MARCH 2015 Visit us now online at www.NJPhysician.org
Hackensack, Summit Set to Partner-Plan is to Create State’s Largest Physician Group House Provision Offers Doctors More Protection Against Malpractice Suits Coalition Blasts Out-Of-Network Health Care Costs
Published by Montdor Medical Media, LLC Co-Publisher and Managing Editors Iris and Michael Goldberg Contributing Writers Tom Bergeron Beth Fitzgerald Andrew Kitchenman Robert Pear Meir Rinde Layout and Design - B&L Printing, Co. Inc. New Jersey Physician is published monthly by Montdor Medical Media, LLC., PO Box 257 Livingston NJ 07039 Tel: 973.994.0068 Fax: 973.994.2063 For Information on Advertising in New Jersey Physician, please contact Iris Goldberg at 973.994.0068 or at igoldberg@NJPhysician.org Send Press Releases and all other information related to this publication to igoldberg@NJPhysician.org Although every precaution is taken to ensure accuracy of published materials, New Jersey Physician cannot be held responsible for opinions expressed or facts supplied by its authors. All rights reserved, Reproduction in whole or in part without written permission is prohibited. No part of this publication may be reproduced or transmitted in any form or by any means without the written permission from Montdor Medical Media. Copyright 2010. Subscription rates: $48.00 per year $6.95 per issue Advertising rates on request New Jersey Physician magazine is an independent publication for the medical community of our state and is not a publication of NJ Physicians Association
Contents
Hackensack, Summit Set to Partner CONTENTS
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8 House Provision Offers Doctors More Protection Against Malpractice Suits 10 Coalition Blasts Out-Of-Network Health Care Cost 11 New Jersey Requires Encryption for Health Insurance Carriers 12 Prognosis Bleak for Many in New Jersey if Supreme Court Rejects
Health Insurance Tax Credits
14 Database Checks Proposed to Stop ‘Shopping Around” for Addictive Drugs 16 Would Patients Save Cash if Out-of-Network Provider Charges Were Slashed 17 Dems Threaten ‘Legislative Veto’ To Ease Restrictions on Medical Marijuana 18 Valley, Cleveland Clinic Sign Exclusive Cardiac Care Agreement 20 Hopkins Exec Names CEO of Atlantic Health 22 Shulkin, Morristown Medical Centere President, is Picked for VA Post 23 Effort to Save Saint Michael’s Earns Support from Newark City Council 24 New Data Indicates Survival Rates for High-Risk Surgeries Vary by Hospital 26 Aetna, Hackensack Health Network Expand Accountable Care Relationship
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Cover Story
Hackensack, Summit Set to Partner Plan Is to Create the State’s Largest Physician Group By Tom Bergeron
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ackensack University Health Network and Summit Health Management have entered into a unique partnership that will lead to the creation of the largest physician group in the state, one that has the potential to dramatically change how health care is delivered, the leaders of both organizations told NJBIZ in an exclusive interview. The partnership calls for Summit Health Management, the management organization that runs Summit Medical Group, to coordinate and improve how Hackensack’s burgeoning physician group delivers care. The final details are still being worked out, but under the initial agreement, there are plans to create a new company that will run a physician group that will start with about 100 providers (50 from each side) but could quickly grow to a statewide network of more than 1,500 providers.
The company would be owned by Hackensack University Health Network, but run by Summit Health Management, the leaders of both groups said. A formal announcement is expected soon. “This is huge; there’s nothing like it,” said Robert C. Garrett, CEO and president of Hackensack University Health Network. “It’s a sensible partnership, but it’s one that hasn’t happened before so we’re breaking new ground here. It just makes so much sense.” Jeff LeBenger, the chief executive of both Summit Health Management and Summit Medical Group, said the groups are a perfect match. “Hackensack is such a forward-thinking organization,” he said. “It is one of the few systems that we have seen across the country that is looking to create a network of providers to integrate care within their system. That’s why we are so excited.” Hackensack will pay Summit a management fee in the partnership; terms are still being negotiated. Here are the first steps of the partnership, which was forged with a signed letter of intent earlier this month: • Officials from Summit Health Management already have started observing the practices of doctors in Hackensack’s physicians group, which has about 600 doctors and practitioners. • The observations are expected to last for roughly four months and will conclude with a report that includes actionable items to improve the coordination of care and provide care more economically. • The potential new company would start with a group of about 100 providers, a number small enough number to enable enhanced integration without any disruption of services. The hope is that it will be a model for a rollout for the entire network. LeBenger said his group’s expertise will benefit the people who need it most: the patients. “When you create a provider network, you are creating a care management system that will navigate that patient through the health care experience much better,” he said. “The sickest 5 percent of the patients take up 30 percent of health care spending. So when you can navigate and care-manage that patient really well and at a lower cost point, moving more toward an ambulatory sector, you can really improve the quality of care of that patient while lowering the cost.” Garrett, a well-regarded leader and innovator who earned the top spot on the NJBIZ Power 50 Health Care list in March, welcomes the chance to work with Summit Health Management on what is a growing part of the Hackensack system. Hackensack, which had revenues of more than $2 billion in 2014, has seen its physician group double in size the past five years. Garrett said he recognized his system could benefit by working with Berkeley Heights-based Summit. 6 New Jersey Physician
“That’s what partnerships are about,” he said. “It’s getting better. It’s learning from others. “We do some things great, and there are some things that we do very well but we could do better. I’m very impressed with what Summit has been able to do in terms of practice management. They really have the tools and the know-how and the resources to be able to take our medical group into the future and actually make it work better than it actually has, producing better quality outcomes providing more efficient care.” And eventually doing so with a network that has enormous scale. In addition to Hackensack’s 600 providers, there are more than 500 at Summit Medical Group. And Hackensack is in the process of merging with Meridian Health, a partnership that could bring another 400 providers into the fold. When you consider the number of doctors looking to join groups every week and who will be looking to join Hackensack as it moves closer to the opening of its private medical school — not to mention future alliances or acquisitions Hackensack could make — the numbers are staggering. Despite the numbers, neither Garrett nor LeBenger sees any antitrust issues. The two groups have some overlap in Essex County, but little elsewhere with Hackensack having a stronger presence in Bergen and Hudson counties and Summit concentrated more in Union and Morris counties. The Meridian merger will bring in the Shore area, where Summit does not have any facilities. “We will not be more than 10 percent in any ZIP code or market because so many other hospital systems are here, as are all the other physicians groups,” LeBenger said. Garrett feels their combined number of physicians over such a vast area will make a difference. “You have the ability, with that many providers, to really make an impact in a positive way on outcomes in the health care system,” he said. LeBenger, whose Summit Medical Group is widely acknowledged to have been ahead of the health care reform curve and who earned the No. 7 spot on the NJBIZ power list, agreed. “Just imagine having a group with up to 2,000 doctors under the same integrated health network working seamlessly — or two systems really working together,” he said. “That is we found with Summit Medical Group. When you really have an integrated model, you see all the data and you have so many more efficiencies and no duplication of testing.” LeBenger, who is still a practicing doctor, said the fact that his organizations are physician-owned and physician-run gives them more credibility with other doctors — enabling his groups to produce better results with less skepticism or distrust. The proof, he said, is in the success of Summit Medical Group. “We’ve proven we can produce better health quality metrics at a better cost,” he said. “That’s where this can really go.” Garrett is eager to see it play out. “This is big; this is huge and exciting,” he said. “When people stop to think about it, they are going to say, ‘Wow.’ This changes the landscape.” March 2015 7
Hospital Rounds
House Provision Offers Doctors More Protection Against Malpractice Suits By Robert Pear
WASHINGTON — A little-noticed provision of a bill passed by the House of Representatives with overwhelming bipartisan support would provide doctors new protections against medical malpractice lawsuits.
