At issue is the so-called 'competitive impact' conditions attached to the affiliation by the AG's office that state regulators said would ensure that the consolidation does not raise prices for consumers in the affected service areas.
Cedars-Sinai and Huntington Hospital have filed a lawsuit against the California Attorney General's Office, claiming that state regulators have slapped burdensome and unprecedented conditions on their proposed affiliation.
At issue is the so-called "competitive impact" conditions attached to the affiliation by the AG's office that state regulators said would ensure that the consolidation does not raise prices for consumers in the affected service areas.
Notably, the deal would require price caps on Huntington's negotiated rates with insurance companies for at least 10 years, without any requirement that the insurance companies pass their savings on to consumers, the suit alleges.
Huntington and Cedars-Sinai would also be required to submit to insurance companies' demands for "winner-take-all" arbitration in contract negotiations any time that a payer wanted to do so. No other hospital in California is subject to such conditions, the hospitals claim.
"We are shocked at the unprecedented over-reach of the conditions being imposed," Lori J. Morgan, MD, MBA, president and CEO of the not-for-profit Huntington Hospital, said in a media release.
"Rather than benefitting our community, the conditions primarily benefit health insurance companies," Morgan said.
The California AG's office issued a statement defending the requirements.
"The priority of the California Department of Justice is to ensure the proposed affiliation of Huntington Memorial Hospital with Cedars-Sinai Health System safeguards the availability and accessibility of healthcare for the people of Greater Los Angeles, and protects public funds," the AG's office said. "The conditions we attached to this affiliation will keep the healthcare market competitive for the consumers served by these hospitals."
Under the proposed deal, which was announced in March 2020, the 619-bed, Pasadena-based Huntington Hospital would continue to operate independently from the three-hospital Los Angeles-based Cedars-Sinai. As part of the affiliation, the Cedar-Sinai would invest in the Huntington's information technology infrastructure, along with its "ambulatory services and physician development."
The suit, filed in Los Angeles County Superior Court, claims the two hospitals worked in good faith with state regulators to resolve issues around provisions of care for their respective patient communities that included maintenance of operations and services and capital improvements, maintaining access to reproductive health services, and ensuring there is no discrimination against LGBTQ patients.
"However, the Attorney General added the unprecedented "competitive impact" conditions, despite the fact that the Federal Trade Commission's analysis of the proposed affiliation did not find any concern that the affiliation would lessen competition," the suit alleges. "The Attorney General's office has never imposed such conditions on any previous nonprofit hospital affiliation."
Cedar-Sinai President and CEO Thomas M. Priselac said the common measure of market competition used by the Federal Trade Commission shows that the Huntington affiliation would not lessen competition, because there is little overlap between Huntington's service area and Cedars-Sinai's.
Instead, the suit alleges that the AG's office used an "unvalidated academic theory" called "cross-market effects" that assumes that Huntington and Cedars-Sinai would engage in "all-or-nothing" negotiations with health insurers to accept the same terms for both Cedars-Sinai and Huntington.
The two health systems said they had agreed to not engage in such negotiations with payers for 10 years, but the AG rejected the proposal "even though its own expert's 'cross-market effect' analysis confirmed that such a commitment would remove any concerns regarding competition," the suit alleges.
Atrium Health Virtual Edge will partner with other hospitals, employers and commercial payers to deliver clinically appropriate, consumer-oriented care.
Atrium Health this week announced the launch of an expansive telehealth platform that will give patients a wide range of virtual primary and specialty care options.
"Virtual health is no longer a nice-to-have or an augmentation of care," said Scott Rissmiller, MD, executive vice president and chief physician executive for Atrium Health. "It is an essential and necessary way of clinical care delivery and customer service for any healthcare system. It allows us to deliver affordable, accessible care for all."
During the pandemic, the Atrium Health Hospital at Home program allowed tens of thousands of COVID-19 patients to be treated virtually, freeing bedspace and conserving staff time and personal protective equipment.
