Medical liability caps enacted in Texas in 2003 have not reduced rising medical costs in the Lone Star State, and expose as false claims that malpractice expenses are a key driver for medical inflation, according to a study from Public Citizen.
"Despite the sales campaign to promote Texas as an exhibit of the merits of limiting doctors' liability for mistakes, the real-world data tell the opposite story," Taylor Lincoln, research director of Public Citizen's Congress Watch division and author of the report, said in a media release. "Healthcare in Texas has become more expensive and less accessible since the state's malpractice caps took effect."
"This contradicts the 'defensive medicine' theory, which holds that fear of litigation is to blame for stark increases healthcare costs. Also, since the caps were instituted in Texas, health insurance costs have outpaced the national average and the percentage of residents lacking health insurance has risen,'" the report says.
However, Jon Opelt, executive director of the Texas Alliance for Patient Access, an advocacy group for malpractice reforms whose members include the Texas Medical Association and the Texas Hospital Association, said in an interview with HealthLeaders that the Public Citizen report is fundamentally flawed, and that it misstates the original intent of the malpractice reforms.
"When proponents argued for a cap it was a discussion about stabilizing insurance rates paid by healthcare providers and attracting new doctors to the state, and that has been overwhelmingly successful," Opelt says. "Never was it stated that passing these reforms would reduce the health insurance premiums for consumers."
According to the Public Citizen report, since Texas instituted its liability limits:
Per-enrollee Medicare spending has risen 13% faster than the national average;
Medicare spending specifically for outpatient services has risen 31% faster than the national average;
Medicare diagnostic testing expenditures have risen 26% faster than the national average;
Premiums for private health insurance have risen faster (52%) than the national average (50%);
The percentage of Texans who lack health insurance has risen to 25%, solidifying the state's dubious distinction of having the highest uninsured rate in the country;
The per capita increase in the number of doctors practicing has slowed to less than half its rate in the years leading up to the caps;
The per capita number of primary care physicians practicing in Texas has remained flat, compared to a sharp increase in the years leading up to the caps; and
The prevalence of physicians in non-metropolitan areas has declined.
Opelt says he cannot repudiate every statistic highlighted in the study, but he says he doesn't have to, because most of the claims – for example, rising Medicare costs, or the percentage of Texans who are uninsured -- have nothing to do with medical malpractice.
He asserts, however, that any claims that Texas has seen a decline in the numbers of practicing physicians since 2003 are simply untrue. "By any objective measurement what we have seen is the end of the exodus of doctors from our state. We have seen a substantial increase in doctors coming to Texas and practicing, especially in the high-risk fields. What that means is more care for more people and closer to their homes. That is not reflected in their study," he says.
Opelt says the report also gives a false impression that patients' rights to legal redress have been gutted in Texas when, in fact, only non-economic damages have been capped.
"Even with these new reforms in place one could still receive a multimillion dollar judgment," he says. "What it has done is reduced the number of lawsuits filed in this state. It has reduced the number of outlier awards. It has allowed doctors hospitals and nursing homes to find and afford liability coverage so they can treat patients."
Opelt also objected to the study's contention that Texas physicians face less accountability for errors since the imposition of the caps. "There is nothing in the peer review studies that draw a correlation between lawsuits or the threat of lawsuits to the improved quality of care," he said. "Since the passage of reforms we have seen some significant improvements in Texas, but they are not totally related to the cap. Although it can be stated that dollars that used to go to lawyers and lawsuits are now going to charity care and patient care."
The American Medical Association has launched a national media campaign urging the public and physicians to tell Congress to repeal the sustainable growth rate Medicare payment formula before 30% cuts go into effect on Jan. 1.
"We believe Congress needs to come forward with honest accounting at this point and really clear the books on the SGR," AMA Chairman Robert M. Wah, MD, told HealthLeaders Media. "This has been with us for a decade and the problem is that the cost of what they have done so far has just gotten bigger.
Five years ago this problem could have been solved at a cost of about $48 billion. Now to fix it they say it will cost $300 billion. But if they don't deal with it and it goes another five years, the costs will go up to $600 billion."
AMA also rejected a nonbinding recommendation to Congress this month from the Medicare Payment Advisory Commission to kill the SGR and replace it with an equally contentious plan that would include reimbursement cuts to specialists and pay freezes for primary care physicians.
If no action is taken on the SGR and other budget deficit issues by Jan. 1, automatic 30% Medicare reimbursement cuts to physicians are supposed to be implemented, but it's not clear if Congress will allow that to happen.
