Journalists love closure. I started the year with eight predictions for healthcare HR in 2010. So, I thought I'd end the year with a look back to see how well – or poorly – I did as a prognosticator.
Prediction 1: "The healthcare sector will continue to see job growth." Verdict:Correct!
I will confess that this was hardly a difficult prediction. The healthcare sector has never seen long-term job contraction. We won't have the final numbers for all of 2010 until early January. But it's safe to say that the healthcare sector, once again, was a major driver for job creation in this country, as it has been for decades. Bureau of Labor Statistics figures for the first 11 months of 2010 show that healthcare job creation was significantly slower than it was during the middle of the decade. However, the rate of healthcare job growth in 2010 has nearly doubled the historically low rate of job growth in 2009. Look for this hiring trend to continue into 2011.
Prediction 2: "The hunt for qualified healthcare IT workers will intensify." Verdict: Depends.
There was a lot of talk last year about where hospitals, physicians' offices, and other providers would find the people with the clinical and technical expertise to operate these complete interoperable electronic health records. Some providers are having more luck than are others. Generally, rural providers are finding it more challenging than are their colleagues in urban areas, many of whom report a glut of qualified help. That shouldn't be too surprising because that dynamic holds true on just about every other healthcare staffing issue, where rural providers are struggling to attract qualified people. Plus, the recession is making hospital employment more attractive to people who see healthcare as more resistant to economic doldrums.
Prediction 3: "Wash your hands!" Verdict: Sort of.
I suggested last January that HR would take a significant role in improving employee awareness about the importance of hand washing. I'm not so sure that has proven to be the case. However, hospital/healthcare-acquired infections is still a huge issue, and two recent and alarming reports suggest that the healthcare sector has made little if any progress in preventing tens of thousands of hospital deaths will ensure that the issue remains on the front burner in 2011. Besides, if your HR folks aren't taking an active role in hand washing campaigns, they ought to be.
Prediction 4: "Coming soon to a hospital near you: Unions. Verdict: Spot On!
Labor unions are rolling healthcare. The 35th Semi Annual Labor Activity in Healthcare Report—conducted by IRI Consultants for the American Society for Healthcare Human Resources Administration—found union win rates in healthcare representation elections have held above 70% for five straight years. Even more impressive, in the first six months of 2010 the Service Employees International Union won 91% of its representation elections, and the newly formed National Nurses United won 100% of its elections. If a union targets your hospital for organization, odds are it's already too late for you to do much about it.
Nurses unions are making staffing ratios a huge priority and they have a compelling argument that resonates with the public, although the movement has not gained as much traction in the last 12 months as I would have anticipated. However, I do believe it will pick up steam as the super union National Nurses United gains members and clout. Even if mandatory staffing ratios are not necessarily implemented widely, the mere threat of demanding mandatory staffing ratios will remain a powerful bargaining chip for nurse organizers.
Prediction 6: "Cracking down on patient confidentiality." The Verdict: Correct!
Patient confidentiality is not a fad . It is here to stay. Get used to it. The federal government has invested tens of billions of dollars in healthcare information technology, and it desperately wants patients to trust that their personal information will remain confidential in the age of electronic medical records. Woe betides any provider that violates that trust.
Prediction 7: "Healthcare sector employee health and wellness programs." Verdict: Correct, for the most part.
I could have phrased this prediction a little better. My point back in January was that the healthcare sector has been something of a laggard in the wellness movement, and that the sector would spend 2010 trying to catch up with other industries that have had wellness programs in place for more than a decade. In that sense, I was correct. We are hearing more talk about hospitals and other healthcare providers that are finally recognizing the need to implement effective wellness programs to reduce the cost of healthcare coverage, sick days, and other illness-related expenses, and to improve employee morale.
Frankly, that's not enough. The healthcare sector – and hospitals in particular – should be leaders by example in the wellness movement. That includes not only implementing the wellness programs, but studying wellness programs to find out what works, what doesn't, and how much money they can save. Hospitals are often the economic engines of a community and the largest employer. If your hospital implements effective wellness programs, others will follow.
It seems like every week the U.S. Justice Department is writing about a multimillion dollar whistleblower lawsuit settlement. Often as not, the defendant is a healthcare provider, a pharmaceutical company, or an insurer. A lot of the growth in the whistleblower industry in the last few years has deservedly been directed at the financial sector. There is good money in informing, which can garner as much as 30% of the value of the settlements for whistleblowers and their attorneys.
