Heyward Donigan takes the reins as Rite Aid and rivals CVS Health and Walgreens Boots Alliance battle to extend their reach into traditional provider services.
Rite Aid Corp. has named veteran healthcare executive Heyward Donigan chief executive officer, effective immediately.
Donigan succeeds John Standley who Camp Hill, Pennsylvania-based Rite Aid said had planned to step aside once his replacement was named.
"I see tremendous opportunity to revitalize the company's position as a leader in meeting the health and wellness needs of customers and patients through our store and pharmacy benefit management platforms," Donigan said in amedia release.
Rite Aid Corp. , the nation's third-largest drug store chain, operates 2,466 stores in 18 states and pharmacy benefits manager EnvisionRxOptions. The company posted $21.6 billion in revenues in fiscal 2019.
Donigan takes the reins as Rite Aid and rivals CVS Health and Walgreens Boots Alliancebattle to expand traditional pharmacy services and extend their reach into provider services, both digitally, and through walk-in clinics and urgent care centers.
Donigan comes to Rite Aid from Sapphire Digital, where for the past four years she has served as the president and CEO. Sapphire Digital, formerly Vitals, designs omnichannel consumer platforms for accessing healthcare providers.
Before that, Donigan was president and CEO of ValueOptions, then the nation's largest independent behavioral health company. She also has extensive experience in the health insurance sector, having served in senior leadership at Premera Blue Cross, Cigna Healthcare, Empire BCBS and U.S. Healthcare.
Rite Aid Board Chairman Bruce Bodaken said Donigan was picked to lead the company based on her "strong senior executive experience, proven leadership capabilities and consistent track record of driving profitable growth, as well as her broad healthcare knowledge and digital shopping technology expertise set her apart."
"Her skillset will be invaluable as we work to deliver on the full potential of our business and create additional long-term value for our shareholders, associates, customers and patients," Bodaken said.
As part of her inducement reward, Donigan will be given $2 million in restricted stock which will vest in equal annual installments for the next three years, and nonqualified stock options valued at $2 million to be vested over the next four years.
Barry S. Sloan, MD, admitted that he gave medically unnecessary prescriptions for 'Subsys' to a 36-year-old Manhattan man who died from an overdose.
A New Jersey physician faces four-to-nine years in prison after pleading guilty this week to second-degree manslaughter in the fentanyl-related overdose death of a patient.
Under a plea deal reached with New York State prosecutors, Barry S. Sloan, MD, of Fort Lee, New Jersey, will also surrender his New York State medical license. The 61-year-old physician had no prior criminal record before entering the plea.
According to documents filed with the Supreme Court of New York County, Sloan admitted that in August 2014, he gave a 36-year-old Manhattan man identified only as "L.W." by prosecutors two separate and medically unnecessary prescriptions for "Subsys," a narcotic approved by the FDA to treat intense pain in terminal cancer patients.
L.W. died of an overdose four days later.
Sloan also admitted he lied to Healthfirst, a Medicaid managed care company contracted by New York to cover the cost of medical care and prescriptions.
Sloan also admitted that between 2012 and 2016, he issued prescriptions for controlled substances, including opioids, to four other patients, without medical justification, which prosecutors said placed each of the patients at significant risk of overdose and death.
"Doctors take an oath to heal, not harm people," New York State Attorney General Letitia James said in a media release. "With a raging opioid crisis, it is unconscionable that a doctor would recklessly endanger lives by providing fentanyl to healthy patients."
Sloan has also been convicted of multiple counts of first-degree reckless endangerment, criminal sale of a prescription for a controlled substance, and third-degree healthcare fraud.
"Stated plainly, Dr. Sloan was a drug dealer in a thinly-veiled disguise, which led directly to this conviction," said Scott J. Lampert, Special Agent in Charge for Health and Human Services' Office of Inspector General.
"His opioid prescribing, in no small part, fueled the spread of these drugs, while he stole from Medicare and Medicaid," Lampert said.
The 837-page expanded public charge rule limits who can get or keep a green card based on their use of government-sponsored programs.
The hospital lobby on Monday called on the Trump administration to rescind a newly expanded public charge definition that critics say would discourage legal immigrants from accessing Medicare, Medicaid and other government-sponsored healthcare.
