a p r i l 2 0 11
Michael L. Bilof, MD and Basil M. Yurcisin II, MD of Garden State Bariatrics & Wellness Center
Utilizing Innovative Technology to Offer New Surgical Options for Patients Who are Suffering from Obesity and its Life-Threatening Complications Also in this Issue
• Meaningful Use Attestation to Begin • CMS Proposal Outlines Rules for ACO Participation in Medicare Shared Savings Program • The Fifty Most Powerful People In New Jersey Health Care • Paula Dow Wants to Know if N.J. Medical Pot Legislation Violates Federal Law
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Contents
4
a p r i l 2 0 11
Michael L. Bilof, MD and Basil M. Yurcisin II, MD
of Garden State Bariatrics and Wellness Center
Utilizing Innovative Technology to Offer New Surgical Options for Patients Who are Suffering from Obesity and its Life-Threatening Complications
CONTENTS
3 10 14
Health Law Update
Legal Issues
Statehouse
Power 50: Health care The 50 most powerful people in New Jersey Health Care.
21 22
Event
2011 NJ MGMA Practice Management Conference is a Huge Success
Food for Thought
Khun Thai
Short Hills, New Jersey
24
Hospital Rounds
COVER STORY
COVER PHOTO: From the left, Basil M. Yurcisin II, MD, and Michael L. Bilof, MD of Garden State Bariatrics and Wellness Center, in surgery.
2
New Jersey Physician
Children’s Hospital of New Jersey Receives grant from Healthcare Foundation on New Jersey for Cardiac Care cover PHOTOs BY Ken Alswang, At Home Studios
Health Law
Health Law Update
Update
Provided by Brach Eichler LLC, Counselors at Law
Manigan Named in NJBIZ “Power 50 Health Care”
physician assistants practicing in a federally
Applications must be submitted on behalf of
CN for Hospital in Bergen County
Mark Manigan, a member of Brach Eichler’s
each individual professional (rather than his
By Debra C Lienhardt and Mark E. Manigan
or her medical practice), but payments may
On March 21, 2011, the New Jersey Depart-
be reassigned.
Eligible hospitals include
ment of Health and Senior Services (DHSS)
acute care hospitals, critical access hospitals
issued a notice of invitation for certificate of
and children’s hospitals, subject to minimum
need (CN) applications for a proposed new
volume thresholds.
general hospital to serve Bergen County. A
qualified health center or rural health clinic and meeting certain volume thresholds.
Health Law Practice Group, was ranked # 12 in NJBIZ magazine’s “Power 50 Health Care,” a list of the most powerful and influential leaders in New Jersey’s health care industry. The only health Care lawyer on the list, Mani-
maximum of one new general hospital may
gan was described as “a leading advocate for health care providers looking for a better deal from insurers…helped shape legislation on hot-button issues like ambulatory surgery centers and payments to out-of-network providers.” One insider says he’s respected on both sides of the aisle, “as well as within the
February 29, 1012 is the deadline to register
be considered pursuant to the invitation.
and attest to the meaningful use of EHR to
Applications are due by June 1, 2011. DHSS is
be eligible for 2011 incentive payments. New
also inviting existing New Jersey general hos-
Jersey’s Medicaid incentive program is not yet
pitals to file written submissions with DHSS
operational and is expected to launch in the
in response to any submitted CN applications
fall of 2011.
that are deemed complete.
executive branch.”
Meaningful Use Attestation to Begin
The healthcare business environment continues to be increasingly turbulent.
By John Fanburg and Kevin Lastorino
The attestation portion of the Medicare HER incentive program began on April 18, 2011. Once an eligible provider registers for the
Is your practice
weathering the storm?
HER incentive program, participants must demonstrate compliance with the program through an attestation of “meaningful use” of HER technology. completing
the
Upon successfully
online
registration
and
attestation process, CMS intends to begin releasing incentive payments as early as May. Eligible professionals can receive up to $44,000 over five years (hospitals may
The healthcare experts at Nisivoccia LLP utilize a full breadth of practice management, accounting and tax services to improve efficiency, maximize cash flow and enhance your overall practice. We’ll help you navigate the challenging healthcare climate and set your practice on a course for smooth sailing.
receive a $2 million base payment). Eligible professionals for these programs non-hospital
based
physicians,
include
(973) 328-1825
dentists,
www.nisivoccia.com
nurse-midwives, nurse practitioners, and
Independent Member of BKR International
April 2011
3
Cover Story
Michael L. Bilof, MD and Basil M. Yurcisin II, MD
of Garden State Bariatrics and Wellness Center Utilizing Innovative Technology to Offer New Surgical Options for Patients Who are Suffering from Obesity and its Life-Threatening Complications By Iris Goldberg
For the overwhelming majority of obese individuals in the United States and in fact, those throughout the world, the data has unfortunately shown that diet and exercise alone, do not offer a permanent weight loss solution. Bariatric surgery has proven to be the most consistently successful modality to produce long-lasting results which can prevent or reverse the onset of the serious medical conditions that are directly linked to being significantly overweight. Type 2 diabetes in particular, with its myriad of debilitating complications is now a global disease approaching epidemic proportions. Here in our country, a healthcare system already struggling to cope with skyrocketing costs may not prevail if this trend continues. Last year, New Jersey Physician featured Michael L. Bilof, MD of Garden State Bariatrics & Wellness Center (GSBWC), who changed courses and became a bariatric surgeon after four years of performing vascular surgery. Dr. Bilof had encountered many overweight patients who were suffering from severe vascular disease as a result of diabetes, hypertension and other complications associated with obesity. He decided that he wanted to do something to intervene with these patients before their blood vessels became
4
New Jersey Physician
scarred and blocked by progressive disease. Dr. Bilof made the stunning choice to leave the comfort zone of the vascular practice where he was working and began training to master the delicate skills of laparoscopic bariatric surgery. The expertise he gained during that time has since been utilized to perform countless successful weight loss procedures. Recently, in order to further enhance the exemplary care and treatment provided to his patients, Dr. Bilof has invited fellowshiptrained bariatric surgeon, Basil M. Yurcisin II, MD to partner with him at GSBWC. Along with his expertise, Dr. Yurcisin brings his own
p Dr. Bilof and partner, Dr. Yurcisin as they appear out of surgery
passion for reversing the alarming trend of increasing obesity-related co-morbidities, particularly diabetes and heart disease and their devastating toll on patients and on the healthcare community. While in his general surgery residency, Dr. Yurcisin became intrigued by the higher technology of minimally invasive laparoscopic surgeries. He was especially drawn to two extreme techniques - single incision surgery and also NOTES surgery (natural orifice transluminal endoscopic surgery), where procedures are done through the natural openings in the body, i.e. the mouth, nose, vagina, rectum. As a surgical resident, Dr. Yurcisin also had the opportunity to witness, up close, the life-threatening damage caused by diabetes and other obesity-related diseases. He decided that his life’s work should be about confronting this problem and providing a surgical remedy. “The idea of being able to affect diseases such as diabetes and heart disease that kill so many people in the United States, to the point of actually curing them in many cases became very fascinating to me,� Dr. Yurcisin relates. Therefore, while subsequently attending a two year fellowship program at Duke University Medical
Center, which is highly regarded as one of the pioneers of the laparoscopic single incision and NOTES technologies, Dr. Yurcisin pursued clinical training which focused on innovative minimally invasive surgical techniques and bariatrics. He could then use those specialized, cutting edge skills to achieve his goal of affecting a positive change in the health of those struggling with obesity and its consequences. Before his arrival at GSBWC, Dr. Yurcisin had, in fact, already utilized that expertise to perform approximately 1500 minimally invasive surgeries. Another exciting development during the past year at Garden State Bariatrics is the addition of the sleeve gastrectomy, an emerging technology within the field that Drs. Bilof and Yurcisin now offer to their patients. Dr. Bilof explains that prior to the emergence of the sleeve gastrectomy bariatric patients could either undergo gastric banding or a gastric bypass. “Now patients have a third choice,” he reports, describing the sleeve gastrectomy as a hybrid between the two other procedures. “The sleeve is more effective than the band but not quite as much as the bypass,” Dr. Bilof adds. Unlike gastric banding in which an implantable ring is placed around the top part of the stomach to restrict the amount of food that can be eaten, in sleeve gastrectomy, a thin vertical “sleeve” of stomach is created using a stapling device and the rest of the stomach is removed. The remaining sleeve is about the size of a banana. Like the band, the sleeve limits the amount of food that can be eaten by creating a feeling of fullness. Also like the band, the sleeve allows for normal digestion and absorption. Food consumed passes through the digestive tract in the usual order, so that it is fully absorbed in the body. Patients who undergo gastric banding can expect to lose about 50 percent, on average, of excess weight, while sleeve gastrectomy patients can lose an average of 65 percent of their excess weight. Dr. Bilof and Dr. Yurcisin usually perform both surgeries as same day procedures, although patients undergoing
p During sleeve gastrectomy, a thin vertical “sleeve” of stomach is created and can be seen here.
sleeve gastrectomy generally remain at the facility for some hours longer. While the banding procedure is completely reversible by merely removing the implanted device, sleeve gastrectomy is obviously permanent since a large portion of the stomach has been removed.
consistently relate that they no longer feel the hunger pangs they once had. “Imagine patients who are morbidly obese and have been struggling with weight for their entire lives and suddenly their appetites are gone. Many of them feel as if they’ve experienced a miracle,” exclaims Dr. Bilof.
