NJ Physician Magazine September 2014 by NJPhysician Magazine

JULY 2014 2012 SEPTEMBER Visit us now online at www.NJPhysician.org

GANJ

A Time-Tested Business Model Thatâ&#x20AC;&#x2122;s a Win-Win for Physicians and Patients Also In This Issue: Electronic Protected Information and Patient Communications Three N.J Health Care Organizations Earn Millions of Dollars in Bonuses for Saving Medicare Money. ASC Pays $5M to Settle Kick-Back Case Based on Cheap Buy-In Claim

Published by Montdor Medical Media, LLC

Montdor Medical Media, LLC

Co-Publisher and Managing Editors Iris and Michael Goldberg

Contributing Writers Iris Goldberg Michael Goldberg John Forrester Beth Christian Kurt Anderson Beth Fitzgerald Mark Manigan Melanie Evans Carl Blesch

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Contents

GANJ (Gastroenterology Associates of New Jersey)

A Time-Tested Business Model Thatâ&#x20AC;&#x2122;s a Win-Win for Physicians and Patients CONTENTS

10 12 14

Cyber Liability, the Looming Threat for Doctors and the Health Care Industry Electronic Protected Health Information and Patient Communications Three N.J. Health Care Organizations Earn Millions of Dollars in Bonuses For Saving Medicare Money

ASC Pays $5M to Settle Kick-Back Case Based on Cheap Buy-In Claim

ACOs, Other Delivery Reforms Shift Job Roles at Hospitals

Atlantic Health System CEO Trunfio Retires

Two N.J. Health Care Systems Announce Merger

Sharp Decline in Uninsured New Jerseyans in Wake of Obamacare, Report Finds

Sloan Kettering Breaks Ground on N.J. Cancer Center, Which will Cost $217M and Create 160 Jobs

Rutgers Receives $10 Million Pledge to Advance Treatment of Cancer Patients

Health Care Data Breach has Hit 1 Million N.J. Patients Since 2009

Barnabas Health System Appoints VP to Lead Wellness Initiatives

Palisades Medical Center Joins HackensackUMC Health Network

2 New Jersey Physician

Healthcare Reform Brings New Risk. Boynton Healthcare Can Help You Understand the Change and Find Solutions.

Changes in the healthcare law have created new risks for Physicians, Hospitals and Accountable Care Organizations. Boynton Healthcare is a recognized leader in healthcare insurance and risk management and can limit your exposure and help you navigate this new environment through innovative insurance products and services.

For more information Call 800-822-0262 or 732-747-0800 Visit our website www.boyntonhealthcare.net Email us at JBisbee@boyntonandboynton.com

Cover Story

GANJ (Gastroenterology Associates of New Jersey)

A Time-Tested Business Model That’s a Win-Win for Physicians and Patients By Iris Goldberg In just the past decade we have witnessed radical changes in the structure of medical practices, not only in New Jersey but nationwide. The sole practitioner is virtually extinct and even two or three-physician partnerships are significantly less common than they were only ten short years ago. With insurance reimbursements to providers more strictly regulated and escalating costs of practice management in terms of staffing and technology requirements, “strength in numbers” remains a catchphrase for physicians. Large groups are best positioned to meet the fiscal challenges of practicing medicine today, while providing the highest level of care to patients. Some of the newer multi-physician models cast the physician as an employee, such as the ever increasing number of hospital-owned practices or the numerous ACOs (Accountable Care Organizations), which hire physicians from many specialties who practice underneath one umbrella. Almost two years ago we featured a practice that offers an appealing alternative. Gastroenterology Associates of New Jersey, LLC or GANJ, as it is best known, incorporates a business model that provides an impressively-trained group of physicians with a way to retain ownership of their individual practices, by merging together to form an Integrated Group Practice (IGP). This month we are pleased to re-visit GANJ to measure its progress and also to introduce and describe this business model to perspective physicians. Steven J. Puchik, COO, shares how the IGP works. “What makes this model unique is that although there are many practices operating under one tax ID,

4 New Jersey Physician

Steven J. Puchik, COO of GANJ

Steven J. Puchik, COO of GANJ each practice retains total autonomy regarding how it’s run clinically,” Mr. Puchik states. “But we’ve taken the business part out of each practice and that’s run here in the administrative office,” he further explains. “The basic infrastructure of an IGP begins with one central business office that performs all of the administrative functions, that will no longer need to be performed by each individual practice,” relates Mr. Puchik. “So they keep their autonomy but lose some of the work and obviously, the expense,” he adds. Some of the responsibilities delegated to the central office include:

• Accounts payable • Accounts payable • Accounting Accounting • Medical Medical billing billing • Payroll Payroll resource management • Human Human resource management (including benefits management, (including benefits management, administration, employee pension administration, employee implementation and handbook implementation and employeetermination termination issues) employee issues) vendorsvendors who provide • Overseeing Overseeing who services such as EMR and provide services such asbilling EMR and billing Mr. Puchik also makes a point of mentioning the increased leverage that

Dr. Matthew Grossman views monitor during hospital based endoscopy the IGP has in terms of negotiating. For instance, reimbursement rates from third party payers can be negotiated higher for the IGP than for an individual, while medical malpractice insurance rates for each member of the group are less expensive. Going forward, Mr. Puchik foresees enough partners joining the IGP for it to self-insure against malpractice. “This leverage can also be used for bank financing deals, EMR purchase, medical supplies and equipment, etc. You get better rates when you have more people being supplied,” Mr. Puchik points out. “There’s enormous potential and unlimited possibilities of what everyone involved in an IGP can gain,” he continues. “Bigger is not always necessarily better but in the case of an

IGP, bigger is most definitely better,” Mr. Puchik asserts. In fact, he is so confident, that he would like GANJ to eventually include gastroenterologists from across the entire tri-state area. Besides the sharing of expenses of practice management amongst the large group of physicians that comprise GANJ and the substantially increased cost-efficiency, freeing physicians from the responsibility of dealing with the business end of practice management allows them to focus attention more completely on their patients. Just as important, having the resources that are generated from the efforts of the group, allows GANJ to recruit the brightest and the most expertly-trained physicians to join with them in practice.

