector - everything from allergists to X-ray technicians -- created 265,800 jobs in 2010, Bureau of Labor Statistics preliminary data shows.
ECI data for the December 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.
Financial challenges ranked No. 1 on the list of hospital CEOs' top concerns, as it has for the last six years, according to the American College of Healthcare Executives' annual survey of top issues confronting hospital leaders.
Healthcare reform and its implications ranked No. 2 on the 2010 survey released this week, similar to last year's No. 2 issue "healthcare reform implications." Concerns about governmental mandates moved to No. 3 on the list, up from No. 5 in 2009.
"Because health reform became a reality last year, it is not surprising that the importance of implementing reform has not only remained the No. 2 issue on CEOs' minds but has also elevated the area of governmental mandates to CEOs' No. 3 concern," said Thomas C. Dolan, president/CEO of ACHE.
ACHE asked 542 hospital CEOs who responded to the survey to rank 13 issues affecting their hospitals in order of importance, and to identify specific areas of concern within their top three issues. After financial challenges (77%), and healthcare reform (53%), other top issues included government mandates (32%), patient safety and quality (31%), physician relations (30%), providing care for the uninsured (28%), patient satisfaction (16%), personnel shortages (11%), technology (10%), capacity (6%), governance (3%), not-for-profit status (2%), and disaster preparedness (1%).
CEOs who expressed concerns about finances said they were most concerned with Medicaid reimbursements (88%), followed by Medicare reimbursements (78%), bad debt (70%), overhead costs (63%), inadequate funding for capital improvement (63%), managed care payments (51%), other commercial insurance reimbursements (42%), revenue cycle management (37%), emergency department (30%), and competition from specialty hospitals (20%).
The nation's hospitals reported 137 mass layoffs of 50 or more employees in 2010, down 9.8% from the record 152 mass layoffs in 2009, but still significantly higher than any other year in the last decade, Bureau of Labor Statistics preliminary data shows.
Hospital mass layoffs appeared to be on a pace to match the 2009 record but layoffs tapered off in the fourth quarter of 2010, with six mass layoffs recorded in November, and three in December, BLS preliminary data shows.
In 2010, hospital layoffs resulted in 10,490 initial claims for unemployment benefits. In all of 2009, there were 11,787 initial claims for unemployment linked to hospital layoffs, BLS data shows.
Even with the layoffs, the nation's hospitals continue to be job creation machines, reporting 8,000 payroll additions in December, and 50,100 payroll additions in 2010. Those numbers, however, are well off the pace of hospital job growth for most of the decade. After erratic hospital job growth in the first seven months of this year, hospitals saw five straight months of growing employment, and have added 31,900 jobs since August. Overall, BLS data shows, hospitals employed more than 4.7 million people in 2010.
In the overall economy, BLS reports that employers imposed 1,483 mass layoffs involving 137,992 workers in December, 96 fewer mass layoffs than recorded in November. This figure reflects a 6% decrease and is the lowest reported level of mass layoffs since April 2008.
There were 19,564 mass layoffs in 2010 and the 1.8 million initial unemployment claims were lower than in 2009 when both events and claims reached their highest annual levels since layoffs among the 19 major industrial sectors began to be tracked in 1996, BLS reported.
President Obama's State of the Union address got a calculated review from major players in the healthcare sector, with most groups praising the overall message, but vowing to work with both political parties to improve their own standing in the coming months as Congress moves to amend the sweeping reforms under the Accountable Care Act.
The strongest support came from the AMA. "President Obama outlined a vision for our nation's future that includes key AMA priorities, such as lowering healthcare costs through medical liability reform, improvements to the new health reform law, and investments in biomedical research," said AMA President Cecil B. Wilson, MD.
"The AMA applauds the president's willingness to consider medical liability reform to rein in frivolous lawsuits and help reduce healthcare costs. Medical liability reform is critical as every American pays the price for high medical liability costs," Wilson said.
Wilson said the AMA was gratified to learn that the president will consider eliminating the 1099 reporting requirement for physician practices and other small businesses. "We will continue to work with members of Congress from both sides of the aisle and the administration during the implementation phase of this new law to ensure the best outcomes for patients and physicians," Wilson said.
Pharmaceutical Research and Manufacturers of America President/CEO John J. Castellani praised the president for focusing on economic development. "We believe that medical innovation specifically will continue to play a crucial role in advancing patient health and spurring economic growth in the U.S. The President recognized this crucial point tonight, as he stressed the need for investments in biomedical research," Castellani said.
The pharmaceutical industry invested more than $65 billion in research and development in 2009 alone, Castellani said, adding that drug makers should be considered "a national health and economic asset. Our global leadership in medical progress, and the domestic jobs and economic output that goes along with it is ours to lose if our nation's leaders don't support policies that help preserve and nurture future medical innovation," he said.
The trial lawyers' lobby, normally a strong supporter of Democrats, rejected Obama's support for tort reform. "As many as 98,000 people die every year from preventable medical errors, with countless more injured," said AAJ President Gibson Vance. "President Obama should direct his focus towards tackling this startling figure, not promoting efforts that could eliminate the legal rights of patients."
