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Apple eyes medical-clinic business

Apple seems to be considering entering the clinic business. CNBC reports that the huge tech company recently spent months in acquisition talks with medical-clinic company Crossover Health, which runs Apple’s on-site clinics for employees, although no deal has been reached

The network also said that Apple, which has some health-related initiatives already underway, also contacted primary-care vendor One Medical about buying it.

Healthcare Dive reported that it’s not clear if Apple seeks to own and run a clinic network, which might be set up in some ways similar to its retail stores, or wants a vehicle for selling such health-related products as the Apple Watch.

Crossover Health provides on-site and near-site health and wellness centers for self-insured employers in the San Francisco Bay area, New York City and some other places.

Of course, buying or otherwise partnering with a primary-care network would give Apple easy access to providers who could test and use its burgeoning number of products.

To see the CNBC report, please hit this link.

To read Healthcare Dive’s take on the story, please hit this link.

 

 


Study: Almost half of U.S. healthcare provided by EDs

 

A study published in the International Journal of Health Services determined that hospital emergency departments provide nearly half of all medical care in America. No wonder U.S. healthcare is so astronomically expensive! But are these data too old ?

University of Maryland School of Medicine (UMSOM) researchers studied available data between 1996 and 2010 from several national healthcare databases and determined that emergency departments contributed an average of 47.7 percent of the medical care in the U.S., and that  the percentage increased steadily over the 14-year study period.

“I was stunned by the results. This really helps us better understand healthcare in this country. This research underscores the fact that emergency departments are critical to our nation’s healthcare delivery system,” David Marcozzi, M.D., an associate professor in the UMSOM Department of Emergency Medicine, and co-director of the UMSOM Program in Health Disparities and Population Health, said in a study announcement. “Patients seek care in emergency departments for many reasons. The data might suggest that emergency care provides the type of care that individuals actually want or need, 24 hours a day.”

The researchers found that African-Americans, Medicare and Medicaid beneficiaries, residents of the South and West, and women accounted for increasing percentages of ED use over the 14 years.

Dr. Marcozzi said that while hospitals have been trying to discourage patients from using emergency departments for non-emergencies,  policymakers might want to reconsider that approach given the fragmented structure of the country’s healthcare system. Instead, he suggested, perhaps  emergency departments should be considered  as part of a  wider approach to  healthcare reform, including boosting population-health efforts.

To read the study, please hit this link.

To read FierceHealthcare’s comment on the report, please this link.


Chasing Medicaid dollars, hospitals rent or buy up nursing homes

By PHIL GALEWITZ

For Kaiser Health News

Westminster Village North, a nursing-home and retirement community in Indianapolis, recently added 25 beds and two kitchens to speed food delivery to residents. It also redesigned patient rooms to ease wheelchair use and added Wi-Fi and flat-screen televisions. This fall, it’s opening a new assisted-living unit.

“We have seen amazing changes and created a more home-like environment for our residents,” said Shelley Rauch, executive director of the home.

The nursing home can afford these multimillion-dollar improvements partly because it has, for the past five years, been collecting significantly higher reimbursement rates from Medicaid, the state-federal health insurance program for the poor. About half of its residents are covered by the program.

In 2012, the nursing facility was leased to Hancock Regional Hospital, a county-owned hospital 15 miles away. The lease lets it take advantage of a wrinkle in Medicaid’s complex funding formula that gives Indiana nursing homes owned or leased by city or county governments a funding boost. For Indiana, that translates to 30 percent more federal dollars per Medicaid resident. But that money is sent to the hospitals, which negotiate with the nursing homes on how to divide the funding.

Nearly 90 percent of the state’s 554 nursing homes have been leased or sold to county hospitals, state records show, bringing in hundreds of millions in extra federal payments to the state.

Even though Indiana’s nursing home population has remained steady at about 39,000 people over the past five years, Medicaid spending for the homes has increased by $900 million, in large part because of the extra federal dollars, according to state data. Total spending on Indiana nursing homes was $2.2 billion in 2016.

The funding enhancements were pioneered in Indiana, but hospitals in several other states, including Pennsylvania and Michigan, have also used the process. Advocates say it has been a key factor in helping to keep Indiana’s city and county hospitals economically vital at a time when many rural hospitals nationwide are facing serious financial difficulties.

Westminster Village North, a nursing home and retirement community in Indianapolis, recently redesigned patient rooms in the nursing home to ease wheelchair use. (Courtesy of Westminster Village North)

But critics argue that the money flow has not significantly improved nursing home quality and has slowed adoption of community and home health services.

More than two-thirds of Indiana’s Medicaid long-term-care dollars go to nursing homes, compared with the U.S. average of 47 percent.