Instead of cuts or freezes, AMA wants the 12-member budget deficit reduction "super committee" in Congress to provide physicians with a five-year "stability period" on Medicare reimbursements that would include modest inflation adjustments.
"That is what we seek to do with our three-prong plan, which is to repeal the SGR, get five years of stable Medicare payments with inflationary updates, and during those five years work on delivery system improvement and reform that delivers cost effective care for patients in a more coordinated fashion," Wah says. "Then we can fashion a payment system that would facilitate that new deliver system."
Also this week, AMA said in a letter the Centers for Medicare and Medicaid Services that it wants Medicare to start paying doctors for four types of coordination services because they avoid more expensive patient care in the hospital down the line.
The services include responding to telephone calls seven days or more after a patient sees the doctor, education and training to enable patients to better manage their own health, better management of anticoagulation drugs such as warfarin, and time spent coordinating team-based care when the patient is not present.
Wah says physicians are already paid about 20% below cost for their Medicare patients, and taking further reductions could gravely impact patient access.
That is the theme of an ad campaign that AMA unveiled this month. The two-week long media campaign, which was launched Friday, features 30-second television ads on cable and broadcast television in select markets, along with 60-second radio spots.
The television ads – clearly aimed at Medicare beneficiaries -- show an elderly man floating through the sky hanging on to a few dozen balloons that are popped one-by-one. As he sinks helplessly toward the tree line, his face more alarmed with the descent, a voiceover says: "Medicare keeps many seniors afloat. But Medicare payments to doctors are scheduled to be cut by 30% in January. It means doctors may have to limit the number of Medicare patients they see, or even stop seeing them all together to keep their doors open. Tell your representatives in Washington to stop the cuts and find a permanent solution for Medicare that safeguards healthcare access for America's seniors now and forever."
Wah says the super committee could actually provide the impetus for change that has been lacking in Congress in the 10-year battle over the SGR. "One thing that is different now is that the super committee has some things in its favor to expedite getting things done that we don't normally see in the standard process that Congress follows," Wah said.
"The fact that they don't have to be under the cloture rules or the filibuster or that business means that things can get done through the super committee process that we had not see get done in the regular process. This is a unique opportunity for Congress to fix what both parties have said they need to fix and finally fix permanently the SGR. This is an opportunity with the structure that is in place to get this done."
Wah acknowledges that eliminating the SGR would create a $300 billion hole in the budget. However, unlike the American Hospital Association, which last month suggested that Congress raise taxes or the Medicare eligibility age before it cuts hospital Medicare reimbursements, Wah says AMA is steering clear of any specific recommendations. "There is a list of options that have been identified by those groups that the super committee can look at to reduce the deficit and repeal the SGR," he says.
"As a physician I am interested in telling Congress what is best for my patients and my practice and I leave the decisions for how to accomplish that up to Congress. That's part of what they're elected to do."
The American Hospital Association is calling for “shared sacrifice” from the greater society – even if it means higher taxes or raising the Medicare eligibility age – if that would help the nation’s hospitals avoid further reimbursement cuts over the next decade.
“It’s the theme of shared sacrifice,” AHA Executive Vice President Rick Pollack told HealthLeaders Media. “If we are going to tackle these major problems, you can’t keep going back to the same well. It is everybody’s responsibility to step up to the plate in the name of shared sacrifice.”
“Cutting providers and rationing the provider payments doesn’t represent reform. It represents the same old, same old. Cutting providers eventually does harm beneficiaries,” he says. “If we have this big national problem, shouldn’t everyone be part of solving it?”
AHA last month compiled for Congress and the Medicare Payment Advisory Commission (MedPAC) more than 40 recommendations amounting to $2 trillion in either cuts or new revenues that have been proposed by Republicans, Democrats, and special interest groups.
Pollack says AHA leaders attended a “fly-in” last week on Capitol Hill “to make the case that, from our perspective, not only have we already stepped up to the plate in the name of shared sacrifice, but our sector is absorbing more change than virtually any other sector in society.”
Pollack says most anything on the list would be preferable to imposing more cuts on hospitals, which he says have already agreed to take a $155 billion cut in Medicare reimbursements over 10 years under the Affordable Care Act, and have also seen huge cuts in state Medicaid programs.
“A lot of people might not like the recommendations, but our membership has felt that we have to be responsible in suggesting alternative solutions to address the problems and it needs to be done in the framework of shared sacrifice, which we have already done a lot of on our own,” he says.
Last week, MedPAC ignored the AHA’s pleas and instead approved its plan to repeal the ineffective sustainable growth rate (SGR) formula. In its place will be an equally controversial plan that will include, among other steps, cuts in reimbursement payments to specialists and frozen payments for primary care physicians.
