This is the eighth state to secure such an approval. Nine more have requests pending.
As a federal judge considers whether Medicaid work requirements in Arkansas and Kentucky are legal, the Trump administration approved new work requirements Friday for the Medicaid program in Ohio.
The Buckeye State is the eighth in the nation to secure approval for such requirements, but nine others also have pending requests for similar undertakings. The trend reflects what proponents describe as a push to put more control into the hands of state governments while helping people rise out of poverty and what critics describe as an effort to reduce the number of Medicaid beneficiaries.
Gov. Mike DeWine praised the development and said his state's Medicaid work requirements will strike a balance between nudging people toward employment and maintaining healthcare access.
"They are intended to put those able-bodied adults served by the Medicaid expansion on a pathway to full employment,"DeWine said in a statement. "Our next step is to focus on connecting Medicaid expansion recipients with opportunity. The opportunity to grow, to learn new skills, and to engage with their community."
Lt. Gov. Jon Husted said in the statement that these programs should aim "to give Ohioans the opportunity to live up to their God-given potential and pursue their own version of the American dream."
"With the approval of Ohio's waiver, it is now the responsibility of the state to develop a system that allows Medicaid enrollees to easily report their time working, and that ensures no one deserving of services is kicked-off the roles due to an overly cumbersome reporting process," said Rea S. Hederman Jr., the institute's vice president of policy and executive director of the Economic Research Center, in a statement.
The Ohio Hospital Association said it shares the state government's aim of promoting financial independence and preparing Medicaid beneficiaries to transition to commercial insurance, but it hopes the change won't needlessly interrupt Ohioans' access to care.
"Anything that disrupts coverage disrupts access, and we want to assure that beneficiaries are not in constant transition, on and off the program, which would ultimately add confusion, complexity and cost to the system," the OHA said in a statement. "We will continue to work with patients and Ohio Medicaid to implement this program."
Ohio's approval comes a day after the Centers for Medicare & Medicaid Services released new tools and guidance to help states document and assess their Section 1115 demonstration waiver programs.
The panel is recommending that Congress raise reimbursement rates for 2020 and restructure hospital quality incentive programs.
Hospitals have long complained that Medicare reimbursement rates are insufficient to cover the true cost of the care they provide.
That negative margin is now even afflicting hospitals that consistently deliver relatively high-quality care at relatively low costs, according to a report released Friday afternoon by the Medicare Payment Advisory Commission (MedPAC). The report includes recommendations for how Congress should update 2020 rates.
"When a hospital or other healthcare provider is being efficient and still cannot stay in the black in Medicare, that's cause for concern," MedPAC Executive Director James E. Mathews, PhD, said Friday on a call with reporters.
Medicare margins have been negative for hospitals overall for quite a while. What changed last year, however, was that MedPAC saw margins turn negative for relatively efficient hospitals, when the panel assessed 2016 data. The median Medicare margin fell to -1% for efficient hospitals.
"We didn't want to get unduly alarmed at that point because one data point doesn't necessarily represent a trend," Mathews said. "But now that we've got two years of data … that has captured our attention a little bit more."
In this year's report, which assesses 2017 data, the median Medicare margin slipped even further, to -2% for relatively efficient hospitals. These efficient hospitals remained profitable because they had a median non-Medicare margin of 11%, resulting in a total median margin of 8% for 2017.
The median Medicare margin for the other hospitals in MedPAC's sample was significantly worse: -9%. These less-efficient hospitals had a median non-Medicare margin of 9%, resulting in a total median margin of 5% for 2017.
MedPAC's report categorized 291 hospitals as highly efficient, based on their performance on certain risk-adjusted cost and quality metrics for 2014-2016, including mortality rates, standardized costs per discharge, and readmission rates.
MedPAC's Recommendations
Rather than recommending across-the-board rate increases only, MedPAC is recommending that Congress implement a two-pronged approach to address this problem, Mathews said:
Revamp the Medicare hospital quality programs. There are currently four programs, some of which are burdensome and duplicative, so the recommendation calls for them to be consolidated, Mathews said. That should reduce the reporting burden that hospitals shoulder. Additionally, the MedPAC report recommends that the two penalty-only programs—the Hospital Readmissions Reduction Program (HRRP) and Hospital-Acquired Condition Reduction Program (HACRP)—be revised so that the dollars from those programs would be redirected to hospitals with the best quality scores.