Joe Moser, who until May was Indiana’s Medicaid director, said while in office that the hospital-nursing home marriages were partly responsible for keeping more people in nursing homes. “It is a factor that has contributed to our imbalance,” he said.

Daniel Hatcher, a law professor at the University of Baltimore and author of  the book The Poverty Industry, said this funding arrangement is a bad deal for the poor and undercuts the purpose of the Medicaid program. “The state is using an illusory practice and taking away money from low-income elderly individuals who are living in poor-performing nursing homes,” he said. He noted Indiana is ranked near the bottom of states for nursing home quality by several government and private reports.

But proponents of the practice say that even when hospitals get most of the money, it is well spent.

Marion County Hospital and Health Corp., the large safety-net hospital system in Indianapolis, owns or leases 78 nursing homes across the state, more than any other county hospital.

Sheila Guenin, vice president for long-term care there, said the hospital keeps 75 percent of the additional Medicaid dollars and the nursing homes get the rest. Still, the additional money has improved care. The transfer of the license to the hospital has kept several nursing homes from closing and increased staffing rates at many others, she said.

About 40 percent of the county hospital’s nursing homes have five-star ratings from the federal government, up substantially from 10 years ago, she said. Among the improvements at the nursing homes were the addition of electronic health records as well as high-capacity emergency generators to provide power in case of a natural disaster.

Still, some patient advocates said the extra funding is flowing to hospitals and nursing homes with little public accounting. Ron Flickinger, a regional long-term-care ombudsman in Indiana, said, “A lot of extra money is being spent here, but I’m not sure patients have seen it benefit them.”

A couple reads the paper in one of the common rooms at the Westminster Village North nursing home. (Courtesy of Westminster Village North)

Practice Dates To 2003

Medicaid, which typically covers about two-thirds of nursing-home residents, is jointly financed by the federal and state governments. States pay no more than half of the costs, although the federal match varies based on a state’s wealth. In Indiana the federal government covers about two-thirds of Medicaid costs.

The enhanced nursing-home payments began in 2003 when a financially strapped Indianapolis hospital owned by the county took advantage of the Medicaid funding provision to bolster its bottom line. In this case, the hospital purchased a nursing home, then provided the money for the state to increase what it spent on the home to the federally allowed maximum.

That increase, in turn, drew down more federal matching funds. Since the federal remittance is larger than the hospital contribution, the hospital got back its initial investment and divided the extra money with the nursing home.

Other county-owned hospitals in Indiana slowly followed suit.

Hatcher said Indiana government leaders embraced the funding arrangement because it let them avoid the politically difficult step of raising taxes to increase state funding to improve care at nursing homes. “It’s a revenue generator for the state and counties,” he said.

All the Medicaid funding for nursing homes should be going to those homes to care for the poor, not shared with hospitals to use as they choose, he added.

The strategy, promoted by consultants advising hospitals and nursing homes in Indiana, is used heavily there because of the plethora of county-owned hospitals. But the federal government is tightening the rules about such payments.

Texas has secured Medicaid approval for a similar strategy starting this month, but federal officials have made the extra funding dependent on nursing homes meeting quality measures, such as reducing falls. Oklahoma is seeking to get federal approval as well.

And in a rule released last year, the federal Centers for Medicare & Medicaid Services announced that it would gradually force states to shift to payment systems that tie such reimbursements to quality of care. Michael Grubbs, an Indiana health consultant, said that rule does not stop the Indiana hospital funding program, but it’s unclear that it will last.

Nursing-home operators in Indiana say the financing arrangement has helped them keep up with rising costs and improve care for residents.

Zach Cattell, president of the Indiana Health Care Association, a nursing-home trade group, noted the number of nursing homes in the state earning Medicare’s top, five-star rating has increased 9 percentage points since 2011. He said the percentage of high-risk residents with pressure ulcers and those physically restrained also dropped significantly.

An Opportunity Or A Loophole?

In Indiana, the small, county-run rural hospitals generally are not facing the financial threat that has become common elsewhere, in part because of the extra Medicaid funding gained from buying nursing homes, hospital officials say.

“The money has meant a great deal to us,” said Gregg Malot, director of business development at Pulaski Memorial Hospital in northern Indiana. “I don’t see this as a loophole but see it as an opportunity for small rural community hospitals to improve our quality and access to care.”

His hospital is the only one in Pulaski County. The extra Medicaid revenue from acquiring 10 nursing homes statewide — about $2 million a year — has helped finance the hospital’s obstetrics care and the purchase of the hospital’s first MRI, so doctors don’t have to rely on a mobile unit that used to come twice a week, he said. The hospital also spent some of the funding to add a centralized telemetry unit to monitor patients.