When we last visited GANJ, Matthew Grossman, MD had just joined the practice after completing a four year fellowship where he specialized in advanced endoscopic procedures such as double balloon enteroscopy, endoscopic ultrasound, endoscopic mucosal resection and radiofrequency ablation for Barrett’s esophagus. At that time he was thrilled to be included in a group of impressively skilled physicians and was excited about the opportunity to contribute his own expertise. After two years with GANJ, Dr. Grossman’s enthusiasm has not diminished. In fact, he explains that working within the IGP model has allowed him to perform advanced endoscopic procedures exclusively. “A September 2014

lot of advanced endoscopists get hired into four or five-person groups with the best intention but unfortunately there is not enough volume in a small group to provide cases so that the physician can only practice advanced endo,” Dr. Grossman shares. “Because the IGP model works so well for any given physician, I can work with Steve Puchik as a central liaison or consult to this entire group,” he informs. Dr. Grossman specifies that for diseases of the liver, the pancreas, the biliary tree as well as for large polyps and double balloon enteroscopy - for all endoscopic purposes, he is called upon by his colleagues. He goes on to explain the advantages of having an in-house advanced endoscopist. “The AGA (American Gastroenterology Association) currently recommends that someone who is going to do ERCP, for example, should do at least one a week. I am now able to do as much as five a week with the size of this group,” he states. “My expertise is improved because of the volume and I think they’re getting a better consultant out of me as a result,” Dr. Grossman emphasizes. Besides the obvious benefit to patients, having a dedicated endoscopist allows GANJ to retain those patients by not having to refer them elsewhere. “We have retained a tremendous number of patients in the New Jersey area who would have otherwise been sent out to New York and we would have lost those patients,” says Dr. Grossman, reiterating the importance of providing patients with the same care as would be available in an academic facility. As one example, Dr. Grossman discusses endoscopic sub-mucosal dissection, which he performs to essentially carve out an early stage cancer from the wall of the GI tract. “If someone has an early gastric cancer and surrounding that a large field of intestinal metaplasia (precancerous tissue), we’re able to resect the entire area in one piece” (en bloc resection), he reports. Again, GANJ can offer its patients the highest level of care without having to refer elsewhere. Speaking of the time he has spent at GANJ and how he views the future, Dr. Grossman is as excited as he was when he first joined. “It’s a large organization with Steve (Puchik) at the helm and

6 New Jersey Physician

everyone has been really fair. It’s an honest agreement and I have my autonomy. I work hard but it’s been worth it every step of the way.” Michael M. Mainero, MD is one of the Founders of GANJ and his practice is the largest in the group. “I think the way we set things up really makes a lot of sense to people,” he states. “It enables the individual practitioner to do what it is that he or she wants to do without losing independence or stepping on anyone else’s toes and at the same time it gives you the security of being in a big group,” Dr. Mainero points out. “It really gives us some additional negotiating power as well as the ability to offer services and to cover areas that people pay attention to. Also, we are able to attract high-quality new physicians to join us.” Dr. Mainero mentions the positive recognition from large insurers that comes from GANJ’s ability to satisfy all of the quality guidelines imposed. “If you can provide high quality care in a cost-effective way, that’s what they’re looking for. And with a group this size we can meet all the quality indicators because we’ve got all of those mechanisms in place. Adenoma detection rate, colonoscopy timing – these are the types of things in GI that they’re watching for. It would be very difficult for someone in solo practice to comply with everything required,” he maintains. In terms of the administrative capacity at GANJ’s disposal, Dr. Mainero feels certain that the IGP has a tremendous advantage over smaller, more traditional practices. “From Steve Puchik on down we have extremely capable people who skillfully handle all of the administrative issues. The small practice simply cannot afford to hire people of this high caliber,” he asserts. After being a sole practitioner for fifteen years and then getting involved with the creation of GANJ, Dr. Mainero is certain that making the change was the absolutely right decision. “You have to adapt to the changing environment. If you cannot adapt or you refuse to adapt, then you can’t succeed,” he strongly believes. Further, Dr. Mainero is delighted with the collegiality that results from bringing a group of highly skilled

physicians together. “You can share ideas and that’s great because nobody has all of the answers. I’ve been able to learn from my partners because we all look at things differently, each having a different experience,” he remarks. “It’s all worked out really well,” Dr. Mainero is happy to report. As Dr. Mainero and the other partners all agree, one of the most important advantages of forming the IGP has been the ability to attract top-notch physicians who have exceptional training and skills. Rini Abraham, MD is the newest member of GANJ and a perfect example of the impressive caliber of the physicians who are eager to join. Receiving all of her specialty training in New York City – completing her residency at Cornell and her fellowship training at New York University, Dr. Abraham could not be happier with her choice. “When you come out of fellowship you get all of these offers,” Dr. Abraham shares. “There’s a nervous feeling you get thinking about going into private practice rather than staying in academic medicine but this has been the best decision I’ve ever made.” Since joining, Dr. Abraham has been able to put her extensive training to good use. One of the special skills she brings is her expertise in the evaluation of bowel function in patients with constipation that is refractory to medical treatment or those with fecal incontinence. Anorectal manometry is new to GANJ and not yet available in many parts of the state. “Basically, we’re looking at the strength of the anal sphincter muscles,” Dr. Abraham explains. She goes on to share that women who have had multiple childbirths are particularly affected. “I’ve seen patients who are in tears because of this problem and I’m so happy, especially as a woman, to be able to offer this service to them,” Dr. Abraham exclaims. Performed by Dr. Abraham as an outpatient procedure at St. Joseph’s Hospital, anorectal manometry involves passing a flexible catheter into the rectum. The catheter is connected to a computer and a recording device that graphs the pressure and strength of the anal and rectal muscles. Also, a small balloon attached to the catheter is inflated in the rectum to assess normal reflexes and how the patient perceives stool sensation inside the rectum.

