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The Politics of Health Care

Medicaid Expansion
February 15, 2013 1:26 PM by Kelly Wolfgang

Editor's note: This blog is written by Miguel A. Bustillos, department chair and professor at California University of Management & Sciences in Virginia.

Most of us have heard about the Medicaid expansion and how states like Florida, Texas and Virginia are against it. Some do not understand why the Medicaid expansion has become such a big issue or what exactly the Medicaid expansion is.

The Medicaid expansion, expected to be fully implemented by 2014, is a plan under the Patient Protection and Affordable Care Act (PPACA) to expand medical coverage for a number of people who do not qualify under the current plan. The Medicaid expansion mandates that a state must meet PPACA standards to receive full federal funding, which is needed to increase the current plan. The largest problem involving the mandate is how states will cover the "new eligibles," those patients who are receiving Medicaid assistance for the first time. It is estimated that 15.9 million new enrollees will participate in the plan by 2019.

The federal government currently pays, on average, about 57% of the total cost of Medicaid enrollees in each state. Of those that qualify for Medicaid, only 62% have signed up for Medicaid benefits, leaving the remaining 38% without benefits. Generally, those that are not taking the benefit either don't know that they qualify or refused the benefit.

If states were to accept the Medicaid expansion, they would continue to pay for the benefits of the 62% that are currently covered; in addition, they will have to cover the 38% that qualified under the previous requirement, but did not take the benefit. According to the new mandate, states must also provide for the new eligibles.

Under the Medicaid expansion mandate, the federal government will continue to pay the cost for about 57% of the 62% that are currently taking the benefit. With the new law, the 38% that did not receive benefits will now either take the benefit or pay a tax penalty. Some states believe that those who are qualified will take the benefit rather than pay the penalty. Despite the "new enrollee" status of those patients, the government will not support funding for any persons who previously qualified but did not receive benefits.

With regards to the true new eligible, the states believe that the cost of providing Medicaid is just too large for any state to handle.  To lessen the burden, the federal government has penned an agreement to cover 93% of the cost of the true "new enrollees" till the year 2020.

Many states will decline to take on the Medicaid expansion because it's a voluntary program. The new law can be very taxing to any state's budget and in most cases, there are not enough incentives for states to adapt the program.

The federal government is, however, not worried. When Medicaid was first signed into law in 1965, only six states agreed to participate. But by 1982, every state had joined. As 2014 comes along, and the law comes into full effect, it will be interesting to see what develops and what does not. With the cost of providing healthcare to so many people being so high, and the fact that Medicare benefits will be cut to fund the Medicaid expansion, I foresee much resistance on its implementation.

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Is Gun Violence a Public Health Issue?
January 18, 2013 11:13 AM by Kelly Wolfgang
As reported on Newswise, the following is a statement by Jo Ivey Boufford, MD, president of The New York Academy of Medicine, one of the nation's oldest and most prestigious medical academies, on the seriousness of gun violence as a major public health issue. The statement is in response to deadly incidents of gun violence in Newtown, CT, Webster, NY, and the shooting of 15 individuals, three of whom died, during separate acts of gun violence in Chicago, IL on New Year's Day.

"As a nation, we can only improve the health of the public when we get our priorities straight. Recent acts of gun violence in Chicago, Webster, NY, and Newtown, CT cannot be ignored. Neither can the 31,000 Americans who die each year at the hands of a gun. This number exceeds the number of babies who die each year during their first year of life (25,000) or people who die from AIDS (9,500) or illicit drugs (17,000).

We institute protective measures enforcing speed limits and requiring the use of safety belts; we implement public health measures such as child vaccinations and regulations around the safety of food, drugs, and products. Yet guns escape this type of regulation despite their significant contribution to the mortality rate each year. We must view gun violence as a serious threat to the public's health if we want to reduce the number of deaths associated with guns.

We can start by banning the sale of assault rifles, high-capacity magazines, and other facilitators of mass murder. And we must allow government agencies like the Centers for Disease Control and Prevention to fully exercise their duties in both surveillance of the incidence and impact of gun violence, and in educating the public on steps for preventing death and injury through the use of firearms.

The evidence is clear, and we must now take action to protect our neighbors and ourselves from this devastating public health crisis."

In December, both the American Nurses Association and the American College of Emergency Physicians, two prominent and national healthcare organizations, issued calls for a ban on the sale of assault weapons.

Sister publication ADVANCE for Nurse Practitioners & Physician Assistants asked its readers, "Do you think it is the responsibility of healthcare provider organizations to urge this type of action?"

Here's what some readers had to say:

  • "We can all do our part. As nurses, as humans." - Teanne
  • "Just stand in a trauma unit for one night and come back and give me your answer." - Melissa
  • "Yes! Absolutely! It's everyone's responsibility to speak up for what they believe!" - Kelli
  • "Absolutely not. I have stood in the trauma unit for 15 years and taking away my legal guns, which I carry concealed because I am licensed to do so, and taking away my rifles, which I enjoy shooting responsibly, will do nothing to stop the common street thug with an illegal weapon, other than allow me no protection for myself and my property when I'm leaving the trauma unit at midnight, sitting at a red light, and getting jacked by said thug." - Dana
  • "Most of our ER staff is armed; we see what's out there. As the Boy Scouts say, be prepared. The bad guys will always find guns; we need to be able to defend ourselves." - Diana
  • "Absolutely. Prior trauma nurse here at Miami Dade County. Some individuals have no business having weapons. Period." - Teresa
  • "This is definitely not the responsibility of healthcare provider organizations. This is a civil liberty. I'm sure many members of the groups do not support a ban. These groups should focus on healthcare issues." - Rita
  • "Supporting mental illness awareness and research would be a wiser choice! Let's be honest, what health professional has not taken some form of weapon to work with them?" - Susan

Do you agree with Boufford's statement and the calls for action by the American Nurses Association and the American College of Emergency Physicians? Weigh in on the comments below.

Editor's note: We welcome your comments and topic suggestions; contact blog author Kelly Wolfgang at kwolfgang@advanceweb.com.
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Patient Engagement Helps Hospitals Achieve Stage 2 Meaningful Use Compliance
December 6, 2012 2:27 PM by Adrianne OBrien
Editor's note: This blog was written by Jodi DeMarco, PhD; she is the interactive solutions advisor for TeleHealth Services.

The controversy around meaningful use options and proposed requirements has morphed from spirited debate to reluctant acceptance. Healthcare providers have weighed in with sometimes varying opinions over the many months since Stage 1 was rolled out. The Centers for Medicare and Medicaid Services (CMS) has reviewed input from all sides and affirmed its intentions for Stage 2 compliance. The resulting mandates reflect compromise in breadth and timing, and the healthcare world now has more clearly defined goals and a timetable for achieving compliance and meeting full reimbursement requirements.