Steve Long, CEO of Hancock Regional Hospital, in Greenfield, Ind., said his hospital recently built two fitness centers in the county with help from its extra Medicaid dollars. “This would not be possible without the additional funding.”

He rejects the notion that additional Medicaid money reduces the hospital’s incentive to add home- and community-based care in the community. He said new Medicare financing arrangements, such as accountable care organizations, give the hospital motivation to find the most efficient ways to care for patients after they leave the hospital.

But he acknowledged the hospital benefits from seeing more patients go to nursing homes licensed under its name.

“Welcome to health care — it’s a complex and confusing environment where we have all different competing incentives,” Long said.


‘Physiatry’ for patients with severe injuries

 

Spaulding Rehabilitation Hospital, Boston.

Chloe Slocum, M.D., MPH, a staff physician at the Spaulding Rehabilitation Hospital, in Boston, and an instructor at the Harvard Medical School, talks about a kind of care called “physiatry”. She writes in NEJM Catalyst:

“Individual teams in physical medicine and rehabilitation (PM&R), also called physiatry, care for some of the most medically complex and vulnerable patients following severe injuries, all while maintaining an inclusive focus on medical management, quality of life, and long-term goals for community participation.”

“Providing high-quality care for individuals with multiple complex medical conditions and functional impairments can pose unique challenges, and involves close collaboration and teamwork across different specialties and sites of care within the community.”

“While I am incredibly fortunate to work in a system where collaboration across settings is the norm, I have long admired two peer institutions that have seemingly bridged the divides of geography and discipline to accentuate the value of rehabilitation medicine and effective teamwork — not only for specific teams, but for entire organizations in very different environments.” The institutions are the University of Washington and the Shirley Ryan AbilityLab, in Chicago.

To read Dr. Slocum’s essay on this, please hit this link.


Hospital-practice subsidiary blends physician employment, independence

 

A FierceHealthcare story discusses a third option for physicians between becoming a hospital employee and staying completely independent.

It’s  called the group practice subsidiary (GPS) model, as explained by lawyer Curt Chase, J.D., a partner at Husch Blackwell LLP in Kansas City, Mo.,  during a presentation at the Medical Group Management Association annual conference.

Fierce reported: “The emerging model integrates independent practices with hospitals and healthcare systems while allowing physicians to keep their independence, Chase said. Rather than a hospital or health system owning a practice, it creates a subsidiary which employs the physician practice. The doctors are not employed by the hospital, but the hospital owns the subsidiary although it doesn’t subsidize it. The hospital has a certain level of control but the practice continues to operate much like it did before.

“For hospitals, the model provides a broader physician network, better positions them to work with community physicians to manage population health and gives them strategic, long-term affiliations with doctors.”

To read more, please hit this link.


Microhospitals are spreading fast

Not quite this small.

Hospitals & Health Networks has done  an  update on the rapidly increasing number of microhospitals, facilities that bridge the gap between ambulatory and tertiary care.

H&HN reports, for example, that “PhiloWilke Partnership, Houston, has designed approximately 25 microhospital facilities in the last eight years, with 20 more on the books, according to Kevin TenBrook, partner at the firm.”

“It’s definitely expanding at the moment,” he said.

H&HN notes that “they can be distributed throughout a region to support a network of care; they also can be designed to be scalable, to grow along with a burgeoning community.”

David Argueta,  an executive with CHI-St. Luke’s in Texas, told the news service that microhospitals are, in H&HN’s paraphrase, “an innovative solution for delivering hospital care where it’s needed, to meet a healthcare organization’s strategic goals and its mission as a care provider. In short, efficient, well-placed microhospitals can achieve the healthcare trifecta of ‘best value, high quality, lower cost,’ he says.”

Kevin Harney, AIA, NCARB, principal at architecture firm ESa,  in Nashville,  told H&HN that microhospitals are mostly 15,000 to 25,000 square feet, although they can be up  60,000 square feet.  “They typically include eight to 10 inpatient beds, eight to 10 emergency department (ED) treatment bays, a small imaging and diagnostic suite and support functions like dietary services, environmental services and materials management,” the news service said.

Rod Booze,  partner in the Texas office of healthcare architecture firm E4H, told H&HN that the facilities perform, in H&HN’s words, “essentially the same functions as standard-sized hospitals, but are scaled to respond to the needs of lower-acuity patients.

To read more, please hit this link.


Bundled payments gaining more popularity with surgeons

 

Harris Meyer writes in Modern Healthcare about how bundled payments are gaining popularity with orthopedic surgeons even as the Trump administration has thrown  some cold water on the reimbursement approach when applied to Medicare patients.

For example, Dr. Amol Navathe, an assistant professor of health policy and medicine at the University of Pennsylvania, told Mr. Meyer.