Update rates by 2% for all hospitals in 2020, plus additional money for top performers. The projected current-law update for 2020 is 2.8%, so MedPAC recommends that Congress give all hospitals a 2% update. The difference between that 2% update and the current-law projection—i.e., an estimated 0.8%—would then be distributed among acute care hospitals that perform the best on quality and cost metrics, the MedPAC report states.
Mathews says the recommendations, if implemented, would not quite close the gap for hospitals but would get them headed in the right direction.
"We rarely, if ever, recommend payment updates in excess of current law, so this is quite an unusual circumstance for us," he said. "But we do feel that the status of the efficient hospital, with respect to their financial performance under Medicare, does warrant these kinds of measures, and we have tried to be as judicious and targeted in spending these additional dollars as we can be."
New tools and guidance aim to help states document and assess their Medicaid waiver projects, including those involving work requirements.
As a federal judge heard arguments Thursday in legal proceedings challenging Medicaid work requirements in Kentucky and Arkansas, the Centers for Medicare & Medicaid Services launched new tools to monitor and evaluate such tweaks to the program.
The new CMS tools and guidance establish standard metrics and recommended methods to assess the performance of Section 1115 demonstration waivers, which have been used to authorize Medicaid work requirements and a wide variety of other adjustments to the joint state-federal program
CMS Administrator Seema Verma alluded briefly to the lawsuits in a blog post published alongside Thursday's additional guidance.
"I recognize that not everyone supports our efforts to prioritize local control," Verma wrote. "I've heard the derisive comments from those in the health policy stratosphere that prefer centralized government command and control of health care in America. It's not surprising that many of these same people are now working double time to pull us into the big government abyss of Medicare for All."
"They decry the very notion of linking eligibility for programs like Medicaid with expectations of work and community engagement, despite these being long-standing bedrock values of our society," she added. "They dismiss any possibility that setting and supporting these expectations may actually help families break cycles of generational poverty and improve their health and financial independence more than just handing out a Medicaid card. And they argue vociferously that we overstepped our authority by allowing states to test these theories."
The new resources include the following items CMS highlighted:
An implementation plan template: This gives states a framework to document their various approaches to implementing work requirements (which the administration calls "community engagement" requirements), and it aims to help states determine what information they should be reporting to CMS quarterly and annually, CMS said.
A monitoring report template: This gives states a framework on how to report information to CMS quarterly and annually, with quantitative metrics, CMS said.
Evaluation design guidance: This draws attention to key questions, hypotheses, measures, and evaluation approaches that states can use to assess their Section 1115 demonstration projects, including those that involve work requirements, CMS said.
States will be able to get support from CMS both individually and through forums, such as the Community Engagement Learning Collaborative, CMS said. Further instruction and guidance on these tools is forthcoming.
By hiring two internal candidates, the organization is breaking up a three-part position that had admittedly run 'counter to common practice.'
Larry J. Goodman, MD, who is CEO for both the Rush University System for Health (RUSH) and Rush University Medical Center in Chicago, will retire within the next several months, the organization's board announced this week.
Rather than passing his role on to a single successor, Goodman's duties will be split between two internal hires.
The new CEO of RUSH will be K. Ranga Rama Krishnan, MB, CHB, who is currently dean of Rush Medical College and a senior vice president of the medical center. The new CEO of Rush University Medical Center will be Omar B. Lateef, DO, who is currently chief medical officer for both the system and the medical center and senior vice president of medical affairs for the medical center.
This decision comes after Goodman's other title, president of Rush University, was handed to Sherine E. Gabriel, MD, MSc, last fall.
"It is unusual, and runs contrary to common practice, for a single leader to run a university, a flagship hospital, and a health care system with the exceptional skill and vision Dr. Goodman has demonstrated," Susan Crown, chairperson for the RUSH and Medical Center boards, said in a statement. "As we continue to pursue our long-term vision of being nationally recognized for transforming health care, it is clear that Dr. Krishnan and Dr. Lateef are the leaders we need to continue the System and Medical Center transformation."