A significant advantage that the sleeve gastrectomy offers over the band and the reason that it is more effective in promoting substantial weight loss is that it produces a chemical/hormonal reaction that decreases the appetite. The most prevalent theory as to why this happens is that removing a large part of the stomach creates a dramatic drop in the body’s grehlin level.
When comparing the two procedures, it becomes evident that sleeve gastrectomy accomplishes everything that gastric banding does while also providing the added benefit of decreased appetite. For patients who need to lose a significantly larger amount of weight than would be possible with the gastric band but who might not be comfortable with having a bypass procedure, the sleeve gastrectomy is an excellent option that is mid-way between the other two.
Grehlin, which is produced in the stomach, is the hormone that stimulates the appetite, causing us to feel hunger. When normal levels of grehlin production are significantly reduced as a result of the gastrectomy procedure, patients no longer experience hunger with the same intensity. Future research may reveal other chemical reactions resulting from the sleeve gastrectomy that play a part in appetite suppression as well. Dr. Bilof reports that patients who have undergone sleeve gastrectomy surgery
Clare Kennedy is a 43 year old pediatric registered nurse who underwent sleeve gastrectomy surgery in October of 2010, weighing 278 pounds. In the six months since, she has lost 106 pounds. In good health, except for the excess weight, she was really not at ease with the thought of having bypass surgery and did not think that gastric banding would be appropriate for her either. She was still struggling to make a decision between the two when Dr. Bilof told her about the April 2011
5
new sleeve gastrectomy, which he thought would be the perfect option for her. “When he explained the procedure it made so much sense, I was all for it before I even left the office,” Clare remembers.
Patients who do opt for the sleeve gastrectomy at GSBWC will be pleased to learn that Dr. Yurcisin and Dr. Bilof are among the first bariatric surgeons in the tri-state area to perform this procedure using the novel single incision laparoscopic surgical technique, often called SILS™. Utilizing the single incision technology, the surgeons are able to place multiple instruments through one access point (incision) in the umbilicus (navel).
The advantages to the single incision approach are numerous. Positioning the single access within the navel avoids muscle penetration, which minimizes incision pain. The significant reduction in abdominal wall trauma results in less postoperative pain, a more rapid recovery and fewer wound complications. From the patient’s perspective, perhaps the most significant advantage is a much improved cosmetic outcome. In fact, after healing, the scar, which is located deep within the navel, is practically invisible.
p Sleeve gastrectomy with single incision laparoscopic surgery involves one port (shown) with openings for the camera and instruments.
For surgeons, since the umbilicus is the thinnest part of the abdominal wall, access through it facilitates the mobility of the trocars in a number of directions allowing the surgeon to approach the surgical site from different angles. The instruments used in the single incision approach are curved at the end, which accomplishes angling as well. Even the camera is curved to allow visualization from different vantage points.
In traditional minimally invasive laparoscopic surgery several one centimeter incisions are made. Trocars (long hollow tubes through which the surgeon manipulates the surgical instruments) are placed through each incision. The laparoscope (camera) is inserted through one trocar and the instruments through the others. In the single incision procedure, one two centimeter incision is made in the navel. One port with several openings, one for the laparoscope and the others for the surgical instruments is inserted.
Twenty-three year old Erica Butler was close to 150 pounds overweight when she underwent a single incision sleeve gastrectomy performed by Dr. Yurcisin and Dr. Bilof. Ten days later, she has already lost 26 pounds. A jubilant Erica relates that even at this short interval of time, the incision within her navel is barely noticeable. “I’m really surprised at how well the sleeve is working for me and how really minimally invasive it is,” Erica shares. “I feel great! I’m up, I’m out. My energy level is high,” she happily relates. When asked about
p Clare Kennedy on the day of her sleeve gastrectomy surgery
p After losing more than 100 lbs., the “new” Clare Kennedy is happy, healthy and enjoying an active life.
Now Clare couldn’t be happier with the choice she made. She doesn’t think about food the way she once did. “I eat healthy foods now and my body tells me when to stop,” states Clare. She feels fantastic and can now enjoy sports and just being active with her family and also at work with the children in her care. “I do look wonderful,” she remarks. “I normally don’t say things like that about myself but I have to start learning to accept those compliments,” Clare proudly says.
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New Jersey Physician
p Once inserted into the navel, the port facilitates the mobility of the trocars in a number of directions but requires only one incision.
gastric bypass for the treatment of morbid obesity experienced a complete diabetes remission within days of their surgeries, before any appreciable weight loss had occurred. Others saw their glucose levels drop so significantly that insulin was no longer needed or the dosage and amount of oral medications could be substantially reduced.
p Dr. Yurcisin and Dr. Bilof manipulate the surgical instruments through the single incision access port.
her food cravings, Erica immediately replies, “I’m completely dumbfounded,” she says. “I don’t think about food,” Erica reports, still marveling at the positive changes that have already occurred. In addition to gastric banding and sleeve gastrectomy, the surgeons at GSBWC perform the laparoscopic Roux-en-Y gastric bypass, which is still most appropriate surgery for many patients. A large number of patients seen at GSBWC need to lose 100 pounds or more and also suffer from obesity-related co-morbidities such as diabetes, hypertension, sleep apnea, coronary artery disease and severe joint pain. When the health of patients such as these is severely compromised, especially for those who are insulin-dependent diabetics, Drs. Bilof and Yurcisin still recommend the gastric bypass procedure in most cases. During the laparoscopic bypass surgery, Dr. Yurcisin or Dr. Bilof reduces the size of the stomach from 32 ounces down to approximately two ounces, which significantly restricts the amount of calories that can be taken in. The intestines are then re-routed, thereby decreasing the absorption of food and are re-attached to the new smaller stomach. Because the effects of the bypass are both restrictive and mal-absorptive, gastric bypass surgery results in more rapid and also greater weight loss than either banding
or sleeve gastrectomy. Bypass patients can expect to ultimately lose between 70 and 90 percent of their excess weight. It should be noted therefore, that just as the sleeve gastrectomy is a step above gastric banding in terms of what can be accomplished, the gastric bypass offers all that the sleeve does and has additional health benefits for certain patients. For diabetics in particular, the gastric bypass can result in more than significant weight loss alone. Surgeons have observed for years that many patients with type 2 diabetes who underwent
It has been theorized by a number of researchers who have been trying to discover the mechanism of immediate diabetes resolution after gastric bypass that there is a combination of hormonal changes that occur when the duodenum (first part of the intestine) is bypassed. These changes in hormones lower glucose levels within days of surgery. This has prompted some within the healthcare community to question whether non-obese patients (perhaps those who are merely 2030 pounds overweight) with type 2 diabetes should undergo gastric bypass as a means of reversing or at least lessening the severity of their disease. In certain ethnic groups, most notably within the Asian community and also amongst African Americans and Hispanics, type 2 diabetes often occurs in individuals with BMIs that are less than 35. Certainly, further investigation of this issue will help to decide whether or not the current criteria for bariatric surgery should be modified.
p Erica Butler’s incision just days after single incision sleeve gastrectomy surgery. When fully healed, the incision scar will be practically invisible.
April 2011
7
Dr. Yurcisin reiterates that neither the band nor the sleeve can resolve diabetes as immediately as happens with the bypass. He does explain, however, that if the amount of weight that was lost with diet and exercise alone was compared to the same amount of weight loss with the sleeve, the rate of diabetic resolution with the sleeve would be better. “There is something we haven’t put our finger on yet, as a medical community, that’s happening metabolically,” Dr. Yurcisin strongly asserts, suggesting that the hormonal/chemical changes that occur with the sleeve gastrectomy are responsible, to some extent, not only for greater weight loss but also for an increased rate of resolution of type 2 diabetes. For many patients who might not be bypass candidates for one reason or another, Dr. Yurcisin and Dr. Bilof strongly recommend the sleeve gastrectomy as a superb alternative. p The gastric bypass is the most appropriate procedure for many bariatric patients. The stomach is reduced from 32 oz. to approximately 2 oz. limiting the amount of calories that can be consumed. The intestines are then rerouted decreasing the amount of food absorption.