Let me know what you think is on the radar screen for 2011.
Psychiatrist, Research Director, Naval Medical Center San Diego U.S. Navy Reserve Commander Robert Neil McLay's field of expertise involves post traumatic stress disorder and the effects of combat-induced stress on the brain. He is a pioneer in the use of computer-based virtual reality simulators for treating PTSD. His treatment regimens, which include traditional therapy and consultation, have enjoyed success rates of up to 75%, even for patients with a history of treatment resistance. [Read more]
For trauma surgeon John Brebbia, MD, volunteer work in Haiti after the Jan. 12 earthquake was inspired by the memory of a fallen colleague, as much as it was by the knowledge that the practical expertise and care he could provide was desperately needed in the stricken island nation. [Sponsored by McKesson]
To find a working, bipartisan, political system that focuses on practical results within budgetary constraints, leave the Beltway and look to the states. In striking contrast to Congress, Vermont provides a great example of what Republicans and Democrats can achieve in healthcare when they agree upon a common goal. And perhaps no one better embodies that bipartisan spirit in the Green Mountain State than long-serving Republican Gov. Jim Douglas. [Sponsored by McKesson]
In the past two years, this column has focused much on workplace violence in the hospital—an issue that until recently received scant attention beyond the people who were immediately threatened.
Fortunately, awareness is growing. The mainstream media has picked up on the story, thanks to the efforts of groups like the Emergency Nurses Association (ENA), which has provided detailed accounts about the frequency of onsite violence against clinicians and other staff. ENA’s alarming 2007 survey in which 86% of respondents reported having experienced workplace violence is frequently cited by news outlets.
Now, when violence occurs in a hospital, media no longer report it simply as an isolated and unpredictable incident, but as part of a larger and disturbing trend of hospital violence that is taking place across the country. And, as more data is compiled about the extent of these attacks, the media will intensify its coverage because it resonates with the public.
This is all good. Acts of violence in places of healing are still occurring at an alarming rate, but most people who are in a position to address the issue no longer are in denial. That is an important first step. An informed and angry public will demand change, and that means that hospital leaders who ignore workplace security do so at their own peril.
If an employee, a patient, or a visitor in your hospital is attacked, be assured your local news media (probably unions, too) will examine previous incidences of violence at your hospital to look for patterns, and demand to know why you took no previous action to address an issue you should have known about. And, they’d be right in asking.
Recently, the Journal of Emergency Nursingreported on an innovative program at the University of Wisconsin Hospital and Clinics to address an uptick in violent incidents against staff, patients, and visitors at the Madison, WI-based health system’s emergency department. Working from Centers for Disease Control data which shows that emergency departments are the most frequent location for violence in healthcare, UWHC formed an interdisciplinary team of nurse leaders and front-line staff to address the issue.
They developed a safety program that uses a green-yellow-red color-coded alert system that shows the security status with lights in strategic places in the ED. For example, when ED staff encounter patients with behavioral problems, victims of violent crime, surge-capacity issues, gang activity, multivictim trauma, and other events that could lead to a higher of risk for violence, physicians, nurses and security staff briefly huddle to discuss changing the department's status from green (business as usual) to yellow (potential for disruptive behavior) to red (potential for loss of control of any part of the ED). When security status changes, a three-second alarm and change in light color alert staff to the new situation.
“The training may not prevent unexpected violent outbursts, but staff are better able to identify people at risk of individual violent behavior and know when to cue a potential change in security status,” said Tami Morin, ED clinical nurse manager at UWHC.
Bingo!
Front-line healthcare professionals like the folks at UWHC tend to be practical problem-solvers. They understand it’s probably not realistic to think that workplace violence in the hospital can be eradicated. However, raising staff awareness, and training staff in appropriate responses will give them the tools they need to react accordingly to protect themselves, their colleagues, patients, and visitors.
Appleton (MN) Area Health Services, a community-owned critical access hospital, has entered a volume purchasing agreement with Sanford Health, effective Jan. 1.