Based on the findings of anorectal manometry, Dr. Abraham can recommend biofeedback therapy and refer the patient to a specialized physical therapist who works to re-condition the muscles used in passing stool. While this may not work for every patient, Dr. Abraham relates that for the many who are helped, this restores their quality of life. Speaking of GANJ and the IGP model, Dr. Abraham is delighted to have so many accomplished colleagues with whom she can share ideas. “The beauty of our group is there are a number of young doctors who have been trained in the latest technologies at the best institutions and then you have doctors that have been in practice for 25 years. We have lots of book knowledge and we’re gaining our experience but when there’s a case that doesn’t quite make sense, there’s that experienced doctor right beside you who you can talk with,” she informs. “It’s the best of both worlds.” Gary J. Kosc, MD is one of the Founders of GANJ and someone who is often called upon by the younger members of the group to share his considerable experience. Dr. Kosc emphasizes that since he and the others formed the IGP, GANJ has succeeded remarkably well, meeting and even exceeding their original expectations. “We are now able to attract and recruit people with wonderful expertise,” Dr. Kosc informs. He specifically mentions both Dr. Grossman and Dr. Abraham as examples of clinicians who are skillfully trained to perform diagnostic and therapeutic procedures that in the past had to be referred to academic medical centers, often in New York. “In my estimation this is the magic and the beauty of this IGP. We are able to recruit people who are very well trained that add something to what we already do,” he adds. “Through our expertise we are now developing a better healthcare delivery system for gastroenterology and pancreatic diseases.” Dr. Kosc also credits St. Joseph’s Hospital for continually updating its facility so that young physicians who have been trained at major medical centers will be eager to join GANJ and have an opportunity to work in an environment that equals what they have been

accustomed to. “So what we now hope to do with our group going forward, as developments within the field emerge, is to continue to be the latest and the best in all the new technology,” he shares. “As things change, obviously the rules change as well,” remarks Dr. Kosc. He refers to governmental restrictions in particular and reports that GANJ makes it a priority to assimilate all of the governmental directives and to treat the patient, not only via the directives but in the best clinical way possible. “We’re able to tailor their treatment and followup based on their specific disease,” he states. This is possible, in part, because of the IGP’s ability to hire expert staff members, such as coders and others, who understand what is necessary in order to be compliant. Also, as Dr. Kosc points out, GANJ, with its many available resources, is capable of providing the education needed to re-train their physicians in order to help them to continuously adapt. “We push ourselves constantly with conferences and with meetings. And at those meetings we closely monitor what is new and we try to incorporate all of the new trendings as best we can. Of course this is done to make sure we provide care at the highest level,” he notes. It is extremely gratifying for us, the Founders, to know that the practice is growing and developing as we had hoped,” relates Dr. Kosc. Exemplifying the priority at GANJ for physicians to keep abreast of current technology, Joseph G. Shami, MD offers cutting edge procedures to diagnose conditions affecting the esophagus. Esophageal manometry, like anorectal manometry involves the insertion of a catheter and is an outpatient procedure. Although esophageal manometry has been used for years, Dr. Shami has been re- trained to expertly utilize newer high-resolution technology in order to identify swallowing disorders for his own patients and gets many referrals from his colleagues in GANJ, as well as from gastroenterologists in surrounding counties. Dr. Shami explains that often, problems with swallowing can be caused when the muscles in the esophagus are not functioning properly. The test is somewhat complex and requires Dr. Shami to carefully examine a distance of

15 inches. One condition which he has been finding with some more frequency of late is achalasia. “In achalasia the neurons which tell the sphincter muscle to relax are somehow missing,” Dr. Shami informs. “When you look with endoscopy you often can’t tell what the problem is but with manometry it is clearly shown,” he adds. Once achalasia is diagnosed it can be treated with minimally invasive surgery or for those over the age of 70, BOTOX® injections can help the muscle to relax. Transnasal esophagoscopy (TNE) during which a camera is passed down to examine the esophagus through the patient’s nostril is performed by Dr. Shami in his office. The advantages of this innovative procedure are that no anesthesia is required and patients can get a diagnosis and treatment plan immediately as part of a regular office visit. Like esophageal manometry, TNE is not done by many gastroenterologists and Dr. Shami receives many referrals from colleagues. As one of the Founders of GANJ, Dr. Shami is also quite pleased with the way things have worked out. “You get to stay in your own practice and do your own work but yet there are so many ancillary benefits of having the backing of a large group,” Dr. Shami offers. “The bigger you get the more of an impact you can make both in the community and hopefully, with the insurance companies,” he continues. Like the other Founders, Dr. Shami credits the IGP with enabling GANJ to attract the best and brightest young physicians. He makes a point of mentioning that in addition to enhancing the practice, new recruits benefit substantially as well. “These days when the young people come out of school, they’re so overridden with debt already that it’s really tough to get into their own practice. So here, they are bringing their talent but at the same time they are protected,” he notes. Anna Korkis, MD is a recent addition to GANJ and yet she had been a solo practitioner for many years. It is most interesting to learn, from her perspective, why the IGP is an attractive business model. “Truthfully, I want to be able to continue the kind of practice that I have in the September 2014

