The Patient Protection and Affordable Care Act is only now putting a spotlight on the good work that's been going on in community health programs for decades. This week, five hospital-led collaboratives will be recognized for their work.
Rhonda Brown
For all the media coverage the trendy terms "population health" and "community health" have received in the last few months, it may seem like the idea did not exist before the Patient Protection and Affordable Care Act became law three years ago.
It is true that under PPACA healthcare providers are suppose to be weaned away from fee-for-service, volume-based reimbursements and pushed toward value-based, preventative care and shared savings. That will require some significant outreach beyond hospital walls and into the communities that hospitals serve. It is important to remember, however, that hundreds of providers in towns and cities across the country have been doing this outreach for decades before PPACA arrived.
The American Hospital Association on July 27 will present its annual NOVA award to five hospital-led collaboratives that have improved community health. The winning programs are Bangor Beacon Community in Bangor, ME; Hope Clinic and Pharmacy in Danville, KY; Free Preventive Screenings Program in Vincennes, IN; Chippewa Health Improvement Partnership in Chippewa Falls, WI; and Core Health Program of Healthier Communities in Grand Rapids, MI.
Rhonda Brown, director of the Chippewa Health Improvement Partnership, says the program has flourished since its founding in 1994 because of the "collaborative spirit" within the community.
"You have to be able to get out and get engaged with the community organizations, the agencies. You need to do that at a really grassroots level. You need to talk to the people that are impacted by the programs that you try to put in place," Brown says. "We can guess, as professionals, all we want about what it is that people need. But if we don't ask them, we are not going to be successful."
CHIP monitors the health, environmental, social and economic needs of people of all ages. Working on a shoestring budget and with a lot of volunteers and community support, the AHA says that the program "has successfully established a federally qualified oral healthcare center, provided automated external defibrillators in public venues and established an open door clinic that offers free medical and mental healthcare.
CHIP has successfully improved food security in the area and increased community awareness of sweetened beverages as part of its goal to lower childhood obesity. CHIP directed a community-wide falls prevention program for the elderly in addition to advance directive education and end of life planning to name a few. CHIP has also been involved with local and international mission activities. St. Joseph's Hospital is the primary funding source for CHIP although local, state and federal grant monies are actively sought and successfully secured."
Brown says CHIP was able to make this happen because it remains focused, inclusive, and structured but not rigid. All of this is accomplished with a budget of around $150,000 and a tiny staff.
"My 'staff' is me, and just recently the hospital was able to give me a half-time staff person," Brown says. "As much as we hate to think about it, you have to keep sustainability in mind. You have to be creative. You have to create an atmosphere of acceptance. You have to be open to other people's ideas and to their creativity and allow anybody and everybody who wants to be a part of it. Everybody has a stake in this game."
"When I started, my budget was probably $30,000, which is like next to nothing, but you can do a lot of stuff on a very small budget if you have community support. A lot of it has to do with how your staff is able to communicate with and network with other people. That means establishing good relationships and partnerships with the other agencies and organizations in our community. You have to nurture those relationships and give and take. When someone calls and needs me to be on a committee, I try to do that even if I don't have any extra time. If I do that, then they are much more likely to help me out." Brown says it's hard to estimate an exact return on investment for the various services CHIP offers. "We started providing free mental health services for patients that are at free clinics that we helped found along with their community agencies and individuals," she says.
"Since June 2011 we have provided 627 counseling sessions free to people in our community. Those are individuals that probably would not be seen anywhere else. So it is hard to put a price tag on what that has meant for those people but I think it is safe to say that we probably made a pretty huge impact by putting that program together."
Good Samaritan Hospital
Good Samaritan Hospital in Vincennes, IN, is another NOVA winner and its Community Health Services preventive health outreach program offers free health screenings for a 10-county areas.
Sandra Ruppel Hatton
"We wanted to make sure that instead of just expecting people to come on the hospital campus to receive preventative health screenings or education as part of the discharge planning process that we actually took the screenings and the information to the communities we serve," says Sandra Ruppel Hatton, director of Marketing and Community Health at Good Samaritan.
"Since we are a very rural area we wanted to make sure we took it to the areas that were farther away from a healthcare facility where it might be difficult for them to get to a healthcare screenings, or healthcare period."
AHA noted that Good Samaritan nurses "work within the community to provide health-related education and screenings ranging from blood pressure checks to lipid profiles. Collaborative partners provide the space necessary to see patients and include senior and community centers, Goodwill and Salvation Army facilities, housing authorities, churches, farmers markets, parks departments, YMCA and other not–for–profit sites.
Screening results are shared with the individual and their physicians and appropriate follow?up and treatment referrals are arranged. The program has provided more than 220,000 free screening over 10 years." The program has also gone into Knox County schools to teach its "Fit Kids" obesity and nutrition classes for third, fifth, seventh and ninth graders.
Ruppel Hatton says CHS could not truly be called a community health program if it didn't actively go out into the community it serves to understand what care people need and how best to delivery that care.
"We have said that that is our role as a hospital. We have taken that stance for years—that we should set the standard for healthcare and be the leader in healthcare and set the standard on lifestyle," she says. "We could not perform these services if we didn't collaborate with the community centers, libraries, farmers markets, farm preview shows, Ag Days—those events that people come to in rural communities."
Like CHIP, Ruppel Hatton says CHS operates on a shoestring budget, a tiny staff, and a lot of volunteers. Several retired nurses work part-time for the program, using their own vehicles to drive to these screening events. Ruppel Hatton says these nurses are highly motivated because they can see the positive effect they're having on their fellow citizens.
"I like to remind our nurses that you do save lives," Ruppel Hatton says. "We had a woman who was in total renal failure and had no idea. We caught a guy who was 41-year old on his way to eating a Pronto Pup. We told him you don't need that. Get your cholesterol checked. Come to find out he had prostate cancer in this 40s. There was the truck driver we found at Old Oaken Days who had colorectal cancer and he didn't know it. They do save lives."
[Here's a quick overview that AHA provided for the three other NOVA winners. Space considerations kept me from speaking with the folks who run these programs, but I hope to chat with them in the coming weeks and months. Congratulations to all the winners.]
Core Health Program of Healthier Communities
Spectrum Health – Grand Rapids, MI.