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he bill, which requires the government to measure the quality of care that doctors provide and rate their performance on a scale of zero to 100, protects doctors by stipulating that the quality-of-care standards used in federal health programs — Medicare, Medicaid and the Affordable Care Act — cannot be used in malpractice cases. The provision is nearly identical to legislative language recommended by doctors and their insurance companies. They contend that federal standards and guidelines do not accurately reflect the standard of care and should not be used to show negligence by a doctor or a hospital. Medicare, Medicaid and private insurers increasingly require doctors to report data that can be used to assess the quality of care. They then evaluate and pay them based on their performance. Medicare, for example, asks doctors: What percentage of tobacco users receive counseling on how to stop smoking? What percentage of patients develop infections after surgery? What percentage of diabetes patients haveblood sugar levels in the normal range? The government scrutiny of doctors is only expected to increase. Sylvia Mathews Burwell, the secretary of health and human services, recently announced an ambitious goal, calling for “virtually all Medicare fee-for-service payments to be tied to quality and value” within three years. But doctors are now concerned that the proliferation of quality metrics, some mandated by the Affordable Care Act, poses unintended legal risks to health care providers, and that patients and their lawyers can use such data in court to show that providers were negligent. 8 New Jersey Physician
That concern is not far-fetched. The website of a New Mexico law firm points consumers to a Medicare list of preventable injuries and illnesses — caused, for example, by transfusions of the wrong blood type or foreign objects left in patients during surgery. “If you or a loved one has suffered serious personal injury or wrongful death as a result of one of the medical errors on this list,” the law firm says, “you may very well have a medical malpractice claim.” Brian K. Atchinson, president of the Physician Insurers Association of America, a trade group for insurers, said the bill would “eliminate the uncertainty” about the use of federal guidelines and standards to establish the legal liability of doctors, nurses and hospitals. It would, he said, “simply preserve the status quo with respect to medical professional liability.” But Tom Baker, a professor and an expert on insurance law at the University of Pennsylvania, said the provision of the bill barring lawsuits based on federal guidelines “does not make any sense.” “Why wouldn’t you want to take these guidelines into consideration?” Mr. Baker asked. “They indicate what a reasonable doctor does and should do, just like guidelines adopted by a medical specialty society.” Consumer advocates and plaintiffs’ lawyers also expressed concerns. Kelly Bagby, a lawyer at AARP, the lobby for older Americans, said the malpractice provision was “very troubling.” The National Consumer Voice for Quality Long-Term Care, a consumer group, said the provision would make it more difficult for nursing home residents to vindicate their rights and to establish negligence by showing that a home had violated federal health and safety standards. James L. Wilkes II, a Florida plaintiffs’ lawyer, said he often used inspection reports showing violations of federal standards in lawsuits against nursing homes and their medical directors. When a nursing home violates federal standards and a resident is injured, Mr. Wilkes said, the patient should be allowed to cite the violation in court, to help demonstrate that the institution did not meet its “duty of care.” But Harry M. Dasinger, a vice president of the Doctors Company, which describes itself as the nation’s largest physicianowned medical malpractice insurer, said that the standard of care should be established by the testimony of experts, not by reference to federal guidelines. “What a doctor thinks is best for a particular patient is not necessarily what the government thinks is right for groups of patients with that condition,” Mr. Dasinger said. Since 2009, the Doctors Company has been pushing for legislation that would prevent federal payment guidelines from being used as evidence of negligence. The House-passed version of the health care overhaul in 2009 included such language, but it was dropped from the Senate version that eventually became law. The main goal of the House Medicare bill, cited by Speaker John A. Boehner as one of his most significant legislative accomplishments, is to establish a new way of paying doctors. The bill, approved in the House last week by a vote of 392 to 37, is considered an urgent priority for Congress. It would block a 21 percent cut in Medicare doctors’ fees scheduled to take effect in April. The Senate plans to take up the bill when it returns on April 13. Representative Michael C. Burgess, Republican of Texas and chief sponsor of the bill, said the new payment formula would help doctors “get out from under the constant threat of payment cuts” while shifting to a new payment system based on “quality measures.” “While taking these important steps toward ensuring quality care,” Mr. Burgess said, “the bill specifically states that these quality measures are not creating a federal right of action or a legal standard of care.” The American Medical Association has mobilized a campaign to secure passage of the Medicare bill, including the section on medical malpractice. President Obama has endorsed the bill. Dr. Robert M. Wah, president of the American Medical Association, said that federal guidelines and quality criteria “should not be exploited to invent new legal actions against physicians.” The Affordable Care Act established a number of “value-based purchasing programs.” March 2015 9
Insurance Issues
Coalition Blasts Out-Of-Network Health Care Cost Study: ‘Caps Protect Insurers, Not Patients’ By Beth Fitzgerald
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s Trenton works on a bill regulating the high medical bills that can result when patients get care outside their insurance company network, a coalition of health care providers came out Tuesday in opposition to putting caps on out-of-network medical payments.