The virtual program has since been extended to cardiac patients, a process that Rissmiller said is the product of a decade of telehealth innovation at Atrium Health, a 42-hospital health system based in Charlotte, NC.
"Since the beginning, our goal has been crystal clear; to make virtual health an everyday part of how we care for patients," Rissmiller said. "We realized years ago that there were cost factors, convenience factors and access issues that could be improved upon through advancements in virtual care delivery. With dozens of rural hospitals closing their doors, we recognized that we could extend the reach of our renowned clinicians to help more people through virtual care."
The new remote care platform, Atrium Health Virtual Edge, will partner with other hospitals, employers and commercial payers to deliver clinically appropriate, consumer-oriented care that could also extend to patients living in remote and underserved areas, said Katie Kriener, senior vice president of Medical Group Operations for Atrium.
"Within Atrium Health Virtual Edge, our critical care, neurology, stroke, psychiatry, infectious disease and hospitalist programs all offer virtual hospital-based services, providing access to specialty care, while also helping balance provider supply," Kriener said.
Atrium has seen substantial, tangible results from its virtual offerings, Kriener said.
"We've achieved significant improvement in mental health and cost, including greater than 40% remission rates, 27% reduction in avoidable inpatient visits and 7% reduction in avoidable emergency department visits," she said.
Atrium also uses virtual, school-based clinics, providing students with increased access to care during school hours, which Kriener said has yielded 55% fewer avoidable emergency department visits and a 33% reduction in school absences.
An AMA analysis shows the highest prevalence of medical liability premium increases since 2005.
Nearly one-third (31%) of liability insurers increased their premiums at the height of the COVID-19 pandemic in 2020, the highest percentage in 15 years, an American Medical Association analysis shows.
The analysis found that, for a second straight year, there was a big surge in the percentage of premiums with a year-to-year increase. Between 2010 and 2018, the share of premiums that increased maintained a somewhat stable pattern, ranging from 12% to 17%. In 2019, that proportion almost doubled to 26.5% and went up again in 2020 to 31.1%, the analysis found.
However, the analysis noted that it's not clear if the pandemic was to blame for the premium increases, or if they were already in the works when the public health emergency was declared.
"The responsiveness of premiums to changes in their determinants and external factors takes considerable time in the medical liability insurance market," the analysis said. "Therefore, although some 2020 premiums may have been set after the onset of the [COVID-19] pandemic, it was still too early for them to be affected by it."
AMA President Susan R. Bailey, MD, said the premium hikes came at a difficult time for physicians.
"Increases in medical liability premiums compound the economic stress on medical practices as the COVID-19 pandemic resulted in significant reductions to patient volume and revenue, and higher expenses for scarce medical supplies," she said.
"Practice revenue has not fully recovered as the pandemic has stretched on and a protracted upward trend in medical liability premiums will threaten the viability of many practices that already face a difficult road to recovery.
The analysis identified the 14 states that had premium increases of 10% or more. Those states are: Kentucky (29.6%), South Carolina (27.8%), Maryland (18.8%), Nebraska (16.7%), Oregon (16.7%), Montana (16.7%), Georgia (14.8%), Missouri (14.8%), New Hampshire (13.3%), Illinois (11.9%), Michigan (11.6%), Texas (9.2%), North Carolina (6.7%), and Virginia (1.3%).
There was also a striking difference in premiums by geography. For example, in 2020 physicians in OB/GYN faced base premiums ranging from $49,804 in Los Angeles County, California to $205,380 in Miami-Dade County, Florida.
"Keeping medical liability premium growth in-check is imperative to ensure patient access to care is not jeopardized by unaffordable liability insurance costs that make it impossible for physicians to remain in practice," Bailey said. "This concern is particularly pressing given the negative impact that the COVID-19 pandemic has had on access and practice viability, as many physicians have had to suspend patient visits or elective procedures, and some have had to close their practices."