The Core Health Program of Healthier Communities seeks to improve the health of underserved adults with chronic disease, remove barriers to care, teach self?management skills and work collaboratively within a continuum of care to improve adherence to medication regimens and dietary requirements and to ensure patients receive follow?up care such flu shots, eye exams and foot care.
The services are provided using a cost?efficient approach to chronic disease management by reducing health care costs when compared to conventional approaches for managing chronic diseases. A registered nurse and community health worker team up to provide home visitation services to work with the patient to improve clinical and behavioral outcomes through motivational interviewing, disease management and cultural sensitivity.
Caregivers assist in having a patient assigned to a primary care provider should the patient not have one. The voluntary program extends for 12 months. Collaborative partners include federally qualified health centers, insurers, community centers, food pantries, primary care providers, including the Visiting Nurses Association and other hospitals.
Bangor Beacon Community
EMHS – Brewer, ME St. Joseph Healthcare – Bangor, ME
The 12 partners of the Bangor Beacon Community worked to improve the health of chronically ill people in the Bangor region by using health information technology to ensure better patient care coordination. The goal of the collaboration was to reduce variation in care delivery, improve care quality and alleviate high use of emergency departments and hospitals by chronically-ill patients with symptoms and conditions that could be addressed more appropriately in primary care settings.
The program led six clinical interventions focused on patients with diabetes, cardiovascular disease, chronic obstructive pulmonary disease (COPD), and asthma and a community initiative on immunization, including sharing immunization data among providers. Nurse care managers in each primary care practice worked with high-risk patients. The program's goals, successes and collaborations continue through a newly created accountable care organization.
Hope Clinic and Pharmacy
Ephraim McDowell Health – Danville, KY
Established in 2006, the Hope Clinic and Pharmacy serves low?income, uninsured and chronically ill patients by providing access to care for the people of Boyle, Casey, Garrard, Lincoln, Mercer and Washington counties. Advanced practice registered nurses (APRNs) lead the clinic's efforts to provide preventive care and care management, as well as access to prescriptions and medications with the goals of reducing reliance on emergency department care and improving health status across the region. In addition to part?time paid APRNs, volunteers and physicians donate services including health education and counseling, specialist referrals and securing medical procedures at no charge to patients. In 2011, the clinic had 223 active patients and the hospital provided 618 free procedures. Collaborative partners include Ephraim McDowell Health, Ephraim McDowell Health Care Foundation, the Presbyterian Church of Danville, The Salvation Army, United Way and the Boyle County Health Department.
The deal, when it closes, will give Tenet a footprint in 30 markets across 16 states. Charlie Martin, Vanguard's founder, chairman and CEO, will join Tenet's board of directors, and Keith Pitts, Vanguard's vice chairman, will serve Tenet as vice chairman.
Trevor Fetter, president and CEO of Tenet
Tenet Healthcare Corp. jolted the hospital industry this week with the surprise announcement that it will acquire smaller rival Vanguard Health System in a deal the two for-profit hospitals chains valued at $4.3 billion.
This latest high-profile consolidation in the hospital industry is expected to be finalized by the end of this year, just as millions of people gain health insurance under the Patient Protection and Affordable Care Act.
"The acquisition of Vanguard significantly increases our scale and diversifies our geographic footprint increasing our hospital and outpatient facilities by 61% and 25% respectively," Trevor Fetter, president and CEO of Dallas-based Tenet said during a Monday conference call with analysts.
Fetter said that with the acquisition of Vanguard, Tenet "will go from 49 hospitals and 126 outpatient centers serving 24 markets across 11 states to 79 hospitals and 157 outpatient centers in 30 markets across 16 states."
"This acquisition will create a broader platform across which we can apply our skills is revenue cycle services, cost management, and quality improvement as well as our clinical integration and network development strategies," he says.
"Significantly, it enhances our growth opportunities. Tenet's strategic priorities have always placed value on the creation of leadership positions in our markets. We will now be No. 1 or No. 2 in 19 key markets. It is important to note that Tenet and Vanguard serve totally distinct markets with essentially no overlap. We are excited to add clear leadership positions it the growing and highly attractive San Antonio and South Texas markets, two of the crown jewels in Vanguard's portfolio."
Under the definitive agreement reached by the two chains, Tenet will pay $21 per share in the all-cash transaction, which includes the assumption of $2.5 billion in Vanguard debt, which Tenet will refinance. The $21-a-share payout represents a premium of 70% and is the highest price for the stock since Vanguard's initial public offering in 2011.
Tenet says it has already identified at least $100 million to $200 million annually in savings with the acquisition. The deal was unanimously approved by the boards at both chains,
Investors responded favorably to the news. On an otherwise dour day on Wall Street, Nashville-based Vanguard saw its share prices soar by more than 67% for a 52-week high before closing at $20.70, just below the Tenet payout. Tenet shares rose 4.5% and closed at $43.73.
Analysts were caught off guard.
"Most of the M&A talk lately has been around names like HMA, so this was a surprise," said Joe France, healthcare analyst with Cantor Fitzgerald.
France says Vanguard was not necessarily on the radar screens for an acquisition because of its 2010 acquisition of Detroit Medical Center. "The appetite for an acquisition that includes that, which is about one third of their revenue, is fairly limited," he said.
"For a company like Tenet which has large urban medical centers it's a promising transaction because if it is successful—and there are reasons to believe that it has already been successful—then they can replicate that in other markets across the country and that opens up a whole new opportunity. This is something like an HCA might do in Kansas City or Colorado, but it is not something that has been done by most of the other hospital chains. But Tenet has a lot of experience historically in taking large hospitals and making them successful. Obviously Detroit Medical Center is a much bigger undertaking but I think they believe they can do it or they wouldn't have made this offer."
Fetter, in an interview Monday with CNBC, called Detroit "an interesting market obviously."
"It is a three-way tie for No. 1 in market area and Vanguard is very well positioned in Detroit. They have high-quality assets with a great reputation. I think post the transaction revenues from Detroit will only be about 11% of Tenet's combined revenues, so we see big opportunities there," he said.
"They have made very substantial investments that in the market that have yet to generate earnings, hospitals under construction and expansion there. We're looking forward to being state of Michigan and operators in Detroit."
