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Smooth care transitions a point of pride for this small R.I. hospital

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South County Health, a small nonprofit system in bucolic southern Rhode Island, owes a large part of its success to its ability to manage transitions of care – an increasingly urgent imperative as healthcare moves from fee-for-service to value-based reimbursement.
The system’s flagship is South County Hospital, a 100-bed community hospital. The system also includes South County Home Health Services (a home health agency); South County Surgical Supply (home medical supplies); South County Medical Group, with 65 physicians and advanced-practice providers, and two Medical and Wellness Centers, one in Westerly and the other in East Greenwich, with urgent-care facilities and an array of primary-care and specialist physicians.

South County Hospital has long had very high marks for quality and patient satisfaction. Indeed, surveys have often called it the best hospital in its state and one of the best in New England. It was recently awarded a five-star rating by the Hospital Consumer Assessment of Healthcare Providers and Systems (HCAHPS), putting it in the top 2 percent of those surveyed nationwide.

Louis R. Giancola, the system’s president and chief executive, attributes much of the hospital’s success in patient satisfaction — and fiscal stability — to the strong engagement of its staff, which “we keep in the know’’; a “supportive board’’; the long-term loyalty of people in the service area, and the “nimbleness of a community hospital’’. Having a relatively affluent market with many well-insured people hasn’t hurt either, he acknowledged.

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Mr. Giancola.

A particular point of pride is: “We’re good at transitions of care. Maybe that’s a result of our being small.’’

South County Hospital, like virtually all health systems these days, faces many challenges in dealing with the rewards and penalties involved in the forced-march transition to value-based reimbursement. Mr. Giancola notes:

“Medicare incents us to improve patient satisfaction, reduce hospital infections and avoid various patient injuries.  Most commercial payers (insurers) have followed suit. I believe the threat of reduced payments has focused our attention on these measures even though we sometimes complain that the measures are not always fair.’’ (See below.)’’
“It’s all about blocking and tackling. The biggest issue is readmissions within 30 days. {South County has long had lower readmission rates than most hospitals.} We’ve really focused on managing the transition from the hospital to another level of care. The important element is good communication between the hospital providers and the skilled-nursing facility, home health and the doctors caring for the patients in the community.’’

Part of South County’s recognized success in overseeing clinically successful and financially efficient transitions – and, in so doing, reducing costly readmissions — has been its emphasis on using, when possible, home health care instead of nursing centers to save money and improve care, Mr. Giancola said.

The Centers for Medicare & Medicaid Services and other regulators and payers have been pushing hard for better patient-care management, especially since the Affordable Care Act took full effect. Much of South County Health’s work in this area involves helping primary-care physicians to be better traffic managers of their patients’ care.

Another transition success story he cites is medication reconciliation. “Often patients are confused about their drugs and that can lead to readmission because they take drugs that are contra-indicated or they take two meds designed to address the same problem. We’ve hired pharmacists that review meds in the hospital to ensure they are reconciled and the patients get clear advice on discharge.’’

He notes as an example of what might sometimes be unfair pressure from the Feds: CMS’s making hospitals put many patients who have to stay in the hospital for a night or two into “observation’’ status instead of as inpatients, thus slashing potential hospital reimbursement.

Bundled payments, Medicaid and an ACO

An increasingly important strategy for controlling costs and improving care is bundled payments.

South County Health participates in a bundled-payment program for joint-replacement patients with Blue Cross for their Medicare Advantage and commercial-insurance members. (Cambridge Management Group has been doing a lot of work in bundled-payment programs and so this particularly caught our eyes.)

With older-than-average market demographics, the joint-replacement business is a major contributor to the system’s bottom line. (However, while the system is financially stable, its operating margin is only about 2 percent; the system is closely managed.)

Mr. Giancola said that, as with many things in the brave new world of value-based medicine, it’s unclear what sort of savings may come out of the move to bundled payments. However, he thinks that the clinical benefits are clear:

“The bundling process helps us to get a better handle on the clinical process. Having to report quality throughout the entire episode of care makes for better transitions and final outcomes.’’

South County Hospital’s leaders are happy that the Affordable Care Act has put so many uninsured people into Medicaid. While Medicaid reimbursements lag those of Medicare it’s a lot better than no insurance for low-income people. Many of those people, of course, have long used the emergency room as their major source of “free’’ (to them) medical care.