The three positions held by Larry Goodman, MD, (left) are being divided among three successors (top to bottom): Ranga Krishnan, MB, CHB; Omar Lateef, DO; and Sherine Gabriel, MD, MSc. (Images provided by RUSH)
The board spent more than a year going through a succession planning and evaluation process that reviewed candidates from inside and outside the organization, according to the board's announcement.
"It has truly been a special honor and a privilege to be a part of the extraordinary transformation at Rush and to serve alongside the Rush community, with a singular focus on improving health," Goodman said in the statement. "I came here as a resident in internal medicine in 1976 and met my wife here, so Rush has always been like a family and like home to me."
A major expansion project that has been underway at the facility is expected to be completed in about three years.
Two major healthcare nonprofits in southern California said Tuesday they will work together to jointly own and operate a hospital in Tarzana, where Providence St. Joseph Health has been working on a $540 million expansion project.
Providence, a 51-hospital Catholic health system, acquired the hospital in 2008 and has been upgrading its facilities and constructing a new patient care wing and emergency department. Under the terms of a new partnership, the hospital will be renamed and jointly run with Los Angeles–based Cedars-Sinai.
"Rather than duplicating resources, we are working together to bring the latest, state-of-the-art advances to the community," said Mike Butler, president of operations for Providence, in a statement. "It's an innovative way to invest in the healthcare needs of the future to ensure high-quality, affordable care for those in need."
Cedars-Sinai President and CEO Thomas M. Priselac said in the statement that the continuum of care in the San Fernando Valley will be enhanced by the two systems combining their resources and talent.
"We're delighted that this partnership will have such a meaningful impact on the health of our region," Priselac said.
A spokesperson for Providence tells HealthLeaders the venture wil bring a new level of specialists to the valley, serving patients who had previously traveled into Los Angeles for higher-level care, which will be especially helpful to patients recovering after transplant procedures.
A spokesperson for Cedars-Sinai declined to disclose how much it plans to contribute financially to the Providence Cedars-Sinai Tarzana Medical Center expansion. The joint statement noted that Providence will retain a controlling interest in the facility, which will retain its Catholic identity.
Although there are Cedars-Sinai health centers throughout the region, this venture marks Cedars-Sinai's first hospital investment in the San Fernando Valley, as the Los Angeles Daily News' Ariella Plachta reported.
Providence and Cedars-Sinai said in their statement that they will begin to consult in the coming year on a broad offering of services in the valley.
Dale Surowitz, CEO of the 249-bed Tarzana hospital—which ranks among Healthgrades' 50 top hospitals—told the Daily News that this deal has been in the works since fall 2017.
The expansion project is expected to be completed in 2022.
The hospital operator quarreled with Community Health Systems and had its CEO retire last year.
Quorum Health Corporation, based in Brentwood, Tennessee, announced fourth-quarter and year-end financial results Tuesday, including a $200.2 million loss for the 2018 calendar year.
The loss is 75% bigger than the $114.2 million loss Quorum reported for the 2017 calendar year. Net operating revenues, meanwhile, were $1.88 billion for 2018, down about 9.3% from the $2.07 billion Quorum reported for 2017.
Despite the challenges, Quorum President and CEO Robert Fish said Tuesday's fourth-quarter results "represent a strong finish to 2018."
Net operating revenues were $458.6 million for the three months ended December 31, a 10.9% decrease compared to the $515.1 million reported for the same period a year prior. The company's fourth-quarter net loss was $20.7 million, an improvement of about 22.7% over the $26.8 million loss Quorum reported in the fourth quarter of 2017.
"Over the course of 2018, we significantly improved our EBITDA margins through targeted efficiency initiatives, and divested three hospitals, which brought us closer to our refinancing goal," Fish said in a statement to investors and filed with the Securities & Exchange Commission.
"I look forward to building on the success we had in 2018 and carrying that momentum forward through 2019," he added.
The budget proposal includes less discretionary authority and more mandatory funding than last year's proposal.
Health and Human Services released a detailed overview Monday of its fiscal year 2020 budget, as HHS Secretary Alex Azar prepares for a gauntlet of hearings on Capitol Hill this week about the proposal.