When the deal closes, Charlie Martin, Vanguard's founder, chairman and CEO, will join Tenet's board of directors, and Keith Pitts, Vanguard's vice chairman, will serve Tenet as vice chairman. Martin has a 4.1% stake in Vanguard, which was founded in 1997. "We see the opportunity to recruit and retain Vanguard's operational and corporate talent as a real plus in this acquisition and we will maintain a presence in Nashville," Fetter said in the conference call.
Joe Lupica, chairman Denver-based Newpoint Healthcare Advisors, says the roles at Tenet for Martin and Pitts will not be mere sinecure.
"Charlie is nobody's prop. Charlie is one of the most feverishly brilliant thinkers in the business," Lupica says. "Keith is a brilliant operator and relationship builder with communities. That is important in this industry. If you are coming to town and you are a bad apple, you are going to have a hard time convincing the community to entrust their hospital to you. The question is, are they going to stay."
Adam Powell, a healthcare economist and president of Boston-based Payer+Provider Syndicate, calls the acquisition "a clear win for Vanguard investors; time will tell whether it will be equally advantageous for Tenet investors."
"The additional scale and experience with business outsourcing offered by Tenet has the potential to lower costs within the Vanguard system," Powell says. "The two companies have a partial geographic overlap, so the merger offers both geographic expansion, and in some cases, greater market power."
The acquisition is expected to be finalized by the end of 2013, just as millions of people are expected to become insured either through Medicaid expansion or health insurance exchanges provided under the Patient Protection and Affordable Care Act.
With that in mind, analyst Allan Baumgarten said in an email exchange that Vanguard was an appealing takeover target because of its "broader experience and assets in operating managed care plans and Accountable Care Organizations."
"It is unique among investor-owned provider systems in that regard," Baumgarten says. "Vanguard has large Medicaid (Phoenix Health Plan) and Medicare (Abrazo Advantage Health Plan) HMOs in the Phoenix area. In 2012, it acquired ProCare in Detroit, a small Medicaid HMO (less than 2,200 members), with an eye toward growing its share of the Michigan market for Medicaid managed care. Further, two Vanguard divisions are in the forefront of Medicare ACO development. In Michigan, the Vanguard-owned Detroit Medical Center formed Michigan Pioneer ACO, one of the original class of risk-sharing ACOs. In Illinois, some of the Vanguard hospitals and their physicians have established Chicago Health System, a Medicare shared savings program ACO."
Tenet management apparently is not overly concerned with Texas Gov. Rick Perry's bar-the-door refusal to expand Medicaid coverage. "The State of Texas has roughly 30% of its residents not covered by insurance today," Fetter told CNBC.
"Eventually we believe those residents will be covered by one form of insurance or another, and that will create substantial growth opportunities for hospital operators in Texas and very materially Vanguard's portfolio is located in the high growing markets of San Antonio and South Texas, particularly Harlingen and Brownsville. It is very appealing to us. We have a strong presence in Texas already, and together we will nearly double our revenues in the state."
Fetter told CNBC that the Vanguard acquisition "marks a turning point for the company in which we'll be more aggressive in acquisitions."
"We have been building our outpatient portfolio. We have doubled that through acquisitions in the last few years, and we have been building our services portfolio through acquisitions," Fetter said. "This is the first big acquisition we have done in a very long time in acute care hospitals. It will not be the last. One of the skills that Vanguard brings to the table is that they're known as a very good acquirer and partner to not-for-profit health systems and so I look forward to expanded acquisition pipeline in the acute care business."
In two reports examining the status of health insurance exchanges, the U.S. Government Accountability Office raises concerns that "much remains to be accomplished" by the Oct. 1 enrollment date.
The federal government's watchdog agency is raising concerns that the health insurance exchanges created under the Patient Protection and Affordable Care Act will not be operational by the start of the October 1 enrollment period.
The Government Accountability Office issued two reports this month. One report examined the status of the Centers for Medicare and Medicaid Services' efforts to establish federally facilitated health insurance exchanges. The second report examines CMS and state efforts to establish the insurance exchanges for small businesses.
Both reports reach the same conclusions. "Much progress has been made, but much remains to be accomplished within a relatively short amount of time," the GAO said in both reports.
"CMS's timelines provide a roadmap to completion; however, factors such as the still-evolving scope of CMS's required activities in each state and the many activities yet to be performed—some close to the start of enrollment—suggest a potential for challenges going forward," GAO said in Status of CMS Efforts to Establish Federally Facilitated Health Insurance Exchanges.
"And while the missed interim deadlines may not affect implementation, additional missed deadlines closer to the start of enrollment could do so. CMS recently completed risk assessments and plans for mitigating risks associated with the data hub, and is also working on strategies to address state preparedness contingencies. Whether these efforts will assure the timely and smooth implementation of the exchanges by October 2013 cannot yet be determined."
In a June 6 letter responding to the GAO concerns, Jim R. Esquea, assistant secretary for legislation for the Department of Health and Human Services, assured the auditors that "on Oct. 1, 2013, a health insurance marketplace will be open and functioning in every state."
CMS is supposed to operate "federally facilitated exchanges" in 34 states that have elected not to run state-based exchanges in 2014. Fifteen of those 34 states are expected to help CMS operate their FFEs in one capacity or another, but GAO says that exact role continues to evolve, even with the open enrollment period looming only four months from now. GAO noted that CMS approved states' exchange arrangements on the condition that the states actually do what they said they were going to do to make the exchanges operational. However, it's not clear how that process is going. If states don't meet their part of the deal, CMS said it would step in and carry out the necessary steps to make the exchanges operational.
"CMS is also depending on the states to implement specific FFE exchange functions, and CMS data show that many state activities remained to be completed and some were behind schedule," GAO said.
GAO says many other provisions that are the responsibility of CMS remain to be completed and some were behind schedule, especially functions related to "core exchange functional areas of eligibility and enrollment, plan management, and consumer assistance."
"While CMS has met project schedules, several critical tasks, such as final testing with federal and state partners, remain to be completed. For plan management, CMS must review and certify the qualified health plans (QHPs) that will be offered in the FFEs. Though the system used to submit applications for QHP certification was operational during the anticipated time frame, several key tasks regarding plan management, including certification of QHPs and inclusion of QHP information on the exchange websites, remain to be completed. In the case of consumer assistance, for example, funding awards for Navigators--a key consumer assistance program--have been delayed by about two months, which has delayed training and other activities," GAO said.