"Rural hospitals face many challenges, and this associate relationship with Sanford Health allows us to continue to provide quality healthcare for people in the community. It also increases potential for growth in services," said Jason Carlson, CEO of Appleton Area Health Services.
Sanford Health, based in Sioux Falls, SD, and Fargo, ND, has several relationship tiers with hospitals in the region, ranging from associate, managed, leased and owned status. The associate agreement with Sanford Health allows Appleton Area Health Services access to Sanford's volume purchasing power, saving money for the local hospital.
"This new relationship also expands education opportunities for staff and Appleton Area Health Services to gain and share 'best practices' knowledge with the entire Sanford Health system," Carlson said.
Appleton Area Health Services includes the 15-bed critical access hospital, a long-term care facility, congregate living facility, home health and a primary care clinic. It employs approximately 170 full and part-time people.
"Both of our organizations believe healthcare should be delivered as close to home as possible," said Sanford Health President Ed Weiland. "Sanford Health has a significant presence in Minnesota, and by working together we can create a virtual medical hub for the area with potential for sharing expertise, resources and providers.
Sanford Health is the largest, rural, not-for-profit healthcare system in the nation, with a presence in 110 communities in eight states that includes 30 hospitals, 111 clinics, more than 800 physicians in 70 specialties, and more than 18,000 employees. Sanford Health is also developing clinics in Belize and Ireland.
Community Health Systems, Inc. has made public its unsolicited offer to acquire Tenet Healthcare Corp. for $6 per share in cash and stock—a deal valued at $7.3 billion that if finalized would create the nation's largest private hospital chain.
However, Tenet's board of directors unanimously rejected the offer as "inadequate," and added that "Community Health's stock appears to be over-valued and is not a desirable currency for Tenet shareholders."
"In making its determination, the Tenet Board considered that Community Health's opportunistic proposal would transfer the growth potential inherent in Tenet to Community Health without adequately compensating Tenet shareholders," Tenet President/CEO Trevor Fetter, and Chairman Edward A. Kangas said in their letter to CHS. "The Tenet Board believes that the interests of Tenet shareholders would be better served by benefiting from 100% of the upside inherent in Tenet rather than accepting Community Health's inadequate proposal. In addition, the Board has serious concerns about Community Health's ability to integrate and operate a business like Tenet."
CHS had offered to pay $6 per share, including $5 per share in cash and $1 per share in CHS common stock, which represents a premium of 40% over Tenet's closing stock price on Thursday. The value of the transaction would be approximately $7.3 billion, including $3.3 billion of equity and approximately $4 billion of net debt. The offer was made in a letter to Tenet's Board of Directors on Nov. 12, and rejected by Tenet on Dec. 6.
CHS Chairman, President, and CEO Wayne T. Smith said he decided to go public with the offer to ensure that Tenet shareholders were made aware of the proposal, and the board's rejection.
"This will allow Tenet shareholders to decide for themselves if they prefer the substantial premium and high degree of certainty offered in this transaction—or would rather continue to accept the significant risk, especially in light of recent operating performance, that Tenet can achieve greater present value for shareholders through execution of its strategic plan in the years ahead," Smith said in a letter Thursday to the Tenet board.
Franklin, TN-based CHS said the combined company would have approximately $22 billion in annual revenues and own or operate 176 hospitals in 30 states with a total of 32,830 licensed beds.
Global spending on healthcare will surge by $71 trillion—an increase of more than 50%—by 2020, with the greatest growth coming from emerging markets in Brazil, Russia, India, and China, according to a new report from PricewaterhouseCoopers.
Health spending in these countries is rising faster than gross domestic product, exposing gaps in budget deficits and prompting governments to look to public-private partnerships for better value, PwC said in its report, Build and Beyond: The (r)evolution of healthcare PPPs.
The report identifies as a growing trend the use of PPPs to finance and manage health infrastructure and delivery, which PwC said could create a multi-trillion global market opportunity for private companies and investors, implement a more efficient use of taxpayer dollars, and improve healthcare quality.
"The public finance of private innovation and efficiency is a win-win-win for governments, private industry and patients," said David Levy, MD, global health leader, PwC. "Public-private partnerships offer the opportunity to increase access and quality of care, bend the cost curve on health spending and create accountability for health systems among groups that previously haven't had appropriate incentives to work together."