Presently, in order to qualify for any of the weight loss surgeries, patients must have a body mass index (BMI) of 40 or more or a BMI between 35 and 39.9 with a serious obesity-related health problem such as type 2 diabetes, coronary artery disease or severe sleep apnea. Dr. Yurcisin and Dr. Bilof discuss how patients might come to choose one type of surgery over another. “The gastric bypass is still the gold standard,” Dr. Bilof wants to emphasize. If a patient comes to me asking for that procedure I would not discourage that patient unless perhaps he or she was a smoker,” he adds. He does feel, however, that the sleeve gastrectomy is a great option for many of his patients and he makes sure to inform appropriate patients about this effective newer procedure.
Whether it’s accomplished through gastric banding, sleeve gastrectomy or gastric bypass, the surgeons at Garden State Bariatrics & Wellness Center are doing their part to reverse the alarming trend of obesity and its life-threatening complications. For Dr. Bilof and Dr. Yurcisin it is also much more than that. Each is realizing his strongly determined goal of improving the quality and ultimately, the length of life for so many who are suffering with the physical and emotional burdens of being significantly overweight. With the staggering number of morbidly obese individuals, even here in New Jersey, who are yet untreated, the surgeons know there is still much work to be done.
Dr. Yurcisin agrees. He understands the importance of patient input when deciding upon the right surgery for each individual. “That process really needs to be a give and take between physician and patient,” Dr. Yurcisin states. For younger patients who are active and in reasonably good health and are leaning towards gastric banding, he feels the band can be an appropriate choice because as the weight comes off, the risk of serious co-morbidities declines as well. “If you have a morbidly obese patient with severe insulin-dependent diabetes and if you add illnesses such as heart disease and sleep apnea, you would definitely then have to lean towards the other end of the spectrum,” states Dr. Yurcisin, referring, of course, to the gastric bypass. He goes on to share why the sleeve gastrectomy is an excellent choice for the many patients who fall somewhere between the two extremes. “There is clearly an effect of the sleeve that is beyond just weight loss, Dr. Yurcisin emphatically states. “When you compare someone who has had the band to someone who has had the sleeve, the diabetes resolution rate with the sleeve is quicker and more effective than with the band,” he points out.
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New Jersey Physician
p The Garden State Bariatrics and Wellness Center surgical team – Michael L. Bilof, MD, Bella Baum, PA-C and Basil Yurcision II, MD.
For more information or to make an appointment, please call (973) 218-1990 or visit www.GardenStateBariatrics.com Email: laf@gsbwc.com
Legal Issues
CMS Proposal Outlines Rules for ACO Participation in
Medicare Shared Savings Program By Carol Grelecki, Esq.
• Physicians,
physician
On March 31, 2011, the Centers for Medicare
care physicians in every ACO. Primary care
& Medicaid Services (CMS) published its
physicians should seek to take a leadership
nurse
practitioners
long-anticipated proposed rule to govern
role in the formation and operation of
nurse
specialists
Accountable
ACOs, rather than having the terms of their
Professionals”)
participation in ACOs dictated to them.
arrangements;
Care
Organization
(ACO)
participation in the Medicare Shared Savings Program.
in
assistants,
and/or (hereinafter, group
clinical “ACO practice
• Networks of individual practices of ACO
For health care providers, the
Shared Savings Program is a key Medicare
By definition, ACOs are formal legal entities
initiative to be implemented as a result
composed of health care providers working
of federal health care reform legislation
together, with shared governance and under
between hospitals and ACO Professionals;
adopted in 2010. The Shared Savings Program
one tax identification number, to manage
• Acute care hospitals employing ACO
To counteract the impact of reduced admissions, Hospitals will need to grow their overall market share and may determine to do so through ACO participation.
Professionals; • Partnerships or joint venture arrangements
Professionals; and • Other providers only as determined by the Secretary of Health and Human Services. Hospital participation is not required to obtain ACO approval. However, hospitals
gives health care providers participating in
and coordinate health care for Medicare
will want to participate in ACOs. One of
ACOs an opportunity to receive payments
beneficiaries, including coordination of the
the goals of the Shared Savings Program is
from the Medicare program based on
delivery of items and services under both
to reduce or eliminate costly inappropriate
savings achieved as a result of the ACO’s
Medicare Part A and Part B. The expectation
and/or preventable inpatient admissions.
management of Medicare beneficiary care.
is that the coordination of care among
To counteract the impact of reduced
The recently proposed regulations outline
the various providers who treat Medicare
admissions, Hospitals will need to grow their
CMS requirements for ACO participation
beneficiaries will result in the transition of
overall market share and may determine to
in the Shared Savings Program and the
beneficiaries between health care providers
do so through ACO participation.
requirements that must be met by the ACO
more efficiently, eliminating duplicative care,
to be eligible for shared savings payments.
resulting in beneficiaries receiving their care
While CMS considered whether rural health
in the most appropriate setting, and leading to
clinics (RAHs), federally qualified health
Dedicated physician leadership, with the
better overall care and outcomes. ACOs will
center (FQHCs), and critical access hospitals
ability to motivate other ACO participants to
be required to demonstrate improved quality
(CAHs) would be permitted to participate,
implement quality and clinical management
of care in order to be eligible for payments
CMS concluded that the participation of RAHs
measures, will be essential to the success of
under the Shared Savings Program.
and FQHCs could only be implemented in collaboration with other providers that
ACOs under the Program. CMS envisions that ACOs will be provider-driven and is
Only certain providers are eligible to form
are independently eligible to form an ACO
requiring significant participation of primary
ACOs under the Program, as follows:
and CAHs could only participate if they use April 2011
9
Legal Issues method II billing (i.e., they bill for both the
primary care providers for the number
beneficiaries informed and encouraged
facility services as well as the professional
of Medicare FFS beneficiaries assigned
to make choices regarding the care they
services performed at the facility).
to the ACO – CMS envisions that primary
receive. Under the current proposal, the
care physicians will be key participants
ACO will be required to have a Medicare
In addition, in order to participate in the
in every ACO.
beneficiary on its governing board.
Shared Savings Program, all ACOs will be
assigned beneficiaries is required.
A minimum of 5,000
Participating
required to meet other eligibility criteria set forth in the proposed rule. These eligibility
(5) Disclosure
to
information
criteria include the following:
the
regarding
ACOs
that
meet
the
of
requirements of the Program and generate
participating
program savings, may obtain shared savings
Program
ACO professionals, implementation of
payments.
(1) Agreement to become accountable
quality and reporting requirements, and
addition to the ordinary reimbursement
for the quality, cost and overall care
determination of payments for shared
paid by the Medicare program for the ACO’s
of the Medicare fee-for-service (FFS)
services - The ACO will be required to
services. That is, under the current program,
beneficiaries assigned to it - This
implement processes to use for reporting
payments will continue to be made under
will require ACOs to be or become
on quality and cost measures. These
Parts A and B of the original Medicare FFS
able to identify and produce data
may include adopting data management
program in the same manner as they would
necessary to best evaluate the health
systems and physician level reminder
otherwise be made, but participating ACOs
needs of their patient population,
systems.
are eligible to receive payment for shared
improve
systems will likely be a significant start-
health
outcomes,
monitor
provider quality of care and patient experience
of
care,
and
Indeed, data management
Such payments would be in
savings as well.
up cost for many ACOs. ACOs will receive shared savings payments
produce management
only if the estimated average per capita
structure that includes both clinical
Medicare expenditures, for Medicare FFS
The proposed regulations identify 65
and administrative systems – The ACO
beneficiaries for Parts A and B services
quality measures for establishing quality
participants must share governance
under the ACO, adjusted for beneficiary
performance standards that ACOs will
and be responsible for at least 75% of
characteristics, are at least a specified
be required achieve in order to receive
the governance of the ACO.
percentage below an established benchmark.
shared savings payments. The proposed
management and oversight must be
scope of these measures is ambitious.
managed by a senior-level medical
CMS proposes to establish benchmarks at
While large and currently integrated
director
board-certified
the start of the participation agreement based
provider systems may have the ability to
physician and there must be a physician-
on beneficiaries that received a plurality of
address each of the measures, this will
directed quality assurance and process
their primary care services from primary
be more difficult for smaller and less
improvement committee to oversee
care physicians participating in the ACO in
organized providers.
an ongoing quality assurance and
each of the prior three most recent available
improvement program.
years. On the other hand, beneficiaries will
efficiencies in utilization of services.
(6) A leadership
and
who
is
a
Clinical
be assigned to ACOs retrospectively, at the
(2) Agreement to participate in the Program for at least 3 years - ACO agreements will have a term of at least three years.