Among 4,405 surgeons in a Michigan cohort, 2,599 (59%) used telehealth to meet with a patient.
Telehealth use among surgeons for patient visits soared in the early months of the coronavirus pandemic in 2020, according to a new study.
Researchers examined insurance claims from a Michigan statewide commercial payer for new patient visits with a surgeon from 1 of 9 surgical specialties immediately before the pandemic (January 5 to March 7, 2020), during the early months of the pandemic (March 8 to June 6), and later in the pandemic (June 7 to September 5).
The research was published online Friday in JAMA Surgery.
Among the 4,405 surgeons in the Michigan cohort, 2,599 (59%) used telehealth to meet with a patient. For new patients, 1,182 surgeons (27%) used telehealth, and a total of 109,610 surgical new patient telehealth visits were identified during the pandemic.
Before March 2020, less than 1% (8 of 173, 939) of new patient visits were done using telehealth.
Telehealth use peaked in April 2020 -- week 14 of the pandemic – and represented 35% (479 of 1,383) of all new patient visits that week.
The telehealth conversion rate peaked in April 2020 -- week 15 -- and was equal to more than 8% of the 2019 mean weekly new patient visit volume.
From March to June, 12% of all new patient surgical visits were conducted using telehealth).
From June to September, telehealth visits slipped to 3% (2,168 of 71,819) of all new patient surgical visits.
The median age of telehealth patients was 47 (34-58) years compared with 52 (38-62) years for in-person patients.
"While rates of telehealth use have declined as in-person care has resumed, telehealth use remains substantially higher across all surgical specialties than it was prior to the pandemic," the study said.
ARP will bolster hospital margins by reducing the numbers of uninsured, which is a credit positive.
The expansion of health insurance access and premium subsidies under the $1.9 trillion American Rescue Plan are among the actions that "would subtly improve the revenue profile and reduce cost pressures for not-for-profit hospitals," Fitch Ratings says.
The ARP provides about $8.5 billion in direct aid but only to rural providers. However, Fitch says the ARP will help all hospital margins by reducing the numbers of uninsured, which is a credit positive.
"The most significant measures," Fitch said, "temporarily subsidize healthcare coverage under the Consolidated Omnibus Budget Reconciliation Act (COBRA), subsidizing the premium at 100% through the end of September; provide additional funding/incentives to expand Medicaid coverage in those states that have not yet done so; and expand Affordable Care Act premium subsidies."
Medicaid expansion would have a substantially positive effect on providers in states that have expanded the insurance program because it will reduce the numbers of uninsured patients while increasing Medicaid volumes.
"The law increases the Federal Medical Assistance Percentage by 5 percentage points for two years for states that have not already expanded Medicaid," Fitch said.
States that expanded during the public health emergency may also receive the coronavirus 6.2 percentage point FMAP increase.
When Medicaid expanded in 2014–2015, upgrades of Fitch's rated credits outpaced downgrades by 3:1.
ARP also cuts premium costs for Affordable Care Act plans by increasing tax credits and capping premium contributions at 8.5% of income for mid-level health plans. Those who earn 100% to 150% of the federal poverty level will not pay any premiums.
In line with greater Medicaid coverage, the law increases Medicaid coverage for coronavirus testing and treatment and clarifies that the federal matching rate for vaccinations is 100% for those covered by Medicaid.
The ARP also allocates $50 billion for the Disaster Relief Fund, which could be used to help hospitals with personal protective equipment and other supplies.
The recent confirmation of Xavier Becerra as Secretary of the U.S. Department of Health and Human Services, who is considered a strong supporter of ACA expansion, is seen as further confirmation of the expected direction of healthcare policy.
The Centers for Medicare and Medicaid Services announced earlier this year that it plans to rescind Trump administration approval of Medicaid work requirements.
Hospital finances are stressed, care access is threatened, and staff are burned out.
The nation's hospitals are reporting that the year-long battle with the coronavirus pandemic has put them in "survival mode," contending with stressed margins, burned-out staff, and exacerbated concerns about care access for vulnerable communities, a federal report said.