The wording of the conclusions in the second report—Status of Federal and State Efforts to Establish Health Insurance Exchanges—was virtually identical to that of the first report, but added that "in commenting on a draft of this report, HHS emphasized the progress it has made in establishing exchanges, and expressed its confidence that exchanges will be open and functioning in every state by Oct. 1, 2013."
The Small Business Health Options Program (SHOP) was approved in 18 states, and for 17 states that operate health insurance exchanges for individuals. CMS will operate a federally facilitated SHOP and an individual exchange in the remaining states. As with the status of the overall FFE programs and their relationships with particular states, the GAO study of SHOP programs found them in varied stages of evolution.
"For example, funding awards and development of a training curriculum for a key program that will provide outreach and enrollment assistance to small employers and employees have been delayed by about two months," GAO found. "Many key activities remained to be completed—some scheduled for near the start of enrollment in October 2013—and, as of May 2013, states were behind schedule in completing some key activities. In particular, about 44% of the key activities CMS initially targeted for completion by March 31 were behind schedule, although CMS reported that it had revised many target dates and other delays were not expected to affect exchange operations."
In his identical responses to both GAO reports, HHS' Esquea touted the "tremendous progress" that has been made in the three years since the PPACA became law.
"Earlier this year we successfully administered the qualified health plan submission process for the federally facilitated Marketplace. We published the final single streamlined application. We have announced several grant and contract programs that provide consumer assistance functions. We are in the final stages of finalizing and testing the IT infrastructure that will support the application and enrollment process," Esquea said in his letter.
"HHS is extremely confident that on Oct. 1 the marketplace will open on schedule and millions of Americans will have access to affordable quality health insurance."
Healthcare industry leaders discuss the shortage of staff with information technology expertise, the impact on hospitals and health systems, and what can be done to address the situation.
This article originally appeared in the June issue of HealthLeaders magazine.
The lack of IT staff with expertise represents the top challenge leaders face regarding their IT group.
Where in the IT group are you finding these shortages, what is the effect on the organization, and what can leaders do to address that?
Jack Kolosky
Executive vice president and COO
H. Lee Moffitt Cancer Center and Research Institute
Tampa
On finding the right people: Even with a higher-than-expected unemployment rate, the issue of trying to find really qualified people who understand the program and who are willing to stick with it through all the trials and tribulations and difficulties in implementations is challenging.
A staffing problem across many industries: We thought we might have been unique in healthcare, but we spoke with one of our board members who runs a major corporation and she was saying the same thing about her business. We all agree that information technology and the usage of it—being able to mine the data—is critically important to our businesses. But we really need to have our schools and our infrastructure—be it government or whatever else—step up and help accelerate the idea of recruiting people into this field.
On building partnerships: We are looking at partnerships with some of the major schools, much as we did in nursing and other areas where we had critical shortages, about helping us to recruit and continually train new qualified people.
On the effect of IT staff shortages: To be perfectly frank, I wish we were able to turn out more people who are qualified and can think outside the box and be a little more innovative. We have a great group here. We just don't have enough of them. We obviously get the job done but it seems to take us longer or we can't do some of the innovative things we'd like to do.
Sam J.W. Romeo, MD CEO
Tower Health & Wellness Center
Turlock, Calif.
The evolution of healthcare technology is behind the curve. It will be self correcting for two reasons: There are an increasing number of physicians who are becoming technical themselves and there are technical people who are beginning to learn the physicians' language.
The biggest barrier is we have third-party and other people including Medicare that basically are saying these are the priorities and they distract us away from the patients and toward the payer mechanisms. That is important because if you don't get paid you can't take care of patients. But it seems like we are putting a whole bunch of balls in the air at the same time and we don't have enough technical people to be able to communicate across those bridges to be able to do it with any efficiency.
We are fixing it. I'm an old man. I am a family doctor for 50 years but I have six children, five of whom as physicians are working on this and who are electronically savvy and much of the culture is different. That is a big transformation. They are head over heels involved in creating software that will support documentation of what happens in the examining room so we will have a relational data base so we can do some things that are meaningful in terms of quality and not just meaningful in terms of payment.
Deborah Gaspar
Chief Nursing Officer
Memorial Hospital Sweetwater County
Rock Springs, Wyo.
We can't recruit skilled health system administrators who understand how the programs interconnect and how they connect to server capacity and how they connect to wireless capacity; how they are upgraded becomes an issue. This needs to be addressed industrywide
Nursing has always had to deal with shortages and we've learned how to train our own and that is what is going to have to happen in healthcare IT.
The IT people are pretty frustrated about it, too, because so many of the IT people don't have leadership abilities. They don't know how to problem solve. And the people they report to in the organizations often don't have competencies doing that problem solving. So I do think there are going to be more clinical people who delve into that role because it's going to be necessary.
We have a couple of RNs who built our clinical system. They are both in their 20s and they are much more competent and capable at that stuff than I am. I can do the clinical background and the clinical standards and the high-level stuff and they do the technical skills-based stuff. We're creating our own solutions. You have to survive so you do what you have to. Give people the abilities because there are people out there who want to do this stuff. You have to be patient and willing to groom them.
Glenn McElroy
Executive Director
Columbia (Mo.) Surgical Associates Inc.
It is pretty easy to find the guy who can handle the complex hardware networks within the office. However, the complex software—and the nuances and constant updates that are associated with each, often unfixing things you fixed last week—gives you constant new challenges, and finding someone who has a handle on both hardware and EMR is very difficult. I am not sure I know anybody who is really happy with their EMR and practice management products as they interrelate.
It is self-correcting somewhat with the younger doctors coming up, but in the short term we aren't going to outgrow it. It is the switchover from the texted base to a data-based EMR that is throwing everybody for a loop. That consternation is going to lessen as more of the old guard who are used to dictating verbal notes either retire or give up and get on a computer and figure out how to make it work. The younger docs coming up are very familiar with messing with computers and can't think of any other way to do it.
A federal court found the action of a NC dental board to restrict discount teeth-whitening procedures was intended to limit competition, and a legal expert says the ruling could affect other oversight boards.
A federal appeals court ruling this month that affirmed antitrust complaints against a state dentistry board in North Carolina could have broader implications for other state regulatory boards monitoring professional activities, including those of physicians and hospitals.