The MedPAC proposal calls for a total of $335 billion in reimbursement reductions over 10 years. The plan’s “doc fix” would account for $100 billion. Specialists’ reimbursement rates would fall 5.9% each year for three years and then freeze for the following seven years. PCP reimbursements would be unchanged for the 10 years.
The remaining $235 billion would come from:
Cuts to Medicare Part D drug plans (32%)
Post–acute care facilities (21%)
Medicare beneficiaries (14%)
Hospitals (11%), labs (9%)
Durable medical equipment (6%)
Medicare Advantage plans (5%)
Other providers (2%)
The Medicare commission has no authority beyond the recommendation, and Congress is free to ignore the findings, as it has for the last decade.
However, as the budget deficit has become a huge political issue, the six lawmakers on the bipartisan “super Committee” charged with finding a budget resolution are likely to give the proposal more consideration. Unless some action is taken on Jan. 1, 2012, Medicare payment rates for physicians will drop by 29.4%.
Pollack says AHA has supported the repeal of the SGR, but not if it meant reimbursement cuts to hospitals to make up the difference. “From our perspective, this is robbing Peter to pay Paul,” Pollack says. “We employ a lot of physicians and we want to see this fee problem fixed, but we don’t think it is productive to cut one provider to fix another provider’s problem. We have a stake in this as well.”
As for raising the Medicare eligibility age, Pollack says he is not overly concerned with any blowback for hospitals because that idea has already been floated by House Republicans and, however briefly, by President Obama.
“On the retirement age, things get boiled down into sound bites,” he says. “If you look at that option in particular, from our perspective you have to be thoughtful about it. We always assumed that if you looked at this option you had to have health exchanges in place so that those people who are between the new Medicare eligibility age and the old one would get access to coverage through exchanges. For those of limited means, that would be subsidized.”
Pollack says AHA also has acknowledged that some exceptions would have to be built into raising the Medicare eligibility age. “Not everyone can work past 65. For people that have physical limitations by virtue of the work they have done as opposed to people who do desk work, you have to have exceptions,” he says. “None of that is really fleshed out. That is the way we would view that option.”
On Sunday, May 22, a category EF5 tornado ripped like a buzz saw through Joplin, MO. Within minutes, at least 142 people were killed, hundreds were injured, and much of the town was destroyed, including the 367-bed St. John’s Mercy Regional Medical Center.
And just as quickly, the 2,200 employees at the gutted hospital faced the prospect of losing their jobs. That’s when Mercy Health System CEO Lynn Britton made the decision that may come to define his leadership at the system, which operates 30 hospitals in four states. Britton launched a talent-sharing program designed to keep as many Mercy workers as possible employed through the rebuilding effort.
Britton spoke with HealthLeaders Media recently about the decision, and the nearly $1 billion commitment that Mercy has made towards rebuilding Joplin’s healthcare infrastructure.
HLM: The decision to keep staff on the payroll was made just hours after the tornado struck. Why was that a priority?
Britton: “For a variety of reasons. With Hurricane Katrina, a lot of healthcare professionals who didn’t have a place to work tended to leave New Orleans to find work, and once the healthcare organizations were thinking through how to get back on their feet, there wasn’t a professional medical community to support them. So I absolutely didn’t want that to happen in Southwest Missouri. We felt it was critical that we kept everybody employed – but not just sitting on a sofa collecting a paycheck. They needed to be using their clinical skills and keeping them sharp to make sure the medical community was going to be there when the new hospital opened.”
“Then there is the economic side of it. One government agency said that if those 2,200 people had not kept their jobs, about 13,000 (other people in the community) would have lost their jobs because it takes that much in support for the healthcare system. It made sense from an economic perspective, for the community it made sense, from the continuity of healthcare services into the future it made sense.”
HLM: Would it not have been cheaper to lay off employees?
Britton: “Not in the long run. Those people would have had no choice but to go somewhere else to find a job. We are building a new hospital and when we open it back up we would have been spending enormous amounts of money to recruit that very talent back into the community. I would much rather have a resident professional medical community stay there and continue to deliver care and evolve with us and be part of dreaming the dream for the new community. So no, I’m not going to say that it would have cost less.”
HLM: How were you able to find that many jobs in such a short time?
Britton: “We started a program called talent sharing. We had enough Mercy facilities in the surrounding area that I’d hoped that many of [the employees] could find work there. I was also hoping that other hospitals in the area that were going to see some temporary growth in volume because of the displaced patients from St. John’s – that they wouldn’t want to staff up and recruit a workforce knowing that volume was eventually going to go back to St. John’s, and that they might be willing to use some of those resources to meet that temporary growth in demand, and they were.”