A group of legislators led by Assemblyman Craig Coughlin (D-Woodbridge) and Sen. Joseph Vitale (D-Woodbridge) has been meeting for weeks with health care stakeholders, and has said they expect to introduce a bill addressing out-of-network medical bills within the next few weeks.
The NJ Access to Care Coalition, a group of physicians, hospitals and other health care providers, criticized a study of the impact of out-of-network medical charges that was commissioned by the state’s largest health insurer, Horizon Blue Cross Blue Shield of New Jersey.
Horizon spokesman Tom Vincz said: “Horizon and the vast majority of physicians have a common goal to ensure New Jersey residents receive the best possible health care at a reasonable cost. When an out-of-network doctor can charge excessive amounts such as $12,500 for a stress test, $10,000 for a consultation of less than an hour or $650 to draw blood, it is not hard to understand why New Jersey consumers are paying such high health insurance premiums. Horizon members alone pay more than $1 billion a year in outof-network costs.”
The study, conducted by Avalere Health, concluded that New Jerseyans could see lower monthly premiums if the state’s current out-of-network regulations were changed. Current state law requires that, when consumers receive emergency care from out-of-network hospitals and doctors, they can’t be charged more than they would pay if they were in-network. “New Jersey state law protects patients who, by no choice of their own, are seen by an out-of-network provider in an emergency situation,” said Betsy Ryan, chief executive of the New Jersey Hospital Association. “Imposing rate setting measures on health care providers does nothing to improve access to care for patients; caps protect insurers, not patients. Instead of capping payments to providers, the health insurance industry should be focused on bringing more providers into their networks and providing better access to care for their members. Rate setting is a vestige of the past.”
10 New Jersey Physician
Vincz added: “The out-of-network cost issue is a consumer protection issue. New Jersey residents will continue to pay higher health care costs unless common sense changes are made.” The coalition contended that some health care providers have been “squeezed out” of insurance networks because they were unable to agree on in-network reimbursement rates. “Physicians’ and hospitals’ only recourse to negotiate adequate payment rates is to have the ability to walk away from the table and go out of network with the insurer,” the coalition said in a statement. Neil Eicher, vice president of government relations for the New Jersey Hos-
pital Association, said the coalition is opposed to out-of-network rate caps but is working with legislators to arrive at a compromise. “We want to be part of the solution, which should be a shared response by providers and insurers,” he said. He said that, in general, “We think if you make the in-network situation better for (health care) providers it gets rid of the out- of-network problem.” He said providers are seeking “better reimbursements and a better in-network experience.” Lawrence Downs, chief executive of the Medical Society of New Jersey, said the inability to come to terms with insurers forces a number of doctors to remain out of network. He contended that Horizon has “the ability to contract with all physicians and hospitals in the state, but they choose not to.” Dr. Jon Lustgarten, a neurosurgeon who testified on behalf of the New Jersey Neurosurgical Society before the Assembly Financial Institutions and Insurance Committee last October, said: “It’s certainly our perspective that we have an in-network problem, not an out-of-network problem. If financial pressures become too great, neurosurgeons will choose not to practice.” Vincz of Horizon said: “More than 85 percent of physicians, and a majority of acute care hospitals, are in the Horizon networks — the state’s largest networks. So this is not an issue of access. This is an issue of excessive charges by those doctors who choose to go out-of-network to increase their profits.”
New Jersey Requires Encryption for Health Insurance Carriers; May Open Door to Class Action Suits over Violations under State Consumer Protection Law G
ov. Chris Christie has signed into law S. 562, which, as its title states, “Requires health insurance carriers to encrypt certain information.”
Violation of this new law constitutes a facial violation of the New Jersey Consumer Fraud Act, a powerful consumer remedies statute. The NJCFA can be enforced by the state attorney general, or by private action. For private litigants showing ascertainable loss, the NJCFA allows for recovery of treble damages and attorney’s fees. The NJCFA is a favorite of the state class action bar. For purposes of this Act, a “health insurance carrier” is “an insurance company, health service corporation, hospital service corporation, medical service corporation, or health maintenance organization authorized to issue health benefits plans in this State,” New Jersey. Such health insurance carriers “shall not compile or maintain computerized records that include personal information, unless that information is secured by encryption or by any other method or technology rendering the information unreadable, undecipherable, or otherwise unusable by an unauthorized person.” A simple password will not do. Unlike the Massachusetts data security regulation, the New Jersey Act does not expressly establish a duty to pass encryption standards on to vendors. As defined by the Act, personal information “means an individual’s first name or first initial and last name linked with any one or more of the following data elements: (1) Social Security number; (2) driver’s license number or State identification card number; (3) address; or (4) identifiable health information.” While the substantive requirements of this Act may not be onerous, the explicit link between this Act and the NJCFA should give pause to all New Jersey health carriers.
March 2015 11
Hospital Rounds
Prognosis Bleak For Many In NJ If Supreme Court Rejects Health Insurance Tax Credits Losing subsidies under Affordable Care Act could prove disastrous for residents with health problems who might lose insurance By Andrew Kitchenman
Y
olanda Quintero knows what it’s like to go without health insurance. She doesn’t want to go through that again.