The U.S. Court of Appeals for the Fourth Circuit this month rejected the North Carolina State Board of Dental Examiners' claims that it was exempted from federal antitrust laws under the "state action" doctrine.
The dental board had been the subject of an administrative complaint by the Federal Trade Commission in 2010 for violations of the FTC Act after the board banned non-dentists operating in mall kiosks and other venues from performing discount teeth-whitening procedures. A federal district court rejected the board's initial complaint, and the appeals court this month sided with the FTC and noted that the dental examiners board was composed of dentists who stood to gain financially by restricting the practice.
"At the end of the day, this case is about a state board run by private actors in the marketplace taking action outside of the procedures mandated by state law to expel a competitor from the market," the appeals court said in its ruling.
Jay Levine, a healthcare antitrust attorney with the Washington, D.C.–based firm of Bradley Arant Boult Cummings LLP, says the ruling has broader implications for all state regulatory boards that attempt to limit competition.
"What the board was doing here was essentially restricting competition by sending cease-and-desist letters to purveyors of teeth-whitening services saying 'what you are doing is illegal' and thereby driving them from the market, which all inured to these dentists' competitive benefit," Levine says.
"The essential ruling of the Fourth Circuit was affirming the FTC's complaint that because the North Carolina dental board was comprised for the most part of practicing dentists who were elected by practicing dentists , they were considered a private actor and not a governmental entity," Levine says. "Therefore they needed to meet both prongs of the Midcal test, which are a clearly articulated state policy to displace competition plus active supervision of the state over the private parties' conduct."
"If the board is not acting in a collusive manner then they may be entitled to some other protection … because Section 1 of the Sherman Act requires that there be concerted activities between two economic actors. The Fourth Circuit rejected that line of reasoning in the North Carolina dental case because it essentially said 'here you have a bunch of different actors with different economic interests engaging in conduct designed to promote their individual economic interests.' "
Levine says state oversight boards with concerns about their immunity from antitrust complaints should probably review how they are comprised and how they do business.
"From an infrastructure perspective you have to look at whether there is active state supervision over your activity," he says. "If there is active state supervision where there is a state governing body that actually reviews your decision such that your decisions can be appropriately attributed to the state, then you are going to satisfy both prongs of the Midcal test and you are going to be immune from the antitrust laws."
"But if your board doesn't have active supervision from the state, then you need to understand that your conduct may not be immune from the antitrust laws and you may have to look at how you are constituted and discuss whether you need to go back to the legislature and either have them draft legislation putting in a regime that does engage in active state supervision or possibly reformulate how your board is constituted so you are not deemed a private party."
Levine says it is also important that regulatory boards "understand what conduct you are engaging in and whether it can fairly be called anticompetitive."
"Not every activity of the board is going to restrict competition," he says. "You really only have to worry about conduct that can be said [to be] where you are foreclosing or otherwise eliminating or reducing competition. In those cases if you really want to feel comfortable about it, you need to make sure that you are not considered a private party because your board composition is made, for example, straight from the governor or is not comprised of people who are essentially practicing in the field or that there is a regime of active state supervision."
Theories abound as to why young physicians won't practice in rural areas. But the key reason why young medical doctors don't fill these much-needed roles readily is a lack of accountability in publicly funded Graduate Medical Education programs, researchers suggest.
A new round of metrics doesn't bode well for rural healthcare.
The U.S. Census for 2010 says that one in five people —19.3% of the population, about 59.4 million people—live in rural America. Unfortunately, a new report this month from George Washington University School of Public Health and Health Services says that only 4.8% of new physicians plan to establish a practice in rural areas, despite the critical need.
Clearly there is a disconnect between supply and demand. This is hardly news to most rural healthcare professionals, researchers on the topic, or physician recruiters serving rural areas. It's a topic that's been predicted and discussed for decades. That's what makes this persistent shortage all the more vexing. We know what the problem is but we can't fix it.
"I can't say we were terribly surprised but it does definitely confirm what a lot of us suspected. When you see the actual numbers it is hard not to be a little shocked and disturbed," says Candice Chen, MD, MPH, an assistant research professor of health policy at SPHHS, and a lead author of the study, which appeared this month in Academic Medicine.
Candice Chen, MD
Theories abound as to why young physicians won't practice in rural areas: less money, horribly long or erratic working hours, massive medical school debts to repay, a lack of cultural diversity and other social chasms with the populations they serve, practicing in isolation, a lack of professional support, and generally poorer schools for their children and fewer career options for spouses, to name a few.
The failures continue despite the efforts and financial incentives by the federal and state governments to encourage medical students and residents to practice in underserved areas both rural and urban. The key reason why young physicians don't take up these obvious and dire needs is a lack of accountability in publicly funded Graduate Medical Education programs, researchers suggest.
Chen and her colleagues studied the career paths of 8,977 physicians who had graduated from 759 medical residency sites from 2006 to 2008. The researchers analyzed data to find out where these new physicians ended up practicing three to five years after graduation. They found that overall only 25.2% of the physicians in this study worked as primary care physicians.
Chen says this number likely too high because it includes hospitalists. The researchers found that 198 of 759 institutions produced no rural physicians during the study period. And 283 institutions graduated no doctors practicing in the Federally Qualified Health Centers that serve low-income or destitute patients in underserved urban and rural areas.
The study's findings are blunt: GME operates on public money—nearly $10 billion in funds from the Medicare program and another $3 billion from Medicaid—but apparently the nation's teaching hospitals can't address physician shortages that were identified and anticipated decades ago.
The problem is not just in rural and underserved areas. Chen says GME institutions produce primary care physicians at an "abysmally low" rate. This failure by a taxpayer funded program to address a dire public need is occurring despite the full knowledge that the need for primary care physicians will dramatically increase in the coming years as more Americans gain health insurance coverage under the Patient Protection and Affordable Care Act.
"If residency programs do not ramp up the training of these physicians, the shortage in primary care, especially in remote areas, will get worse," Chen says. "The study's findings raise questions about whether federally funded GME institutions are meeting the nation's need for more primary care physicians."
"Right now with the Medicare money that goes for GME there is very little requirement around that money other than that you train and report that you train 'X' number of residents," Chen says.
"There is nothing that says we need more primary care doctors or other kinds of doctors. General surgery is another area where a lot of communities are struggling. There is nothing in the payment that says you need to produce these kinds of doctors or produce doctors who are going into certain areas to serve the need that America has."