(7) Defined processes to promote evidence-
end of the applicable period, for purposes
based medicine, report on quality and
of determining cost savings, based on where
cost measures, and coordination of care
they received their services during the
(3) A legal structure which allows the ACO to
- Under the current proposal, ACOs will
agreement period.
receive and distribute shared shavings to
have flexibility to choose the methods by
participating providers - While CMS has
which it will meet these requirements.
distributed, each ACO will be required,
(8) Demonstration that the ACO meets
the average population of Medicare FFS
as part of its application to participate in
specified patient-centeredness criteria,
beneficiaries that receive their care from
the Program, to indicate how the ACO’s
such as the use of patient and caregiver
the ACO participants during the ACO
planned use of the potential shared
assessments on the use of individualized
agreement period, CMS acknowledges that
savings meets the goals of the Program.
care
Patient-centeredness
the Medicare FFS population served by the
requires individualized care based on
ACO from year to year will change and some
the patient’s individualized needs, with
of the beneficiaries whose expenditures
(4) Participation of a sufficient number of
10
While CMS believes that this approach will provide a relatively accurate reflection of
not specified how shared savings must be
New Jersey Physician
plans
-
Legal Issues will be included in the benchmark
and make adjustments, before taking on risk
comment and will not be finalized until later this
with this approach would not
for losses.
Ultimately, the proposal outlines
year. Therefore, given the complexity of the rule,
be reflected in the population
an ambitious program and it is unlikely that an
CMS may not be in a position to enter any ACO
assigned to the ACO during the
ACO will achieve savings until care management
agreements as early as January 1, 2012.
years of the ACO agreement
becomes fully systemic to its operation. Carol Grelecki is a member of the Health Law
period. To be successful under the Program, the ACO will have to treat
Implementation of a final ACO rule is currently
Practice Group at Brach Eichler L.L.C. in Roseland,
all Medicare FFS beneficiaries as if
scheduled to take place on January 1, 2012.
NJ.
they are assigned to the ACO.
However, the proposed rule is subject to public
CMS
also
acknowledges
that
this approach could create an unwanted incentive to seek and/or avoid specific beneficiaries during the ACO agreement period so that average expenditures would more likely be less than those of the historical beneficiaries included
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11
Legal Issues
Selling your Practice to a Hospital Weighing the pros and cons By John D. Fanburg, Esq., and Leonard Lipsky, Esq.
In light of recent health care reform and reductions in reimbursement, more and more physicians are entertaining the sale of their practices to a hospital. Particularly with the development of accountable care organizations (ACOs), organizations of health care providers that share in the responsibility and reimbursement for the overall care of patients, physicians face uncertainty as to how health care will be delivered and reimbursed in the future. The sale of physician practices to hospitals has become an increasingly popular trend. Although such transactions have become more common among cardiologists, other specialties are beginning to be coveted by hospitals to capture referrals and “loyalty.” More than ever, hospitals are looking to integrate their services and secure additional revenue streams. By reconfiguring a practice and utilizing its higher reimbursement rates, a hospital can do just that. But whether the deal is right for the physician is an entirely different question. This decision should not be made lightly. Physicians that are contemplating selling their practice need to understand the benefits and disadvantages of this transaction and how their personal and professional lives may be impacted as a result. Employment with the hospital In most cases, the purchase of a physician practice will be contingent upon the main partners of the practice remaining in practice under the umbrella of the hospital for a period of time. Although the length of
12
New Jersey Physician
the term is negotiable, a selling physician may expect to remain with the practice for at least one year after the sale. This ensures a smooth transition, without any negative effect on the continuity of care or patient volume. This is particularly true when a practice’s reputation is closely linked to one or two well-regarded physicians. A selling physician must also understand that as an employee of the hospital, the physician may not be able to generate the same level of compensation that he or she earned in his or her own private practice. Because the hospital bears the risk of the investment, it also reaps the rewards. Such physicians must accept that they will no longer be compensated as partners of the practice, but instead will be retained by the hospital as fixed salaried employees for a certain period of time or based upon a work RVU basis. At the same time, these physicians no longer need to worry about slow years and fluctuating revenue. This stability and security is often welcomed by risk-averse and risk-seeking physicians alike, particularly in an economic climate where reimbursement rates are continually reduced by private and government payors. Another benefit is that as an employee of the hospital, a physician is no longer responsible for the overhead associated with running a private practice. Such physicians do not need to allocated resources towards rent, payroll, supplies, marketing, etc. Their only concern is to maintain their patient relationships and
providing high quality, cost-effective care. By reallocating their focus, selling physicians may be better positioned to improve patient care. Quality of life A sale of a practice may mean a lifestyle change for a physician. The benefit is clear – fewer hours and a generally better quality of life. While perhaps not all physicians are willing to sacrifice compensation in exchange for improved quality of life, such considerations can be very important for physicians that are looking for more time with the family or are simply tired of the headaches associated with the administrative aspects of running a practice. But while it certainly means fewer headaches, it also means reduced autonomy in the management and day-to-day affairs of the practice. Physicians that once controlled every aspect of their practice soon learn that as employees of a hospital they have very little say over management decision-making. Prior to entering into such a transaction, a physician may need to give up control of the decision-making power. While some aspects of control are negotiable terms in
the transaction, selling one’s practice may still require an adjustment period for those physicians who have grown their practices from the ground up. It is not always an easy transition from owner to employee. Benefits An important benefit of selling a practice to a hospital is the increased resources that a hospital is in a position to provide to a physician’s patients. With health care shifting from reactionary medicine to improved preventative care, access to a wide range of resources can significantly improve patient care. For example, instead of shipping out specimens to private laboratories, physicians are able to provide faster, cost-effective pathology services to their patients since most hospitals maintain their own pathology department. For the physician personally, a hospital fully subsidizes certain employee benefits. For example, as an employee of the hospital, a physician is not required to purchase his or her own medical malpractice coverage. Depending on a physician’s specialty, such savings can be quite substantial. A hospital similarly provides all of its employees with various benefits such as health care coverage and retirement benefits. Of course, just as with the management of a practice, physicians should remember that as employees of a hospital, they have very little influence over the type of benefits they are afforded. Valuation In making the decision to sell one’s practice, an important consideration for both the physician and the hospital is the valuation of the practice. The valuation is usually closely tied to the goodwill of the practice, which, in turn, is heavily dependent upon patient volume and a practice’s reputation in the community. This explains why a hospital is so adamant about employing the core physicians of a practice for a period of time after its sale. A physician joining a hospital’s staff can expect his or her employment agreement with the hospital to contain
a restrictive covenant that prevents the physician from competing with the hospital upon termination of the employment. If the selling physician desires to retire or otherwise not join the hospital staff, a hospital will look for a restrictive covenant immediately effective as of the date of the sale. In either case, a hospital will look to protect its investment in the goodwill of the practice. In order to facilitate a sale, it makes sense to hire an independent consultant to appraise the value of the goodwill. It is important to understand, however, that a hospital may not always offer a physician the fair market value of his or her practice. Because of the importance of retaining practice physicians as employees of the hospital, a hospital will often seek ways to offset this increase in expenses. At the same time, everything is negotiable. Once a benchmark dollar amount is attributed to the goodwill, the parties may use it as a starting point to further negotiate the terms of the sale. While the
price a hospital pays for the practice itself may not be ideal, selling physicians may be able to receive concessions elsewhere – like in their employment agreements. The starting point for any physician contemplating the sale of his or her practice to a hospital is to evaluate what the physician wants in his or her professional and personal life today and in the future. Those physicians that are looking to sacrifice autonomy and greater compensation in exchange for security and quality of life – a trend that is more and more popular in today’s reimbursement environment – should explore potential hospital purchasers that fit their practice’s culture and offer a widerange of benefits and services. John D. Fanburg chairs the health law practice, and Leonard Lipsky is an associate in the health law practice of Brach Eichler L.L.C., a Roseland, NJ-based law firm. Contact Mr. Fanburg at jfanburg@bracheichler.com or at 973-403-3107.
State of New Jersey Department of Health and Senior Services
Deputy Commissioner Public Health Services This key management position, which reports directly to the Commissioner of Health and Senior Services, will provide leadership for planning, policy implementation, budgeting, and executing the goals and mission of the department as it relates to the assigned areas of responsibilities: The Divisions of HIV/STD/TB Services; Family Health Services; Epidemiology, Environmental and Occupational Health Services; Public Health Infrastructure, Laboratories and Emergency Preparedness. Successful candidate must be a licensed physician. For a full description of the position, including the education and experience requirements, and addresses for filing either via electronic or hard copy visit: www.nj.gov/health/jobs.
EEO/AA
The State of New Jersey April 2011
13
Statehouse
New Jersey Statehouse POWER 50: Health Care
The 50 most powerful people in New Jersey health care The sirens are wailing for health care in New Jersey. Camden has become a poster child for wasted health care dollars, the soaring costs of insurance coverage have slammed employers at the worst time, hospital operating margins are thinner than a cut from a scalpel — and all this is set against the backdrop of federal reform that has yet to win over physicians and insurers, much less employers and patients. But it’s not all dismal. Read on to meet New Jersey’s emergency responders to the crisis, and find out what these powerful leaders are doing to treat health care’s many ills.