But, perhaps surprisingly, Mr. Giancola told us, Medicaid expansion has not yet cut the flow of people into South County Hospital’s ER, despite efforts encouraged by public and private insurers to promote more and better preventive care to keep people out of the ER. “ERs are too handy for lots of people,’’ he observed.

South County Hospital has had to deal with many other changes, whose long-term fiscal effects are difficult to predict. One is the rising number of employed physicians, hired, Mr. Giancola says, to ensure that the hospital can maintain the range of services that patients want and need in an acute-care facility, such as obstetrics.

Mr. Giancola notes that’s expensive. “Hiring doctors away from private practices to be based in the hospital puts them in more expensive places, with expensive support staffs, equipment and technology. The jury is out on whether the increase in hospital-employed physicians will save money in the long run.’’

Also unknowable at this point is whether South County’s participation in an Accountable Care Organization with Blue Cross & Blue Shield of Rhode Island (BCBSRI) and Integra Community Care Network will ultimately save money. Integra is a partnership of Care New England Health System and its network physicians, Rhode Island Primary Care Physicians Corporation and South County Health and its network physicians. Focused on population-health management, the ACO provides incentives for Integra’s providers to proactively manage patient health, with a heavy emphasis on prevention of illness, while trying to restrain costs.

South County Health, as befits a, well, beloved local institution is big on promoting community-wide collaboration of institutions that can help improve not just healthcare in a clinical sense, but population health.

Toward that end, it has brought together such diverse agencies as the YMCA, the five Federally Qualified Health Centers in its area, school systems, the local Community Action Program and community members to harness the resources of the community. Whatever happens to the ACA, the move toward community and population health will continue, and South County Health will help lead it in southern Rhode Island.

Mr. Giancola has written: “Our long-term goal is to inspire the broader community to see health as a community issue and to mobilize government, schools, businesses and citizens at large to rally around efforts to ensure a healthy community.’’


Public option being eyed for California

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California State Capitol.

By CHAD TERHUNE

For Kaiser Health News

With  some major insurers retreating from the federal health law’s marketplaces, California’s insurance commissioner said he supports a public option at the state level that could bolster competition and potentially serve as a test for the controversial idea nationwide.

“I think we should strongly consider a public option in California,” Insurance Commissioner Dave Jones said in a recent interview with California Healthline. “It will require a lot of careful thought and work, but I think it’s something that ought to be on the table because we continue to see this consolidation in an already consolidated health insurance market.”

Nationally, President Obama and other prominent Democrats have revived the idea of the public option in response to insurers such as Aetna Inc. and UnitedHealth Group Inc. pulling back from the individual insurance market and many consumers facing double-digit rate hikes.

The notion of a publicly run health plan competing against private insurers in government exchanges was hotly debated but ultimately dropped from the Affordable Care Act when it passed in 2010.

Most of the discussion surrounding a public option, however, has focused on a nationwide plan, not one emanating from a state. In July, Democratic presidential nominee Hillary Clinton said she would “pursue efforts to give Americans in every state in the country the choice of a public-option insurance plan.”Health insurers have long opposed the idea, and other critics fear it would lead to a full government-run system.

Jones offered few specifics on what a public option might look like in the Golden State.

“I don’t want to begin to prejudge it,” said Jones, an elected Democrat serving his second term as head of the state Department of Insurance, one of two insurance regulators in California. “I don’t know whether you would start in certain areas of the state and expand from there. I think there would be significant reservations about the state running it. There would be a wide variety of governance models you could come up with.”

Politically, the proposal may gain more traction in Sacramento than Washington with Democrats firmly in control of the state legislature and many lawmakers eager to go beyond the boundaries of the federal health law. Depending on what form it took, a public option would require state legislation, some type of federal approval and some source of funding.

The idea of a California-style public option drew mixed reaction. Some consumer groups say they welcome another run at the public option after a disappointing outcome in 2010.

“We’re certainly very interested,” said Anthony Wright, executive director of Health Access California. “This is something we advocated for in its most ambitious form during the debate over health reform and there are elements of the proposal that could be adapted for California.”

Some health-policy experts questioned whether the proposal would backfire, ultimately reducing competition.

“I don’t know what would compel other insurers to stay in the market, so the public option could quickly become the only option,” said Katherine Hempstead, who directs the Robert Wood Johnson Foundation’s work on health insurance coverage. “I think that is only a clear win when the alternative is nothing.”