Consider these findings from Chen and her colleagues:
The top 20 primary care producers in this study trained 1,658 primary care doctors out of a total of 4,044 or 41%. These sites received just $292 million in GME funding.
The bottom 20 programs produced only 684 primary care graduates out of 10,937 or 6.3%. These sites received $842 million in GME payments—an amount that reflects not a dedication to training doctors in primary care but in churning out highly paid specialists who typically practice in big cities or the suburbs.
Almost two-thirds of the nearly $10 billion in Medicare funding for GME annually goes to 200 hospitals—and those sites perform poorly when it comes to producing primary care doctors.
Chen and her colleagues say policymakers should examine the skewed incentives that have led to the ongoing primary care crisis and the lack of physicians in underserved areas, and develop a more accountable GME system. Of course there are other nagging issues out there that disincentivize primary care, especially the huge compensation gap between primary care physicians and their specialist colleagues.
"GME reform alone will not be the thing that magically fixes the system," Chen says. "But there is a definitely a sense and there is research evidence out there that shows that GME residency training programs can do things that would increase the likelihood of people going into primary care and underserved areas. Where we locate our residency programs and the exposure to different kinds of mentors in GME and the exposure to positive experiences in rural and underserved areas, those do make a difference to trainees."
Chen believes the failure of GME to respond to glaring shortage of primary care physicians will prompt that review.
"The fact remains that there is no accountability in the system currently," she says. "Even with the system the way it is, [could you] layer in an accountability system could that make the difference? It could depending upon what it looks like. There are definitely things going on now. People are looking at GME and they're interested in how you can start to align it with producing the physicians that we ultimately need."
Simply building more accountability into GME and ignoring other issues such as compensation won't remove all the hurdles that keep physicians away from rural America. But it's a good start and it's long overdue.
Data from the American Medical Association details the costs of medical billing complexity on patients and physicians, who are put "in the awkward situation of having to ask patients for money," says an AMA board member.
Barbara L. McAneny, MD
Higher co-pays, deductibles and other fees have held patients responsible for nearly 25% of their medical bills and forced physicians to become reluctant bill collectors, a new study from the American Medical Association shows.
For the first time in its six year history the AMA's National Health Insurer Report Card [PDF] examined the portion of medical bills that patients are responsible for through co-pays, deductibles and coinsurance. In February and March this year patients paid an average 23.6% of the amount that health insurers set for paying physicians, the report found.
"The patient isn't always aware of what they signed up for and physicians don't like being the bearers of bad news to these patients," says AMA board member Barbara L. McAneny, MD, a board certified medical oncologist/hematologist from Albuquerque, NM.
"As we have more and more third-party administrator types of insurance claims, and there are more and more payers out there, each of whom has their own rules on how they are going to pay you, it gets more complicated," McAneny said in an interview.
"Physicians now are concerned with having to collect a significant amount of the money they're contracted to be paid from the patients who are often unaware that they are going to have to pay part of the fee. It puts physicians in the awkward situation of having to ask patients for money and doctors don't like doing that. We're not very good at that."
Also new this year, the AMA unveiled its Administrative Burden Index [PDF], which ranks commercial plans according to the unnecessary cost they add to the billing and payment of medical claims. The AMA said that red tape associated with avoidable errors, inefficiency and waste in the medical claims process resulted in an average ABI cost per claim of $2.36 for physicians and insurers.
Cigna had the best ABI cost per claim of $1.25, or 47% below the commercial insurer average. Health Care Services Corporation had the worst ABI cost per claim of $3.32, or 41% above the commercial insurer average. McAneny says the ABI is a simple and accurate way to show physicians the cost of administrative burdens.
"We are trying with this report to quantify this so that when a physician practice looks at options for contracts with payers, they will know early into the process that they may be bargaining for $100 but it is going to cost me $14 to pay for that so what I am really asking for is $86," McAneny says.
"Physicians are going to have to use tools like this and a lot of other tools the AMA provides because if you are not an efficient physician practice in this market you are going to have a hard time surviving. And we need every physician we possibly have in this country to be able to continue with their practice of medicine and continue taking care of patients, especially as we have all of these new patients who are on insurance plans either through Medicaid expansion or from the exchange-based plans."
The AMA estimates that $12 billion a year could be saved if insurers eliminated unnecessary administrative tasks with automated systems for processing and paying medical claims. This savings represents 21% of total administrative costs that physicians spend to ensure accurate payments from insurers.
"In this day and age when healthcare costs are so high the AMA is focused on the idea that we need to lower the costs of healthcare without harming patients," McAneny says. "One of the ways that we can lower the cost of healthcare and actually do a better job for patients and for doctors is to eliminate this huge amount of money that goes into the administrative burden that we are trying to quantify with this index."
McAneny says that the Health Insurer Report Card since it was first published in 2008 has provided an influential and reliable measure of payers' denials, timeliness, accuracy and transparency, and has prompted insurers to clean up their acts and honor the wording of their own contracts.
"That's a huge benefit for physicians that I don't think a lot of physicians are even aware of. They just think their billing department is doing better at collecting claims," she says. "The fact that a lot of the insurance companies now have gone from under 80% accuracy to upward of 95% accuracy in paying claims is a huge benefit."
Other key findings highlighted in the report card:
Accuracy: Error rates for commercial health insurers on paid medical claims have dropped from nearly 20% in 2010 to 7.1% in 2013. While dramatic improvements have been made in accuracy during the last three years, the AMA estimates that more than $43 billion could have been saved if commercial insurers consistently paid claims correctly since 2010. UnitedHealthcare led commercial plans with an accuracy rating of 97.5%. Regence trailed all plans with an accuracy rating of 85%. Medicare led all insurers with an accuracy rating of 98%.
Denials: Medical claim denials dropped 47% in 2013 after a sharp spike in 2012 among most commercial plans. The overall denial rate for commercial plans went from 3.5% in 2012 to 1.8% in 2013. Among all insurers this year, Cigna had the lowest denial rate at .54%, while Medicare had the highest denial rate at 4.9%. AMA officials have no explanation for the 2012 spike in claims denials.
Timeliness: Plans have improved response times to medical claims by 17% from 2008 to 2013. Humana had the fastest median response time of six days, while Aetna was the slowest with a median response time of 14 days. Medicare's median response time of 14 days has gone unchanged since 2008.