sense that I spend my time as aa solo solo practitioner. I I want want my my patients patients to to get get the same level of care care and and not not have have numerous doctors in in one one office,” office,” Dr. Dr. Korkis firmly firmly states. states. “This This model allows allows us to avoid aa situation situation that that would would take take away from the format of of the the office office but at the same time allows us, in in the the present healthcare environment, environment, to to contain our costs, associate associate with with other other gastroenterologists and have these these colleagues to work closely with with while while maintaining our independence independence with with patients,” she continues. “That’s really patients,” she continues. “That’s really the ticket – controlling controlling your your costs costs and and having the patients retain the the solo solo practitioner experience.” experience.” call on on Dr. Korkis values the ability to call GANJ when when aa the other members of GANJ

patient needs care.care. “So needssub-specialized sub-specialized to have someone as wonderful as Matt “So to have someone as wonderful as Grossman be so readily available is really Matt Grossman be so readily available great,” she shares. is really great,” she shares. From a fiscal standpoint Dr. Korkis agrees with her colleagues about the negotiating negotiating power that comes with the large group and finds that particularly particularly important in cuts in inpresent presenttimes timeswhen when cuts reimbursements are aare constant worry. in reimbursements a constant “If you don’t want to bewant an employee of worry. “If you don’t to be an aemployee hospital and want to maintain your of ado hospital and do want to independence, then this is the waythis to maintain your independence, then go,” she says. is the way to go,” she says. Primarily, she she worries worriesabout aboutbeing beinginina situation where those in authority could a situation where those in authority require a physician to maintain a certain couldrequire a physician to maintain volume of volume patients. of“Here, I determine a certain patients. “Here, what my income That’s will not I determine whatwillmybe.income

GANJ

decided by not the group. knows be. That’s decidedDr.byKorkis the group. the importance of spending time with Dr. Korkis knows the importance of her patients. I like the way I practice,” spending time with her patients. “I she know like remarks. the way I“Patients practice,”want she to remarks. that you care.” “Patients want to know that you care.” In In these these challenging challenging times, physicians who who are are just just starting starting out and those who who have have been been in in practice practice for years, must must choose choose aa path path that that will ensure the the ability ability for for them them to to succeed. succeed. The IGP IGP has has shown shown to to be be a haven for those who who wish wish to remain autonomous autonomous while enjoying enjoying fiscal fiscal security. security. The physicians of of GANJ GANJ provide provide a stunning example of of clinicians clinicians who who are are thriving thriving and most importantly importantlydelivering delivering the the highest highest level of of healthcare healthcareto totheir theirpatients. patients. For For more more information information please contact Steven StevenPuchik, Puchik,COO COOat at(973) (973)812-1400 812-1400

Directory of Doctors and Locations

Rini Abraham, M.D., PharmD

John J. Farkas, M.D.

Natan Krohn, M.D.

Michael J. Martino, M.D.

246 Hamburg Turnpike, Suite 203

716 Broad Street, 1st Floor

1011 Clifton Avenue

205 Browertown Road, Suite 206

Wayne, NJ 07470

Clifton, NJ 07013

Woodland Park, NJ 07424

Tel: 862-336-9988

Tel: 973-777-5717

Tel: 973-471-8200

Tel: 973-837-0230

Fax: 862-336-9987

Fax: 973-777-0669

Fax: 973-471-3032

Fax: 973-837-0234

171 Union Avenue Andrew Boxer, M.D.

Rutherford, NJ 07070

Subodh H. Patel M.D.

1011 Clifton Avenue

Steven D. Gronowitz, M.D.

Tel: 201-896-0400

1031 McBride Avenue, Suite D212

Clifton, NJ 07013

1011 Clifton Avenue

Fax: 201-896-0863

Tel: 973-471-8200

Clifton, NJ 07013

Fax: 973-471-3032

Tel: 973-471-8200

Anna M. Korkis, M.D.

Fax: 973-471-3032

200 South Broad Street – Back Office

171 Union Avenue Rutherford, NJ 07070

Ridgewood, NJ 08450-5003

Tel: 201-896-0400

Tel: 201-444-0009

Fax: 201-896-0863

Fax: 201-444-2181

Oren E Bernheim, M.D. 246 Hamburg Turnpike, Suite 203 Wayne, NJ 07470 Tel: 862-336-9988

Matthew Grossman, M.D. 205 Browertown Road, Suite 204 Woodland Park, NJ, 07424 Phone: 973-283-5005 Fax: 973-812-5235

Fax: 862-336-9987

Woodland Park, NJ 07424 Tel: 973-890-1303 Fax: 973-890-5609 George N. Pavlou, M.D. 205 Browertown Road, Suite 201 Woodland Park, NJ 07424 Tel: 973-812-8120

Gary J. Kosc, M.D.

Fax: 973-812-8144

205 Browertown Road, Suite 201

Joseph G. Shami, M.D.

Woodland Park, NJ 07424

205 Browertown Road, Suite 204

Tel: 973-812-8120

Woodland Park, NJ 07424

Fax: 973-785-0335

Tel: 973-812-5230 Fax: 973-812 5235

Ralph A.DeMaio, M.D.

Ashok Gupta, M.D.

Michael M. Mainero, M.D.