HLM: How does talent sharing work?
Britton: “The organization [that temporarily hires the Mercy employee] pays the hourly rate that they would for that position, and the Mercy coworker still keeps their original rate and benefits on our nickel and we bill and collect on the hourly rate at the other organizations. It helps offset but it doesn’t cover all the costs for that coworker.”
HLM: You’ve found work for about 95% of your St. John’s employees. Are you surprised by the success?
Britton: “I was pleased. We knew it would be a big challenge. It sounded daunting. I am a firm believer that you have to have big goals and dream a little, especially in moments like this that are crises situations. You can’t just accept it. You have got to get busy and work your way through it. So, giving people big goals like we did was important in the recovery, in the community, and in the professional recovery as well. Because you’ve lost everything, the place that you went to work every day and socialized with 2,200 people is gone. You have to have a focus and a way to bring yourself back to a new reality. Big goals that seem audacious or daunting are just what it takes.”
HLM: How has this affected employee engagement at St. John’s?
Britton: “It’s off the charts. They’re actively participating in designing the new hospital, and their work in the temporary facility is extraordinary. All the indicators show they are a very engaged workforce and very appreciative of what has been done to help them through this.”
HLM: Mercy has committed about $950 million towards the rebuilding effort in Joplin that will include a new 327-bed hospital. Did you have any concerns about the level of the investment in such uncertain economic times?
Britton: “I have had people say to me, ‘Those were terrible business decisions. Were you worried about your job? What did the board think about that?’ The short answer is if I had gone back to the board and said, ‘Let’s take the insurance money and run,’ that would have been a termination reason right there. Because we did the right thing, I never worried that the board would view it as a bad business decision. I knew they would view it as the right thing to do, and that is exactly what they did.”
HLM: What advice would you give other healthcare leaders facing similar crises?
Britton: “Clearly understand the situation and make some quick, appropriate decisions. Don’t be ambiguous ever about what you are going to do and how you are going to do it, and be bold when you face those moments. People will not remember if you didn’t get a decision just quite perfect during a moment like this, but they will absolutely remember if you don’t do anything or you are just in a state of inaction. That is far worse and does far more damage than being slightly off on one or two decisions at some critical moment.”
The healthcare sector is creating jobs at a pace not seen in four years and is responsible for nearly one in four new jobs in the overall economy so far in 2011, new data from the Bureau of Labor Statistics show.
Through the first three quarters of 2011, healthcare created 258,000 jobs – nearly as many as the 263,400 healthcare jobs created in all of 2010. Healthcare is on a pace to create 344,000 new jobs by year’s end, a level of growth last seen in 2007, when the sector created 347,800 jobs, according to the BLS.
For September, healthcare continued to be one of the few bright spots in an otherwise stagnant job picture. Overall healthcare employment rose by 43,800 jobs in September, representing roughly 42% of the 103,000 payroll additions in the overall economy. So far this year, the 258,000 new healthcare jobs represent 24% of the slightly more than 1 million non-farm jobs created in 2011, BLS preliminary data show.
Despite reports of a growing number of mass layoffs by hospitals, BLS preliminary data show hospital job growth is nearly four times higher than it was in 2010. Hospitals gained 13,300 new jobs in September, after recording 7,700 new jobs in August and 11,000 new jobs in July. Hospitals lost 1,900 jobs in June, but have created 66,800 new jobs so far in 2011. By comparison, in the first three quarters of 2010, hospitals created 19,800 new jobs.
Ambulatory services continue to set the pace for healthcare sector growth, creating 26,000 new jobs in September after posting 18,100 new jobs in August. Ambulatory services have been responsible for 66% (155,200) of new jobs in healthcare so far in 2011. In the first nine months of 2010, ambulatory services created 128,300 new jobs.
Within the ambulatory services subsector, physicians' offices have created 53,200 new jobs in the first nine months of 2011, which is more than double the 25,300 jobs created in that subsector for all of 2010. Physicians’ offices created 12,200 new jobs in September, after posting 5,600 new jobs in August. In comparison, physicians' offices created 17,500 new jobs in the first nine months of 2010.
BLS data from August and September are preliminary and may be revised considerably in the coming months.
More than 14.1 million people worked in the healthcare sector in September, with more than 4.7 million of those jobs at hospitals, more than 6.2 million jobs in ambulatory services, and more than 2.3 million jobs in physicians' offices, according to the BLS.