"Hospitals described difficulty balancing the complex and resource-intensive care needed for COVID-19 patients with efforts to resume routine hospital care," the Department of Health and Human Services' Office of the Inspector General said in a report made public Wednesday.
"(Hospitals) reported that staffing shortages have affected patient care, and that exhaustion and trauma have taken a toll on staff's mental health," the report said. "Administrators detailed challenges associated with vaccine distribution efforts and concerns about vaccine hesitancy among staff and members of their communities."
The report is based on a February 22–26 survey of hospital administrators from 320 hospitals across 45 States, the District of Columbia, and Puerto Rico. They were asked three questions:
What are your most difficult challenges in responding to the COVID-19 pandemic right now, and what strategies have you been using to address the challenges?
What are your organization's greatest concerns going forward?
How can government best support hospitals?
"Hospitals also raised concerns that the pandemic has exacerbated existing disparities in access to care and health outcomes," the report said. "Additionally, many hospitals reported experiencing financial instability because of increased expenses associated with responding to a pandemic and lower revenues from decreased use of other hospital services."
The report noted that many of the challenges posed by the pandemic are even more severe for rural hospitals.
Beyond providing more money, especially for hospitals in rural and underserved areas -- the hospitals said government could best help them by offering guidance on COVID-19 treatment and prevention, including safe discharges of COVID-19 patients, help to reduce depleted staff, especially nurses and specialists, and continuing to encourage the public to get vaccinated.
In the long-term, the hospitals said the pandemic has exposed existing gaps in the nation's care delivery system. The recommend that the federal and state governments and healthcare stakeholders use the public health emergency to address issues that predate the pandemic, such as healthcare disparities and access.
"These improvements include reducing disparities in access to healthcare and in health outcomes, building and maintaining a more robust health care workforce, and strengthening the resiliency of our health care system to respond to pandemics and other public health emergencies and disasters," the report said.
Mental health was the top consultation. Patients in COVID-19 hot spots, younger patients, urban patients, and patients with two or more chronic conditions were more likely to use telehealth.
Telehealth accounted for one-in-four (24%) outpatient consultations among privately insured working-age adults during the first four months of the COVID-19 pandemic in 2020, up from 0.3% for the same period in 2019, a new study shows.
"Telehealth has been around for a long time, but the recent increase has been enormous," said study lead author, Jonathan Weiner, DrPH, co-director of the Center for Population Health Information Technology and professor in the Department of Health Policy and Management at the Bloomberg School.
"These findings will not only help doctors and other clinicians plan for the future, they will also guide policymakers and technology companies, especially as we learn more about the challenges of accessing telehealth among older patients, the uninsured, and low-income patients," Weiner said.
The shift to telemedicine was prompted by the shuttering of many healthcare venues during the initial months of the pandemic for fear of transmitting the virus. At the same time, Weiner noted, insurance companies and the federal government were loosening restrictions on telehealth consultations to meet consumer demand.
The study analyzed Blue Health Intelligence-compiled claims data from 36.6 million private insurance plan members who were of working age and continuously enrolled during the study period.
A total of 15 million telehealth claims were submitted during the March to June 2020 study period, with 75% involving video, 9.2% using audio-only telephone, 3.3% conducted either by email or chat while 13% were unspecified.
Mental health was the top virtual consultation, with 46% taking place via telehealth, while 22% of medical consults were virtual.
In COVID-19 "hot spots" -- states with a COVID-19 prevalence at least 1.5 times the national average – 36% of all consults were telehealth versus 21.6% in low COVID-19 areas. The study also found that the greater the COVID-19 prevalence in a specific ZIP code, the higher the use of telehealth.
About 24% of consultations in urban areas were via telehealth, compared to only 14% of visits from more rural settings. Age and number of chronic diseases were associated with more frequent telehealth consults, with individuals age 18 to 49 and those with more than two chronic conditions using telehealth the most.