Ary Volfson, MD

205 Browertown Road, Suite 206

842 Clifton Avenue

205 Browertown Road, Suite 202

205 Browertown Road, Suite 206

Woodland Park, NJ 07424

Clifton, NJ 07013

Woodland Park, NJ 07424

Tel: 973-837-0230

Tel: 973-470-0101

Tel: 973-785-0102

Tel: 973-837-0230

Fax: 973-837-0234

Fax: 973-777-3024

Fax: 973-785-2205

Fax: 973-837-0234

8 New Jersey Physician

To NJ Hospitals, Healthcare Systems, ACOs and All Other Practice Models

Your Ad Here Will Receive Statewide Exposure to:

• • • • • • •

Promote Advanced Technology Share Innovative Procedures Receive Physician Referrals Create a Prominent Awareness Recruit Physicians Acquire Practices Sell Your Practice

Call (973) 994-0068 for details about placing your ad in upcoming issues of New Jersey Physician

Cyber Liability, the Looming Threat for Doctors and the Health Care Industry Almost daily, the news reports of the latest hacking incident to many big corporations and the federal government from a myriad of unknown sources. In some cases it’s the simple infecting of a system by a malicious virus or Trojans implanted by others of unknown origins, but in many cases it’s the hacking of individuals and patient’s records maintained by organizations and third party operators of individuals record used by organizations. Doctors and health care facilities will become particularly vulnerable as new rules require patient’s records and be maintained electronically in their data bases, and their relation to strict HIPPA laws when it comes to securing patient records. Healthcare facilities and doctor’s offices are increasingly becoming targets of hackers for the theft of patient records for various purposes. These records can be hacked directly from facilities and doctor’s systems, or through lost or stolen laptop and other computer devices. The hacking of records requires strict HIPPA law reporting to the state attorney general, hard letters sent to all the patients informing them of the breach, a call center be set up, forensic work to reveal why the breach occurred and the mandatory offering of 1 year free credit reporting to each record involved in the breach. The average cost estimated from industry experts is between $100-$200 per record, a cost born by the facility or doctor, even when a third party operator maintains the records. When one tallies the number of records any one facility or doctor can have on file, the potential cost can be astronomical. So what can be done? Careful examination of security for the systems in place is step one, including firewalls, anti virus, proper passwording, and limited user access is paramount. Health care related entities should be careful to fully examine their exposures by security professionals and follow all protocol. Even with the best security, systems are still breached every day and records hacked in almost every business, as evidenced by the virtual constant reports in the media. It’s important to note, most don’t even get reported, so the threat is large and growing. From a secondary protection standpoint, the insurance industry has also stepped up and is now offering “cyber” insurance coverage for this exposure from a number of insurance carriers. The coverage covers both third party exposures, (damage to other’s systems and suits brought by others) and first party coverage (damage to the insured’s systems and reimbursement due to expenses incurred if a breach occurs). Coverage is generally subject to deductibles and sublimits with respect to the reimbursement coverage for record breaches. Policies can range from a few thousand dollars to much higher premiums, depending on exposures. Many medical mal practice policies now build in some cyber coverage with basic limits of $50,000. However it is important to note, this would be considered inadequate when considering the potential costs, so a separate cyber policy should be purchased if the medical mal practice policy cannot raise limits to more adequate levels. Typical limits would be $1,000,000 for third party exposures and sublimits of $100,000 to $1,000,000 for privacy breaches and stolen patient record requirements. Deductibles can range from $1,000 to $25,000 in most cases. The coverage is typically written as follows: Network security and privacy insurance — coverage for both electronic and physical information, virus attacks, hackers, identity theft, and defense costs for regulatory proceedings. Regulatory fines and penalties insurance — coverage for administrative fines and penalties a policyholder is required to pay as the result of an investigation conducted by a federal, state, or local government agency resulting from a privacy breach (such as HIPAA, HITECH, and state or federal notification requirements).

10 New Jersey Physician

Patient notification and credit monitoring costs insurance — includes all necessary legal, IT forensic, public relations, advertising, call center, and postage expenses incurred by the policyholder to notify third parties about the breach of information. This coverage will also pay for credit monitoring for all affected parties. Data recovery costs insurance — includes all reasonable and necessary costs to recover and/or replace data that is compromised, damaged, lost, erased, or corrupted. Multimedia insurance — coverage for both online and off-line media including claims alleging copyright/trademark infringement, libel/slander, advertising injuries, and plagiarism. Cyber extortion — coverage for a threat involving a party demanding cyber extortion funds or they will: •

release confidential information of a third party;

•

introduce malicious code;

•

corrupt, damage, or destroy the policyholder’s system;

•

restrict or hinder access to system including denial of service attack; or

• electronically communicate with policyholder’s patients or customers claiming to be the policyholder in order to obtain personal confidential information. This coverage pays cyber extortion expenses, but such expenses can only be incurred with TMLT’s consent. The coverage would also reimburse cyber extortion funds paid (with TMLT’s consent) to terminate the threat. Cyber terrorism — coverage that pays for acts of terrorism, meaning a use of force or violence for political, religious, ideological, or similar purposes, including the intent to influence a government or put the public in fear. John Forrester is a Vice President at Boynton & Boynton, one of the tri state’s leading medical malpractice insurance firms, insuring over 4,000 doctors with offices located in New Jersey and Pennsylvania. jforrester@boyntonandboynton.com 1-800-822-0262 x 1185.

Visit us now online at www.NJPhysician.org

September 2014

Electronic Protected Health Information and Patient Communications By Beth Christian and Kurt Anderson Giordano, Halleran & Ciesla, Attorneys at Law Electronic recordkeeping and communication tools are a fact of life for every modern medical practice. You may be considering, or may already have implemented, electronic communications with your patients. This article will set forth some of the things that you should consider in implementing an electronic communication process for your practice that is compliant with HIPAA as well as some of the requirements for other electronic protected health information (‘EPHI’). Question #1:

Does HIPAA allow health care providers to use email with their patients?

