The U.S. Senate reached an 11th hour deal today and unanimously agreed to extend a $6.4 billion temporary "doc fix" deadline for 21% cuts in Medicare by another six months.
However, the cuts still go into effect today because the U.S. House won't act on the measure until at least Monday.
CMS today instructed Medicare contractors to lift a temporary hold on claims and services paid since June 1 and begin to process the claims with the 21% reimbursement cuts.
"The CMS is hopeful that Congressional action will be taken to avert the negative update and will continue to monitor those actions. If Congress changes the negative update currently in effect, CMS is prepared to act expeditiously to make the appropriate changes to Medicare claims processing systems," CMS said in a prepared statement.
The Senate action did little to assuage critics of Congress, particularly the American Medical Association, which has long called for a permanent fix.
"It is astounding that Congress has let seniors down through their inability to deal with this problem on time and in a responsible fashion," said AMA President Cecil B. Wilson, MD. "This afternoon, the Senate voted to delay the cut another six months, but the cut is still in place until the U.S. House of Representatives acts."
A Republican filibuster on the vote was cleared after Senate Democrats agreed with a GOP demand that the extension would not add to the federal budget deficit. "The fully-paid-for bill that we passed today would stop doctors from taking a 21% pay cut and ensure Nevada's seniors and veterans won't lose access to medical care they depend on," said Senate Majority Leader Harry Reid, D-NV. "This is good news for millions, but we still have much work ahead of us to make sure that we are helping working Americans during these difficult economic times."
Wilson was less enthusiastic, and accused Congress of "playing Russian roulette with seniors' healthcare."
"Congress has finally taken its game of brinksmanship too far, as the steep 21% cut is now in effect and physicians will be forced to make difficult practice changes to keep their practice doors open," he says. "This is no way to run a major health coverage program - already the instability caused by repeated short-term delays is taking its toll."
Wilson says one in five physicians report that they've already been forced to limit the number of Medicare patients, including nearly one-third of primary care physicians.
"The top two reasons physicians gave for these actions were the ongoing threat of future cuts and the fact that Medicare payment rates were already too low," Wilson says.
New York Hospital Queens on Thursday opened its seven-floor West Wing with a ceremonial ribbon cutting at the Flushing main campus.
The 190,000-square-foot wing will add 80 beds to the hospital, and raises to 519 the hospital's certified bed capacity. The wing and a three-level parking garage took more than three years to complete at a cost of $210 million.
NYHQ President/CEO Stephen S. Mills said the wing was completed despite a deep recession and great uncertainty in the healthcare sector.
"Right here in Queens we saw several institutions close while our expansion project was underway," Mills said in a media release.
The wing includes medical/surgical units with private and semi-private rooms, and centralizes high-demand cardiovascular and orthopedic services. The ground floor includes an ambulatory surgery center with 10 operating rooms and 33 recovery beds.
The wing increases the hospital's capacity to perform surgical and interventional procedures with a hybrid operating suite for endovascular and interventional radiology procedures that can be converted to perform vascular procedures.
The lobby welcomes visitors with messages in the languages used most in the diverse neighborhoods of Queens County.
The wing was designed with the structural capacity to support additional floors, and as the project proceeded, two floors were added to the original plan. They will remain vacant space for the near future.
New York Hospital Queens is a member of the New York-Presbyterian Healthcare System and an affiliate of the Weill Medical College of Cornell University. Primary funding for the project came through the Department of Housing and Urban Development.
Health and Human Services Secretary Kathleen Sebelius announced that the federal government has targeted $250 million to bolster the nation's primary care workforce.
The funding represents the first allocation from the $500 million Prevention and Public Health fund for fiscal 2010, created by the Affordable Care Act. Half of the fund—$250 million—will attempt to boost the number of primary care providers in this country by:
Creating additional primary care residency slots: $168 million for training more than 500 new primary care physicians by 2015;
Supporting physician assistant training in primary care: $32 million to develop more than 600 new physician assistants;
Encouraging students to pursue full-time nursing careers: $30 million for more than 600 nursing students to attend school full-time so they can complete their education faster;
Establishing new nurse practitioner-led clinics: $15 million for 10 nurse-managed health clinics to train nurse practitioners;
Encouraging states to address health professional workforce needs: $5 million for states to plan strategies to expand their primary care workforce by 10% to 25%.