Completing the Transition from Stage1 to Stage 2: Emphasis on Health Information Exchange

In the Stage 1 meaningful use regulations, CMS had established a timeline that required providers to progress to Stage 2 criteria after two program years under the Stage 1 criteria. This original timeline would have required Medicare providers who first demonstrated meaningful use in 2011 to meet the Stage 2 criteria in 2013.  However, CMS has delayed the onset of Stage 2 criteria. The earliest that the Stage 2 criteria will be effective for eligible hospitals is in fiscal year 2014.

Providers who were early demonstrators of meaningful use in 2011 will meet three consecutive years of meaningful use under the Stage 1 criteria before advancing to the Stage 2 criteria in 2014. All other providers would meet two years of meaningful use under the Stage 1 criteria before advancing to the Stage 2 criteria in their third year.

Stage 2 retains its core and menu structure for meaningful use objectives, although some Stage 1 objectives were either combined or eliminated. A majority of the Stage 1 objectives are now core objectives under the new criteria.

The Stage 2 criteria emphasize health information exchange between providers to improve care coordination for patients. Although clinical quality measure (CQM) reporting has been removed as a core objective for eligible hospitals, all providers are required to report on CQMs in order to demonstrate meaningful use. Beginning in 2014, all providers regardless of their stage of meaningful use will report on CQMs in the same way.

Eligible hospitals must report on 16 out of 29 total CQMs. In addition, all providers must select CQMs from at least three of the six key health care policy domains recommended by the Department of Health and Human Services' National Quality Strategy. These include:

  • Patient and Family Engagement
  • Patient Safety
  • Care Coordination
  • Population and Public Health
  • Efficient Use of Healthcare Resources
  • Clinical Processes/Effectiveness

That the final list includes these six domains is encouraging news. Each domain reflects areas already receiving significant attention and resources. One of the great things about most practitioners is that they don't need mandates to do the right things, especially when it comes to clinical care and working in their patients' best interests. That said, cost plays a huge factor in achieving compliance, especially when regulations require enormous capital outlays to achieve sophisticated electronic milestones, and when goals involving consistency -- though paved with good intentions -- are extremely difficult to achieve.

Although there is consensus in the industry that working toward these CQMs is important and necessary, many go about it in their own way and at their own pace. Some hospitals have made enormous progress, integrating these efforts across multiple disciplines, setting ambitious patient-education goals and dedicating resources to ensure consistent outreach and positive patient, family and caregiver engagement. One shining example is the work being done at University of Arkansas for Medical Sciences (UAMS), a health center with colleges of Medicine, Nursing, Pharmacy, Health Related Professions and Public Health; a graduate school; a hospital; a statewide network of regional centers; and seven institutes.

UAMS is the only adult Level 1 trauma center in the state. It has more than 2,800 students and 775 medical residents, and more than 10,000 employees, including approximately 1,000 physicians and other healthcare professionals. Barbara Brunner, RN, is the director of Patient and Family Centered Care for the hospital at UAMS.

"We have integrated healthcare teams taking care of our patients, essentially a comprehensive nurse/clinician partnership that targets educational planning, implementation and measurement, encompassing all aspects of care, including emergency, inpatient, medication and discharge," Brunner says.

Staff, Brunner explains, practice a "teach back" method to ensure patient understanding of directions and information pertaining to their health and care, particularly involving post-discharge requirements. "Our goal isn't only to determine what they know, but as importantly, what will that patient do when he or she goes home," says Brunner.

Empowered Patients & Caregivers Improve Outcomes & Satisfaction

To that end, UAMS uses a customized interactive patient engagement system with wellness programming that delivers customized, condition-specific education care plans to the bedside television. Following viewing, the patient responds via an automated survey conducted over the telephone to simple "yes/no" questions about their care. This feedback is then reviewed by their care team, who then personally consult with the patient to reinforce care and compliance requirements.

Additionally, families and caregivers are invited to attend classes which teach them how to deal with issues and tasks such as IVs and central line maintenance, pre- and post-natal care, diabetes, wound care, pneumonia, congestive heart failure, stroke care and more.

"Our goal is to integrate the patient, along with his or her family and related caregivers, in the recovery process to plan and adjust to life outside of the hospital," says Jamie Peacock, director of Quality Programs in Nursing. "Additionally, using our patient engagement system we conduct comprehensive satisfaction benchmarking through surveys to ensure that we're hitting our marks and always raising our levels of care. Results vary, based on traumatic versus chronic needs, but we know that empowering patients in their own care is valuable, improves patient satisfaction, and will reduce readmissions. That is a key focus, especially in this era of cost-containment."

The hospital, Peacock adds, is partnering with two outpatient facilities to continue their educational outreach effort after patients go home, focused initially on congestive heart patients, and patients at risk for central line infections.

Maintaining awareness of population-specific tenets and standards plays an important role at UAMS. All communication and information is available in multiple languages, the hospital has certified interpreters, and offers a language line providing translators fluent in dozens of languages. They also have a patient education database, which helps staff deal effectively with cultural differences relating to areas besides language, such as nutrition, family structure, touch and eye contact.

"While we have not yet implemented an online electronic medical record connection integrating patient education, a solution is being planned," says Jerri Garland, director of EMR Services. "Patient education and providing the information patients need at the right time to make informed choices about their health care is a central focus of our initiative. Our interactive patient engagement is one technology that uniquely positions UAMS to extend our health education resources. We'll get there by enabling direct patient interaction and providing proven tools needed to fulfill Stage 2 criteria, while enhancing the patient experience across the care continuum."

Every patient receives an educational assessment within 24 hours of being admitted, Garland says, allowing the hospital to quickly determine the best way to teach each individual. "Through this process we identify potential barriers to learning such as language, cognitive, visual or hearing challenges," Garland explains. "The results of that assessment are documented and available to all staff so it can be used in coordinating care in the hospital, and for subsequent transitional care."

The hospital, Brunner adds, has an extensive medical library, and its video library is accessible to all patients via the televisions in their rooms. They also feature a Department of Patient Education, with dedicated health educators who integrate care across all clinical areas. Their expertise includes training in care planning, formatting, and adult learning. This benefits everyone, Brunner says, and results in patient education being managed by staff beyond just the physicians and nurses, including nutritionists, respiratory therapists, pharmacists and every medical professional that engages the patient. The hospital also is in the process of establishing advisory councils. These will strengthen ties with the community by enhancing outreach, community wellness, and patient education efforts.

"Ours is a far-reaching, education-oriented, multi-dimensional effort," Brunner concludes. "Everyone is involved, and every patient and patient family or caregiver benefits from this comprehensive approach."