The budget proposes $87.1 billion in discretionary authority and $1.2 trillion in mandatory funding. By contrast, the fiscal year 2019 budget proposal sought $95.4 billion in discretionary authority and $1.12 trillion in mandatory funding.
The HHS proposal is a big piece of the Trump administration's total $4.7 trillion budget. The overall plan would increase the federal budget deficit to $1.1 trillion for fiscal year 2020 alone, as The Wall Street Journal 's Kate Davidson reported.
The proposal claims it would eliminate the deficit by 2034, based on the assumption of faster economic growth than many independent forecasters expect, the Journal noted.
The final spending plan must be approved by 60 senators, so the administration's proposal is just the starting point in what could be a long and contentious process between now and the end of the current fiscal year on September 30, especially since Democrats gained control of the House this year.
President Donald Trump has already faced criticism that his budget proposal breaks a campaign promise. Despite saying on the campaign trail ahead of the 2016 election that his administration would make no cuts to Medicare or Medicaid, his 2020 budget proposal calls for funding estimated reductions of $800 billion or more from Medicare over the next decade, as CNBC's Jacob Pramuk reported.
In a statement Monday, Azar highlighted five HHS priorities in the Trump administration's 2020 budget proposal.
"The budget will advance HHS's work on [1] increasing the affordability of individual health insurance, [2] bringing down the price of prescription drugs, [3] transforming our healthcare system into one that pays for value, and [4] combating the opioid crisis," he said. "It also provides historic new funding dedicated to one of the most important public health initiatives undertaken this century: [5] President Trump's plan to end the HIV epidemic in America by 2030."
In an overview of the proposal, Azar noted also that the budget aims to foster healthcare innovation and strengthen services for native Americans while advancing regulatory reform.
Editor's note: This story was updated Tuesday, March 12, 2019, with additional information.
The reports come after significant mergers and acquisitions, such as those by AMITA Health and Advocate Aurora Health, have affected the Chicago area in recent years.
If local media reports pan out, then more hospital consolidation could be coming to the Windy City.
Chicago's Swedish Covenant Health is reportedly discussing a potential merger with the Rush System for Health, which includes Rush University Medical Center on the city's Near West Side.
A spokesperson for Swedish Covenant, which runs one hospital on the city's North Side, told the Chicago Sun-Times' Stefano Esposito that the organization is always looking for ways to grow stronger and enhance its ability to meet the community's needs.
"Over the years we have partnered with several leading health organizations in the Chicago area," the spokesperson reportedly said. "We will continue to explore opportunities to partner with organizations who share our mission and values and will share news if or when partnerships occur."
A spokesperson for Rush declined the Sun-Times' request for comment.
'Finalizing a Deal Is the Easy Part': Advocate-Aurora Merger Complete
Crain's Chicago Business was first to report the potential merger, citing unnamed sources "close to the hospitals."
The reports come after significant mergers and acquisitions have recently affected the Chicago area. AMITA Health, which was formed as a partnership between Ascension's Alexian Brothers Health System and Adventist Health System, added 10 hospitals last year with its Presence Health acquisition.
And the union of Advocate Health Care with Aurora Health Care to form the large Chicago-based Advocate Aurora Health has impacted the broader region.
Lawmakers and witnesses alike cited the ill-effects of hospital mergers and acquisitions in a long list of industry behavior they find troubling.
A hearing of the House Judiciary Committee's antitrust subcommittee would not have been a comfortable place Thursday for any healthcare executive touting the benefits of a planned merger or acquisition.
Lawmakers and witnesses took turns criticizing rampant consolidation among hospitals and other healthcare companies. While the public is often told these deals will lead to improved efficiency and higher quality care, those purported benefits frequently fail to materialize, they said.
Since the hearing grouped payer and provider consolidation with anticompetitive concerns about the pharmaceutical industry—an area that both major parties have expressed interest in addressing through congressional action—the discussion could signal how lawmakers will approach any legislation to address the problems they perceive.
Rep. Doug Collins, a Republican from Georgia and the committee's ranking member, said hospital consolidation has had an especially detrimental impact on rural communities in his state.