Beyond the healthcare sector, nonfarm job growth in the larger U.S. economy was up slightly in September, with 103,000 payroll additions reported. Much of the growth outside of the healthcare sector was credited to the end of a two-week strike in August affecting about 45,000 telecommunications workers at Verizon. Those workers were put back on the payroll in September.
If those returning Verizon workers are factored out of the September growth, then healthcare would be responsible for 75% of the 58,000 new jobs in the economy for the month.
Overall, the nation's unemployment rate remained essentially unchanged at 9.1% – its level since April – with 14 million people unemployed. The number of long-term unemployed, defined as people jobless for 27 weeks or longer, was 6.2 million in September, up from 6 million in August, and represented 44.6% of the unemployed.
Emergency physicians in the state of Washington have filed a lawsuit against a state plan to classify more than 700 diagnoses as non-emergent, and limit Medicaid reimbursements to no more than three non-emergent visits to the emergency department each year.
"The state has been mandated to try to save $72 million over the next two years, and this will clearly impact emergency care," Stephen Anderson, MD, president of the Washington Chapter of the American College of Emergency Physicians, told HealthLeaders Media.
"The list at the moment includes chest pain, hemorrhage during miscarriage, infections of the leg that can result in amputation, passing out for no reason, heart arrhythmia. It's frightening."
Anderson says the new restrictions could impact healthcare access for the poor and those most in need of care in at least 19 other states that have worked with Washington State to develop the policy, which went into effect on Oct. 1. "If this plan goes into effect, other states will certainly follow suit," he said.
The emergency physicians have asked a judge in the Superior Court of Washington for Thurston County to slap an immediate injunction on the new restrictions. In a media release, ACEP spelled out its concerns about the suit, alleging that the state:
Has not implemented a rulemaking process that included stakeholder comments; yet the plan is being forced on hospitals and providers with no warning.
Violated the requirements that this be a collaborative process as outlined by the legislature.
Violated the requirements that this be a list of non-emergent diagnoses as outlined by the state legislature.
Misconstrued the ability to bill patients for services. Federal law prevents physicians from meeting Medicaid requirements for billing patients through the Emergency Medical Treatment and Active Labor Act (EMTALA), and state law blocks hospitals from billing under charity requirements.
Is violating the federal Prudent Layperson standard by applying it to managed care patients.
Because EMTALA requires emergency departments to examine patients seeking care, "we still have to see them and we have to make sure they don't have an emergency," Anderson says. "The problem is that sometimes it takes a full evaluation to figure out that this burning crushing chest pain is heartburn and not a heart attack. What the state is saying is yes by federal law you have to see them and do the work up, but when you're done with the work up, if it turns out it wasn't a heart attack then you aren't going to get paid for any of that."
Jim Stevenson, chief communications officer for the Washington State Healthcare Authority, says ACEP has "misrepresented a little bit" the new restrictions. "The code doesn't refer to all chest pains. It only refers to non-cardiac, non-specific, generalized chest pains," Stevenson says. "This is not someone who is coming to the hospital in the belief that there is an emergency. It would probably be someone who has been at the emergency several times before with the same complaint. Many of these un-generalized complaints do end up looking for narcotics as a treatment."
The Washington State Health Care Authority issued a statement explaining the new restrictions and noted that the three-visit limit would not apply to:
Children placed by the department in out-of-home care with foster parents, relatives, or other caregivers
Clients delivered to the ED by ambulance, police or EMTs.
Visits for mental health diagnoses or for clients seeking detoxification services
Visits that result in an inpatient admission, emergency surgery, or admission for observation.
The authority said the program also created an "exception to rule" process by which hospitals can appeal non-emergency billings on the grounds of special circumstances.
"In point of fact, 97% of our clients can live very comfortably with this three-visit limit," Jeffery Thompson, MD, the authority's Medicaid's CMO, said in a media release. "The small number who exceed that limit are responsible for scores of visits – and most of them are for chronic conditions and complaints of pain – visits that usually end with a narcotics script."
Anderson says the new restrictions have the potential to "punish" that same 97% of Medicaid patients for the sake of clamping down on the 3% who allegedly abuse the system. "My bigger concern from a provider standpoint is that somebody is going to sit at home with their sick kid who has already had to go in three times, and now they're at home having trouble breathing," Anderson says.
"Or somebody is going to sit home with chest pains, or they are going to sit at home with a stroke. Some of these diagnoses are absolutely against the mission statement of the American Heart Association and the American Stroke Association about seeking care promptly."