Health care providers are permitted to communicate electronically (such as through email) with their patients, as long as they apply reasonable safeguards when doing so. If your practice will use email to transmit EPHI, it must ensure that the transmission is compliant with HIPAA technical safeguards, discussed below. Alternatively, you may limit email communications to out-bound communications only, such as practice announcements, general health education information, or appointment reminders. Even if no EPHI is communicated by email, you should take measures to avoid unintended disclosures. You may want to send a test email to the patient for address confirmation. While HIPAA doesnít prohibit the use of unencrypted email with patients, safeguards should be applied to protect patient privacy, such as limiting the amount or type of information disclosed in the unencrypted email.

Patient preferences should also be respected. An individual has the right under HIPAA to request that you communicate by email if it would be reasonable for the health care provider to do so. Conversely, if a patient does not want information sent via unencrypted email, other means of communication must be used (e.g., phone, mail or encrypted email). If you do not want patients to send e-mail messages to you, you should include a disclaimer at the bottom of each e-mail which states that the sending e-mail address is only used to send messages, that incoming e-mail is not regularly monitored at that e-mail address, and that patients should call your office if they have any questions or health concerns. Consider also whether you will use text messaging with patients or communicate with them via Facebook or Twitter. While, publicly posting EPHI to a social media platform is clearly problematic, as platforms like Facebook and Twitter add private messaging capability, they begin to function more like traditional email platforms (e.g., Gmail, Yahoo, AOL). Question #2:

What types of administrative safeguards should my practice implement in order to protect EPHI?

HIPAA requires that health care providers implement administrative safeguards in order to secure EPHI. Administrative safeguards are ‘administrative actions, policies, and procedures to manage the selection, development, implementation and maintenance of security measures to protect EPHI and to manage the conduct of the covered entity’s workforce in relation to the protection of that information.’ A practice must conduct an accurate and thorough assessment of potential risks and vulnerabilities to

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the confidentiality, integrity and availability of EPHI. The practice must identify what EPHI it creates, receives, maintains and transmits. In addition to computer workstations, EPHI may also reside on servers, or on portable devices such as laptops and cell phones. You should have security measures in place to reduce risks and vulnerabilities to a reasonable and appropriate level. E-mail access should only be granted to persons who have received HIPAA training, and electronic devices used to communicate via email should be password protected. Your employees shouldnít share passwords or leave them in open areas. Appropriate sanctions must be imposed against employees who failed to comply with security policies and procedures. You should implement a written sanction policy that covers both email and other forms of EPHI storage, security and communication, and should train your employees regarding the policy. You should also implement procedures for the authorization and/or supervision of employees who work with EPHI. You should maintain a record of every electronic device used by your workforce and implement a sign out procedure for electronic devices used to communicate with patients. Many well publicized HIPAA breach settlements have involved the assessment of fines and penalties against providers whose employees have lost laptops or cell phones containing EPHI. A practice must also have a data backup plan to create and maintain retrievable copies of EPHI. A number of physician offices had devices used to send and receive email damaged by flooding during Hurricane Sandy. You should ensure that your practice is able to regularly backup all sources of EPHI (including email) on a regular basis. The use of business associate agreements is an important component of the administrative safeguards required by HIPAA. You should have written contracts in place with all outside entities entrusted with EPHI. Question #3:

What types of physical safeguards should my practice implement in order to protect EPHI?

HIPAA also requires practices to comply with various physical safeguards. Physical safeguards relate to protecting the buildings where and equipment on which EPHI is kept from not only unauthorized intrusion, but also natural hazards. Practices must implement policies and procedures which limit physical access to buildings and equipment, specify proper use of equipment containing EPHI, and address the proper receipt, movement and removal of such equipment. You probably already limit access to buildings and equipment by having physical locks on the doors to your building, requiring user IDs and passwords and requiring users to log off computer systems when not being used. You should also consider using video surveillance cameras and posting signs identifying restricted areas. There are also many ways to reduce unwanted exposure to EPHI on individual workstations. Monitors should be positioned so unauthorized users cannot view the screens. Privacy screens (which reduce the ability of persons not directly in front of the monitor to view the screen) are available at very low cost. Most operating systems come with screen saver functionality that, after a period of inactivity, displays a selected image on monitors thereby reducing unintended exposure of EPHI to unauthorized persons. HIPAA also requires practices to implement safeguards with respect to the handling of storage media (e.g. internal and external hard drives, flash/thumb drives, discs). Practices must implement policies and procedures for the receipt, movement and removal of such devices, including having back-up retrievable exact copies of EPHI. One frequently misunderstood issue is erasure of data. HIPAA requires that you erase any media that contained EPHI before you discard it. However, erasure is not the same as deletion. In a Windows environment, when you delete a file, it is simply moved into your recycle bin, not erased. Even when you empty your recycle bin, the data is not erased. Rather, the data remains on your hard drive and the computer merely marks that space as free space that can be written over. In order to truly erase such data, this free space must be overwritten. When data is overwritten, it is replaced with random data. Software that performs this function is readily available at low cost and many operating systems come equipped with this functionality. Windows XP Pro, Vista, 7 and 8 all include functionality that will overwrite free space. Question #4:

What types of technical safeguards should my practice implement in order to protect EPHI?