1) Barry Ostrowsky Ostrowsky moves up from president to CEO of St. Barnabas Health Care System later this year, and he’s playing a key role in Gov. Chris Christie’s plan to restructure the University of Medicine and Dentistry of New Jersey, said to include bringing Newark’s University Hospital into the St. Barnabas fold. Described as “very bright, highly respected and down to earth,” Ostrowsky often is called the architect whose legal and technical expertise has been central to the growth of St. Barnabas into the state’s largest health care system.
2) David Samson The co-founder of Wolff & Samson is Christie’s point man in closeddoor talks on how to break up UMDNJ, which could split the medical school between Rutgers and NJIT and transfer state-owned University Hospital to St. Barnabas. The move would elevate the stature of Rutgers and NJIT, have a ripple effect on the economies of Newark and New Brunswick, and get New Jersey out of the expensive business of running a medical school and teaching hospital. An attorney who chairs the Port Authority, Samson can be found “at the center of a lot of deals” transforming health care in New Jersey.
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New Jersey Physician
3) Thomas B. Considine As he implements federal health reform in New Jersey, the commissioner of the state Department of Banking and Insurance has to make sure that in 2014, the state is ready to launch health care exchanges for individuals and employers. And he may have the toughest job in state government — fixing the state’s dysfunctional health insurance market, where employers get hit with double-digit premium increases year after year, and a mere handful of companies can be bothered doing business here. He is “open and approachable,” with the people skills to bring warring adversaries to the table.
4) Jeffrey Brenner The medical director of the Camden Coalition of Healthcare Providers works to improve health care for Camden’s poor, while cutting millions in wasted Medicaid spending. He’s been able to inspire some of health care’s adversarial stakeholders to work in unison for a common cause. Brenner’s efforts have made him a “rock star” in health care innovation, and inspired legislation aimed at spreading his success throughout New Jersey. A recent New Yorker profile of Brenner demonstrated how he makes urban health care seem not only hip and cool — he seems to be making it work.
5) Joseph F. Vitale Losing his Senate health committee chairmanship didn’t diminish the stature of “the dean of health care,” who authored the state’s FamilyCare program and, as health committee vice chairman, is shaping legislation to regulate out-of-network medical bills and cut Medicaid waste by delivering better care to the poor. Nearly everyone we spoke with put Vitale near the top of their list — and above Loretta Weinberg, who replaced him as committee chair. A Democrat, Vitale has bipartisan respect as the sharpest mind in Trenton on health care issues. “Nobody knows more about health care than Vitale,” was a typical comment.
6) Robert J. Hugin The CEO of Celgene, one of New Jersey’s most successful biotechs, has “Big Pharma clout and bio sizzle.” Hugin bridges the gap between pharma and biotech, playing an active part in the policy debates in Trenton that impact the drug and biotech industries.
New J ersey Statehouse 7) George Norcross III Norcross is building a new medical school in Camden with Rowan University, a watershed moment for the South Jersey Democratic Party power broker. The chairman of Cooper University Hospital’s board has overseen millions in investment in Camden, betting on health care as a catalyst to reverse the city’s decline.
8) Mary O’Dowd The deputy health commissioner is the go-to person in the state Health Department. Dr. Poonam Alaigh, her boss, “looks at the big picture, policy — but you see Mary if you need something done on a particular issue. And she works well with the Legislature.”
9) Amy Mansue If this list was based on popularity, Mansue might be No. 1. The Democrat was named by many, including Republicans, and is someone who gets along well with the Christie team. As CEO of Children’s Specialized Hospital, part of the Robert Wood Johnson system, Mansue has emerged as one of the most influential executives at Robert Wood Johnson.
10) Jennifer Velez The Department of Human Services commissioner is responsible for the state’s Medicaid program, putting Velez at the center of Christie’s plan to address Medicaid’s looming $1 billion shortfall. A holdover from the Corzine team who’s respected as a seasoned official, Velez is a strong advocate for reducing the ranks of the uninsured.
11) Bob Marino The veteran Horizon Blue Cross Blue Shield executive who became CEO earlier this month, Marino “brings a much more consultative management philosophy” to the state’s largest health insurer. Insiders wonder if he’ll steer the insurer giant into the health care policy debates raging in Trenton and Washington.
12) Mark Manigan A leading advocate for health care providers looking for a better deal from insurers, the Brach Eichler partner has helped shape legislation on hot-button issues like ambulatory surgery centers and payments to out-of-network providers. One insider says he’s respected on both sides of the aisle, “as well as within the executive branch.”
13) Barry S. Rabner The hospital he’s building in Plainsboro “makes the rest of us look old,” one insider says. Princeton Health Care System’s CEO aims to showcase the latest in patient care at the new Princeton University Medical Center, and he presides over a fundraising powerhouse that blew past its initial goals.
14) Robert Schwaneberg The reporter-turned-health care adviser convenes weekly meetings
of the state officials doing the trench work to implement health care reform in New Jersey. When members of the health care community reach out to the governor’s office to give their input on health reform, it’s often Schwaneberg who takes the call.
15) Louis John Dughi Jr. / Russell L. Hewit Talk about connected. This duo remains close with three powerful former colleagues of their law firm: Christie, William J. Palatucci and Jeff Chiesa. We doubt the former colleagues could pick one partner over the other, so we didn’t, either. Dughi & Hewit counsels pharmaceutical and insurance companies, plus hospitals and physicians.
16) Kenneth C. Frazier The new president and CEO of Merck & Co. Inc. successfully managed the company’s Vioxx litigation — a huge challenge — in a previous position. Now, as the head of the behemoth company, Frazier is considered an ex-officio leader of the sector in New Jersey.
17) Richard Miller One of New Jersey’s visionary hospital leaders, Vitua’s CEO has been out in front on adoption of medical technology, and is credited with building the kind of financially strong enterprise that’s enabling the company to build a replacement hospital in Voorhees.
18) Cavan M. Redmond The Pfizer group president oversees the growing animal health division plus consumer health care and Capsugel, all in Madison. Redmond also is leading the company’s corporate strategy efforts. And if Redmond ever has trouble on a state issue, he can call a key connection in the governor’s office — former Pfizer executive Richard Bagger.
19) David Knowlton The New Jersey Health Care Quality Institute CEO has the ear of both parties: He works with legislative Democrats and served on Christie’s transition team. He’s a director of The Leapfrog Group, a national organization working to reduce medical errors, and played a key role in legislation to publicize infection rates at New Jersey hospitals.
20) Robert Garrett While the hospital industry has consolidated for years in New Jersey, the CEO of Hackensack University Medical Center is leading a campaign to reopen shuttered Pascack Valley. Garrett’s leadership has taken HUMC into the top ranks for patient safety — a difficult benchmark for such a large institution.
21) Richard Bagger The governor’s chief of staff seems to be involved in every major issue, including those impacting health care. As a former high-level executive at Pfizer, Bagger understands the state’s important pharmaceutical industry and can advocate for it from the top. Praised for his integrity and intellect, Bagger gets taken seriously. April 2011
15
N ew Jersey Statehouse 22) Richard Popiel
29) Judith L. Roman
The president and chief operating officer of Horizon Healthcare Innovations, a new venture from Horizon Blue Cross Blue Shield, partners with physicians to improve patient care and limit costs, in a model the insurer hopes changes the way care is delivered. While doctors and insurance companies are natural adversaries, Popiel, a physician, is building collaborative relationships.
The AmeriHealth New Jersey CEO is an advocate for making health coverage affordable for the state’s employers, and is part of the current discussion over how to implement health care reform in New Jersey. Roman is a critic of legislation and regulation that drives up the cost of health care coverage for New Jersey businesses.
23) John P. Sheridan Jr.
This “true leader” heads the principal teaching hospital of the Robert Wood Johnson Medical School. The 30-year industry veteran will play a key role if the state implements the Kean commission’s recommendation to move the New Brunswick medical school to Rutgers University.
“A big voice, and very successful” is how one insider described Cooper University Hospital’s CEO. The lawyer and former NJ Transit chief’s business acumen is credited with keeping Cooper on an even financial keel — a difficult task for a hospital on the front lines of providing medical care in Camden.
24) Annette Catino Called a “formidable force of nature,” the CEO of QualCare is a forthright voice on health care policy issues: “trusted, respected and not adversarial.” She’s gone to court rather than pay sky-high bills from health care providers, and is a strong advocate for wellness and preventive-care programs.
25) John K. Lloyd Meridian’s CEO had a vision for health care that has taken form as a system that’s financially stable, growing and diverse. Last year he acquired Bayshore Community and Southern Ocean Medical Center, bringing the system to six hospitals. “He has brought together hospitals that serve diverse populations, and gotten them to work together as one culture.”
26) Mark Trudeau The arc is on the upswing for Bayer HealthCare Pharmaceuticals’ in New Jersey, and Trudeau, as U.S. region president, leads the charge. The state obviously values Bayer, awarding it a $14 million retention grant in February. We wouldn’t be surprised if the profiles of Bayer and Trudeau continue to grow here.