Public health authorities around the world are increasingly contracting with private entities to manage healthcare services for defined populations or markets. These PPPs—which have been used for infrastructure finance—are evolving as way to slow the rising cost of healthcare and address larger problems in the health system.
PPPs enable public health authorities to maintain oversight of standards while injecting private sector fiscal discipline, innovation, and efficiencies that are driven by incentives to generate long-term savings and improve quality, PwC said.
The market for PPPs is expected to grow significantly over the next five years, because the model can save healthcare costs. For example, Spain's Alzira project, which includes hospital and primary care services, saved the government 25% of the cost of providing care, PwC said.
Competition for private capital has prompted governments in Europe, Asia, Africa and southeast Asia to establish PPP agencies to develop policy recommendations, streamline procurement and contract for services, PwC said.
"The keys to the success of PPPs as they move beyond building infrastructure to long-term delivery of clinical services will be in contracts that clearly establish performance goals around quality and health outcomes," said Kelly Barnes, U.S. Health Industries Leader, PwC.
In 2010, a number of record-setting PPPs formed across three continents to finance hospital infrastructure, including a new 700-bed Karolinska Solna University Hospital in Stockholm, Sweden, the largest hospital PPP in the world. Other deals were made in Canada, Mexico, Africa and Spain.
While the deals are dominated by infrastructure projects, they are also expanding the market for private capital and expertise in health services. As the scope of the partnership projects in healthcare grows, so does the size of the potential market for private companies, PwC said.
PwC estimates that:
By 2020, spending on health infrastructure among the Organization for Economic Cooperation and Development countries, and Brazil, Russia, India, and China, will increase to $397 billion annually, up from $263 billion today. However, the larger market for health PPPs will be in non-infrastructure spending, estimated to be more than $7.5 trillion annually, up from $5 trillion in 2010.
Between 2010 and 2020, OECD and BRIC nations will spend cumulatively $3.6 trillion on health infrastructure and $68.1 trillion on non-infrastructure health spending.
Health spending in the United States accounts for half of all health spending among OECD nations. However, the biggest growth will be outside of the U.S. According to PwC projections, the countries that are expected to have the highest health spending growth between 2010 and 2020 are China, where spending is expected to increase by 166%, and India, which will see a 140% increase.
Among OECD countries, health spending as a percent of GDP will increase to 14.4% by 2020, up from 9.9% in 2010. Among BRIC nations, health spending as a percent of GDP is expected to increase to 6.2% in 2020, up from 5.4% in 2010 as their economies grow and they build out their health systems. In actual spending, this amounts to a 117% increase in spending over the decade, with China leading the way.
The U.S. House on Thursday afternoon voted 409-2 to delay by one year the nearly $20 billion in Medicare reimbursements cuts to physicians that were due to take effect Jan. 1.
The overwhelming and bipartisan vote came one day after the measure garnered unanimous consent in the Senate. President Obama said he supports the delay. He also called for a permanent solution to the "doc fix," a perennial Congressional sideshow.
"This agreement is an important step forward to stabilize Medicare, but our work is far from finished," Obama said. "For too long, we have confronted this reoccurring problem with temporary fixes and stop-gap measures. It's time for a permanent solution that seniors and their doctors can depend on and I look forward to working with Congress to address this matter once and for all in the coming year."
The Sustainable Growth Rate formula for Medicare funding dictates the cuts, which have repeatedly been temporarily delayed – including five times this year -- since Congress passed the measure a decade ago. In the latest round of cuts, physicians were facing a 25% reduction in Medicare reimbursements on Jan. 1. Delaying the cuts is expected to cost about $19.2 billion.
The American Medical Association praised the lame duck Congress for its bipartisan support of the measure.
"Stopping the steep 25% Medicare cut for one year was vital to preserve seniors' access to physician care in 2011," said AMA President Cecil B. Wilson, MD. "Many physicians made clear that this year's roller coaster ride, caused by five delays of this year's cut, forced them to make difficult practice changes like limiting the number of Medicare patients they could treat."
Wilson echoed the president's call for a permanent SGR solution. "The AMA will be working closely with Congressional leadership in the new year to develop a long-term solution to this perennial Medicare problem for seniors and their physicians. This one-year delay comes right as the oldest baby boomers reach age 65, adding urgency to the need for a long-term solution before this demographic tsunami swamps the Medicare program," he said.