“One of the nice things about bundled payment is it can provide a direct financial reward for physicians to work hard on aspects of care that can be difficult and require coordination with the hospital. It’s important that physicians be engaged and bought in.”

Mr. Meyer writes:

“While many hospitals and physician groups are working on improving care outside the CMS’S bundled-payment programs, the financial incentive of meeting a fixed cost target for an entire episode of care has spurred a stronger collaboration between these often-competing players. That’s true even for hospitals and medical groups that have not established financial arrangements in which doctors get bonuses for meeting cost targets, known as gain-sharing.”

“Another key to the success of bundled payment is helping surgeons prepare patients and their families for the surgery and recovery phases. That includes working with patients to improve their health before surgery to optimize outcomes, such as encouraging them to lose weight or quit smoking. Many orthopedic groups have invested in hiring nurse practitioners or surgical assistants to do this patient education work.”

Of course identifying physician leaders to facilitate the move to bundled payments is crucial:

“At each hospital, the physician leader convened a kickoff meeting with the doctors and other clinical staff involved in joint replacements to discuss how to streamline the pre-surgical, inpatient and post-acute processes and determine what resources were needed to achieve that. That was followed by multiple meetings to design and test the new {bundled-payment} model and offer any support physicians needed in their offices.”

Mr. Meyer is writing about hospitals but  hospital bundled-payment lessons would apply to out-of-hospital surgeries, too.

To read more, please hit this link.

 


How can smaller practices compete in value-based-reimbursement world?

 

Medical Economics recently spoke with Daniel K. Zismer, Ph.D., a co-founder and managing director of Castling Partners, a Minneapolis-based healthcare management advisory firm, about how organizations of different sizes can succeed in the value-based-reimbursement world. Among his remarks:

Medical EconomicsThe big question: How can a smaller practice compete with larger practices under value-based reimbursement?

“Mr. Zismer: To play to win in this environment, practices may have to do something many don’t want to do—be part of that larger, more integrated, sophisticated health system that can go upstream while contracting with both insurance and the government.

“The average health system has fewer than five payers that matter to the whole revenue stream in a major way. With such a consolidated payer marketplace, there really isn’t a payer interested in trying to aggregate and contract separately with hundreds of small medical practices.

“Payers are more attracted to larger, more integrated sophisticated systems of care delivery that have a more resilient economic model. Smaller practices should get organized and positioned to play in this era of experimentation, understanding that health insurance providers are interested in creating value-based programs. They may not, however, be interested in creating models and methods so that any provider of any size and scale can participate with them.”

To read the whole interview, please hit this link.

 


AHA uses report to defend not-for-profit hospitals’ tax exemption

Citing  a report based on four-year-old data, the American Hospital Association (AHA) asserts that community benefits outweigh the value of nonprofit hospitals’ tax exemption by a factor of 11 to one. The analysis, performed by Ernst and Young at AHA’s request, used 2013 data from tax forms, community- benefit reports and Medicare cost reports from nearly 3,000 non-profit general hospitals.

The report said that more than half the benefits involved financial assistance to patients as well as the hospitals’ eating of unreimbursed Medicaid and other expenses.

Healthcare Dive commented: “Hospitals have to take a number of steps to support their tax-exempt status. Most facilities don’t have trouble meeting these requirements, but last month the IRS — for the first time — revoked a tax exemption for an unnamed  hospital. Gary Young, director of Northeastern University’s Center for Health Policy and Healthcare Research, told Healthcare Dive that was an extreme case, but could signal a step up in enforcement. ‘It may certainly send some chills down the spines of some hospital managers,’ he said.

“Non-profit hospitals have faced questions about high executive salaries and occasionally significant revenue. The AHA report could ease some of those concerns.’’

To read the report prepared for the AHA, please hit this link.

To read the Healthcare Dive commentary, please hit this link.

 


Vermont’s ‘all-payer’ pilot expands fast

 

FierceHealthcare reports:

“Nine hospitals in Vermont have signed on to participate next year in the state’s all-payer pilot.

“OneCare Vermont, the Accountable Care Organization that is heading the effort, estimated that 120,000 Vermont residents will be covered under the program in its second year …compared with 30,000 in year one.

“In all-payer models, providers are reimbursed based on patient outcomes, not on how many procedures are performed. ”

“OneCare announced that a variety of providers would be joining the model for 2018 in addition to the hospitals, according to an article from Vermont Business Magazine. The all-payer program will also include one hospital in New Hampshire, two federally qualified health centers and 19 skilled nursing facilities. ”

“Twenty-four independent physician practices and 30 independent specialty practices have signed on as well, the magazine reports. ”

To read the Vermont Business Magazine article, please hit this link.

To read the FierceHealthcare article, please hit this link.

 

 

 

 


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