But that may depend on how the U.S. Supreme Court rules in a case involving the legality of tax subsidies that are key part of the federal Affordable Care Act. Quintero and her family lost their coverage in 2010 when Gov. Chris Christie ended NJ FamilyCare coverage for legal immigrants who had been in the country for less than five years. After losing her insurance, she then needed brain surgery for an aneurysm, leaving her with large medical bills. She later was able to buy health insurance through the federal marketplace. “We are all covered and we receive the best coverage for my family,” Quintero said. Now Quintero is again facing the possibility of losing her insurance, as the nation’s highest court rules in the King v. Burwell case King v. Burwell case on whether tax credits that subsidize individual and family health insurance under the ACA are invalid. The court will hear oral arguments in the case today and is expected to issue a decision in late June. King v. Burwell focuses on a provision of the ACA that specifies that the tax credits are available for those who buy insurance through exchanges established by the states. The plaintiffs argue that there can’t be subsidies for those who live in states like New Jersey that opted for a federally operated marketplace because the law doesn’t specifically say that residents of these states can receive subsidies. Federal officials argue that in reading the entire law, it’s clear that residents in every state are eligible for subsidies, whether or not their state created its own insurance exchange. Analysts expect that many people will drop their coverage if they lose their subsidies. 12 New Jersey Physician
A new report finds that many of the people most likely to be affected by losing the subsidies live in areas represented by congressmen who are critical of the ACA. The impact of the top court’s decision could extend beyond the ACA to individual insurance plans purchased outside of the marketplace, as well as to the state budget, since Gov. Chris Christie has proposed cutting hospital charity care spending by $148 million due to a drop in the number of uninsured residents in New Jersey because of provisions of the ACA. While ACA supporter U.S. Rep. Bill Pascrell (D-9th) represents the congressional district with the most New Jersey residents receiving subsidies, ACA critic U.S. Rep. Chris Smith (R-4th) represents the district with the second-highest number of residents with ACA insurance subsidies. The district with the fewest residents receiving ACA subsidies is actually one of the districts with the highest poverty levels: the 10th Congressional District represented by Democratic U.S. Rep. Donald Payne Jr. That number is low because the newly expanded NJ FamilyCare, the state’s Medicaid insurance program, covers a larger share people who live in the district. U.S. citizens and immigrants who have been in the country legally for longer than five years can receive FamilyCare coverage if their income is less than 138 percent of the federal poverty level, currently $16,243 for a single person and $33,465 for a family of four. The ACA subsidies cover citizens and all immigrants with legal status with incomes between 100 and 400 percent of the poverty line, which currently amounts to $24,250 and $97,000 for a family of four. “These are working-class individuals,” said Raymond J. Castro, senior policy analyst for New Jersey Policy Perspective. “They are throughout the state and they really go beyond the usual political boundaries.”
A total of 252,792 state residents have enrolled for insurance through the ACA marketplace, with 84 percent of them receiving subsidies. New Jersey Citizen Action healthcare program director Maura Collinsgru said New Jersey should take action to establish a state-based exchange, through which residents would be eligible for subsidies, ahead of the court decision. She’s been working with a coalition of different nonprofit organizations, known as New Jersey for Health Care, which supports expanding access to healthcare. “We in the coalition see this case not as King v. Burwell, but King v. 200,000 New Jerseyans who would have a devastating impact and again be at risk of losing their coverage and access to the healthcare treatment they need,” Collinsgru said. Castro said the state could launch an exchange more quickly if it began preparations now, rather than waiting until June for the court to rule. He noted that the state did research on having a state exchange before Christie decided against it. Christie spokesman Kevin Roberts said the governor’s office didn’t have a comment “at this time” on Castro’s comments or the King v. Burwell court case. Castro compiled the report, which calculated that state residents would lose an average of $3,708 in annual subsidies if the court ruled the tax credits invalid, for a total of $780 million statewide. He noted a RAND Corp. study that estimated average premiums would rise by 47 percent. But that would just be the increase for 2015. The impact would likely get even worse after that. The reason is that healthier people would be more likely to drop their coverage, while more people with existing health problems would be expected to try to pay the higher premiums in order to keep their coverage. With fewer healthy people enrolled, insurers would likely steadily increase their premiums, a process that has been
described by analysts as a “death spiral” for the individual health insurance market. This would also affect the roughly 100,000residents who bought insurance directly from insurers outside the marketplace, since the plans and premiums inside and outside the marketplace are identical. RAND analysts estimate that 70 percent of all people with individual and family insurance would drop their coverage, which Castro said would amount to roughly 246,000 people in New Jersey. Castro added that a ruling invalidating the subsidies would also hurt the state budget, since hospitals would see an increased need for subsidized charity care. A Robert Wood Johnson Foundation report estimates that the amount of healthcare spending that would go uncompensated as a result of a rise in uninsured residents due to the loss of subsidies would total $335.2 million in New Jersey. The Rev. David Stoner, pastor of Temple Lutheran Church in Pennsauken and a member of the New Jersey Anti-Poverty Network of New Jersey, said he is s concerned that chipping away at the ACA will increase poverty. Invalidating the subsidies would put “another nail in the coffin of people who are trying to get themselves moving forward and moving up into a place of security, without health care and you get sick, you are insecure,” Stoner said. John Sarno, president of the Employers Association of New Jersey, said the tax credits have benefited businesses in the state, by keeping more workers healthy and on the job, adding that businesses would have to absorb the costs of lost productivity if access to healthcare declined. “The more workers we get insured, the more people we get insured in New Jersey, the better it is for the wider economy,” said Sarno, whose association advises business executives on employment law and offers a health insurance plan to small to mid-sized businesses. March 2015 13
Hospital Rounds
Database Checks Proposed to Stop ‘Shopping Around’ for Addictive Drugs By Andrew Kitchenman
Centerpiece of effort to stem rising tide of overdose deaths moves closer to Gov. Christie’s desk
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t may soon get tougher for people with drug addictions to seek opioid drugs from multiple doctors or pharmacies.