State Sen. Ed Hernandez (D.-West Covina), chairman of the Senate Health Committee, said a public option could make sense in some underserved areas. But he said it may not address the problem of large health systems dictating high prices, and it could interfere with the progress made by the Covered California insurance exchange.

Covered California said 7.4 percent of its 1.4 million enrollees will only have two health plans to choose from for 2017. The state’s biggest markets of Los Angeles, San Francisco and Orange County all feature six to seven insurers.

“I don’t know if a public option will create a lower price [for] the consumer,” Hernandez said. “Covered California has done a good job of keeping rates fairly stable and it has enough plans.”

Health insurers agreed. “Covered California has arguably one of the strongest and most stable exchanges in the country. There is robust consumer choice so we don’t think we need to mess with something that isn’t broken,” said Nicole Evans, a spokeswoman for the California Association of Health Plans, a trade group.

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For years, Jones has criticized the lack of competition in Covered California, and more recently he has opposed the mergers proposed by industry giants Anthem Inc. and Aetna Inc., saying they’re anticompetitive.

Anthem wants to acquire Cigna, while Aetna is trying to merge with Humana, but the U.S. Justice Department has sued to block both deals.

Covered California has fared better than many states in terms of insurer competition. Eleven health plans are participating in the state-run exchange for 2017, but UnitedHealth is dropping out after just one year in California’s individual market.

Consumer advocates had hoped UnitedHealth would become a strong rival to the state’s four largest insurers. Anthem, Blue Shield of California, Kaiser Permanente and Health Net (now a unit of Centene) account for 90 percent of the state’s exchange enrollment.

After modest 4 percent rate increases in 2015 and 2016, Covered California premiums are set to climb by 13.2 percent on average next year.

Jones said he anticipates that critics will cite the failure of numerous co-ops across America as evidence a public option won’t work. But he said that criticism is unjustified because the Republican-led Congress eliminated crucial funding that many of the co-ops were depending on.

The co-ops are nonprofit insurers backed with federal loans and designed as an alternative to commercial health plans.


Hysteria over Aetna’s partial ACA evacuation needs to be cooled

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Jon Kingsdale argues in Health Affairs that news coverage of Aetna’s plan to exit from 11 of the 15 states where it now offers insurance on Affordable Care Act insurance exchanges, and similar actions by some other big insurers, such as Humana and United Healthcare, has contained much hyperbole and that in fact the exits are no big deal.

He writes:

Critics of the ACA are citing these departures as evidence of the law’s fatally flawed design. Even supporters worry about how to staunch the outflow. And the news reverberated in presidential politics, on both sides. What’s really going on here? Are these big insurers bailing because Obamacare is just too risky? Will more such desertions cripple the marketplaces?”

He answers himself: “Not all health insurance companies are the same, nor do they necessarily serve the same customer segments. In fact, most medical insurance companies, unlike Aetna and United, are regional non-profits, such as the state (or smaller) Blue Cross Blue Shield plans, Kaiser Permanente and HIP. These ‘regional’ plans and Medicaid managed care organizations (MCOs) are generally better positioned to compete on the new marketplaces than ‘national’ insurers.”

“By contrast, national firms such as Aetna, United and CIGNA are far better positioned to serve national employers and other large, self-insured groups than to compete for individual households.”

“The vast majority of purchasers on the ACA marketplace are low-to-moderate income households, who are searching for low-priced health plans. As extremely ‘price-sensitive’ buyers, most seem willing to trade access to a broader network in return for lower premiums. Regional health plans and Medicaid MCOs are generally more successful than national ones in negotiating the lowest payment rates with local doctors and hospitals. As a result, the Blue Cross Blue Shield and other regional plans generally—not always—enjoy a cost and premium advantage over national plans and tend to dominate their marketplaces.”

“In fact, United and Aetna, despite their deep penetration of the large-group insurance market, together serve only 15 percent of marketplace enrollees, and their retrenchment will impact only about 10 percent.

“They are leaving many marketplaces, but staying in those where they think they can compete. This is clearly not the same as rejecting ACA marketplaces wholesale because of some fundamental flaw in the law. Presumably, they are being selective about their participation as they see how price-disciplined the marketplaces are and where they enjoy a competitive advantage.”

To read Mr. Kingsdale’s Health Affairs article, please hit this link.

 

 


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