Rick Pollack, president and CEO of the American Hospital Association, called the Department of Homeland Security's Public Charge Rule "a step in the wrong direction when it comes to fairness with regard to the treatment of legal immigrants seeking a pathway to citizenship."
"It creates barriers to appropriately caring for the sick and injured, and to keeping people healthy. Failure to provide such services also has public health implications that could have widespread impact," he said.
The 837-page expanded public charge rule limits who can get or keep legal a green card based on their use of government-sponsored programs. The rule also treats applicants less favorably if they are poor, have health conditions, are either children or seniors, have large families, or lack education or English proficiency.
Pollack said the new rule would also worsen access for legal immigrants to nutrition aid, housing support and other programs that address social determinants of health.
By some estimates, as many as 26 million immigrants could be adversely affected by the expanded final rule.
The White House issued a media release saying that the expanded rule was needed to "protect American taxpayers, preserve our social safety net for vulnerable Americans, and uphold the rule of law."
The Trump administration said the expanded rule is enforcing the existing Immigration and Nationality Act "which makes clear that those seeking to come to the United States cannot be a public charge."
"For many years, this clear legal requirement went largely unenforced, imposing vast burdens on American taxpayers. Now, public charge law will finally be utilized," the administration said.
Bruce Siegel, MD, president and CEO of America's Essential Hospitals, said the expanded definition "worsens the chilling effect that threatens the health of millions of people by making it more likely they forgo care for themselves and their families to avoid putting their legal immigration status at risk."
"This rule also threatens the stability of essential hospitals, which will sustain higher uncompensated costs as immigrants put off care and seek treatment later, only as a last resort, when they’re sicker and more costly to treat," Siegel said. "In turn, this will drive higher costs for taxpayers and the entire health care system."
Siegel said the expanded rule is "wholly unnecessary" because existing law already bars undocumented immigrants from Medicaid and other government assistance programs and requires legal residents to wait five years before enrolling in either Medicare or Medicaid.
Julie Linton, MD, chair of the American Academy of Pediatrics Council on Immigrant Child and Family Health called the final rule "an assault on my professional role."
"I am unsure how to guide families when I know that enrollment in bread and butter services that keep them healthy could jeopardize the family unity," she said. "This final rule serves to further intimidate and frighten families who seek needed services to keep them healthy and productive."
The National Immigration Law Center said it will file suit to block the final rule.
"This policy denies a permanent, secure future in this country to anyone who isn’t white and wealthy," NILC Executive Director Marielena Hincapié said. "We will not stand for it. The National Immigration Law Center is preparing to sue to fight back against this regulation and protect immigrant families."
California's Democratic Attorney General Xavier Becerra, a frequent and outspoken critic of the Trump administration, said the "vile" expanded rule "is the Trump Administration's latest attack on families and lower income communities of color."
UnitedHealth will cancel two-thirds of Team Health's in-network contracts over the next 11 months.
Team Health Holdings Inc.'s ongoing contract fight with UnitedHealth Group Inc. is hurting the bond status on the Knoxville-based hospital staffing and management company.
Moody's Investors Service on Friday downgraded the outlook for Team Health from stable to negative, after affirming the company's B3 Corporate Family Rating and B3-PD Probability of Default Rating.
"The change of outlook reflects rising uncertainty around Team Health's ability to reduce leverage given its recently disclosed dispute with UnitedHealth Group Inc., one of its largest commercial payors," Moody's said.
Moody's also affirmed the B2 rating on Team Health's senior secured credit facilities and Caa2 rating on its unsecured notes.
UnitedHealth told Team Health last month that it will cancel two-thirds of its in-network contracts with Team Health between October 2019 until July 2020.
UnitedHealth has also significantly reduced its payments to Team Health for out-of-network services, Moody's noted.
Team Health provided a statement to HealthLeaders suggesting that it is lawyering up in preparation for more litigation with UnitedHealth.
"As Team Health continues to see more aggressive and inappropriate behavior by payors to either reduce, delay, or deny payments, we have increased our investment in legal resources to address specific situations where we believe payor behavior is inappropriate or unlawful," the company said.
"To date, Team Health has been successful in getting reasonable reimbursements as a result of that litigation effort. Immediately following their most recent termination, United reached out to Team Health and we have begun negotiations," Team Health said.