Anderson says ACEP has alternative ideas for saving money that will not drastically impact care, including:
implementing a stricter prescription narcotics policy for EDs that could save $30 million by reducing the number of people who come to the ED for pain relievers;
increasing the use of psychiatric generic medicines, which could save the state about $130 million a year;
increasing the use of generics in the emergency department;
creating hotlines staffed by RNs who would steer patients to primary care alternatives.
"We want to save the state money because we shouldn't be at the table complaining unless we have alternatives," he said.
Surveys show that the public reveres nurses as the "most trusted" professionals. It's a well-deserved reputation built one patient at a time over decades of dedication and advocacy.
Sadly, that trust was violated in the death of Judith Ming, 66, and that makes her tragedy all the more disturbing.
The circumstances surrounding Ming's death on Sept. 24 at Sutter Health's Alta Bates Summit Medical Center in Oakland, CA remain under investigation. The accident occurred during the second-day of a five-day lockout of unionized staff who had walked off the job during a one-day strike on Sept. 22.
Preliminary reports indicate that Ming, who for months had battled ovarian cancer, died one day after a replacement nurse accidentally put a nutritional supplement into a catheter that entered her bloodstream. For the sake of expediency, anyone not familiar with the story can read this detailed account.
Ming's death was tragic enough. Unfortunately, what followed was a travesty, as the California Nurses Association/National Nurses United, Sutter Health, and the California Hospital Association executives abandoned decorum and traded barbs and pointed fingers.
"An incident like this is chilling and strikes right to our nurses' concern about their ability to advocate for their patients," CNA/NNU Executive Director RoseAnn DeMoro, told the San Francisco Chronicle. "It was irresponsible to lock out those nurses."
DeMoro's comments prompted a return salvo from Sutter Health, which posted a statement on its Website expressing deep regret for Ming's death, but also castigating union leaders for "exploiting the tragic death of this patient to further their own bargaining purposes, which is a shame."
The California Hospital Association also weighed in. "It is inappropriate and irresponsible for the California Nurses Association labor union to exploit this tragedy to further their union agenda," CHA President and CEO Duane Dauner said.
"This is the same union that has taken nurses away from patient bedsides more than 100 times during the past three years. It also is unfortunate that the nurses union is questioning the qualifications of other nurses providing patient care," he said.
No need to pick sides in this fight. There is plenty of blame to go around.
Let's start with the nurses.
DeMoro is asking us to believe that the lock-out was "irresponsible" but that somehow the strike that prompted 23,000 nurses at several hospitals across the state to abandon their patients for one day was not.
Yes, the patient was harmed during the lockout, and not on the strike day, and it's not clear if any patients were harmed during the one-day strike. What if they were? Would the striking nurses have been accountable then? Would we have even heard about Ming's death if the mistake had been made by a union nurse before or after the lockout?
According to the federal government, adverse events in hospitals kill tens of thousands of people each year and we don't hear much about individual cases. Would CNA/NNU have demanded accountability and challenged the competency of one of their own? Or, would they have blamed staffing ratios?
CNA/NNU, please don't tell us this strike was about patient care. There is nothing wrong with fighting for better pay and benefits. If it had been about patient advocacy, however, you would have stayed at the bedside.
Strikes disrupt patient care. Unions know that, and that is why strike threats carry weight. At least one study indicates that mortality rates jump by nearly 20% when patients are admitted during strikes. Unions know that hospitals will be hard pressed to find qualified replacement staff on-the-fly because there is a nationwide nursing shortage. So, when that labor disruption leads to the injury or death of a patient, nobody should be surprised and shocked.
As for Sutter Health, this tragedy illustrates how management gets the union it deserves. Sutter claims the five-day lockout was necessary because that was the shortest contract they could sign with the nurse staffing agency. That may be true, but contracts can be redrawn.
Kaiser Permanente hospitals, for example, were also the target of one- and three-day strikes last month but their union nurses were back on the job the next day. Perhaps the five-day lockout at Alta Bates was a punitive measure from hospital leadership to hit nurses in the paycheck and discourage them from future strikes. Clearly there was brinksmanship at play here, and apparently at least one patient suffered for it.
Sometimes in these labor disputes, healthcare professionals forget what line of work they're in. Hard noses, bare knuckles, and sharp elbows might work at a tire factory or a pier on Long Beach, but they aren't appropriate in a healthcare setting.
Hospitals are supposed to be places of healing, treating sick and frightened people at their most vulnerable. And because of their noble and important work, healthcare professionals are held in high esteem. They are also paid more than most people, and held to a higher standard of behavior and accountability.