27) Wardell Sanders The president of the New Jersey Association of Health Plans, whose members include the state’s health insurance companies, usually is in the room when Trenton debates health care laws, which almost always impact his membership — and he has a talent for getting lawmakers to consider his industry’s side of the issue.
28) Joel Cantor A national expert on health care, the director of the Center for State Health Policy at Rutgers recently was tapped to conduct a major research project that will shape the legislation creating the insurance exchanges mandated by federal health reform. Cantor has been an advocate for making health care accessible, affordable and effective.
30) Stephen K. Jones
31) Betsy Ryan As CEO of the New Jersey Hospital Association, Ryan fights for an industry that’s being turned upside down as federal reform slashes Medicare payments to hospitals. She’s a passionate advocate for keeping hospitals open and viable in the face of fiscal strains that threaten future hospital closures.
32) Michael McGuire Bright and innovative, the CEO of UnitedHealthcare of New Jersey “has a lot of juice in the health care world” as he leads a major player in the health insurance marketplace. He meets frequently with business groups struggling to find affordable coverage and “makes the time to sit down and talk about issues.”
33) Timothy M. Ring C.R. Bard Inc.’s chairman and CEO helped define medical technology as a core pillar of life sciences in New Jersey. Chairman of the HealthCare Institute of New Jersey, Ring also has been active on legislation impacting medical devices: “He’s sort of stepped out in that sector into the public square.”
34) Ronald J. Del Mauro With just nine months until his retirement, the St. Barnabas CEO is still making deals. St. Barnabas is talking about an alliance or merger with Atlantic Health, and Del Mauro says he’ll consider taking over University Hospital. He hires talented people and “knows how to get them to do big things.”
35) John Lawrence The New Jersey president for Aetna, one of the state’s biggest health insurers, Lawrence is among a handful of policy insiders shaping the implementation of federal health care reform. He will help design the new exchange marketplace allowing businesses and individuals to find affordable coverage.
36) Debbie Hart The BioNJ president brings an incurable optimism to her work as an
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New Jersey Physician
New J ersey Statehouse advocate for policies to spur investment in an industry that creates jobs, expands the economy and offers hope for new treatments. Her efforts continue to attract attention from foreign firms eager to plant their flags in the nation’s medicine chest.
37) Elizabeth Gilbertson As a leader of the Hotel and Restaurant Employees International Union, in Atlantic City, Gilbertson is at the forefront of efforts to create models of care that improve the health of her union’s members, while reining in the escalating costs associated with such care.
38) William Hait He founded the Cancer Institute of New Jersey, and put it on the map as a national cancer center. Now, he’s Johnson & Johnson’s global therapeutic chief for oncology, and is “influential in New Jersey, across the country and globally. A bright, articulate scientist and physician … (who) can talk to people at all levels.”
39) Risa Lavizzo-Mourey The CEO of the Robert Wood Johnson Foundation, one of the nation’s largest, is more likely to be found in policy circles in Washington, D.C., than in Trenton — but New Jersey occupies a special space in the RWJF universe, as it’s supporting a major initiative to reverse the state’s nursing drain.
40) Loretta Weinberg The chair of the Senate health committee is known for her commitment to the poor, elderly and vulnerable, railing against budget cuts that slash health care access for those dependent on government help. Weinberg is “not as much in the know as Vitale, but very wellinformed,” one insider said.
41) Christine Stearns A Trenton player who knows health care issues inside out, the New Jersey Business & Industry Association vice president is a regular at legislative hearings where the intricacies of health care policy are woven into bills that affect coverage costs. She’s “made the NJBIA the leader on health care issues that impact business.”
42) Mary Ann Christopher The CEO of the Visiting Nurse Association of Central Jersey is a leader in the effort to improve primary care here. In her work with the Robert Wood Johnson Foundation’s nursing initiative, she’s recruiting more nursing school faculty to train a new cadre of nurses to work in the state.
43) Katherine Grant-Davis Grant-Davis “takes no prisoners, and just pushes people aside and gets things done” as CEO of the New Jersey Primary Care Association. Its members are the federally qualified health centers that care for the poor.
44) Herb Conaway Jr. The strong-willed, powerful chair of the Assembly health committee is both a medical doctor and a lawyer, and serves as a key voice in the Legislature for physicians frustrated by insurance industry bureaucracy — and patients worried about the high cost and uneven access to medical care.
45) Niranjan “Bunky” Rao The incoming president of the Medical Society of New Jersey will advocate for physicians at a time when reform demands a system delivering more medical care for less money. Rao will be among those seeking solutions to New Jersey’s tough health care economy, which motivates our medical school graduates to practice elsewhere.
46) Judith M. Persichilli A nurse who worked her way up to CEO of Catholic Health East, Persichilli looks at the health care bureaucracy with a clinician’s lens. Committed to serving the poor in New Jersey cities, Persichilli operates at the vanguard of figuring out how to create a sustainable urban system that improves public health.
47) Mary Ann Boccolini Samaritan Hospice’s CEO is among the leaders of the growing hospice movement. New Jersey ranks among the highest-spending states on hospital care of the terminally ill; Boccolini is a leading advocate for patient- and family-centered alternatives.
48) Dean J. Paranicas The BD vice president is respected for his work at his company. New to the driver’s seat for influential HealthCare Institute of New Jersey, Paranicas still has to distinguish himself from his esteemed predecessor, Bob Franks.
49) Yitzchock Halberstam The Lakewood rabbi and Hasidic leader is “often seen in the halls of Trenton lobbying for better health care for the poor.” He won approval to start a federally qualified health center in Lakewood, is well connected politically, and uses his influence to fight for better health care for mothers and children.
50) U.S. Supreme Court Millions of dollars have been spent in New Jersey and across the country, and thousands of people are working to implement the health reform law Congress passed a year ago — and it may all be erased if these nine men and women rule it’s unconstitutional to force people to buy insurance.
How we did it The list was compiled and ranked by the editors of NJBIZ after discussions with more than a dozen leaders in the New Jersey health care field. If you have feedback on this subjective list, direct it to Sharon Waters, editor, at swaters@njbiz.com or (732) 246-5702. April 2011
17
N ew Jersey Statehouse
AAA Announces New Healthcare Payor-Provider Arbitration Rules Arbitration has been getting a bum rap lately. Many complain that arbitration has become litigation by another name, with its only advantage being the opportunity of the parties to select the arbitrator. The advantages of speed and lower cost have largely gone by the wayside, or so it would seem. Thomas Stipanowich, writing a guest post at the Disputing blog, recently analyzed this development quite well. Essentially, he argues that all stakeholders in the arbitration game, i.e., parties and in-house counsel, outside counsel, arbitrators and arbitration service providers, bear some responsibility for the shortcomings of arbitration today. Professor Stipanowich suggests that all stakeholders will achieve the advantages of arbitration when they cease to treat it like litigation. In the case of arbitration service providers, he urges them to reject a “one size fits all” approach, and to focus on assisting parties and their counsel in crafting an arbitration process that best suits their dispute. The American Arbitration Association (“AAA”) clearly took this theme to heart in issuing its new Healthcare Payor Provider Arbitration Rules, effective January 31, 2011. These new rules will be available in AAA arbitrations between healthcare payors (e.g., insurers, HMOs) and healthcare
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New Jersey Physician
providers (e.g., hospitals, doctors) if the parties agree to their use, or in the future, if parties specifically include reference to these rules in their contracts. Among the highlights of these new rules are features that should serve to restore the traditional advantages of arbitration over litigation. 1. The rules permit all claims and counterclaims between a payor and a provider to be combined in a single arbitration, even if they involve different contracts and different patients. 2. The rules provide for three different types of proceedings or “tracks” which may be used by agreement of the parties, regardless of the amount in controversy: desk/telephonic track; regular track; or complex track. Absent the parties’ agreement, the regular track will be the default selection. Each of these tracks mandates procedural characteristics that are detailed in the rules. 3. The rules require the AAA to establish and maintain a national healthcare roster of arbitrators, and from that roster, the AAA has designated a subset of arbitrators with expertise in payor-provider disputes.
4. Regardless of the amount in controversy, the rules provide for the arbitration to be conducted by one arbitrator, unless both parties agree upon a panel of three. 5. The rules mandate that a preliminary conference be held regardless of the track selected. The arbitrator is given authority to resolve preliminary issues at that conference, including many that are common to payor-provider disputes. 6. The rules limit the number of depositions permitted by each party according to the track selected: desk/telephonic - 0; regular - 1; and complex - 2. 7. The rules prohibit dissemination or publication of the arbitration award (except as necessary for its enforcement) unless both parties agree in writing. 8. The rules provide that the arbitration award will have no precedential, res judicata or collateral estoppel effect, unless both parties agree in writing. Without question, arbitrations conducted under these rules should be faster, less expensive and more efficient than litigation of the same claims. Of course, as Professor Stipanowich points out, the other players in the game will have to do their part as well. The arbitrators on the AAA national healthcare roster for payor-provider cases (myself included) understand what these rules are intended to accomplish. As parties and outside counsel become familiar with these new rules, their use should go a long way towards reestablishing arbitration as the preferred means of resolving payor-provider disputes.