Over the coming years, meaningful use will help drive consistency and strengthen links to online record keeping and reporting. That's good, and welcomed. But the road to enhanced patient satisfaction and improved clinical outcomes begins with stronger care coordination and comprehensive and integrated patient engagement, as demonstrated at UAMS and other forward-thinking, technology savvy hospitals across the country.

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Projected Costs of Healthcare Law Changing
September 25, 2012 4:14 PM by Adrianne OBrien

Editor's note: This blog was written by Michael LaMagna is a partner at Timins & LaMagna, LLP, practicing Health Care Regulatory, Elder /Probate/Disability/Trusts and Estates, Social Security and General Legal practice in both New York and Connecticut.

The Congressional Business Office (CBO) reports that in 2016, which is when the 2010 health care law becomes fully in effect, 2% of Americans, or roughly 6 million individuals, will be subject to the health care penalty tax. This is significantly higher than the estimated 4 million, in large part due to higher than anticipated unemployment, lower wages and salaries as well as changes to the law since its passage in 2010.

The new penalty is the infamous individual mandate upheld by the Supreme Court as a tax, which requires that you either obtain health insurance or pay a penalty, amounting to $695 or 2.5% of your annual household income. The tax is expected to bring in more than $7 billion in 2016 and $8 billion thereafter.

In addition, the CBO projected that the total amount of individuals who will remain uninsured with be 30 million, up from the projected 21 million. The reason why it is projected that 6 million will be subject to the tax is because the other 24 million include: undocumented aliens, Indian tribe members and those with lower incomes.

The CBO has projected that the total cost for the new law will be upward of $2.6 trillion dollars in the next 10 years, which is significantly higher than the first estimates of $900 billion and covers fewer individuals than first thought.

This article is provided for informational purposes only. Nothing in this article shall be construed as legal advice or should be relied upon as such. Michael LaMagna was just appointed to the ACO Task Force of the American Health Lawyers Association. E-mail him at Mlamagna@nyandctlaw.com, call him at 914-819-0663 or visit Attorney LaMagna's website at www.nyandctlaw.com for more information.

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Patient Education, Engagement, & Interactivity Tools Help Hospitals Achieve Stage 2 Meaningful Use Compliance
September 10, 2012 4:39 PM by Adrianne OBrien
Editor's note: This blog was written by Jodi DeMarco, interactive brand manager, TeleHealth Services.

With final Stage 2 rules for satisfying meaningful use requirements issued by The Centers for Medicare and Medicare Services (CMS) last week, several of these initiatives focus on the importance of patient education and engagement. The requirements for the adoption of certified technology enable the capture and sharing of health-related information to advance clinical processes and drive improved patient outcomes, and many of these criteria actually are driven by patient engagement initiatives.

Beyond improved clinical outcomes and patient satisfaction, the incentive currently driving meaningful use is government subsidies for implementing the technology and compliance changes. Non-compliance in the future will be penalized through withheld reimbursements for hospitals, healthcare organizations, and physicians who fail to achieve meaningful use in the required timeframe.

Under the rules for Stage 2, all Stage 1 items will become mandatory, the scope of many Stage 1 measures will be increased, and providers will be responsible for meeting a number of new requirements, particularly around care coordination and patient engagement. Under the current Stage 2 rule, providers have more time to meet the Stage 2 criteria. A provider that attested to Stage 1 of meaningful use in 2011 would attest to Stage 2 in 2014, instead of in 2013, as was outlined in the original timeline from CMS.  Therefore, providers are not required to meet Stage 2 meaningful use before 2014.

However, in preparation for meeting the rules for Stage 2, hospitals need to prepare for these evolving compliance requirements as soon as possible. Those who resist or do not take quick action face the risk of having only a few months to achieve the deadline by which hospitals are responsible for actually initiating Stage 2 requirements. That makes them vulnerable to penalties for non-compliance if unforeseen issues or delays prevent requirements from being implemented on time.

The Nature of New Requirements for Stage 2

Many of the entirely new measures for Stage 2 put greater emphasis on care coordination. The new measures also require additional capabilities and processes related to patient engagement. For hospitals, Stage 1 measures related to patient engagement were limited to patients who asked for an electronic copy of their health information or discharge instructions. In Stage 2, hospitals are responsible for an entirely new measure requiring that hospitals make electronic access to health information available to more than 50 percent of their patients and that more than 10 percent of patients actually view information about their hospital admission.

Another important aspect of meaningful use involves healthcare IT implementation, which generates useful information and translates that information into knowledge. This, theoretically, leads to improved clinical outcomes that result in reduced readmissions, shortened length of stay, improved patient satisfaction, clinical efficiencies, and other processes that help keep the patient engaged in his or her recovery and continued health and wellness.

Stage 2 quality measurement segments include:

  • Population and public health
  • Patient safety
  • Patient and family engagement
  • Efficiency
  • Care coordination
  • Clinical process

According to CMS, providers have earned more than $5 billion in incentive payments for voluntary Stage 1 meaningful use compliance involving electronic health records. Prior to its release of Stage 2 requirements, The American Hospital Association (AHA) warned CMS that the proposed requirements for Stage 2 were not feasible, especially in light of the fact that more than 80 percent of hospitals had not attained Stage 1. The College of Healthcare Information Management Executives (CHIME) also had said the preliminary Stage 2 criteria were "overly ambitious."

Focus On - and Fund - What's Already Working

As the debate continues, many hospitals already are using patient education, engagement, and interactivity tools to increase compliance and understanding, enhance care coordination, measure service responsiveness, and improve clinical outcomes. These outcomes include reduced readmissions, better post-discharge planning, and improved patient satisfaction ratings. However, while these practices are proving beneficial to patients, their families, and hospitals' bottom lines, they often are not properly coordinated or tracked, nor are they provided needed resources.

Diane C. Moyer, MS, RN, is president of the Health Care Education Association (HCEA), a national non-profit, multi-disciplinary professional organization of healthcare educators. She also serves as associate director of Health System Patient Education for The Ohio State University Wexner Medical Center, in Columbus, Ohio. HCEA, she explains, is dedicated to improving healthcare through evidence-based education, resource development, and communication.

"Everyone has similar standards for patient education, but we use a variety of different resources, vendors, customized in-house, and off-the-shelf third-party solutions for educating patients, and different tools for documentation," Moyer says. "Our intentions are good and the information is useful and valued, but this ‘mish mosh' of execution makes it difficult - if not impossible - to measure effectiveness, share best practices, and demonstrate a clear return on investment."

This lack of consistency, Moyer explains, becomes more complex when you consider the assortment of specialists who all share responsibility for patient education. That includes nurses - who, she says, are the primary educators - as well as physicians, dedicated patient educators, therapists, pharmacists, dietitians, social workers, and more.