Many of the HIPAA technical safeguards are common place in even small practices (e.g., use of unique user names and passwords). HIPAA, however, also requires practices to be able to ìtrackî user identity. Guidance from the Centers for Medicare & Medicaid Services suggests that you may have a duty not only to track user ‘identity,’ but also to track user ‘activity.’ Practices should configure their systems to automatically terminate an electronic session after a predetermined time of inactivity. While this is not mandated by HIPAA, practices are required to implement it where it is reasonable and appropriate. There are likely few circumstances where the implementation of this specification would not be reasonable and appropriate, even for small practices. Encryption has garnered much attention in this area. HIPAA does not require the encryption of EPHI, unless it is ‘reasonable and appropriate.’ Unfortunately, this does not provide bright line guidance. The US Department of Health and Human Services (HHS) has published unofficial guidance (in the form of FAQs) on the use of encryption in email transmissions via the Internet. According to the HHS, if a patient emails unencrypted EPHI to a provider, the provider may assume that the patient has consented to the use of unencrypted email, unless (a) the patient has explicitly stated otherwise, or (b) the provider feels that the patient may be unaware of the risks of using unencrypted email. Even with this guidance, however, practices should be very cautious about the unencrypted transmission of EPHI over public computer networks (e.g., the Internet) and should obtain express written and informed consent from the patient. September 2014

Three N.J. health care organizations earn millions of dollars in bonuses for saving Medicare money By Beth Fitzgerald

Three New Jersey health care consortiums are among 64 nationwide that have generated savings for Medicare, and they will receive millions of dollars in shared savings from the program. The three New Jersey accountable care organizations, or ACOs, are part of a nationwide program launched by Medicare in 2012 with the goal of transforming the huge federal health care system for the elderly into one that rewards health care providers for improving quality and avoiding wasteful spending. There are 11 Medicare ACOs in New Jersey, and the federal Department of Health and Human Services announced that three were among the 64 that so far have generated savings of $372 million for Medicare. Those 64 are out of a total of 242 Medicare ACOs throughout the country, so just one-quarter of the ACOs in the U.S. were able to generate savings and earn a bonus from Medicare. The three New Jersey ACOs are: •

Optimus Healthcare Partners, which saved Medicare $17.03 million and will receive a shared savings payment from the government of $8.34 million;

•

Meridian ACO, which saved Medicare $14.89 million and will receive $7.30 million; and

•

Hackensack Physician-Hospital Alliance ACO, which saved Medicare $10.75 million and will receive $5.27 million.

“That is actually an extraordinary amount if you look across the country,” Dr. John F. Vigorita, chief executive of Summit-based Optimus, said. “The fact that we got three ACOs that could achieve some shared savings — that’s remarkable. Throughout the country, the majority were not able to achieve any shared savings.” Vigorita said his ACO began operating on April 1, 2012, and now includes 500 doctors and 34,000 Medicare patients; the Atlantic Health System is the hospital partner of the ACO. He said the ACO was able to improve access to health care for the Medicare patients. He said the ACO succeeded in reducing inappropriate emergency room visits as well as unnecessary hospital readmissions, and improved the coordination of the medical care that the patients receive. “Our success was probably our dedication to the triple aim of improved patient experience and quality, improved health outcomes for our patient population and reduction in the burden of high cost,” Vigorita said. “It was through the efforts of our participating physicians and our hospital partner, Atlantic Health System.” In addition to partnering with Optimus, the Atlantic Health System also operates its own ACO, which did not make the list of ACOs that generated savings for Medicare in this initial status report on the program. But Vigorita said Atlantic “most definitely played a role in the success” of the Optimus ACO. The physicians who participate in ACOs also will share a portion of the bonus payments the ACOs receive from HHS. Dr. Morey Menacker, chief executive of the Hackensack ACO, said the bonuses will help compensate the 100 doctors in the ACOs for their work to transform their medical practices in ways that ultimately saved Medicare money. Menacker said when the doctors signed up with the ACO two years ago, “There was no guarantee that there were going to be savings. So the doctors were willing to make changes in their practice philosophy and practice patterns — which was the purpose, from my perspective, for joining the program — in order to create this new environment of the way medicine is being practiced.” He said that it’s important to reward the doctors, since “The only way that you can truly initiate change is to show the benefit of the change, so the physicians should be bonused for their effectiveness.” And he said the bonuses are likely to “encourage other physicians who previously said ‘I’m not going to change the way that I do things’ to say, ‘Wait a minute, maybe it is in my best interests to do things differently and do things according to best practices, and not just the way that I feel like practicing.’ ” Menacker said there are a number of ways that the ACOs changed how Medicare patients were cared for. “We made it clear that the physician’s responsibility is not solely for when he or she sees the patients in the office, but as a comprehensive caregiver.”