The study also found that:
Total overall total medical care costs, including hospitalizations, dropped 15%, from $358 to $306 per person per month, from 2019 to 2020. Persons with at least one COVID-19-related consult in 2020 had more than three times the medical costs compared to those with no COVID-19-related services--$1,701 per member per month versus $544, a difference of $1,157.
In-person, outpatient visits decreased by 37%, from an average of 1.63 visits per enrollee during the three-month 2019 study period to an average of 1.02 visits per enrollee in 2020. However, since telehealth visits filled much of the gap, the total combined in-person and virtual encounter rate dropped only 18% between 2019 and 2020.
For persons with at least one COVID-19-related insurance claim, the average number of in-person and telehealth consults were about 30% higher than the average number of claims for persons with no COVID-19-related visit. One-quarter of COVID-19-related consults were via telehealth versus 23% for non-COVID-19-related consults.
"Even though some of our findings are unique to the COVID-19 era, we need to consider what telehealth will look like beyond the pandemic," Weiner said. "We will need to continue to assess and modify telehealth strategies to maximize value during this digital age, particularly given the challenges of the digital divide across social and geographic lines."
A drone under development at the University of Cincinnati would fly inside patients' homes to deliver medical supplies.
University of Cincinnati engineers and healthcare academicians are building a semi-autonomous telehealth drone to improve access to medical care for homebound patients in remote or underserved areas.
The drones, which are still in the developmental stage, will be big enough carry medicine or supplies directly to patients inside their homes, but small enough to maneuver in constricted confines using navigation algorithms the UC engineers are designing.
"Most drones rely on controllers that work on radio communication and require line-of-sight for safe, remote operation," said Manish Kumar a professor of mechanical engineering at UC, and one of several inventors working on the project.
"That’s why most drones have limited operational range. If you want beyond line-of-sight control, you need some autonomous capabilities," he said.
Using cameras and a display screen, the drones will allow patients to speak with their providers from their homes. The prototype carries a waterproof box the size of a small first-aid kit to deliver medical supplies or collect self-administered lab tests.
The UC engineers are also developing autonomous systems that combine artificial intelligence with sensors that allow drones to navigate complex three-dimensional environments, such as inside a patient's home.
Kumar has been experimenting with sensors in a "smart house" to develop aids for older or disabled residents in a partnership with Maple Knoll, Inc., a nursing home, independent living, assisted living and rehabilitative care provider.
The project is a collaboration between UC's College of Nursing, College of Allied Health Sciences and College of Engineering and Applied Science.
As COVID-19 volumes declined in February, hospitals saw new admissions, margins and revenues fall.
Despite the rising numbers of vaccinations and signs that the COVID-19 pandemic may be receding, the nation's hospitals continued to struggle with thinning margins in February, Kaufman Hall reports.
"February hospital margins remained slim to negative," KH said in its National Hospital Flash Reportfor March. "Margins were affected by continued low outpatient volumes combined with declining inpatient volumes following January’s record-high COVID-19 hospitalizations."
Hospitals saw record numbers of COVID-19 patients in January but as those pandemic-related volumes declined in February, they weren't replaced by other admissions, and so hospitals saw expenses rise while margins, volumes, and revenues fell below levels seen in February 2020, KH said.
"As COVID-19 metrics begin to wane and much of the country turns to talk of a possible forthcoming end to the pandemic, hospitals and health systems remain in a tenuous position," KH said. "Organizations continue to bear the high costs of fighting the unpredictable virus as many non-COVID patients remain reluctant to seek outpatient services."
KH cited COVID Tracking Project data showing that COVID-19 hospitalizations were down to 47,352 on February 28, the lowest since late October 2020. Centers for Disease Control and Prevention data show that new daily admissions of infected patients dropped 74% from a high of 18,009 on January 5 to 4,772 on February 28. At the same time, the number of new cases continued to fall in February as vaccinations surged. As of March 16, more than 39 million Americans were fully vaccinated.