"In some ways," Moyer reflects, "we have taken a step back because our systems are not flexible enough to capture all the needed data without extensive documentation by clinicians and time to find and review the notes across disciplines. For example, some hospitals capture patient education participation electronically, and even use simple interactive bedside or online tests to verify comprehension. Often this information is not easily or automatically retrievable, is not connected to a primary resource like an electronic medical record, and is not shared among those educating the patients. This disconnection," she adds, "includes gaps involving patient education and discharge information, particularly as they relate to inpatient and outpatient care."

By "patient education participation," Moyer is referring to how hospitals assign specific educational information and on-demand videos or digitized broadcasts to patients, based on their identified learning needs. For instance, a patient who is in the hospital for heart surgery may be assigned videos detailing specific aspects of his or her disease, as well as programming on medications, exercise, nutrition, rehabilitation, relaxation, and related subjects. Both the patient and the family can view this information, which helps them better understand their challenges and plan appropriate post-discharge care. At the same time, these patient engagement efforts support other clinical initiatives and help the organization meet compliance requirements.

Moyer credits these types of tools, as well as follow-up questioning and additional evaluation by nurses, physicians, and other clinicians, as critical for helping patients comprehend their medical issues and take better care of themselves after they have been discharged. Most patients, Moyer stresses, are not "at their best" when in the hospital. They are frightened, anxious, sedated, and often afraid to ask questions or admit they do not understand the complexities of their illness or what is expected of them. The ability to duplicate their curriculum at home, she adds, is a nice advantage to these systems.

But providing the resources is not the same as providing good education, she stresses, and in the rush to get things done, educational materials may be given to patients with little explanation or opportunity to ask questions or practice the care. Health literacy issues also play a big role in patients' understanding of their care, and not all providers simplify the communication or check that the patient really does understand what needs to be done when they go home.

Ensuring that comprehensive print and video materials are available, particularly in languages specific to the community being served, can be expensive and time consuming. Often there are no take-home resources in non-English languages. More worrisome, Moyer points out, is that there are no federal funds for reimbursement of interpretation or translation fees, so these materials and services add significant costs to doing business, even though it is the right - and smart - thing to do for patient safety and quality care.

"Detailed, coordinated patient education involving patients and their families in understanding their roles in recovery and long-term health is essential," Moyer reflects. "Most patient education specialists would advocate for evaluation of patient/family learning. Can they show you how to change the dressing? Can they tell you what they would do if the tube fell out? Who would they call if they had a problem? Do they understand warning signs before it escalates to the point where that patient is back in the emergency room?"

"Interactive learning tools that inform patients and their families on these scenarios or skills and check comprehension are absolutely critical, but they require resources to implement," explains Moyer. "Providers of interactive patient education tools can offer a scalable solution to aid hospitals in their integration, thus providing immediate value, a manageable installation, and a sustained return on investment. As technology improves, enhanced connectivity and better ways to guide patients to credible, plain language health resources outside the hospital will be invaluable. "That," she adds with a smile, "would truly be meaningful use."

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Business as Usual: What the Supreme Court Ruling Means for Healthcare M&A
August 27, 2012 11:09 AM by Adrianne OBrien

Editor's note: This blog was written by Molly K. O'Neill, Brian R. Browder and Donald B. Stuart.

With the dust settling on the Supreme Court's Affordable Care Act ruling, the question of whether the decision will lead to increased M&A activity in the hospital and healthcare industry can now be answered with a definitive yes, no and we'll see.

Yes

The Supreme Court's ruling left the 2010 healthcare reform legislation largely in place, nullifying only the provisions that would have penalized states choosing not to expand Medicaid eligibility. A legislative repeal of the Affordable Care Act (ACA) would likely require a Republican sweep in the November elections, and despite campaign rhetoric to the contrary, this seems to be highly unlikely (especially to obtain a 60-seat filibuster-proof supermajority in the Senate). It would appear that the ACA, which represented a significant overhaul of the country's health care system and structure, will be with us for at least the near future.

With some measure of certainty now in place, there has been a noticeable increase in interest in deal-making activity in the hospital sector. Hospital systems that adopted a wait-and-see attitude have started to explore acquisitions, partnerships and alliances, and there is no shortage of potential partners who are willing to listen to fresh overtures. Increasingly, these organizations, primarily nonprofit hospitals, recognize that even two- and three-hospital systems will be hard pressed to stand on their own in light of the Medicare reimbursement cuts contained in the ACA and new payment models on the horizon.

For hospitals in states that opt-out of the Medicaid expansion, the need to align with larger systems will be even greater. Several governors have already announced their states would opt out, and hospitals in these states that are already facing a steep uphill climb could have no alternative but to consolidate if there is no increase in the number of insured residents.

Drivers for consolidation in the healthcare industry can be either financial requirements or strategic opportunities. Alignment with larger health systems provides operational savings through group purchasing, back office expenses and other efficiencies and economies of scale. On the acquisition side, distressed hospitals and systems are not the only candidates looking for potential partners. It can also be expected that high-performing, credit-worthy hospitals and health systems will draw significant interest. Investor-owned healthcare providers will be motivated to enhance their cash flow and buoy their stock prices by acquiring these prime facilities and systems. Large tax-exempt health systems, on the other hand, are in a good position to absorb an underperforming asset and improve its margins. This turnaround approach provides return on investment while simultaneously establishing scale.

Increased transactional volume is also likely in vertical markets as hospitals and payors acquire or align with home health agencies, skilled nursing facilities and other providers to position themselves for new delivery and payment models - such as accountable care organizations (ACOs) and bundled payments.

Also likely is increased consolidation among post-acute care providers seeking to gain critical mass. For example, Genesis HealthCare LLC, which operates long-term care, senior living and rehabilitation facilities, recently announced that it had agreed to acquire skilled nursing provider Sun Healthcare Group Inc. With more than 420 facilities nationwide, the combined organization would have the "scale necessary to remain competitive in the post-acute sector," according to a statement released by the two companies following the announcement.

While the Genesis HealthCare-Sun Healthcare transaction involves providers with similar service lines, there have also been announcements of acquisitions and joint ventures involving somewhat strange bedfellows. DaVita, Inc., a Fortune 500 provider of dialysis services, announced plans for a merger with HealthCare Partners, the country's largest operator of medical groups and physician networks. Inova Health System and Aetna announced their strategic partnership to establish a jointly owned health plan to serve the Northern Virginia market.

In addition, with the anticipated increase in the number of Medicaid enrollees, private Medicaid managed care companies and similar players are being sought after, as recently seen in WellPoint's announcement of the proposed acquisition of Amerigroup Corp. It is likely that there will be more announcements involving organizations aligning their interests with partners from different segments of the healthcare industry.