Legislation that’s been two years in the making would require doctors and others who can prescribe dangerous drugs to check the New Jersey Prescription Monitoring Program (PMP), a database of all prescriptions issued in the state, before first prescribing these drugs to patients, and to check the database every three months after the first prescription. This would help detect “doctor shopping,” a term for seeking different doctors to get more prescriptions for opioids like oxycodone or morphine. The measure is a centerpiece of a 21-bill package that the Legislature has been enacting in the face of an epidemic of overdoses from both prescription opioids and heroin. Some people seek heroin after first becoming addicted to prescription painkillers. New Jersey would join 22 other states that mandate checking of PMP registries. Legislators are hoping it will be as successful as an initiative in New York, which saw a decline in opioid prescriptions and “doctor shopping” after it mandated PMP checks. Both law-enforcement officials – including senior officials in the state attorney general’s office -- and advocates for curbing addiction, including members of a task force formed by the Governor’s Council on Alcoholism and Drug Abuse, had sought the mandate. 14 New Jersey Physician
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March 2015 15
Hospital Rounds
Would Patients Save Cash if Outof-Network Provider Charges Were Slashed? By Andrew Kitchenman
Report commissioned by Horizon says insurance premiums could drop if state took action
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orizon Blue Cross Blue Shield of New Jersey members could see significant savings in their insurance premiums if the state reined in the charges from some hospitals and healthcare providers outside of the insurer’s network, the company said this week. And a new Horizon-commissioned analysis lays out a series of policy actions that the state could pursue to make that happen. Avalere Health LLC suggested that the state could lower out-of-network costs by setting benchmarks to determine payments for healthcare services, or by requiring providers and insurers to settle payment differences through arbitration. The analysis cites a separate Horizon-commissioned study that found that if, instead of paying what it pays now for out-ofnetwork services, Horizon instead paid 50 percent more than what Medicare pays for these services, the company would be able to cut its out-of-network costs by 52 percent, or $497 million in 2013 alone. That equals 4.3 percent of the total amount of claims paid through Horizon’s commercial insurance plans. Insurers and providers have been wrangling over out-of-network fees since last fall, when legislators held on ways to reduce out-of-network fees. Under state law, New Jersey insurers must pay for coverage of emergency visits, including ambulances, which are outside of a patient’s insurance network. They must also cover higher charges for specialists who are outside of an insurance network but work in hospitals that are inside an insurance network. This has contributed to some hospitals and providers charging high out-of-network fees – in fact, New Jersey hospital charges are the highest in the country.
16 New Jersey Physician
Hospital Rounds
Dems Threaten ‘Legislative Veto’ to Ease Restrictions on Medical Marijuana By Meir Rinde
For some NJ legislators, the problem with the state’s medical marijuana program is the law itself
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ssembly Democrats are deploying the threat of a rarely used “legislative veto” to push for the easing of state restrictions on medical marijuana that advocates say have made it difficult for patients to access the drug and discouraged the opening of enough marijuana dispensaries to make the program work. The Assembly yesterday passed a concurrent resolution (ACR-224) authorized by a state constitutional amendment approved by voters in 1992. If the measure also passes in the Senate, the Department of Health will have 30 days to change or withdraw certain regulations governing medical marijuana. The measure may not be vetoed. If the agency does not act, the Legislature can pass a second resolution that would invalidate the regulations, which could leave the medical marijuana program in regulatory limbo. That appears unlikely to happen -- it’s uncertain if the Senate will even pass the first resolution -- but lead sponsor Assemblyman Reed Gusciora (D-Mercer) said the administration’s shackling of the marijuana program makes the threat necessary. “That would certainly be a drastic measure,” he said Wednesday, referring to the invalidation of regulations. “But nonetheless, it’s (needed) to force the issue with the Department of Health.” “I’m at this point where I am pushing this legislation because the bottom line is there aren’t enough dispensaries, and there’s not satisfaction from patients or providers that the program is beneficial to anyone,” he said. Gusciora and the other sponsors say several Department of Health regulations violate the intent of the medical marijuana measure signed into law by Gov. Jon Corzine in January 2010, shortly before Gov. Chris Christie took office. As a result, only three dispensaries are open, even though the law calls for the establishment of six. Gusciora said just one is doing well while the other two have struggled. A fourth dispensary has only a permit to grow medicinal marijuana.
Christie opposed the medical marijuana law when he was running for office, though in 2013 he signed a bill relaxing some rules that kept children from participating in the program. This week he restated his opposition to a broader legalization of marijuana for recreational use, describing pot as “a gateway drug to other drugs” and calling potential taxes from marijuana “blood money.” Among the disputed medical marijuana regulations is a requirement that doctors join a public registry before they can prescribe. The resolution also challenges a rule that minors obtain permission from two or three doctors, including a psychiatrist; prohibitions on home delivery and dispensary satellite locations; and the makeup of a panel that would recommend which conditions may be treated with marijuana. “The very same doctors who can already prescribe morphine, who can prescribe opiates, they can’t prescribe marijuana unless they register with the state. [The doctors] have a real problem with that,” Gusciora said. “They don’t want to be designated by the state as quote-unquote ‘pot doctors.’ It’s caused a chilling effect for doctors to sign up.” Gusciora’s resolution also says the state should stop limiting the level of psychoactive THC in the drug or the number of strains of marijuana that can be grown, and should approve the use of edible forms for minors and others. He cited the much-publicized case of Vivian Wilson, a toddler from Scotch Plains who needed edible marijuana products to treat a severe epilepsy disorder. Her family moved to Colorado last year because edibles are not available in New Jersey. “It’s almost death by a thousand cuts,” Gusciora said. “The regulations have really greatly impeded patients’ access to medical marijuana and doctors’ ability to participate in the program, and other dispensaries from coming on board. Because, let’s face it, even as nonprofits they still need to make money. If they’re not going to have a sufficient patient base, they’re just not going to open their doors.”
March 2015 17
Hospital Rounds
Valley, Cleveland Clinic Sign Exclusive Cardiac Care Agreement By Beth Fitzgerald
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he Valley Health System in Ridgewood on Wednesday announced a cardiac care affiliation with the Cleveland Clinic, one of the largest and most prestigious health care systems and which for the past 20 years has been ranked No. 1 for heart care by U.S. News & World Report. Valley Chief Executive Audrey Meyers said the affiliation enhances the large and well-regarded cardiac program at Valley, which annually provides thousands of patients a continuum of care from outpatient to open heart surgery. “We are an award-winning cardiac hospital, and affiliating with the No. 1 heart hospital in the country will only strengthen Valley’s capabilities,” Meyers said. “This will allow us to gain access to clinical research and best-in-class protocols, and that’s going to be a real value to the community.” Meyers said the agreement provides exclusivity: Valley will be the only New Jersey hospital to affiliate with Cleveland Clinic for cardiac care. “They are establishing a robust cardiovascular specialty network, and I’m sure will be announcing relationships in other parts of the country,” she said. When she announced an affiliation last December with New York’s Mount Sinai Health System, Meyers said Valley intends to remain independent and has no plans to merge with a larger health system — and that hasn’t changed, she said. Valley is not currently pursuing additional clinical affiliations, Meyers said. Asked if there might be others in the future, she said, “I think that, as opportunities present themselves, that is certainly something that we would look at, but there is nothing on the table right now.”