New J ersey Statehouse
New Jersey’s Commissioner of Health and Senior Services Discusses Medical Marijuana and Two Other Regulatory “Case Studies” at Seton Hall Law By Kate Greenwood
On Tuesday, March 1, 2011, New Jersey’s
for eligible patients to access relief through
by statute do not require the supervision of a
Commissioner of Health and Senior Services
marijuana,” the Department promulgated a
doctor. On the other hand, Dr. Alaigh knows
Dr. Poonam Alaigh gave a lively and illuminating
revised set of draft regulations reflecting the
from practice how quickly a patient’s condition
talk to an audience from within and outside
terms of a bi-partisan compromise. Dr. Alaigh
can turn critical while under anesthesia. The
the Seton Hall Law School community.
described the massive effort she and her staff —
final regulation provides that nurse anesthetists
Reflecting her medical training, Dr. Alaigh
at times, she said, her entire staff — have made
can administer anesthesia in a hospital setting
organized her talk around three “case studies”:
to educate themselves about both the science
in accordance with a joint protocol that ensures
(1) the implementation of the New Jersey
supporting the use of marijuana for medical
that an anesthesiologist (1) is available at all
Compassionate Use Medical Marijuana Act;
purposes and the experience of other states
times for consultation and (2) is physically
(2) the rulemaking procedure to amend the
with medical marijuana laws. Dr. Alaigh believes
present “during induction, emergence and
hospital licensing standards relating to nurse
the result of the Department’s hard work is a
critical change in status.” Dr. Alaigh noted that
anesthetists; and (3) the decision by the
regulatory regime that serves patients in need
this result was not likely to have made either
Department of Health and Senior Services to
while avoiding the fraud and criminal diversion
anesthesiologists or nurse anesthetists happy. A
defer implementation of New Jersey’s menu-
problems experienced in California and
sign of success for a regulator, perhaps?
labeling law. Two central themes of Dr. Alaigh’s
Colorado. She described New Jersey’s medical
presentation were the remarkable complexity
marijuana program as the “gold standard” and
The third and final case study that Dr. Alaigh
of the legislative and rulemaking processes and
said that the Department has fielded calls from
discussed was the Department’s decision not
the importance of a patient-centered approach
officials in other states interested in adopting
to promulgate draft regulations implementing
to healthcare regulation.
something similar. Among the unique elements
New Jersey’s menu-labeling law and instead to
of New Jersey’s program is a registry of de-
wait for the federal Food & Drug Administration
The bulk of Dr. Alaigh’s presentation addressed
identified patient treatment and outcomes data
to implement the menu-labeling provisions of
the unusually extensive back-and-forth between
that will allow researchers to learn more about
the Patient Protection and Affordable Care Act.
the Department and the Legislature that has
marijuana’s safety and efficacy.
As Dr. Alaigh explained in a post on her blog,
characterized the implementation of New
“pausing to see what the FDA proposes in nine
Jersey’s medical marijuana law. After the New
Dr. Alaigh also spoke about the Department’s
weeks is reasonable. It avoids unnecessary
Jersey Senate invalidated the Department’s
rulemaking amending the hospital licensing
duplication and costs for restaurant owners who
initial set of draft regulations, on the grounds
standards relating to nurse anesthetists. On
would have to invest in new menus and then
that they “would not comply with the intent of
the one hand, Dr. Alaigh explained, nurse
redo them when the federal rules supersede
the law and would make it much too difficult
anesthetists are advanced practice nurses who
the state law.”
NJ Health Commissioner Resigns New Jersey’s health commissioner says she’s
missioner Mary O’Dowd to succeed Alaigh.
stepping down.
Alaigh’s department has been caught up in
restaurants to display calorie counts on menus.
disputed policy decisions over implementing a
The 46-year-old Warren resident said it’s been
Poonam Alaigh submitted her resignation to
medical marijuana law and cuts in funding for
“a great privilege” to serve under Christie.
Gov. Chris Christie, citing “an urgent illness in
women’s health clinics.
Alaigh is an internist specializing in vascular
the family.” Her resignation is effective April 1. Christie said he’ll nominate Deputy Com-
disease and was executive director of Horizon Democrats also have criticized Alaigh’s deci-
Blue Cross Blue Shield of New Jersey before
sion to delay implementing a law requiring
joining the Christie administration. April 2011
19
N ew Jersey Statehouse
Paula Dow Wants to Know if N.J. Medical Pot Legislation Violates Federal Law By Susan K. Livio
The debate over the legality of medical marijuana in two western states has prompted State Attorney General Paula Dow to ask the Obama administration whether New Jersey’s future program could violate federal law.
The Justice Department replied by repeating earlier assertions by Holder that patients legally using a program would not be targeted, but offered no blanket immunity to program operators.
The legal questions potentially raise more obstacles to the state’s fledgling program than lawmakers and patients expected to began last fall.
Dow’s office sent a letter to U.S. Attorney General Eric Holder asking he clarify whether those licensed to grow or sell pot — as well as the state workers who will administer the program when it launches later this year — could face arrest.
Democratic legislators and Christie, a Republican, have been fighting for months over how the program should run. The governor has said he thinks the law is too lax. Democrats oppose the administrations’ rules that limit on how potent the drug can be and how many strains may be sold, and require doctors who recommend it to their patients undergo training in addiction treatment.
Possession and distribution of the drug is a crime even though 15 states passed laws making it available to select patients. “As the state’s chief legal adviser to all of the departments in the Executive Branch, many of which are participating in carrying out the medical marijuana legislation, it is critical that I properly advise them as to the potential criminal and civil ramifications of their actions in carrying out their duties,” according to Dow’s letter. “Accordingly, I ask that you provide me with clear guidance as to the enforcement position of the Department of Justice relative to New Jersey’s medical marijuana legislation and the scope of the entities and individuals who may be subject to civil suit or criminal prosecution,” the letter said. Governor Christie’s administration raised the question following the public debate last week in Washington State, where Gov. Christine Gregoire, who is weighing whether to sign a law creating a program licensing growers and sellers, asked federal officials if it would run afoul of federal statutes.
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New Jersey Physician
of the law, said he was “certainly concerned” about the recent mixed messages from federal law enforcement. “Anything that gives pause or credence to a slowdown of the process is not good for patients,” he said.
“We maintain the authority to enforce the Controlled Substance Act vigorously against individuals and organizations that participate in unlawful manufacturing and distribution activity involving marijuana, even if such activities are permitted under state law,” according to the letter from Washington U.S. Attorneys Jenny Durkan and Michael Ornsby. A California U.S. Attorney offered the same response to Oakland officials when similar inquiries were made in February. Dow also sent the letter to New Jersey U.S. Attorney Paul Fishman, whose spokeswoman, Rebekah Carmichael, declined to comment Tuesday because the letter had not yet arrived. Sen. Nicholas Scutari, D-Union, co-sponsor
Scutari, who has spearheaded an effort to legally overturn the proposed rules, said no compromise has been reached with the administration. Attorney Dave Evans of Pittstown and executive director of the Drug Free Schools Coalition, predicted that anyone associated with running the program is in legal jeopardy. “We regret that the sponsors of the medical marijuana bill did not seek legal advice about the conflict with federal law before they got the medical marijuana bill passed. We repeatedly told them there were violations of federal law,’’ Evans said Tuesday. “We should not override our federal medicine approval process by passing state medicine laws. The FDA has stated that smoked marijuana is not safe or effective as a medicine.”
Event
2011 NJ MGMA Practice Management Conference is a Huge Success! From March 31 through April 1, the Practice Manager members of the MGMA joined with the affiliated members of the group in Atlantic City for two days of conferences, networking opportunities and a chance to meet and be photographed with Naomi Judd. This year’s annual event was deemed a huge success.
The first general session was opened by Chris Ruisi. After 25+ years at USLIFE Corp where he progressed through the leadership ranks of the company to become President & COO/CEO he founded The Coach’s Zone, providing his audiences with direction and motivation on what is needed to accomplish their goals.
The comprehensive sessions offered included each of the areas of expertise required by a manager of a large medical practice. These included business operations, finance, liabilities, administrative simplification, EMR, legislative actions, certification, mergers and acquisitions, and a myriad of other crucial areas.