No

For the reasons outlined above, an increase in healthcare M&A activity seems probable in the wake of the Supreme Court decision. It must be noted, however, that healthcare M&A has been on the rise for the past few years for precisely the same reasons. Many health systems have been gearing up to operate under the ACA's full provisions since the date of its enactment in 2010. Most healthcare providers believed declining Medicare reimbursement rates and the development of new payment and delivery models were here to stay no matter how the Supreme Court ruled. This perspective is underscored by the fact that hospitals and health systems have been actively pursuing the acquisition of physician practices and other healthcare providers in the markets in which they operate since the ACA's enactment.

The reshaping of the healthcare  marketplace through innovative partnerships also predates the Supreme Court ruling. Duke LifePoint Healthcare, a joint venture between Duke University Health System and LifePoint Hospitals, and Ascension Health Care Network, a joint venture between Ascension Health Alliance and Oak Hill Capital Partners, were each established in early 2011 to assemble networks of hospitals and healthcare providers. Both joint ventures have been actively seeking and acquiring and partnering with hospitals since their formation despite any perceived uncertainties associated with the Supreme Court ruling.

We'll See . . .

The simple truth is that acquiring a hospital or a health system takes time. If an organization waited until the Supreme Court ruled on the ACA to begin making plans for an acquisition, merger or joint venture, it could very well be the second half of 2013 before the transaction is finalized. In addition, any consolidation within the healthcare industry could be further complicated and delayed by the increasing level of scrutiny the Federal Trade Commission is directing toward healthcare transactions with respect to antitrust issues and state attorneys general challenges to hospital transactions. Between now and then, a number of other factors could come into play that could also impact individual transactions and industry trends, including election results, economic conditions and other market developments.

While the Supreme Court's ruling upholding the ACA may trigger a further rise in healthcare transactional volume, a great deal of activity was already under way. Will these trends continue? We'll see what happens.

Molly K. O'Neill is senior vice president and chief business development officer with Ascension Health Care Network in St. Louis, MO. Brian R. Browder is a partner with Waller in Nashville, TN where he chairs the law firm's healthcare department. Donald B. Stuart is a partner with Waller in Nashville, TN where he advises healthcare providers on tax law and other business issues.

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HIE Options: The Battle Between Public and Private Continues
August 15, 2012 2:11 PM by Rebecca Hepp

As Meaningful Use criteria push towards required interoperability and changing reimbursement methods necessitate more coordinated care, HIEs are looking more and more appealing to hHealthcare providers. The HIE market practically exploded last year, growing more than 40%, according to a Chilmark Research report.

"As federal incentives drive the adoption of electronic health record (EHR) technology in the U.S., we will quickly move into the post-EHR era where the value of patient data is not what is locked in an EHR data silo, but the cumulative patient data that resides in the community HIE network," said John Moore, founder and managing partner of Chilmark Research.

And those looking to tie their systems together have plenty of options, too, when it comes to the type of HIE. The State Health Information Exchange Cooperative Agreement Program distributed $548 million to states, territories, and state-designated entity HIE startups in 2010, starting the slow creation of public HIEs. But many provider organizations, unwilling to wait for public HIEs to launch, have developed private HIEs — focusing on exchanging data among their own facilities and select outside partners.

While the KLAS report HIE Perception 2011: Public or Private? found that providers were split between selecting a public and private HIE, the tides have turned in favor of private exchanges, according to the Chilmark Research report. Organizations worried about data control or funding sustainability, or looking for a faster implementation time, are opting to create their own, private HIEs rather than wait to join larger, public HIEs. As federal funds dwindle, and state HIEs struggle to implement sustainable business models and develop fee structures through their state legislatures, private HIEs are becoming a more enticing option.

But with private HIE benefits come limitations. The KLAS report listed increased integration and interfacing needs as a possible deterrent, and a recent Journal of the American Medical Informatics Association article took a much closer look at the private vs. public HIE debate. According to the article, private HIEs, which only serve pockets of providers, may be draining resources necessary for public HIEs — which, by mandate, must provide broader services to entire communities and states — to succeed. Public HIEs are designed to connect providers on a grand scale, developing both intra- and inter-state exchanges; if private HIEs corner the market on profitable services, public HIEs have little chance of survival when providing lower ROI services such as connecting rural providers or developing the necessary standards and policies.

But don’t despair, because there may be a way to have it both ways, according to the article. Kentucky, as well as several other states, is working to create a public HIE that operates as an umbrella organization, linking all of the state’s HIEs, including private ones. During a National eHealth Collaborative roundtable, Claudia Williams, director of the State Health Information Exchange Program, recommended that states leverage the burgeoning private HIE development through an umbrella model similar to Kentucky’s, and focus on providing necessary services not met by the private sector.

This approach offers the best of both worlds: private HIEs can link specific provider networks, while the overarching public HIE brings competitors together by connecting all HIEs, as well as private practices not already part of a private HIE. The public HIE would also offer required exchange capabilities with state immunization registries, patient locator services, and new birth and cancer registries.

“In my mind that is a pretty good model. It makes sense to me that some public entity brings all of those [private] entities together, where there really isn’t a motivation otherwise,” said Steven Roth, vice president and CIO of Pinnacle Health System in Harrisburg, Pa, which developed its private HIE in 2009 after failed attempts to create an operable public HIE in 2007.

While public HIEs struggle to get up and running, private HIEs are popping up all over the country to address the immediate information exchange needs of technologically progressive providers. Although private HIEs have taken the lead, HIEs of both kinds are still in flux, and both have much to offer when it comes to sharing information.

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Pharma: To Tweet, Or Not to Tweet?
August 14, 2012 11:42 AM by Adrianne OBrien
Editor's note: This blog was written by Chelsea Foster, a copywriter at DKI.

Twitter has openly embraced the unimportant. It is the foundation upon which it was built in the first place. We all have that innate desire to inform the online eyes and ears of our friends, families, and perfect strangers, about the most painstakingly trivial personal information.

But Twitter's not all bad (or boring). It also gives us the ability to plug ourselves into the world. Tweet by tweet, we can receive real-time information about anything, from the most absurd to the most important: from what we had for breakfast to what medicine has or hasn't worked for our health condition, everything is on the table online.

Brave New World

The pharmaceuticals industry has a rightful place in this new world. There is a wealth of drug and patient education just waiting to emerge from the industry, but with a skittish FDA leaving blurry if not non-existent lines about what pharmaceutical companies can and cannot do, there is great hesitation to do much of anything at all.

Online, patients are delivering tiny bursts of information about their lives for all to see, including their symptoms, how good their doctors are, what drugs they're taking and offering emotional support. These conversations arise and disappear quickly. And like any social media outlet, the information people are swapping isn't always correct, and can even be misleading, which can be damaging, considering about 60% of Americans turn to the Internet first when they're seeking health information.