Recent years have seen numerous mergers of stand-alone New Jersey hospitals into larger systems, but “it is our intention to remain an independent organization,” Meyers said. As a major New Jersey hospital that gets high marks for clinical quality and is financially strong, “our intent is to use these affiliations wisely and bring added value to our community and to our physicians,” Meyers said. Valley is affiliating with the Cleveland Clinic’s Sydell and Arnold Miller Family Heart & Vascular Institute. In a statement, Dr. Joseph Cacchione, the institute’s chairman of operations and strategy, said, “Valley Health System’s cardiac program has a nationally recognized reputation and we are proud to affiliate with Valley to help further advance cardiac care in the region.” Valley said it will make payments to Cleveland Clinic through a dues structure, but declined to provide further financial details. The Society of Thoracic Surgeons gives Valley its highest rating for cardiac bypass surgery and aortic valve replacement surgery, and in August 2014 Valley made the Consumer Reports list of the Top 15 hospitals in the nation for heart surgery. “We meet Cleveland’s very rigorous standards, which is why they are welcoming us into the network,” Meyers said. The affiliation brings the Valley Health System into the Cleveland Clinic Cardiovascular Specialty Network. Valley said this network enables employers located outside the Ohio area to offer their employees Cleveland Clinic-caliber heart care close to home.
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Dr. Gerald Sotsky, chair of cardiac services for Valley Medical Group, said: “Medicine is a collaborative profession to begin with, and collaborating with one of the best hospitals in the country gives us access to their innovation and their technology. So I think it benefits us and it benefits the patients.” Dr. Alex Zapolanski, director of cardiac surgery at Valley, said: “I am very familiar with Cleveland Clinic, and it’s a place where people go and learn new procedures. They are in the forefront of things like minimally invasive valve surgery, for example. Because of the volume of the surgery they do and the way they implement these new technologies, we will have rapid access to (innovation) and will benefit immensely. No question, they are ahead of the game compared to almost anybody in the U.S. with new technology.” Sotsky noted that cardiology has evolved over the years to embrace a team approach, where surgeons work hand in hand with noninvasive cardiac specialists. He said the Cleveland Clinic has a number of well-developed cardiac programs, and the affiliation will provide opportunities for Valley physicians to adopt new technologies and do more cardiac research.
Zapolanski said physicians at Valley conduct research and have published extensively, particularly over the past four or five years: “This will allow us to do some more research with Cleveland Clinic, and that’s going to be great for our patients.” Valley noted that patients make choices about where to get heart care — and the affiliation with Cleveland Clinic is a strategic move aimed at encouraging them to continue choosing Valley. Founded in 1921, the Cleveland Clinic is headquartered in that Ohio city and is a nonprofit, multispecialty academic medical center. Its more than 3,000 full-time salaried physicians and researchers and 11,000 nurses represent 120 medical specialties and subspecialties. The Cleveland Clinic health system has facilities in Ohio, Florida, Las Vegas and Canada, and this year will open Cleveland Clinic Abu Dhabi. Cleveland Clinic said patients come from every state and more than 130 countries. Valley Health System is a regional health care system serving northern New Jersey and southern New York. It includes The Valley Hospital, a 451-bed, acute-care hospital, Valley Home Care and the Valley Medical Group, a multispecialty group physician practice.
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Hopkins Exec Named CEO of Atlantic Health By Tom Bergeron
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collaborative strategic leader with executive experience … a veteran who brings extensive experience working with communities, patients, physicians and nurses… a visionary who can guide a system through what promises to be a fast-moving and perhaps tumultuous health care and hospital era in New Jersey and the country. The Atlantic Health System board of trustees set the bar high when it went looking for its next chief executive officer. After a comprehensive national search, it feels it found its man in Brian A. Gragnolati. “We are thrilled to announce Brian Gragnolati as the new leader of our robust health care system,” Robert A. Toohey, the vice chair who led the search committee, said in a statement Thursday. “After a rigorous and inclusive search process, we have selected a uniquely qualified candidate with the precise background and expertise needed to usher Atlantic Health System into a new era of health care delivery and ensure continued growth.” Gragnolati will replace outgoing CEO Joseph Trunfio, who announced his retirement last October. Gragnolati brings a wealth of experience to the job — from one of the top health care organizations in the world. He was serving as senior vice president, Community Division, at Johns Hopkins Medicine in Baltimore. According to the Atlantic Health release, he was operationally responsible for three owned and two affiliated community hospitals, numerous ambulatory and surgery centers and community-physician integration. He has also led the delivery system business development activities in the United States and co-leads Hopkins’s efforts to expand its insurance products, redefine and grow its geographic footprint and develop models of clinical and financial integration. Gragnolati feels that experience will help him lead the Morristown-based system.