Among the KH metrics for February:
Not counting federal aid through the Coronavirus Aid, Relief, and Economic Security (CARES) Act, the median Kaufman hall hospital Operating Margin Index was –0.5%. With the funding, it was 0.4%."
Median Operating EBITDa Margin was 4 .1% without CARES and 5.4% with CARES.
Operating Margin fell 30.8% (3 percentage points) from February 2020 to February 2021 without the federal aid, while Operating EBITDa Margin was down 22.6% (3.2 percentage points).
With CARES, Operating Margin fell 23.4% (2.6 percentage points) and Operating EBITDA Margin fell 18.3% (2.4 percentage points) year-over-year.
Year-to-date, Operating Margin declined 48% (4.2 percentage points) without CARES and 36% (3.3 percentage points) with CARES.
Adjusted Discharges fell 16.8% YTD and 13.8% YOY, Adjusted Patient Days declined 8.8% YTD and 8.3% YOY, and Operating Room Minutes fell 13.0% YTD and 6.9% YOY.
Emergency Department Visits—which have seen double-digit declines every month since the start of the pandemic—continued to see the largest volume declines, down 25.6% YTD and 26.8% YOY in February.
Average Length of Stay was up 8.5% YTD and 7.3% YOY, but fell 3.4% compared to January, reflecting a decline in high acuity COVID-19 patients.
February revenue results varied, with declines in overall revenues but increases in adjusted revenues. Gross Operating Revenue (not including CARES) dropped 5.2% YTD and 4.6% YOY.
Continued declines in outpatient visits drove Outpatient Revenue down 8.8% YTD and 5.5% YOY, falling below prior-year levels for the tenth time in 11 months.
Inpatient Revenue was down 1.3% YTD and 4.4% YOY. After adjusting for the month’s low volumes, Net Patient Service Revenue (NPSR) per Adjusted Discharge rose 16.9% YTD and 14.9% YOY, and NPSR per Adjusted Patient Day rose 7.1% YTD and 7.6% YOY.
Total expenses showed relatively low increases but jumped significantly once adjusted for volume levels. Total Expense was up 2.6% YTD and just 1.1% YOY.
Total Labor Expense rose 3.9% YTD and 1.0% YOY, and Total Non-Labor Expense increased 1.2% YTD and 2.2% YOY. Total Expense per Adjusted Discharge, however, was up 24.4% YTD and 19.6% YOY. Labor Expense per Adjusted Discharge increased 25.4% YTD and 18.8% YOY as hospitals maintained elevated staffing levels.
Non-Labor Expense per Adjusted Discharge rose 22.1% YTD and 20.7% YOY, driven in part by a 29.1% YOY increase in Drug Expense per Adjusted Discharge and a 24.3% YOY increase in Purchased Service Expense per Adjusted Discharge.
KH warned that February's metrics "illustrate the ongoing uncertainty stemming from a devastating pandemic."
"The pace of these dynamics will vary over time, impacting volumes, revenues, and expenses. as many push for a rapid return to "normal," hospital and health system leaders face a hard reality that there may never be a return to the old normal," KH said.
"The pandemic likely will have long-lasting repercussions on patient behavior, volumes, and the role of telehealth in an evolving healthcare landscape."
Of those recoveries, $855 million were from 786 civil settlements or judgments and $173 million were for criminal convictions, OIG reported, adding that the MFCUs recovered $3.36 for every $1 spent investigating fraud.
In addition, the 53 fraud units – one for each state, the District of Columbia, and Puerto Rico and the U.S. Virgin Islands -- secured 1,017 criminal convictions, 744 of which were fraud-related, and 243 of which were for patient abuse or neglect.
"Similar to previous years, significantly more convictions for fraud involved personal care services (PCS) attendants and agencies than any other provider type," the report said.
Fraud investigations also resulted in 928 people or entities to be banished from Medicare.