The last session featured country music superstar Naomi Judd, who devotes much of her time as an activist for health issues including St. Jude Children’s Hospital, River Cities Harvest, The Saint Louis University Heart Center, MADD, The National Domestic Violence Hotline and her own July 4th Judd’s Annual Food Drive to benefit families of Appalachia. A nurse early in her life, she
p Country Music star, author, and philanthropist Naomi Judd
left the stage for 10 years to recover from illness before returning in 1999. A welcome new addition to this year’s program was a welcome party the evening prior to the event beginning. This casual get- together brought the attendees together over drinks and bites to greet old friends and make new ones before the hectic schedule of the next two days began.
p From the left, Program Chair Ruth Harris, Naomi Judd and President Bruce Kramer
For those of you who do not attend this event or do not belong to the New Jersey chapter of the MGMA, you are really missing an opportunity to fine-tune your management skills and meet some of the vendors who might assist you in bringing your practice into the 21st century. To join visit their website at www.njmgma.com . April 2011
21
Food for Thought
Khun Thai
Short Hills, New Jersey By Iris Goldberg
I am not knowledgeable about Thai food. I know that at some Thai restaurants, just like at some Chinese restaurants, the food served can be “Americanized” to some extent. I have written about this, relating to our difficulty finding authentic Hong Kong style Chinese food here in New Jersey. Michael and I have searched the entire state and have come up with only a handful of acceptable Chinese restaurants. When it comes to Thai food I am not qualified to distinguish which Thai restaurants in New Jersey are “the real deal” and which are not. Although I have only sampled Thai cuisine on perhaps twenty occasions, I do know what I like and what I don’t. For example, when most of the dishes offered are super spicy, I am not a happy diner. Khun Thai restaurant has been described by some as fusion Thai. Whether or not this label is correct can be determined by those who actually know. I can only report that I enjoy this place more than the other Thai restaurants I have visited.
p The rare tuna spring rolls were a fine start to our meal
Although a storefront on Millburn Avenue, Khun Thai’s inside décor is quite attractive, with two levels of seating – the upper usually to accommodate private parties. The last time we were there, Michael and I were seated opposite a large fish tank and I must confess, we spent more than a couple of minutes looking at the colorful occupants. Our dinner that evening began with an order of Rare Tuna Spring Rolls and a Thai favorite for many, Chicken Sate. We shared both appetizers and agreed they were superb. The spring rolls, which came with seaweed salad and a tangy dipping sauce, were perfectly prepared, crisp on the outside with the tuna inside rare and fresh as could be. The chicken, which is marinated in coconut milk, curry and other Thai seasonings, is served on skewers with peanut sauce and a cucumber salad. The entrée selection caused a bit of a conflict. When it comes to eating at most Asian restaurants, Michael and I, like most people, generally choose a few dishes and share everything. This night, however, Michael was determined to have sautéed wild boar tenderloin with hot chili, green peppercorns, thyme leaf, Thai basil and mushrooms.
p Crystal Shrimp with Roasted Almonds
p Drunken Noodles
While I had no problem with ordering one dish that was hotly seasoned, I could not get into the idea of eating wild boar. I kept picturing a large ugly, hairy animal, snorting and charging at anything in its way (which may or may not be an accurate description). I know that eating boar is not all that different from eating any other animal, if you really stop to think about it and Michael kept insisting it was just pork but gamier. Even so, I warned if that is what he chose there would be no sharing. That is what he chose. Michael savored every bite, probably with more gusto for my benefit. I
22
New Jersey Physician
p Wild Mushrooms Soup
who may not know, Pad Thai is sautéed rice noodles with shrimp, egg, dried bean curd, scallions, bean sprout and ground peanuts. This might be considered a boring choice by some with other more exotic and certainly spicier noodle and rice dishes on the menu but it is still one of our favorites.
p Decadent Chocolate Grand Marnier Souffle
chose one of Khun Thai’s special dishes called Duck Honey. It is half a boneless duck served with a honey-ginger sauce and bok choy. I really enjoyed the duck. The meat was tender – not at all dry and the sweetness of the honey along with the sharp ginger was a perfect accompaniment. Along with this I had traditional Pad Thai, which I shared with Michael. For those
The service at Khun Thai is attentive without being overbearing. This BYO has an extensive menu of appetizers, salads, entrée selections, with vegetarian dishes available on request and of course, a variety of rice and noodles. There are Americanstyle desserts such as crème brulee and a special chocolate soufflé that the server asks you about when your order is first taken, in order to allow for preparation time. Also offered are Thai-style desserts such as sweet sticky rice with mango or ice cream sticky rice with tropical fruits.
quite sure if Khun Thai would satisfy your expectations. However, if you are like me and always looking for an interesting and enjoyable dining experience, then I think you might appreciate what Khun Thai has to offer. You might even try the wild boar.
If you’ve never had Thai food, I think Khun Thai would be a good place to start. If you are a discriminating Thai food eater, I’m not
Khun Thai Restaurant is located at 504 Millburn Avenue, Short Hills, NJ 07078. (973) 258-0586
Let Brach Eichler’s Health Law Practice Group Help You Chart a Strategic Course For Your Health Care Business Health care providers have long come to rely on the attorneys of Brach Eichler to navigate the regulatory environment at both the state and federal levels. Now that health care reform is being implemented, Brach Eichler is ready to help you make sense of the significant changes, the statutory framework and the ramifications for health care providers in New Jersey. Health Law Practice Group Todd C. Brower Lani M. Dornfeld
John D. Fanburg Joseph M. Gorrell
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23
Hospital Rounds
Children’s Hospital of New Jersey
Receives Grant from Healthcare Foundation of New Jersey for Cardiac Care Intensive Care Unit (PICU). “Minute-by-minute attention to detail at the beside reduces the risk of complications before and after surgery,” noted Sunil P. Malhotra, MD, Director of Pediatric Cardiac Surgery at Children’s Hospital of New Jersey. “In addition to being a liaison for physicians, the PICU-based nurse practitioner is an important resource for the PICU nurses who monitor patients’ condition around the clock and provide life-saving interventions.” The Children’s Heart Center at Children’s Hospital of New Jersey at Newark Beth Israel Medical Center received a grant of over $422,000 from the Healthcare Foundation of New Jersey that will fund additional clinical staff to provide care for infants and children with congenital heart defects. “This generous grant allows us to add additional intensive care nurses, a pediatric nurse practitioner, as well as a pediatric nutritionist and social worker to expand and enhance the highly specialized care we provide to patients and their families,” said Rajiv Verma, MD, Director of the Children’s Heart Center. The nurse practitioner works collaboratively with the cardiac surgeon and the critical care physicians to coordinate care in the Pediatric
24
New Jersey Physician
A part-time nutritionist and social worker will also contribute to meeting the needs of patients and families. “Infants with heart problems have unique nutritional requirements,” said Dr. Verma. “Appropriate preoperative nutrition reduces the risk of infection and dramatically speeds recovery and healing.” Many children with congenital heart defects require multiple surgeries and prolonged care. A social worker helps families cope with the ongoing challenges of chronic illness, coordinates home care, and helps families access hospital- and communitybased resources. Social services also include a Support Group for parents and assistance for siblings. “The Healthcare Foundation of New Jersey
is proud to support the growth of an outstanding pediatric cardiac center in our state,” said Lester Z. Lieberman, Foundation Chair. “Building a multidisciplinary team made up of highly skilled caregivers is fundamental to a successful program.” For more information about Children’s Heart Center or to make an appointment, please call 973-926-3500.
About Children’s Heart Center Children’s Heart Center at Children’s Hospital of New Jersey (CHoNJ) at Newark Beth Israel Medical Center provides the state’s most comprehensive cardiac services for infants, children, adolescents and adults with congenital heart disease. The pediatric cardiac surgery program, in partnership with NYU School of Medicine, ensures that infants and children have access to the most sophisticated level of care at CHoNJ with immediate and smooth referral to NYU Langone Medical Center when necessary. In addition, CHoNJ’s renowned maternal and fetal medicine specialists manage high-risk pregnancies and are experienced in caring for expectant mothers and fetuses with heart-related complications. Advanced services and technology include a stateof-the-art pediatric cardiac catheterization lab, a dedicated pediatric OR, fetal echocardiography, MRI, advanced electrophysiology treatments, New Jersey’s largest Pediatric Intensive Care Unit and ECMO.
Discover What 2,000 Physician Partners Already Know Surgical Care Affiliates Drives ASC Growth
Independent ASCs are asking themselves a simple question: How can we grow, let alone survive, in this difficult environment? Fortunately, there is an answer. Partner with Surgical Care Affiliates (SCA) – the surgery experts. SCA, which already partners with more than 2,000 physicians nationwide, and Saint Barnabas Health Care System are looking for ASC partners. Our size, our experience and our operational, clinical and financial management systems allow us to: • • • •
Increase productivity Effectively negotiate payor agreements Lower costs through greater purchasing power Improve clinical processes to enhance quality and transparency • Gain access to the capital needed for growth • Monitor and continuously improve clinical, operational and financial performance For more information on how we can help New Jersey ASCs grow, contact Joe Clark, SCA Executive Vice President, at 205.545.2759, or joseph.clark@scasurgery.com
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