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“Having worked in health care my entire professional career, I have seen firsthand the difference we can make in people’s lives,” he said. “As leaders of health care systems, this is our purpose and our privilege and what I love most about our profession. “Atlantic Health System is well-positioned to execute on its vision of empowering communities to be the healthiest in the nation and reaching unprecedented new heights in health care delivery, and I cannot wait to get started.” Gragnolati has had the benefit of having both strong academic and community-based hospital experiences. His other leadership roles were at WellSpan Health in York, Pennsylvania, where he served as president of York Hospital; Medical Center Hospital of Vermont in Burlington; and Baystate Medical Center in Springfield, Massachusetts. Karen Kessler, the chair of the Atlantic Health System board of trustees, said the board will work to make the transition to Gragnolati as seamless as possible. “Working together with our departing CEO and our incoming leader, the board of trustees will ensure a swift and smooth transition of roles,” she said. “We will deeply miss Joe, whose steadfast leadership propelled Atlantic Health System to become a regionally and nationally renowned health care provider, but we are enthusiastic about our future under Brian’s guidance.” Gragnolati is a fellow of the American College of Healthcare Executives and has served on numerous community boards. He is current board member of the American Hospital Association and serves on its Operations Committee and Committee on Research. Gragnolati earned a bachelor’s degree in health systems analysis from the University of Connecticut and an MBA from Western New England College in Massachusetts. He received an Executive Leadership Certificate from the JFK School at Harvard University
Princeton’s Premier Senior Health Campus The Pavilions at Forrestal campus features two comprehensive centers that combine to deliver unparalleled senior care services. Our campus is home to post acute care and assisted living centers. Both offer a variety of on-site amenities and services specially designed to meet the needs of patients, residents and their family members. The Pavilions at Forrestal provides post acute, long term, Alzheimer’s / dementia and hospice care as well as rehabilitation and respite care, all under one roof. We offer state-of-the-art programs for physical, occupational, speech, respiratory and other therapies and our staff of licensed therapists is available seven days a week. Innovative supervised recreational activities in art, music, crafts and our exercise programs encourage social interaction and significantly enhance patients’ rehabilitation and quality of life. The Pavilions at Forrestal Assisted Living offers the independence of a private apartment and all the comforts of home with a host of convenient amenities and hospitality services. Residents enjoy delicious meals in a restaurant-style dining room, energizing fitness and wellness programs and a diverse range of cultural and social activities. The center also offers concierge service, weekly housekeeping services, courtesy van transportation, and much more. We take great pride in the care we deliver at both centers and our compassionate, experienced staff is focused on creating a warm environment that supports healing.
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www.atriumhealthusa.com March 2015 21
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Shulkin, Morristown Medical Center president, is picked for VA post D
r. David Shulkin, president of Morristown Medical Center, has been nominated by President Barack Obama to serve as undersecretary for health in the Department of Veterans Affairs, according to a published report. NJ Advance Media said on NJ.com on Wednesday evening that Shulkin, who is also a vice president of the hospital’s parent, Atlantic Health System, would fill a position that has been vacant since May 2014. That spring, Robert Petzel resigned in the wake of a scandal involving long wait times for veterans at Phoenix-area VA hospitals and reports of a cover-up. Shulkin has served as president of Morristown Medical Center and an Atlantic Health vice president since 2010, according to Atlantic Health; prior to those posts, he was CEO and
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president of Beth Israel Medical Center in New York City for four years. Linda Schwimmer, vice president of the New Jersey Health Care Quality Institute, said, “David is a strong leader and stickler for quality above all else. He’s an excellent choice. We wish him well. Maybe he can get the VA hospitals to be more transparent about their quality. We hope so.” He was not the first choice for the VA post, NJ Advance Media’s report said; Jeffrey Murawsky of the VA’s Chicago office had earlier withdrawn from consideration amid reports that hospitals under his supervision also covered up long wait times for veterans. Shulkin’s nomination requires the approval of the U.S. Senate, NJ Advance Media said.
Effort To Save Saint Michael’s Earns Support From Newark City Council By Beth Fitzgerald
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embers of the Newark city council voiced support for Saint Michael’s Medical Center after hearing last week from a coalition that opposes a state-commissioned report that calls for the hospital to be converted into an ambulatory care center. Council members expressed support for the hospital after members of the Save Saint Michael’s Medical Center Coalition testified in opposition to the study during Wednesday’s meeting. “The council is united in its support for Saint Michael’s,” said South Ward Councilman John Sharpe James. “We’ve got your back,” said Council President Mildred Crump. The study by Navigant Consulting looks at the five hospitals in the greater Newark area and concluded they provide more acute care hospital capacity than the region can support. The report, released by the state Department of Health on March 2, recommended that Saint Michael’s and East Orange General Hospital be converted into state-of-the-art ambulatory care centers. Navigant said Newark’s University Hospital should remain an acute care hospital, undergo a major renovation and then integrate with Newark Beth Israel Medical Center, which would also specialize in outpatient care. Finally, Navigant recommended that Clara Maass Medical Center in Belleville continue as an acute care hospital. Navigant put a price tag of more than $1 billion on its proposals to reorganize health care in the greater Newark area. Members of the coalition presented the city council with petitions with more than 10,000 signatures in support of Saint Michael’s, and called on the city council to urge Gov. Chris Christie to approve the proposed sale of Saint Michael’s to California-based Prime Healthcare, which plans to continue Saint Michael’s as a full-service community hospital. Prime acquired St. Mary’s Hospital in Passaic last August and is in the process of acquiring Saint Clare’s Health System in Denville. “Saint Michael’s along with Rutgers and NJIT anchor the community,” said Dennis A. Pettigrew, Saint Michael’s chief financial officer and chief operating officer. “Cutting back Saint Michael’s to an ambulatory care center, if it is even financially feasible — as the Navigant report suggests — would reduce the hospital to a shell of what it is today and likely lead to closure of the entire facility.” Pettigrew said if Saint Michael’s were to close, hundreds of people, many of them Newark residents, would lose their jobs.
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New Data Indicates Survival Rates for HighRisk Surgeries Vary by Hospital By Andrew Kitchenman
Leapfrog Group report can inform decisions on where to go for surgeries, but doctors, other factors also matter
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person’s chances of surviving certain high-risk surgeries vary depending on the hospital, according to newly available data.