Try to imagine how Jim Ming -- Judith Ming's husband of more than 30 years -- is reacting to this unseemly public relations war waged over his wife's death. Maybe if labor and management had spent as much energy avoiding the strike as they did on damage control after Judith Ming's death, this tragedy could have been avoided.
The next time they go to the bargaining table the union and management should invite Jim Ming. He could remind them of what their priorities should be.
Acute care hospitals in Pennsylvania want Congress to examine ambulatory surgery centers as a target for reimbursement cuts or other revenue measures. The hospitals believe that a review by the "super committee" charged with balancing the budget will show that ASCs are cherry picking lucrative commercially insured patients and shirking care for lower-paying Medicare, Medicaid and indigent care.
"We are asking the super committee to understand that hospitals nationwide have a $155 billion in cuts in the foreseeable future already on the table," as part of the Affordable Care Act, said Michael P. Strazzella, senior vice president for Federal Relations & Political Development at the Hospital & Healthsystem Association of Pennsylvania.
"Those cuts include $9 billion in Pennsylvania alone. There needs to be some recognition that there are other people who can afford to take those kinds of cuts without impact the care they provide," he said.
A report last month by the Pennsylvania Health Care Cost Containment Council showed that there are 266 ASCs in the state, up from 72 one decade ago. The council reported that ASC total profit margins have exceeded 26% in each of the past three years, while acute care hospitals see margins averaged 5.2%. HAP says that is partly because Medicaid accounted for only 4.5% of ASC revenue in 2010, compared to 11.8% of general acute care outpatient revenue.
"The pressure on acute care hospitals is increasing because there is a larger demand on public and private payers. We are seeing more people lose their private insurance and move to Medicare and Medicaid, even as those payments have decreased," Strazzella told HealthLeaders Media.
In addition, Strazzella says Pennsylvania's acute care hospitals have seen their state Medicaid reimbursements cut by 4% in fiscal year 2011-12.
However, Pam Erdel, president of the Pennsylvania Ambulatory Surgery Association, says HAP is making an apples-to-oranges comparison on operating margins because ASCs and hospitals use different calculations. "For ASCs, the salaries paid to physician-owners are not counted as overhead. In the hospital that is all taken out before they report their operating margins. It would be similar to removing all the staff salaries from the operating costs of a hospital before calculating their margins," she says.
Erdel says two-thirds of ASCs nationwide provide care at reduced rates for patients who are underinsured or not uninsured. "We feel bad for hospitals in that they are having reduced rates, but we already started out with less. We get paid on average 56% of the rate that the hospital gets paid for doing the same procedure, because Medicare set it up that way," she says.
Erdel says it's ironic that HAP would target ASCs for criticism when "the most lucrative ASCs are owned by hospitals," and those hospitals belong to HAP. "I would love to bridge that relationship with the HAP because we have a lot to offer each other," she says.
Online advertised vacancies for healthcare practitioners and technical occupations increased by 17,900 listings in September, marking the second consecutive month of impressive gains for the sector, The Conference Board reports.
And for the second straight month, healthcare practitioners and technicians – with 531,600 online job listings -- posted the largest increases in online advertised vacancies among the top 10 occupation groups in the overall economy.
There were 26,300 new online job listings for healthcare practitioners and technicians in August, which snapped a two-month decline that included a decrease of 61,200 listings in July.
The growth in job postings for healthcare practitioners was largely fueled by the demand for registered nurses, according to The Conference Board Help Wanted Online report, which tracks more than 1,000 online job boards across the United States. For those highly skilled healthcare occupations, there were two jobs advertised for every job seeker, with an average hourly wage of $34.27.
Healthcare support positions fell by 200 listings to 115,800 in September. There were 2.7 healthcare support job seekers for every job opening, and the positions paid – on average -- $12.94 an hour, The Conference Board reported.
In the overall economy, the news was dour. Online job listings fell by 43,500 posts in September to about 3.8 million, after losing 164,000 job listings in August, 217,000 listings in July and 100,000 listings in June. Nationally there were 10 million more unemployed people than advertised vacancies.
"In the last six months, labor demand has experienced a drop of 500,000, cutting sharply into the gain of 763,000 at the beginning of the year," said June Shelp, vice president at The Conference Board. "This narrows the average monthly gain for 2011 to 29,000."
Shelp noted, however, that the slowdown varies widely for different occupations. "Some occupations stalled early and are now declining; others have just stalled over the last few months and yet others are holding steady either at or below their pre-recession levels," she said.
This article appears in the September 2011 issue of HealthLeaders magazine.