The hospital company said that, so far in 2019, it has successfully resolved eight lawsuits and has filed another 13 lawsuits.
"As United continues to arbitrarily terminate contracts, we expect to file more lawsuits for unfair payment practices and unjust enrichment – and despite United's urgings we will not surprise bill patients to make up the difference," Team Health said.
While Moody's said it believes that Team Health and United will eventually reconcile, "modified contracts are likely to come with lower reimbursement rates for Team Health, which will reduce profitability."
"Further, a drawn-out negotiation process may lead to disruption to hospital customers and contract losses," Moody's said.
"While there is a range of potential outcomes for Team Health, the company's very high leverage raises the risk that even a modest reduction in profitability will significantly raise debt/EBITDA," Moody's said.
TeamHealth's pro forma debt to EBITDA was estimated by Moody's at approximately 8.2 times on June 30.
Moody's noted that the B3 rating is supported by Team Health's ability to generate positive cash flow of more than $100 million a year, and that the company's liquidity remains solid.
"The company has a sizable cash balance ($299.4 million as of 6/30/2019), near full availability of its $400 million revolver and no near-term debt maturities," Moody's said.
"The company has also shown early signs of progress in executing its business turnaround. This affords the company some flexibility to absorb a modest negative development with respect to contract negotiations with UnitedHealth," Moody's said.
Even with that, Moody's said, the reduced payments from UnitedHealth and potentially other insurers will create a "meaningful decline in free cash flow (that) will likely lead to a rating downgrade."
"Reduced free cash flow would not only limit the company's ability to repay debt, but also its ability to execute its tuck-in acquisition strategy," Moody's said.
A new study shows that lower reimbursements from a Medicare public option would threaten 1,037 rural hospitals in 46 states, which represent more than 63,000 staffed beds, 420,000 employees, and 55% of all rural hospitals.
A public option health plan paying Medicare reimbursement rates could shutter more than half of the nation's rural hospitals, according to a new study.
"Even those rural hospitals not at high risk of closure and the communities they serve face an increased threat," according to the study by Navigant Consulting, Inc.
"The availability of a public option could negatively impact access to and quality of care through rural hospitals' potential elimination of services and reduction of clinical and administrative staff, as well as damage the economic foundation of the communities these hospitals serve.," the study said.
The study notes that, with the exception of critical access hospitals, most rural hospitals contend with a negative operating margin of more than 8% when providing care for Medicare patients, and cost-shift to higher-paying commercial plans and employers to offset the loss.
A Medicare public option would threaten 1,037 rural hospitals in 46 states, which represent more than 63,000 staffed beds, 420,000 employees, and 55% of all rural hospitals in the United States, the study said.
The study looked at three scenarios should a Medicare public option plan come to fruition.
Revenue loss to rural hospitals is projected to be 2.3% under a Medicare public option if only the uninsured and current individual market participants shift to the public option, placing an estimated 28% of rural hospitals at high risk of closure.
If employers shift 25% to 50% of their covered workers from commercial coverage to a Medicare public option, hospital revenues would fall 8%-14% and cause an estimated 51% to 55% to face high risk of closure with an additional 39% to 41% facing moderate risk.
Medicare would have to increase hospital payments for a public option between 40% and 60% above present Medicare rates to keep hospitals whole. That would cost between $4 billion and $25 billion annually, depending upon how many employers shift to the public option.
More than 100 rural hospitals have closed across 29 states since 2010, and rural hospitals in states that have not expanded their Medicaid rolls have been particularly hard hit.
To help struggling rural hospitals, the Trump administration last week issued a final rule to increase the wage index for hospitals with a wage index value below the 25th percentile. CMS is also finalizing changes to the wage index "rural floor" that will remove urban to rural hospital reclassifications from the calculation of the rural floor wage index value beginning in FY 2020.
To pay for the wage index hike, CMS is using a budget neutrality adjustment to the standardized amount that is applied across all IPPS hospitals. The American Hospital Association said the wage index hike for rural hospitals comes at the expense of urban hospitals, and has called on CMS to "increase the wage index in a non-budget neutral manner."
The new rule stipulates that coverage will be provided only at healthcare facilities that are enrolled in FDA risk evaluation and mitigation strategies.