Transparency: Plans have improved the transparency of rules used to edit medical claims by 37% from 2008 to 2013. AMA says reducing the use of undisclosed payer-specific edits unlocks the flow of transparent information to physicians and reduces the administrative costs of reconciling medical claims. .
Robert Zirkelbach, spokesman for America's Health Insurance Companies, did not dispute the accuracy of the AMA report card, but says improving the accuracy and efficiency of claims payments is a responsibility that must be shared by providers and plans.
"Health plans are doing their part to streamline health care administration to reduce paperwork, improve efficiency, and bring down costs," Zirkelbach said in an email exchange. "A recent AHIP survey found that health plans processed 98% of all claims within 30 days. The AMA report card also found 'dramatic improvements in accuracy,' a 47% drop in claim denials, and improved transparency and response times."
"At the same time, more work needs to be done to increase electronic submission of claims and to reduce the number of claims submitted to health plans that are duplicative, inaccurate, or delayed. For example, AHIP's survey found that 16% of electronic claims and 54% of paper claims were received from health care providers more than 30 days after the service date."
"Importantly, government data show that rising healthcare costs are driven primarily by rising prices for medical services, not health plan administrative costs," Zirkelbach says. "In fact, the most recent National Health Expenditure data found that the portion of premiums allocated to health plans' administrative costs in 2011 was among the lowest in recent years, despite the fact that health plans have been incurring new compliance and regulatory costs related to the health care reform law."
The AMA said the findings from the 2013 report card are based on a random sampling of approximately 2.6 million electronic claims for approximately 4.7 million medical services submitted in February and March of 2013 to Aetna, Anthem Blue Cross Blue Shield, Cigna, Health Care Service Corporation, Humana, Regence, UnitedHealthcare and Medicare. Claims were accumulated from more than 450 physician practices in 80 medical specialties providing care in 41 states.
Most of the proposal focuses on program integrity for state marketplaces and insurance companies offering coverage in the federally facilitated exchanges. The rule intends to safeguard federal money and consumers.
The Centers for Medicare and Medicaid Services has unveiled its proposed rules governing the operation of health insurance exchanges [PDF] which aim to facilitate and regulate the sale of private coverage to millions of people beginning Jan. 1, 2014, under the Patient Protection and Affordable Care Act.
CMS released the 253-page proposal on Friday afternoon with little fanfare or notice. The agency said most of the proposal focuses on program integrity for state marketplaces and insurance companies offering coverage in the federally facilitated exchanges, advance payments of the premium tax credit and cost-sharing reductions, and premium stabilization programs.
The proposed rule intends to safeguard federal money and consumers by ensuring that insurance companies and marketplaces actually provide consumers with access to affordable health insurance with reasonable benefits. Consumers in every state will be able to buy insurance from qualified health plans directly through these marketplaces and may be eligible for tax credits to lower the cost of their health insurance.
A public comment period for the proposed rule extends for 90 days.
"In just a few months, consumers across the country will have access to a new Marketplace in their state where they can easily shop for health insurance that meets their needs and the needs of their families," CMS Administrator Marilyn Tavenner said in prepared remarks. "The release of these guidelines signals that we're ready to build on our ongoing efforts and ensure that the new systems are fiscally sound."
The rule also proposes establishing standards for Department of Health and Human Services-approved enrollee satisfaction survey vendors, standards for the handling of consumer complaints, and other provisions to ensure smooth operation of the marketplaces, protect consumers, and give flexibility to states, CMS said in a media release.
A marketplace consumer call center will soon offer program information and then help consumers with open enrollment and plan selection on Oct. 1. CMS will also begin consumer assistance training this summer to help consumers find the right plan.
State-operated premium stabilization programs
HHS proposes standards for the oversight of states that operate either risk adjustment or reinsurance programs. The rule would require that states keep an accurate accounting for the programs, submit to HHS and make public reports on operations, and take other steps to ensure the soundness and transparency of the programs.
Advance payments of the premium tax credit and cost-sharing reductions
HHS proposes timeframes for refunds to eligible enrollees and providers, as applicable, when an issuer incorrectly applies the advance payment of the premium tax credit or cost-sharing reductions, or incorrectly assigns an individual to a plan variation (or a standard plan without cost-sharing reductions).
HHS also proposes general standards necessary for the oversight of these payments, including the maintenance of records, annual reporting of summary level statistics, and audits.
State marketplaces
State marketplace oversight mechanisms would assure that consumers are properly given their choices of coverage available, that consumers correctly receive advance payments of the premium tax credit or cost-sharing reductions if they qualify, and that marketplaces meet PPACA standards.
Flexibility for states
HHS is proposing additional state flexibility by permitting state-based Small Business Health Options Programs (SHOP) while HHS would operate an individual market federally-facilitated marketplace in that state.
Consumer protections for enrollment assistance
This rule clarifies the ways that agents and brokers will help consumers and small businesses in federally facilitated marketplaces.
Establishment of standards for HHS-approved enrollee satisfaction survey vendors
PPACA calls for an enrollee satisfaction survey that will allow the public to compare enrollee satisfaction among comparable plans in the marketplace. This rule sets forth a process for approving and overseeing survey vendors to administer the survey on behalf of qualified health plan issuers in the marketplace.
Primary care physicians have 3% of their total compensation based on quality measures, but doctors will increasingly be tied to these metrics as reimbursement aligns more closely with quality and cost measures, Medical Group Management Association data suggests.
Quality measures are emerging as components in physicians' compensation, a trend is expected to grow as value-based reimbursements gradually supplant fee-for-service, volume-based models, a new survey from the Medical Group Management Association shows.
ThePhysician Compensation and Production Survey: 2013 Report Based on 2012 Data examined data on more than 60,100 physicians, and found that primary care physicians and specialists reported that 3% and 2%, respectively, of their total compensation was based on quality measures.
Although the percentages are small, MGMA's Todd Evenson says physician compensation will increasingly be tied to these metrics as reimbursement aligns more closely with quality and cost measures.
"Really what we are seeing is the very front end for many organizations as they start to address under the Affordable Care Act and the commercial environment value based reimbursement. Ultimately those components of quality and satisfaction will become an ever-emerging component of reimbursement," says Evenson, MGMA's director of data solutions."