The bill, the Medicare and Medicaid Extenders Act of 2010, also includes extensions of other expiring healthcare provisions, including protections for rural hospitals and doctors, Transitional Medical Assistance and the Special Diabetes Program.
Senate leaders patted each other on the back Wednesday after approving the extension, which demonstrated a rare show of cooperation on Capitol Hill.
"This bipartisan agreement gives peace of mind to seniors and military families in Nevada and across the nation," said Senate Majority Leader Harry Reid (D-NV). "We ensured that our seniors and veterans can continue seeing their doctors and getting the treatment they need."
Senate Minority Leader Mitch McConnell (R-KY) said he was "encouraged that we were able to work together in a bipartisan way and protect access to care for America's 45 million Medicare beneficiaries in a fiscally responsible manner."
Reid's office said the legislation would be paid for by modifying the policy regarding overpayments of the healthcare affordability tax credit. This policy does not change the tax credits for which people are eligible based on their income. Instead, the proposal would change the way people pay back overpayments when they have received more credit than they are eligible for because, for example, they earned more money than expected in a given year.
Under current law there is a flat cap of $250 for individuals and $400 for families on the amount of the healthcare affordability tax credit people are required to pay back when they received an overpayment. This payback cap is the same for people earning 160% of the federal poverty level and 360% of the federal poverty level. Under this proposal for correcting overpayments, the cap on the payback amount would be on a sliding scale based on the income of the recipient of the tax credit, making the policy fairer to both recipients and all taxpayers, Reid's office said.
The American Medical Association is praising the U.S. Senate's bipartisan vote Wednesday to delay by one year 25% Medicare reimbursement cuts to physicians, and is urging the House to follow suit before the Jan. 1 deadline.
"This one-year delay comes right as the oldest baby boomers reach age 65, adding urgency to the need for a long-term solution before this demographic tsunami swamps the Medicare program," said AMA President Cecil B. Wilson, MD.
The House has yet to take up the measure, and it's not clear how much support it will garner in the lame duck session.
"Stopping the cut for one year will inject some much needed stability into the system for seniors and physician practices who have spent this year in limbo because of five short-term delays," Wilson said. "We urge the House to quickly pass this critical legislation before the January 1 deadline when the 25% Medicare cut is set to begin."
Wilson said the AMA will work with Congress in the coming year to find a permanent solution to the so-called "doc fix." The Sustainable Growth Rate formula for Medicare funding dictates the cuts, but the cuts have repeatedly been delayed since Congress passed the measure a decade ago.
Delaying the cuts one more time would ensure that Medicare and Tricare, for active-duty service members, National Guard and Reserve members, retirees and their families, will pay physicians who participate in those programs at current levels.
The bill, the Medicare and Medicaid Extenders Act of 2010, also includes extensions of other expiring healthcare provisions, including protections for rural hospitals and doctors, Transitional Medical Assistance and the Special Diabetes Program.
Senate leaders patted each other on the back after approving the extension, which demonstrated a rare show of bipartisanship on Capitol Hill.
"This bipartisan agreement gives peace of mind to seniors and military families in Nevada and across the nation," said Senate Majority Leader Harry Reid (D-NV). "We ensured that our seniors and veterans can continue seeing their doctors and getting the treatment they need."
Senate Minority Leader Mitch McConnell (R-KY) said he was "encouraged that we were able to work together in a bipartisan way and protect access to care for America's 45 million Medicare beneficiaries in a fiscally responsible manner."
Reid's office said the legislation would be paid for by modifying the policy regarding overpayments of the healthcare affordability tax credit. This policy does not change the tax credits for which people are eligible based on their income. Instead, the proposal would change the way people pay back overpayments when they have received more credit than they are eligible for because, for example, they earned more money than expected in a given year.
Under current law there is a flat cap of $250 for individuals and $400 for families on the amount of the healthcare affordability tax credit people are required to pay back when they received an overpayment. This payback cap is the same for people earning 160% of the federal poverty level and 360% of the federal poverty level. Under this proposal for correcting overpayments, the cap on the payback amount would be on a sliding scale based on the income of the recipient of the tax credit, making the policy fairer to both recipients and all taxpayers, Reid's office said.