Medicare will offer nationwide coverage for Chimeric Antigen Receptor T-cell therapy to fight certain cancers, the Centers for Medicare & Medicaid Services has announced.
Coverage for CAR T-cell therapy, which harnesses a patient's genetically-modified immune cells to fight disease, will be limited for use in treating Medicare patients with certain types of non-Hodgkin lymphoma and B-cell precursor acute lymphoblastic leukemia, CMS said.
By some estimates, CAR T-cell therapy can cost as much as $375,000 for a one-time treatment, depending upon the cancer type and treatment regimen. That estimate does not include hospital stays and other related expenses.
"As the first type of FDA-approved gene therapy, CAR T-cell therapies are an important scientific advancement in this promising new area of medicine and provide treatment options for some patients who had nowhere else to turn,” Verma said.
The new rule stipulates that coverage will be provided only at healthcare facilities that are enrolled in the Food and Drug Administration risk evaluation and mitigation strategies for FDA-approved indications.
In the final rule, CMS dropped a requirement that hospitals collect data on patient outcomes under the CAR T therapies, which hospitals had complained was too burdensome. Instead, CMS said it will monitor medical data from the FDA's post-approval safety studies.
The FDA has required CAR T-cell therapy makers to conduct post-marketing observational studies involving patients treated with the therapies.
"We know there are relatively limited data about the use of these life-saving therapies in the Medicare population. Our robust post-market surveillance programs will continue to monitor for potential risks, as we do for all licensed and approved medical products," said Acting FDA Commissioner Ned Sharpless, MD.
"We will also continue to carefully assess the benefits and risks when considering whether to approve new CAR T-cell products," he said.
The Brentwood, Tennessee-based hospital operator saw operating drops in net operating revenue and adjusted EBITDA.
Quorum Health Corporation reported net operating revenues of $442.2 million in Q2, a net loss of $16.9 million, and down $30 million year-over-year, with adjusted EBITDA falling by $2.9 million, according to an earnings report released Wednesday afternoon.
Among other key financial metrics, Quorum posted a $10.4 million loss in cash flows from operating activities, one year after recording negative cash flows of $17.2 million, and slashing its quarterly net loss from $99 million to $39 million. EBITDA fell to $36.9 million, compared to $40.2 million in Q2 2018.
The Brentwood, Tennessee-based hospital operator saw a $16 million drop in same-facility year-over-year net operating revenues, down to $442.4 million for Q2.
In other notable metrics:
Compared to Q2 2018, same-facility net patient revenues decreased 2.6%, while same-facility net patient revenues per adjusted admission increased 0.9%.
The decrease in same-facility net patient revenues compared to Q2 2018 reflects a 3.4% decline in same-facility adjusted admissions and a 2.2% decline in same-facility surgeries. The decline in volumes compared to Q2 2018 represents approximately $14.9 million of same-facility net patient revenues.
Same-facility net operating revenues for Q2 reflect a $5.6 million decrease related to the pending divestitures of Watsonville Community Hospital and MetroSouth Medical Center.
In June, Quorum announced plans to sell Watsonville by the end of Q3, a deal which is expected to provide Quorum with $35 million to $40 million.
Q2 2019 Adjusted EBITDA was 7.6% of net operating revenues and Same-facility Adjusted EBITDA was 8.3% of same-facility net operating revenues.
Same-facility surgeries in Q2 improved 8.9% compared to the first quarter of 2019, which Quorum credited to improved volumes at two facilities that brought in new physicians and re-syndicating two outpatient surgery centers in Illinois.
The program hopes to address the widespread problem of food insecurity and 'food deserts' in some urban areas.
Maywood, Illinois-based Loyola Medicine is giving its low-income patients a free, 10-pound basket of fresh vegetables every week, along with recipes, nutrition classes and cooking shows.
The program, VeggieRx, is a collaboration with Loyola University Chicago, Proviso Partners for Health, and Windy City Harvest, the urban agriculture education and jobs-training initiative that operates urban farms in Chicagoland.
"The vegetables vary each week, depending on what's being harvested in the urban farms," Brittany Calendo, Windy City Harvest's VeggieRx coordinator, said in a media release.
"For example, the vegetables given away one recent Thursday included leeks, scallions, purple top turnips, beets, collards, cabbage and garlic, along with information on how to store and prepare them," Calendo said.