New Jerseyans weighing where to go for one of four types of surgeries can turn to a Leapfrog Group report released today, which is part of a broader effort to increase hospital quality and inform patients’ decisions. The report calculated patients’ odds of surviving based on 2013 data reported by the hospitals. Both the survival rates for 2013 and the number of each type of surgery were factored into each hospital’s predicted survival rate, which was also adjusted for the health of the patients. While Leapfrog Group officials said the data would be useful to those making decisions about where to have surgeries, it also should be used with caution. The particular surgeons are essential to the success of a procedure, and the annual data for each hospital can be based on small numbers. The four procedures considered in the report were: abdominal aortic aneurysm repair, which treats an enlarged vessel that supplies blood to the body; aortic valve replacement, a heart surgery; surgery to remove all or part of the pancreas; and surgery to remove all or part of the esophagus. These surgeries were chosen because they’re relatively common, high risk, and their measurement has been endorsed nationally by organizations seeking to improve healthcare quality. “There is such tremendous variation in hospital performance,” said Erica Mobley, a Leapfrog Group spokeswoman. For abdominal aortic aneurysms, the top New Jersey performer was Morristown Medical Center, where patients’ predicted survival is 98.7 percent. The lowest was Capital Health Regional Medical Center in Trenton, at 94.8 percent, which was below the national average of 97 percent but well above the worst hospital nationally, which was at 86 percent. For aortic valve replacements, eight New Jersey hospitals were rated as having better-than-average predicted survival odds, while three -- Cooper University Health Care in Camden, Newark Beth Israel Medical Center, and Our Lady of Lourdes Medical Center in Camden -- were worse than average. The report didn’t provide more detailed data for most hospitals for this surgery. For pancreas removal, Cooper University Health Care had the highest predicted survival odds, at 99.4 percent, while three hospitals tied for the worst, at 86.3 percent: Inspira Medical Center Vineland, JFK Medical Center in Edison, and Jersey City Medical Center. The national average was 91 percent, while the worst performer nationally was at 81 percent. For esophagus removal, Robert Wood Johnson University Hospital in New Brunswick had the best predicted survival odds, at 94.1 percent, while six hospitals were tied for the worst, at 88.4 percent: Englewood Hospital and Medical Center; Jersey Shore University Medical Center in Neptune; JFK Medical Center; Palisades Medical Center in North Bergen; University 24 New Jersey Physician
Medical Center of Princeton at Plainsboro; and Virtua Memorial Hospital in Mount Holly. The national average was 91 percent. Of 71 New Jersey hospitals asked to participate, 62 submitted data. But many of those didn’t have enough surgeries to be included in one or more categories. “What you’re looking for is a hospital that’s performing a really high volume,” since more-experienced staffs usually perform better, Mobley said, adding that there’s a benefit to having many hospitals without data to report. “We want hospitals that don’t have a high volume to be referring patients to a hospital that does.” Leapfrog Group officials said hospitals with lower rates could learn from higher performers. “Hospitals need to be following best practices for the performance of these procedures,” and ensure that surgeons -- as well as the staff members who help patients with followup and recovery -- are well trained, Mobley said. While a goal of releasing the report is to improve hospital performance nationally, the 2013 numbers didn’t reflect an upward trend. For three of the surgeries, predicted survival odds were relatively flat, while the share of hospitals meeting Leapfrog Group standards actually dropped in 2013 for abdominal aortic aneurysms. “We’re also using this to educate the public in general that this information exists and that there is this tremendous variation, so they should be looking up a hospital before they have these procedures done,” Mobley said. Amanda Melillo, a research associate with the New Jersey Health Care Quality Institute, said institute officials are hopeful that publicly reporting the data will contribute to improvements. “However, we think you need to be careful drawing state-based rather than national conclusions given the relatively small number of these procedures,” Melillo said, adding that the institute appreciated the openness of the hospitals that reported their data. The institute works with the Leapfrog Group to encourage hospital participation. “We think it demonstrates their commitment to transparency and improvement,” she said. The Leapfrog Group is a Washington, D.C., nonprofit started by employers with the goal of improving hospital quality. Castlight Health, a San Francisco healthcare data company, analyzed the information. The report is the second of a series of six, which began last month with a report on maternal health.
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Aetna, Hackensack Health Network Expand Accountable Care Relationship To Another 10K By Beth Fitzgerald
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he movement toward “value-driven” health care, in which health care providers get financial incentives for meeting clinical and efficiency goals, took another step forward Wednesday. Health insurer Aetna and the HackensackAlliance accountable care organization announced a new accountable care agreement and Medicare collaboration that will cover more than 10,000 Aetna commercial and Medicare Advantage members in Bergen and Hudson counties. This agreement expands the existing relationship between Aetna and the Hackensack University Health Network, which belongs to the new Aetna Medicare NNJ Prime Plan launched in New Jersey last October. The HackensackAlliance ACO has 575 physicians and care providers who use health information technology to coordinate care, and are accountable for cost, quality and patient satisfaction for the health care they provide. “This new agreement with the HackensackAlliance ACO — like others that have preceded it over the last seven years — aligns with the federal government’s recent call for more value-based models of care,” said John Lawrence, president, Aetna – New Jersey. “Step by step, Aetna and progressive health care providers like the HackensackAlliance ACO are changing the business model for health care delivery, and delivering strong results for members.” HackensackAlliance ACO physicians are affiliated with Hackensack University Medical Center, HackensackUMC at Pascack Valley and HackensackUMC Mountainside. Aetna said its members who receive care from HackensackAlliance ACO physicians will experience more coordinated care, and will benefit from the improved flow of information to physicians, particularly those patients with chronic or complex conditions. Aetna nurse case managers will work with the ACO to assist in care coordination, outreach and follow-up services. “We are proud to partner with Aetna,” said Robert C. Garrett, chief executive officer and president of Hackensack 26 New Jersey Physician
University Health Network. “We are committed to developing strong partnerships that will improve the level of care coordination provided — ultimately improving the results for our network and patients.” Garrett noted that the federal government found that HackensackAlliance ACO has generated $10.75 million in savings for Medicare, and to date is one of just three ACOs in the state that will receive a share of the money that Medicare saved via the ACO program. This Aetna/Hackensack agreement includes a shared savings model that rewards HackensackAlliance ACO physicians for meeting certain quality and efficiency measures such as: • The percentage of Aetna members who receive recommended preventive care and screenings; • Better management of patients with chronic conditions such as diabetes; • Reductions in avoidable hospital readmission rates; and • Reductions in unnecessary emergency room visits. Aetna said it’s working with health care organizations nationwide to advance value-driven, patient-centered care. The company said about 3.2 million of its members receive care from doctors committed to the value-based approach, with 28 percent of Aetna claims payments going to doctors and providers who practice value-based care. Aetna said its goal is to increase that to 50 percent by 2018 and 75 percent by 2020. Aetna said that, in New Jersey, nearly 230,000 — or 21 percent — of its members are in value-based collaborative arrangements, including ACOs, with the intent to reach over 400,000 — or 35 percent — of its New Jersey members during 2015.
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