This is why the pharmaceutical industry should be involved in these discussions. It borders on having a responsibility to provide patients or potential patients with factual information about their products. It's also helpful to offer the tools and resources that many marketing campaigns provide, like symptom trackers, support and financial resources, and access to patient ambassadors that speak from their personal, verified experience with specific treatments.

What is Pharma Tweeting?

After reviewing pages upon pages of pharmaceutical twitter channels, several themes consistently arose. If pharmaceutical companies can't talk directly about their drugs, they're dead set on trying their best to improve their image and boost awareness about what's to come. The common tweet topics included:

  • What companies they're collaborating with (often research oriented)
  • The charities and philanthropic endeavors they're donating to or participating in
  • Current data and analysis about clinical trial results
  • Health tips for various conditions
  • Drivers that help flow their followers to their corporate websites
  • Re-tweets of patient testimonials regarding their condition, not their treatment
  • Links to interesting studies or topics in the healthcare field

Much of the information that the various pharma channels shared was interesting and informative. Surprisingly, one of the more powerful, unexpected tools was the ability to re-tweet. This allows companies to share information about conditions and the personal experiences of others without tweeting it themselves, which may be reviewed more leniently by the FDA (there's no way to be sure). If they're not affiliated or responsible for a given tweet, simply sharing it is a great way to link their followers to information they may not feel comfortable tweeting themselves.

Engagement is a Good Thing

An engaged patient is an empowered patient. This goes for caregivers and HCPs as well. Promoting a drug to boost engagement of any kind in the healthcare arena seems to be a beneficial addition to the twitterverse. It promotes the drug, yes, but it also starts a conversation between patients, a patient and their doctor, or concerned and interested parties. This can lead to a more engaged industry and public, overall. Additionally, these followers are willingly following their chosen channels. As long as the information they are provided with by a corporation is correct, it should be fair game.

We need to catalyze the conversation, not shy away from it. More likely than not, this will entail using the knowledge and understanding we currently have about promoting and marketing drugs, and applying it as seamlessly as we can into the social media abyss. Still, more guidance, if not a green light from the FDA, is needed first.

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ICD-10: Still in the Works
August 9, 2012 2:10 PM by Rebecca Hepp

If you are worried that your organization is falling behind on ICD-10 preparation, you are not alone. Nearly half of the 2,118 providers who participated in the Workgroup for Electronic Data Interchange (WEDI) February 2012 ICD-10 readiness survey said they did not even know when they would be completing their impact assessment — a key milestone that should have been met in 2011. Only a fifth had already completed their assessment.

Health plans are only marginally more prepared, according to the WEDI survey; over one-third of the 242 respondents have completed their assessments, but a quarter are less than halfway there. Most health plans have not slated external testing until 2013.

WEDI notes that historically, their membership and survey respondents tend to be more aware of industry issues and are correspondingly more advanced in addressing them, giving even more weight to ICD-10 preparedness concerns.

In April, the Department of Health and Human Services (HHS), which includes the Centers for Medicare and Medicaid Services (CMS), proposed to postpone the ICD-10 deadline for one year, from Oct. 1, 2013 to Oct. 1, 2014.

The American Hospital Association (AHA), recognizing that deadline uncertainly is diminishing industry focus on ICD-10 preparation, asked CMS in July to set a firm deadline in order to give providers the time — and motivation — to properly prepare.

“We are in an environment where the demands on providers are really great,” AHA policy director Chantal Worzala told InformationWeek Healthcare. “So there is a natural tendency to prioritize among all the things you have in front of you. We asked CMS to finalize its rule as quickly as possible so we can go back to a state of certainty about the date.” 

The AHA has a right to be concerned, as the WEDI survey found that providers, payers, and even vendors have become distracted by a plethora of issues.  The survey asked all participants to list the top three obstacles to their ICD-10 preparation progress, and nearly three-quarters responded that competing internal priorities were the biggest obstacle. Other distractions listed included other regulatory mandates, significant IT impacts, staffing, budget and both customer and vendor readiness concerns.

Two-fifths of the providers responded that they were worried about vendor preparedness, and with reason. Vendors are certainly as far behind as providers and payers, with nearly half of the 231 surveyed responding that they are less than halfway complete with their product development. For those organizations ahead of the game and looking for the right vendor, their options may be limited, as only about one-fifth indicated their services or software was already available.

 “When CMS puts out a final rule and everybody starts to say ok, ‘this is the date,’ and they get back to the work of preparing, we can take that extra time and use it to ramp up the testing with our trading partners, including the insurers,” Worzala said.  

Of course, not everyone agrees with these somewhat worrying results. The 2012 HIMSS Leadership Survey, published at its February conference, found that, for two-thirds of the respondents, ICD-10 was a top focus for their organization. Nearly 90% thought they would be able to complete their ICD-10 conversion by the earlier, October 2013, deadline. 

Whether your organization’s preparation timeline supports WEDI’s survey results or HIMSS’s, there is no denying that ICD-10 is a major transition all healthcare leaders must focus on, now or in the immediate future.

If you are looking to motivate your organization to keep its foot on the gas when it comes to ICD-10 preparation, check out a recent Executive Insight article written by Bob Schwyn, principal, Aspen Advisors. He emphasizes that the potential impact of ICD-10 implementation on your organization's financial performance is substantial, so preparedness is essential. He recommends organizations take advantage of the delay to ensure that their efforts do not negatively impact their financial performance as the deadline looms. 

For more information, see WEDI’s Survey Results, or check out InformationWeek’s coverage:

For more information from HIMSS, browse through their 2012 Leadership Survey

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Having Insurance Doesn't Rule Out Social Security Disability Eligibility
July 12, 2012 2:30 PM by Adrianne OBrien
Editor's note: This blog was written by Karen Hercules-Doerr, a healthcare executive and director of Community-Based Representatives at Allsup. Contact: k.hercules-doerr@allsupinc.com. 

It seems reasonable to assume that patients with health insurance are ineligible for Social Security Disability Insurance (SSDI), a program that provides benefits to Americans unable to work because of a disability.

After all, more than 55 percent of Americans aged 26-64 participate in employer-based healthcare coverage, and if they have employer-based insurance, they're able to work, right?

Although working typically disqualifies a patient from SSDI, simply having health insurance does not. Even if patients have health coverage when they are initially treated, that may not be the case in just six months, or later on. When patients have progressive chronic illnesses, they experience increasing difficulty in maintaining work schedules and can lose access to steady income and health insurance. Patients who could be receiving SSDI benefits, but aren't, can become a higher cost patient for the provider.