VeggieRx gives away vegetables during the harvest, and participants also get coupons to double food stamp purchases at Windy City Harvest farm stands
In addition, each week registered dietitian Mary Mora with Proviso Partners for Health does a cooking class for the week's featured vegetables, and gives a nutrition talk on topics such as sugar, sodium, heart-healthy fats and reading food labels
Lena Hatchett, executive lead of Proviso Partners for Health, said VeggieRx addresses the widespread problem of food insecurity and food deserts in some urban areas, which affects many low-income people.
Hatchett and her colleagues are gathering data to test their premise that VeggieRx will prove to be a cost-effective way to reduce the toll of obesity-related conditions such as diabetes, high blood pressure, cancer, heart failure and chronic obstructive pulmonary disease.
"We believe a small investment in food will have a large benefit in people's health," Hatchett said.
Enrollees with 'persistently high spending' over three years averaged almost $88,000 in health spending in 2017.
Just 1.3% of people enrolled in large employer health plans for more than three years accounted for 19.5% of overall healthcare spending in 2017, according to a studyby the Henry J. Kaiser Family Foundation.
These "people with persistently high spending" were in the top 5% of spending each year from 2015 to 2017, with an average healthcare spend of $87,870 in 2017, KFF found.
By comparison, the average per person spending was $5,870 for all large group enrollees during that three-year span.
"Spending on retail prescription drugs accounted for almost 40% of spending for those with persistently high spending in 2017, more than twice the percentage for enrollees overall," the study said.
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People with persistently high spending averaged more than $34,100 in spending on retail prescription drugs in 2017, compared to $1,290 for enrollees overall, the KFF study showed.
"This underscores the importance of prescription drugs in treating people with chronic illnesses as well as the fact that some drugs have very high prices," KFF said.
The analysis linked persistently high spending with diagnoses for chronic health conditions such as HIV, multiple sclerosis, cystic fibrosis, rheumatoid arthritis, diabetes with complications, and a number of cancers.
"While not everyone with these conditions has persistently high spending, there are large shares of people with persistently high spending who have these diseases," KFF said.
The study found that many enrollees move in and out of the "persistently high spending" category as they suffer serious illness and recover. However, some of the high-spending enrollees remain in the category for years, and KFF recommended that these enrollees become the focus of lowering costs while improving quality.
A first-of-its-kind intensive training program gives non-specialist pharmacists confidence to deal with complex and critical medication issues for ICU patients.
RWJBarnabas Health System has developed a new, team-based model for intensive care unit pharmacists that improves medication response times for critically ill patients.
Writing in the Journal of Clinical Outcomes Management, researchers at the New Jersey-based health system said that general practice pharmacists working in the ICU are not comfortable responding to complex issues such as determining if a delirious patients needs to switch medications.
That lack of training can mean that medication adjustments can be delayed if a hospital pharmacist who specializes in critical care is off duty.
To remedy this, the RWJBarnabas pharmacists at the Robert Wood Johnson University Hospital Hamilton developed a first-of-its-kind, six-month intensive classroom and clinical training program for non-specialist pharmacists, that dealt with complications for patients on mechanical ventilators, infectious disease risk, and blood flow management.
Eventually, all pharmacists on the newly formed Critical Care Pharmacist Team could provide the range of interventions that previously only critical care specialist could do.
"Before we tried this model, the non-specialty pharmacists in the ICU were often uncomfortable with clinical issues, which sometimes meant going to the bedside to assess the situation. As a result, relatively minor issues were frequently escalated with a call to the specialist, who was not always readily available," said lead researcher Liza Barbarello Andrews, a clinical associate professor at Rutgers University’s Ernest Mario School of Pharmacy.
"Our new model effectively empowers all of our pharmacists to act as specialists," she said.
In addition to improved patient outcomes, the pharmacists who took the training said they felt confident providing specialized levels of care, and that it gave them a greater sense of professional satisfaction.
Physicians and nurses in the ICU said pharmacy care improved with the team model, and that they saw a consistent, high level of care even when the specialist was not on duty, Andrews said, adding that the new model was adopted without significant cost and could benefit other community-based hospitals with limited resources.
Researchers at Robert Wood Johnson University Hospital Hamilton and Rutgers University also participated in the study.