Actually, Evenson says the survey is low-balling the extent of quality measures in compensation packages for some healthcare organizations.
"Clearly there are some groups that are much more dynamic in the way they have been able to apply that. It's not uncommon in the industry and in many of the large organizations or health systems for that number to be somewhat higher. I have talked to many colleagues in the industry and figures anywhere from 10% to 30% aren't that uncommon for those larger institutions," Evenson says.
"As we look toward large healthcare institutions, the likelihood that they have decoupled compensation from collections is very high. And as a function of that in order to promote the behaviors around quality and satisfaction that they would like to see they want to incentivize their physicians in the appropriate ways to compensate them for those behaviors or activities. But overall, when we are looking at smaller organizations or medium-sized organizations then it is much more likely that there is that direct linkage."
Evenson says it's not necessarily a bad idea for some healthcare organizations to wait and watch before launching a quality component in their compensation packages.
"You don't want to be on the cutting edge. You want to be just behind the cutting edge as it relates to how you change your compensation strategies," he says. "It wouldn't be very effective if you were being paid 90% fee-for-service and paid 50% on quality to your teams of providers. The math wouldn't work in your favor."
Physician Compensation
The report also reaffirmed that median compensation for physicians fluctuated by specialty. Primary care physicians reported $216,462 in median compensation in 2012, and specialists reported $388,199 in median compensation. Evenson says the considerable gap in compensation could prove difficult to overcome, even with a concerted push to get more medical school students to take up primary care.
"The last data I had a chance to look at as I looked towards family practitioners just coming out of residency was something like 40% had over $200,000 in debt. And when we see that coupled with the median compensation for a family practitioner this year was right around that $205,000, it ends up being where there is definitely a constraint that is worth noting," Evenson says.
"We and others in the health industry understand the importance of this. The demand for primary care physicians is going to continue to increase but we have seen that kind of differential between primary care and specialty care compensation. We've even seen a number of advocacy efforts from a number of organizations (to improve primary care compensation) and that continues to evolve, but unfortunately it has remained at a static pace as a ratio of one related to the other. We did see some narrowing of that gap over the last few years, but I have seen that stagnate."
Evenson says the report verifies that healthcare organizations are moving toward an increasing reliance on physicians' assistants and nurse practitioners to make up for the shortage of primary care physicians. As a result, these highly specialized nurses are enjoying significant compensation hikes.
Over the past five years nurse practitioners' compensation has increased, on average about 13.4%, to the median of $92,717 in 2012. For physicians' assistances in the surgical suite that compensation increased by 9.6% over five years to a median of $112,689. For physicians' assistants in the primary care setting the compensation increased 10.4%, with a media of $96,834 in 2012, MGMA reported.
"When we look at their compensation this really underscores how the environment and the healthcare system is leveraging providers to the maximum of their license," Evenson says. "It shows how teams and organizations are dealing with that primary care shortage. They are looking towards the nurse practitioner and their role in the organization. Even if you're in a gastroenterology practice they are leaving the scope work to the physicians and the follow up visits to the practitioners. They are leveraging them to try to meet that demand."
One path toward better population health is for community and rural hospitals to create partnerships with local businesses and civic and government leaders, all of whom stand to enjoy the economic and social benefits of living in a healthier community.
Healthcare reform and the anticipated shift away from the traditional fee-for-service payment model toward a model that rewards value-based preventive care means that hospitals will have to play a greater role in managing the health of the populations they serve—even beyond hospital grounds.
And an effective way for hospitals to accomplish that goal would be to create partnerships with their local business, civic, and government leaders, all of whom stand to enjoy the economic and social benefits of living in a healthier community, says Stephen A. Martin, executive director for the Association for Community Health Improvement at the American Hospital Association.
"There is the common theme that the hospitals and the community stakeholders have to have and that is a willingness to come to the table to solve the health issues of their respective communities," Martin says. "If there is no openness from the various stakeholders, then we can't move the community toward wellness."
These partnerships are especially critical for smaller hospitals in rural areas because of the unique pressures and lack of money and other scarcer resources that they face to treat a patient mix that is generally older, less healthy, less affluent, and more prone to overweight. The good news, Martin says, is that many hospitals have been doing this sort of community outreach for years before the Patient Protection and Affordable Care Act was even drafted.
"The change, although it's new, is not new," Martin says. "Here we have an emphasis with the ACA coming on line in 2014 and the requirement of of community benefit, so you are seeing more emphasis on the fact that hospitals cannot do all of this work alone when you step out of the four walls. So we are working with our partners and stakeholders to move our communities to better health and wellness and our hospitals play a critical role in doing that very thing, not just within the hospital to make someone well but also well while they are outside of the hospital setting."
Now, the focus will be more concentrated toward prevention, disease management, and promoting wellness activities. Not all hospitals are in a position to act on these three prongs in the value-based model.
While hospitals are the logical providers of disease management, for example, it might make sense to work with the local public health agency to identify and prioritize the health threats your community faces so you can collaborate devise an effective population health improvement strategy.
Likewise, the wellness component might be best handled by gaining the active support of business leaders, such as the Chamber of Commerce, to promote workplace wellness initiatives. The local United Way or the community department of parks and recreation, or the mayor's office could be recruited to sponsor healthy activities and events promoting physical activity and good nutrition.
"It's the hospital that will play the vital role in that population health community benefit," Martin says.
"So, in one instances there could be a situation in a small rural setting that the hospital is the center and the convener of a population health benefit strategy. In other settings such as a larger metropolitan urban setting it could be various stakeholders, the local public health department, United Way, Chamber of Commerce, varying parties all coming to the table to be the integral entity that moves these initiatives forward. The critical component is the hospital either playing the role of convener or coming to the table. It's not a one-size-fits all."
What exactly that role will be can also depend upon the hospital. A larger academic medical center, or an integrated healthcare system with more resources and a larger staff might be able to take on more of the responsibility for population health than can a smaller rural hospital.
Rural and community hospital leaders looking for some help on identifying population health issues and establishing programs to address those issues may consult a new guide from the ACHI and the AHA's Hospitals in Pursuit of Excellence initiative.
"Each of these different structures and settings engage their communities in different ways," Martin says. "There is no cookie cutter way of approaching population health management because the dynamic here is the individual community, and each community is different."