A 2010 study found that the average SSDI beneficiary visited the doctor seven times per year. That escalated to an average of 22 times per year over the course of three years. As their condition worsens and patients visit healthcare providers more often, they also become increasingly likely to lose employer-based insurance to help pay for care.

Patients with worsening health and rising costs may not be able to pay for their care if they don't file for SSDI in the interim.

However, there is good news for patients: after 24 months on SSDI, patients are eligible for Medicare. The 2-year waiting period underscores the critical importance of identifying at-risk patients and helping them apply for SSDI benefits as early as possible. That's why it's important to look for warning signs with patients who may become SSDI-eligible, so they can begin the process of applying for benefits as soon as they're eligible.

Healthcare professionals find that when their insured patients fully understand the benefits of filing for SSDI with a representative such as Allsup, they are less likely to become uninsured or underinsured later.

It is critically important that hospitals, physician practices and healthcare providers understand that it's never too early to inform their patients that SSDI benefits may be available if they are deemed disabled and cannot work in any capacity for at least 12 months.

Giving patients options regarding their future and offering them help from expert representatives can minimize the tremendous losses they face when they can no longer work because of a disabling condition. This step also can expedite access to benefits that patients have paid into and deserve, and helps minimize providers' exposure to the significant cost demands of treating patients who don't have a steady source of income or insurance.

Reference

1. Ensuring Patients with Disabilities Can Maintain Care and Coverage." Allsup, 2012.

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The Medicaid "Wrinkle"
July 2, 2012 12:17 PM by Adrianne OBrien
Editor's note: This blog was written by Jill Glomsted, editor of ADVANCE for Occupational Therapy Practitioners.

In the June 28 Supreme Court ruling, seven of the nine Justices agreed that it would be unconstitutional for the federal government to force states to participate in the Affordable Care Act's expansion of the Medicaid program. The expansion had been expected to cover roughly 17 million uninsured Americans, mostly low-income adults. The federal government will foot the full bill for the expansion for the first three years; after that the federal share will slowly decline, but it would still be 90 percent in 2020. 

The Court's decision basically renders the expansion a separate animal from the current Medicaid program. If states don't participate in the expansion, they can keep their existing programs (and existing federal money) without consequence. The question now is, what will the states choose to do?

So far seven states and the District of Columbia are already offering expanded coverage, paying for it with state funds until the federal payments via the ACA kick in in 2014, according to CBS News.

However, 26 were plaintiffs in the case the Court heard; the governors of some of them, including Texas, Mississippi and Wisconsin, have already hinted that they will not implement the expansion, while others have refused to say what they're willing to do. Virginia Governor Bob McDonnell isn't saying, but told Politico.com that the expansion would cost his state $2.2 billion over 10 years, even with the federal funds.

It's unsurprising that few want to commit to a decision, given the political hot potato that the Affordable Care Act has become and the huge financial burdens states are already facing due to Medicaid. But if states opt out of the expansion, what's going to happen to their residents?

If all 26 states who were parties to the suit opt out, that's more than half - roughly 9 million people - of those expected to be covered by the expansion who will still be without insurance. What's more, they will be some of the poorest Americans.

"We will have a really strange doughnut hole in this country," said Kevin Outterson, associate professor of law and associate professor of health law, bioethics and human rights at Boston University, during an Association of Health Care Journalists webcast on the Supreme Court decision today. Individuals making up to the federal poverty level (FPL, currently $15,415 for an individual; $26,344 for a family of three in 2012) will have some level of coverage under existing programs. Those making 133 percent of the FPL or more will be able to participate in the state health insurance exchanges that the ACA established, with subsidies to help them purchase affordable coverage. But the people who fall in between are not eligible to participate in the exchanges - the ACA did not include them because it was assumed they would be covered by the Medicaid expansion.

Public and safety-net hospitals in states that opt out could also suffer. Currently hospitals that treat a large number of low-income, uninsured or vulnerable patients receive "disproportionate share" funding to help pay for that uncompensated care. Under the ACA, those hospitals are scheduled to lose about half that funding, on the premise that the expansion of coverage through both the individual mandate and the Medicaid expansion would offset what hospitals will lose. If a state chooses not to participate in the Medicaid expansion, its hospitals will still have to provide care to those populations but with much less funding than they have now to do so.

Providers could lose out too, though that is uncertain. The ACA raises rates for primary care providers in Medicaid up to Medicare levels. It's unclear, based on the Supreme Court ruling, whether providers in states who don't participate in the expansion will get that increase in payments.

Another issue is that "there is nothing out there to give states any sense of when they have to make a decision, because no one thought they would have to," said Alan Weil, executive director of the National Academy for State Health Policy, during the webcast. In states that don't decide, Medicaid programs could be caught in a holding pattern.

Martin Salo, executive director of the National Association of Medicaid Directors, told the New York Times in an article on June 29 that his initial sense is that many states will participate in the expansion. Many Republican governors may be waiting until after the November election to decide, hoping that Mitt Romney will win and make good on his promise to dismantle the entire law - Wisconsin Governor Scott Walker said on Thursday that was his position, CNBC reported. However, governors don't necessarily hold all the cards here. Much of Medicaid is regulated by the legislature, and when state legislatures come back into session in January they may take some or all of this decision out of the governors' hands, said Weil. It's also possible that Congress or HHS could act in the way of new legislation or new regulations to encourage states to participate.

By way of analogy, several Republican governors initially said they would not take federal stimulus money from the American Recovery and Reinvestment Act of 2009, said webcast moderator AHCJ President Charles Ornstein. Eventually, they all did. Americans - especially the poorest - will just have to wait and see if they do the same with the Medicaid expansion.

 

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Mission Deployed: ICD-10
June 25, 2012 3:07 PM by Adrianne OBrien

Executive Insight headed west and is blogging live from HFMA's annual ANI conference, held from June 24-27 this year in Las Vegas. One popular session today was ICD-10 Readiness, a provider panel discussion that emphasized lessons learned from facilities already marching along the not-so-well-worn ICD-10 path.

One panelist, Danielle Reno, CHC, CCD, CCS-P, the ICD-10 program director for northern California's Sutter Health, discussed why Sutter initiated its ICD-10 program in early 2011.

  • There will be a huge decrease in productivity when ICD-10 becomes official. Sutter estimated that drop will be 50 percent. "Backfill staff," said Reno. "Bring in coders and train them internally." Otherwise, that 50 percent dip will kill revenues.
  • AHIMA is "pushing doing education now," said Reno. ICD-10 "is a whole new language."
  • A "huge challenge," noted Reno is physician engagement. Facilities in California cannot employ physicians, so it's tough for those facilities to mandate anything. "Everyone thinks ICD-10 has stopped," said Reno, so the time to bring physicians on board is now. One answer to the what's-in-it-for me question: historical data analysis that will be available with ICD-10.