"These new investments will strengthen our primary care workforce to ensure that more Americans can get the quality care they need to stay healthy," Sebelius said in a media release. "Primary care providers are on the front line in helping Americans stay healthy by preventing disease, treating illness, and helping to manage chronic conditions."
Roland Goertz, MD, a family physician in Waco, TX, and president-elect of the American Academy of Family Physicians, says the funding is "a great first step."
"It addresses the key issues. It helps us move toward the patient-centered medical home as a model of care delivery, working with registered nurses, PA nurses, and others in the system," Goertz says. "But we need to have a movement toward rebalancing. And the imbalance has been created over a long period of time. We haven't had an adequate balance of primary care physicians in this country since the 1960s. It can't just be one time for two or three years. It has to be for a sustained period of time to correct the imbalance."
The Health Alliance of Greater Cincinnati, two member hospitals, and an affiliated physician group will pay the federal government $2.6 million to settle alleged kickback-for-referral allegations, the Department of Justice announced.
Named with The Health Alliance in the whistleblower settlement were The Fort Hamilton Hospital, The University Hospital, and physicians' group University Internal Medicine Associates Inc.
It's the second time in less than one month that the Health Alliance has been involved in a multimillion dollar whistleblower settlement with DOJ. On May 24, Health Alliance and former affiliate The Christ Hospital agreed to pay $108 million to settle similar allegations.
Federal prosecutors said the alleged scheme at 310-bed The Fort Hamilton (OH) Hospital was fueled by the hospital's desire to expand its cardiology services to include interventional procedures that state law prohibited at that hospital unless they were part of a clinical trial. University Internal Medicine Associates, based at The University Hospital in Cincinnati, allegedly offered to provide the interventional cardiology coverage that The Fort Hamilton Hospital needed for the clinical trial, but only if the hospital agreed to preferential referrals of cardiology patients and procedures to the physician group, prosecutors said.
That arrangement resulted in patients being transferred to The University Hospital, or being seen by cardiologists with University Internal Medicine Associates rather than the hospital or cardiologist of their choosing, a violation of the federal anti-kickback statute. The False Claims Act violations were allegedly committed when the two hospitals and the physicians group submitted claims generated by the illegal scheme to Medicare, prosecutors said.
The Hospital Alliance did not return requests seeking comment.
The suit was initiated by whistleblower Deborah Hauger, MD, a cardiologist who formerly worked at The Fort Hamilton Hospital. She will receive $468,000.
Peter W. Carmel, MD, a pediatric neurosurgeon from New York City, was named president-elect of the American Medical Association today, and will become AMA president in June 2011.
"I am honored to be elected to lead the nation's most influential physicians' organization," Carmel said in a media release. "As AMA president-elect, I pledge to serve as a strong voice and dedicated advocate for patients and physicians on the pressing issues confronting our healthcare system."
Carmel, who practices in Newark, NJ, is the chairman of the Department of Neurological Surgery at the New Jersey Medical School and co-medical director of the Neurological Institute of New Jersey.
He was first elected to the AMA board in 2002, and re-elected in 2006, and has served as a member of the AMA House of Delegates for 17 years. He has served as chair of the Specialty and Service Society, and chair of the AMA Council on Long Range Planning and Development, where he helped establish the proportional representation for specialty medical society members.
Carmel received his medical training at New York University School of Medicine and was a research associate at the National Institutes of Health. He completed his residency in neurosurgery at the Neurological Institute of New York, and obtained his doctorate in neuroanatomy from P&S, where he was the founding chief of the Division of Pediatric Neurosurgery and a professor of neurological surgery.
While the healthcare reform laws that went into effect this year focused on expanding enrollment, they're not expected to do much about containing costs in the short-term. That fact was brought home in a new report from PricewaterhouseCoopers LLP Health Research Institute, which predicts that the nation's employers can expect their medical costs to increase by 9% in 2011.