Our annual industry survey shows that healthcare leaders are somewhat mixed on the effectiveness of comanagement models for service lines, with 43% finding them effective or very effective, 44% neutral, and 13% ineffective or very ineffective. In this era of healthcare reform, do you believe this shared governance model will become more relevant or less?
Paul J. Hensler, FACHE
CEO, Kern Medical Center,
Bakersfield CA
More than structuring these things, relationships are important. It is very important to constructively involve physicians to the maximum they are willing to be involved, particularly by service line.
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I’ve had a lot of success involving physicians in service lines, looking at the various vendors and the various expenses in the program. They have been very constructive in finding ways to improve quality, reduce length of stay, reduce the cost of implants. When they get involved, even without incentive, I have found they become very protective of the hospital’s resources and have serious discussions
with vendors about ‘You’ve got to do better than that.’ The objective should always be to have physicians actively and constructively involved.
There is a level of trust that goes back to the relationship being more important than whatever structure you put together. If they see a common goal and if they understand—either as an employer or as the hospital they choose to use—that it needs to remain financially viable, if they see that savings go to other programs they want to see developed, you get a lot of cooperation. If they perceive that all it does is pad the bonuses of administrators, they are probably not as willing to work with you.
Barry Solomon, MD
CMO, Providence Health,
Kansas City, KS
A lot of it is relationships. They have to be docs you trust and, in essence, people you want to be in business with. You just can’t say ‘I am going to create this comanagement program. I can’t stand the docs but I am going to do it anyway.’ That is just asking for trouble. It truly has to be almost a joint venture. The service line has to be separated out. The ones that I have seen that work are a true comanagement. There is a board, and it’s not just a medical director but a lot of docs involved.
It can work with an employed model. It would be more on the incentive side. The advantage is there are some doctors who don’t want to be employed, and this is a way, especially with the specialties, to allow them to be engaged with the organization without being employed.
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When everybody is working toward the same objective, everybody—physician and otherwise—is going to be cognizant of costs. If you have a management team made up of physicians and administrators, the doctors would say, for example, one of the reasons this particular service line costs so much is that the operating room turnaround is 28 minutes, and down the street at the ambulatory surgery center the turnaround is 15 minutes. The reason is that we as doctors manage it and it affects our revenues.
Cliff Deveny, MD
Senior Vice President for
Physician Practice
Management, Catholic
Health Initiatives, Denver
Transparency and accountability: If the physicians are seeing everything, then there is accountability. Once physicians are held accountable they tend to be very competitive and don’t want to be the poor performer. When you rank people and put it out there, they react to that.
There is historically a culture of distrust that comes from a lack of transparency, a lack of understanding of each other’s perspectives. In most hospital systems the physicians have never been given the data in a way that allows them to be held accountable.
Creating alignment: Depending on the market and the situation, I find that clinical comanagement works well, sometimes as a subset of a joint venture. In joint ventures, we would give the management of the joint venture option to the physicians and we would find that they did a good job with driving down costs and improving satisfaction. There was an extra incentive as managers. In the models where there is just clinical comanagement, it works with a sophisticated group of physicians who are integrated and willing to work together as a team. When you have a fragmented medical staff or group of individuals, it is harder to drive that because you have to create some kind of legal structure.
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Creating incentives: Comanagement can work with employed physicians because you could put incentives in their compensation schedule that are more around group productivity or performance bonuses, not unlike what you see with senior management folks in the hospitals and systems, in that we have base pay and bonuses based on certain metrics. You could create that same sort of infrastructure for physicians.
James R. Gray, RN
Director of Quality, Landmark Hospital,
Athens, GA
If you don’t have good leadership that understands the model, then forget it; it’s not going to work. Some leaders still don’t understand the comanagement model, and they are trying to run it like they own everything—that there shouldn’t be any physician input.
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And physicians aren’t used to being managed that way, so they have to have a good feel for the management above them.
There is an inherent distrust. CV and orthopedics are the big service lines, but the other place comanagement would work is OB, particularly with its liability. If you can package a group of doctors and get a liability policy, you can save them money and provide them with office space and bundle the whole thing. General medicine is still going to balk at comanagement.
Hospitalists are hospitalists. That is a different ball game with those guys. Call, management of the process to get the patient admitted and out of there quickly, utilization of their supplies—that kind of thing—they are a tougher group to manage, per se. And they are so short in supply that it is difficult to recruit for that. Most of those guys are looking at quality of life plus bucks and that is a difficult group to recruit to and manage for that.
This article appears in the September 2011 issue of HealthLeaders magazine.