"These communities often already have few options for quality care, so as hospital consolidation has increased over the past 10 years, rural communities like my own have been hurt the most," Collins said.
"At times, these mergers and acquisitions can help rural communities by keeping facilities open, but often they result in full or partial closures and shifting patients from nearby facilities to those hours away," he added.
Some problems caused by consolidation, such as increased travel times for emergency services, can "literally mean the difference in life and death," Collins said.
Jerry Nadler, a Democrat from New York and the committee's chairman, said there's no question that the recent spate of mergers has contributed to the industry's problems.
"It is well documented that hospital mergers can lead to higher prices and lower quality of care," Nadler said.
Martin Gaynor, PhD,an economics and health policy professor at Carnegie Mellon University and a founder of the Health Care Cost Institute, said in his testimony that there have been nearly 1,600 hospital mergers in the past 20 years, leading most regions to be dominated by one large health system apiece.
"This massive consolidation in healthcare has not delivered for Americans. It has not given us better care or enhanced efficiency," Gaynor said. "On the contrary, extensive research evidence shows us that consolidation between close competitors results in higher prices, and patient quality of care suffers for lack of competition."
Since hospitals that have fewer competitors can better negotiate favorable payment terms, this consolidated landscape "poses a serious challenge for payment reform," he added.
"Our healthcare system is based on markets. That system is only going to work as well as the markets that underpin it," Gaynor said. "Unfortunately, these markets do not function as well as they could or should."
Gaynor recommended several possible policy changes, including an end to policies that make it harder for new competitors to enter a market and compete and an expanded authority for the Federal Trade Commission to review potentially anticompetitive conduct by nonprofit entities. He also said lawmakers should consider imposing FTC reporting requirements for even small transactions to enhance the tracking capabilities of enforcement agencies.
To support his claims, in his written testimony, Gaynor pointed to research he completed with Farzad Mostashari of Aledade Inc. and Paul B. Ginsburg of The Brookings Institution.
A new website launched to coincide with the new name outlines in broad terms some of the areas where Haven could make improvements on the current healthcare system.
The joint healthcare venture being launched by Amazon, JPMorgan Chase, and Berkshire Hathaway has been formally known as "Tcorp62108 LLC" since its founding last year, so it should come as no surprise that those watching the entity's potentially disruptive entry into the healthcare industry have been grasping for monikers that are easier to remember and more concise.
The venture has been called by the acronym "ABC" in court documents, a reference to the three companies backing it. And journalists with Politico settled on a more colorful mashup: "Berkmorgazon." Such improvised names, however, were rendered officially obsolete on Wednesday, as the organization unveiled its new identity: Haven.
The organization's new website says its name was chosen to reflect a goal of partnering with patients and clinicians alike "to make the overall system better for all."
"We want to change the way people experience health care so that it is simpler, better, and lower cost," said CEO Atul Gawande, MD, MPH, in a press release. "We'll start small, learn from the experience of patients, and continue to expand to meet their needs."
The release says Haven will focus on serving the 1.2 million employees and families connected to the three founding companies then expand to serve others later on.
The new site outlines in broad terms some of the areas where Haven could make improvements on the current healthcare system. Those include issues related to patients accessing care, finding their way through the complex system, and affording their treatments and medicines.
"We are focused on leveraging the power of data and technology to drive better incentives, a better patient experience, and a better system," the website states. "Our work may take many forms, and solutions may take time to develop, but Haven is invested in making health care much better for all of us."
In addition to Gawande, there are eight members of the Haven leadership team listed on the website:
Jack Stoddard, a former chief operating officer and chief strategy officer for Accolade Inc., is COO.
Brook Thurston, a former vice president of communications for Steward Health Care, is head of communications.
The list didn't mention David Smith, a former Optum Inc. executive who's being accused of taking Optum trade secrets to the venture now named Haven. Court records indicate that Smith accepted a job in December as the venture's director of product strategy and research.
The three positions held by Larry Goodman, MD, (left) are being divided among three successors (top to bottom): Ranga Krishnan, MB, CHB; Omar Lateef, DO; and Sherine Gabriel, MD, MSc. (Images provided by RUSH)