That represents a decrease of .5% from the 2010 growth rate, but it will also fuel anxiety and anger among workers, who'll almost certainly see their premiums rise while benefits drop and their wages stagnate.
"We deliver American healthcare in an expensive way, and we pay for it," says Cyril F. Chang, director of the Methodist Le Bonheur Center for Healthcare Economics in Memphis. "Nine or 9.5% is extremely high especially compared to zero inflation in the economy. Healthcare is again dancing to its own tune." For the first time, PWC says, most American workers will have a health insurance deductible of $400 or more, as more employers return to cost-sharing by raising out-of-pocket limits, replacing co-pays with co-insurance, and adding high-deductible health plans.
"The value of these benefits is becoming an even more visible part of overall compensation as medical costs grow, and, by 2014, health insurance benefits will shift from being a voluntary benefit to an individual mandate, enforced by new tax levies," says Michael Thompson, principal, Human Resource Services, at PWC. "Companies are now working with their health plan providers for new post-recession, post-health reform strategies to sustain their programs and promote health and well-being as their next competitive advantage."
To offset cost increases the PWC survey of more than 700 employers in 30 industries representing 47 million workers and their families found that:
67% of companies will expand or improve wellness programs.
42% will increase employee contributions for health insurance.
41% will increase cost-sharing, including higher deductibles and co-pays, and 26% will raise drug cost-sharing.
More employers are dropping health benefits for retirees. One-third of employers with more than 5,000 workers subsidize pre-65 retiree medical coverage, down from 47% in 2009. Only 22% of employers with more than 5,000 employees subsidize post-65 retiree medical coverage, down from 37% in 2009.
The report identified three strategies that employers will use to hold down medical costs, including:
Moving toward pre-managed care benefit design by increasing deductibles and replacing co-pays with co-insurance, thus reducing utilization.
Increased use of generic drugs. About $26 billion in annual sales are expected to go off patent in 2011, including Lipitor. Generics account for 80% of prescriptions.
A return to normal levels for COBRA costs. COBRA subsidies passed by Congress in 2009 created a 1% increase in the medical cost trend. Falling unemployment and the expiration of the subsidies are expected to reduce COBRA enrollment.
PWC says the biggest drivers of the medical trend in 2011 will be in hospital and physician costs, which represent 81% of premium costs. Hospitals shifting costs from Medicare to private payers and employers is seen as the primary reason for higher medical costs. In 2011, Medicare will reduce payment rates to hospitals for the first time after seven years of increases. Most hospitals are likely to shift costs to commercial plans, PWC says.
In addition, provider consolidation is increasing, which is expected to increase their bargaining power. The number of physicians involved in mergers or acquisitions in 2009 was 2,910, nearly twice that of 2008. There has been record consolidation activity in 2010, and PWC expects the trend to accelerate in 2011.
Hospitals in 2011 are expected to invest billions of dollars in certified electronic health record systems, and the government's new regulations dramatically condensed their timelines to invest in technology, IT staff, training and process redesign.
While investments in infra-structure, efficiencies, and consolidation may eventually prove to be cost effective, Chang says acting on cost containment will prove to be problematic.
"A lot of people's livelihood depends on the continuous growth. Everybody wants to get rid of the fat in the system, but one man's fat is another man's income," Chang says. "You are talking about threatening somebody else's job."
Rather than containing costs, Chang says the government and other payers are trying to contain payments.
"Right now it seems to me the major instruments they are using to slow down the growth of cost are Medicare cutbacks. But given the history of Medicare cutbacks, it's not easy," he says.
The long-term view has not been made clearer with the knowledge that nobody has figured out how to pay for medical care under the healthcare reform law. "A lot of the payment reforms are pilot studies, and we have not figured out how to do it," Chang says. "We have a lot of good ideas on the drawing board but they will not bear fruits anytime soon."