It was obvious from the audience Q&A that many small and mid-sized hospitals have yet to begin transition work to ICD-10. What has your facility done so far?

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The Trouble with Metadata and Health Privacy
June 13, 2012 11:27 AM by Rebecca Hepp

Advances in technology over the past decade have raised serious concerns for patient privacy, an issue that sparked an intense panel discussion at the Second International Summit on the Future of Health Privacy, held last week in Washington, DC. Panelists debated current legislation’s ability to properly protect patients in the age of smart phones, tablets and electronic records. For James Pyles, a health law attorney who has worked on privacy measures for HIPAA and the HITECH Act, legislation is lagging far behind technology, leaving patients unprotected from potential electronic violations of privacy.

"We now have electronic disclosures of patient privacy that are entirely different from disclosures of paper records," Pyles said. "You can get a paper record back; you cannot get an electronic record back. You can disclose millions of electronic records simultaneously; you cannot do that with paper records."

"The damage that can be done to someone is perpetual," Pyles added. "And the damages that can be awarded are incalculable."

Joy Pritts, chief privacy officer for the Office of the National Coordinator for Health IT (ONC), agrees with Pyles that technology is advancing much quicker than the law, although she did argue that HIPAA still has its strengths. Under HIPAA, enforcement of federal privacy regulations is in the hands of the states, who are free to extend enforcement beyond the floor set by the federal regulation.

"In some states, there are very strict standards on how [health information] can be shared," Pritts said. "In other states, they didn't see a need to do that because they thought patients were comfortable getting care and sharing that information for certain purposes without having to expressly write it down on a piece of paper."

Adding fuel to the fire, Frank Pasquale, a healthcare regulation and enforcement professor at Seton Hall University, brought up the related debate over metadata and its potential to give patients more control over their personal information. "We've got to create new modes, enable modes of granular control over the data in order to make people feel safe,” Pasquale said. “Otherwise, we're never going to have the type of benefits we can get from big data analysis, from observational research."

Metadata, according to the ONC, is data that provides more detail or information about a piece of data, which has the potential to drastically improve the way health organizations communicate electronically. However, without any accepted standards for metadata tags, the National Committee on Vital and Health Statistics (NCVHS), the statutory public advisory body to the U.S. Department of Health & Human Services, recommended that the ONC refrain from including metadata standards in Stage 2 of the Meaningful Use incentive program.

Referring to the NCVHS’s recommendation, Pritts told the panel last week that metadata is currently on hold for electronic health records, at least until metadata standards are better assessed and understood. With such a powerful tool at hand, precautions must be taken to ensure there are no unintended consequences that could infringe on patient privacy. 


http://www.fiercehealthit.com/story/health-privacy-regs-metadata-fuel-heated-debate/2012-06-08

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First ACOs Selected
April 26, 2012 12:55 PM by Adrianne OBrien
Editor's note: This blog was written by Michael LaMagna, a partner at Timins & LaMagna, LLP, practicing health care regulatory, elder /disability/veteran's law, trusts and estates, Social Security and general legal practice in New York and Connecticut. Michael was just appointed to the ACO Task Force of the American Health Lawyers Association. E-mail him at Mlamagna@nyandctlaw.com, call him at 914-819-0663 or visit his website at www.nyandctlaw.com for more information.

Very soon many readers will be part of a new healthcare program that will integrate cutting edge technology, coordinate care amongst many different providers and even take an active interest in your well-being. Curious?

CMS has selected 27 large medical groups to be the first participants as Accountable Care Organizations (ACOs). ACOs are new multi-provider organizations that incorporate hospitals, physician groups, laboratories, and even nursing facilities, coordinating care among the various levels through technology and follow-up. This should reduce unnecessary and harmful duplication of services, improve the overall quality of patient care and lower costs to the healthcare system.

ACOs are required to adhere to 33 quality standards, including patient safety, usage of preventive healthcare and coordination of care. In return, the ACOs will share in the savings and receive up to 25 percent of the savings produced.

In addition, ACOs will be required to carefully monitor chronically ill patients, who are known to be the most expensive participants (i.e., diabetics and those with pulmonary and heart ailments). The monitoring of these patients will be particularly challenging,

If the program works, we will all be part of an ACO in the near future.

This article is provided for informational purposes only. Nothing in this article shall be construed as legal advice or should be relied upon as such.

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Affordable Care Act "Sunshine" Rule Increases Transparency
December 15, 2011 11:12 AM by Lisa Algeo

The Centers for Medicare & Medicaid Services (CMS) announced yesterday a proposed rule that will increase public awareness of financial relationships between drug and device manufacturers and certain health care providers. This is one of many steps under the Affordable Care Act designed to increase transparency in the health care system, which can lead to better care at lower costs.

"When people are faced with the difficult task of choosing the right doctor, they need all the information they can gather. If your doctor is taking money from manufacturers of prescription drugs, suppliers of wheelchairs or other devices, you deserve to know about it," said Peter Budetti, MD, CMS deputy administrator for Program Integrity. "Disclosure of these relationships will discourage the inappropriate influence on clinical decision-making that sometimes occurs while still allowing legitimate partnerships."

The proposed rule would require manufacturers of drugs, devices, biologicals, and medical supplies covered by Medicare, Medicaid, or the Children's Health Insurance Program to report to CMS payments or other transfers of value they make to physicians and teaching hospitals. The proposed rule would also require manufacturers and group purchasing organizations (GPOs) to disclose to CMS physician ownership or investment interests. 

This increased transparency is intended to help reduce the potential for conflicts of interest that physicians or teaching hospitals might face as a result of their relationships with manufacturers.

Drug and biologic manufacturers, medical device or supply manufacturers, and GPOs would be affected by the new reporting requirements. These organizations, as well as the physicians and teaching hospitals, would be allowed an opportunity to review and correct information prior to its publication. 

The Affordable Care Act provides that violators of the reporting requirements will be subject to civil monetary penalties (CMPs), capped at $150,000 annually for failing to report, and $1,000,000 for knowingly failing to report. 

CMS is proposing that data collection will not begin on Jan. 1, 2012 and that manufacturers and GPOs do not need to begin data collection until final regulations are issued. Depending on the timing of the final rule, CMS is proposing that manufacturers and GPOs will be required to submit a partial year on Mar. 31, 2013. Once the data has been submitted, CMS will aggregate manufacturer submissions at the individual physician and teaching hospital level, provide them with a 45-day period to confidentially review and, if necessary, correct the data, and make the data publicly available by Sep. 30, 2013.

CMS will accept comments on the proposed rule until Feb. 17, 2012, and will respond to them in a final rule to be published in 2012.

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