The survey, representing responses from more than 235,000 employees at nearly 400 U.S. hospitals, also found that:
There is a generation gap when it comes to both employee satisfaction. Employees born in 1945 or earlier tend to be the most satisfied while younger employees are the least satisfied. Both Gen Y and Gen X employees have a greater need to receive recognition, to be included in decisions, and to communicate with hospital administration.
There is a strong correlation between patient satisfaction and employee partnership. Hospitals that can provide the best environment for employees will be rewarded with better patient care.
The alienation of a considerable percentage of staff comes as hospitals across the nation contemplate the launch of integrated and patient-centered care programs. Deirdre Mylod, vice president, hospital services, at Press Ganey, said low morale hampers the delivery of high-quality care.
Instead of focusing solely on employee needs, such as pay, benefits, or daily work issues, Mylod said partnerships are created when employees are both satisfied and engaged. She said the survey suggests that hospitals focus on creating an environment where employees feel an emotional bond with colleagues as well as with the overall organization.
"We found hospital employees want to be recognized for excellent work, but they also want to be involved in the decision-making process and have the opportunity to provide input on issues directly affecting their work, so they feel empowered to do their jobs," Mylod said. "It is critical for hospitals to take considerations like these into account when planning employee relations initiatives."
St. Joseph Health System in Orange, CA, has created a new program that allows employees to donate the cash equivalent of their paid time off (PTO) to charity. The PTO Donation Program was launched in March at the behest of employees to help the people of earthquake-stricken Haiti. So far, it has raised about $25,000.
In addition to the international relief, employees can donate their PTO closer to home to fellow employees who may be suffering from catastrophic illnesses or injuries, or economic hardship.
"It's a demonstration of the type of employees we have who are in alignment with the mission and values we have," says Debbie Ortega, vice president of human resources at St. Joseph. "I'm always amazed how every time our employees step forward and ask, 'How can we help?' We are really fortunate to have employees who are in alignment with our ministries."
Between vacations, sick days, and personal time, employees at St. Joseph average about 20 PTO days per year. Of that, up to 80 hours of unused PTO can be paid back to employees each year. That's why the donation program requires that employees accrue more than 80 hours of PTO before they can donate. "We want to keep that balance so that in the event that something should happen to them—some unforeseen circumstances—that they have a bank for themselves," Ortega says. "It's a protection layer for employers for things that might be unexpected."
On average, Ortega says participating employees donate about 16 hours to the program, which they can sign up for online. Once they authorize the deduction, the money is sent to either Catholic Relief Services or Doctors Without Borders—the two charity organizations that St. Joseph has determined can best use the funds in Haiti.
The donation is tax deductible, which provides another incentive to give. Once they decided on creating the program, Ortega says it was "relatively easy" to set up.
"Obviously we sought legal advice on the taxation issue so we didn't jeopardize our current PTO plans," Ortega says. "It's fairly easy to initiate when we know that—in the event that there is unfortunate situation—we have a process by which we can act and assist those in need."
Ortega says the program is getting a lot of "favorable feedback" from employees. "They are pretty positive about the opportunity to have programs that are tailored for them and their own needs and what they can do to extend their generosity," she says.
Ortega says she'd be happy to speak with anyone who wants to start a program at their hospitals. She can be reached at Debbie.ortega@stjoe.org.
"I would love to be able to share this with folks," she says.
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Chiefs at some of New York City's largest hospitals say that state cuts in Medicaid and other healthcare spending passed by the legislature would harm financially weak healthcare centers and could force even stronger ones to cut workers or care. State cuts total $143 million for New York City hospitals alone, according to the Healthcare Association of New York State, a trade group. It is the eighth substantial cut in aide by the legislature in the past two years, hospital officials said.
Some of the nation's largest private-equity firms have formed the Healthcare Private Equity Association, a nonprofit trade association to be based in Chicago and intended to support educational and professional development of the healthcare private-equity community. "Healthcare is the largest sector of our economy . . . and it is also massive and complex," said Brian Miller, the association's founder and president, who is also a partner of Linden Capital Partners, a Chicago-based healthcare private-equity firm. "We need a central repository for research to be done and ideas to be exchanged."