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The physicians extended their office hours and they closely monitored patients moving in and out of the hospital and nursing homes. Experts have identified managing transitions from one health care setting to another as critical to avoiding hospital readmissions. During off hours, the doctors are accessible to patients to help determine whether the patient needs to visit the ER, or could instead receive medical guidance by phone and come to the doctor’s office the next day, Menacker said. And the doctors followed best practice clinical guidelines, including making sure the patients got preventive care and screenings. Menacker said he congratulates the three New Jersey ACOs: “I think by showing this kind of success, we showed that we can manage patients in a more efficient and cost-saving manner, which will allow us to continue to move forward and look at other payment options, other reimbursement options, to improve the general care of patients.” Joel Cantor, director of the Rutgers Center for State Health Policy, said: “This is encouraging; it suggests that the ACO model can be effective. The hospitals must meet quality targets as well as achieve savings in order to be eligible for bonuses.” Although the Atlantic Health System ACO has not yet qualified for a shared savings bonus from Medicare, it has succeeded at bringing down spending and raising quality, according to Dr. David Shulkin, president of the Atlantic ACO. He pointed out that, with 73,000 patients and 2,100 doctors, the Atlantic ACO is one of the largest in the country. The Valley Hospital in Ridgewood is a member, along with the five hospitals in the Atlantic system, which include Morristown and Overlook Medical centers. Shulkin said that, to qualify for shared savings, the ACOs had to achieve savings of 2 percent below what Medicare would have expected to spend, and he said the Atlantic ACO is approaching that benchmark. “We’re exactly where we thought we would be,” at this point, Shulkin said. The Medicare program extends for a total of 36 months, and the second reporting period began in January; Shulkin said he is optimistic the ACO will quality for a bonus in this new reporting period. But he said short-term gains are not the goal. “We always saw this as being like an ocean liner that takes a little longer to steer and change direction,” Shulkin said. “We did not expect this would be a quick and easy, short win.” He said the Atlantic ACO decided it needed to be very large “to actually change the health care in our community, and we knew it was a long-term commitment.” He said Atlantic has tracked its trends in spending and quality measures since launching the ACO in April 2012, and “We are absolutely headed in the right direction. The trends show that we are making great progress, probably ahead of schedule of where we thought we would be. And most important, we have been able to demonstrate significant improvement in quality measures.” He noted that Atlantic is also the hospital partner of the Opimus ACO, which did achieve Medicare shared savings in this first go-round. “Optimus is a smaller, primary care-led ACO, which did well in terms of shared savings,” while the Atlantic ACO, “is much, much larger.” Shulkin said: “Twenty-one months into our larger experiment, the Atlantic ACO is right on track with our hopes about the direction that we’re heading — that we’ll be able to essentially change the way health care is delivered in this part of New Jersey.” He said the Atlantic ACO has learned that, “When patients establish relationships with the primary care doctor, schedule regular preventive care visits and follow on the testing that they need, that’s part of the formula for improving the health status of the community.” He said the Atlantic ACO has “taken the historically high (Medicare) spend rates in New Jersey down over these past 21 months. We’ve seen a very nice, slow, steady downward trend on the cost side, and a slow trend upward on the quality side.” He said the Atlantic ACO was opened up to “any and all physicians that were part of our community, because that is the way you have a long lasting impact on health care.” And he said he is optimistic that Atlantic will see a shared savings bonus in the future. “I think the trend looks good enough, and we’re seeing such a strong level of participation of our doctors and our post-acute providers that I don’t see any reason we won’t achieve shared savings. But that is not the primary objective of Atlantic.” He said: “We are in this for the long haul, and health care is not going to change in 36 months, particularly in New Jersey. This is a good 10- to 15-year commitment.” In addition to the six acute care hospitals, the Atlantic ACO members include rehabilitation hospitals, sub-acute care facilities and home health care agencies. “This was not a pilot test effort,” Shulkin said. “This was ‘We have a chance to change health care, so let’s do it big.’ ” September 2014

ASC Pays $5M to Settle Kick-Back Case Based on Cheap Buy-in Claim There was a development in the ASC industry that I suspect this case will send chills down the spine of some ASC owners and operators. The good news, however, is that with a little careful planning the risk can be tightly managed. Meridian Surgical Partners, LLC (“Meridian”), an ASC development and management company, is paying $5M to settle a whistleblower claim filed by the administrator of an ASC it acquired. Meridian purchased a 60% interest in the ASC for $96K a share and then shortly after syndicated to physician utilizers for $25K per share. The whistleblower claimed that transaction violated the Federal Anti-Kickback Statute because the purchase price was less than fair market value (“FMV”) and as was a disguised kick-back to the physicians in exchange for anticipated referrals to the ASC. The whistleblower noted that the physicians immediately enjoyed a 50% return on their investment. The government did not intervene in the case. We have an old saying in law that “bad facts make bad law.” The position taken by the Meridian was aggressive and while they denied any wrongdoing, and while the government had not intervened, Meridian paid handsomely to make this matter disappear. A few observations, comments and tips: •

The most likely whistleblower is a current or former employee (be careful who you hire).

• While the government did not intervene in this case, the next plaintiffs’ bar cottage industry may have been born. I suspect some of the folks affiliated with the 5000+ ASCs we have in the U.S. will be solicited by enterprising plaintiff lawyers. • Undertake physician utilizer buy-ins without FMV support at your own peril. Our standard advice on physician utilizer buy-ins is that these transactions be sold at FMV with supportive market guidance in the file from a reputable valuation company, particularly if the price is much lower than recent market indicators (as in the Meridian case). There are solid valuation principals that have been relied upon to justify different purchase price for the same product. For example, a controlling interest is worth more than a minority interest that can be terminated without cause. As always, it is a matter of degree and reasonableness. An ounce of prevention… Please let me know if we can be of any assistance to you. Mark Manigan Brach Eichler L.L.C. 101 Eisenhower Parkway | Roseland, New Jersey 07068 Direct: 973.403.3132 | Firm: 973.228.5700 | Fax: 973.618.5532

ACOs, other delivery reforms shift job roles at hospitals By Melanie Evans

Phoenix obstetrician Megan Cheney no longer makes hours of telephone calls on Thursday nights to report routine results of laboratory tests to waiting patients. The calls, however, still get made every week. A medical assistant with experience in obstetrics and gynecology now handles calls involving routine findings. That has freed time for Cheney to draft the lectures she delivers twice a week to her medical resident trainees. The shift in responsibilities may be minor, a matter of hours in a lengthy work week. But it is one of many underway at Banner Health, where the drive to cut costs has triggered an extensive overhaul of employees' roles and patient care. Labor is the largest expense for health systems, and Banner officials see potential savings in freeing up their highest-paid professionals—doctors, pharmacists, advanced practice nurses, physician assistants—for work only they are qualified to do. “We certainly don't need physicians calling back on routine results,” said Mindy Smith, chief operating officer of the Banner Medical Group. To do that, Banner is delegating new responsibilities across a team of clinical and clerical workers. Not only has that shifted work from doctors to medical assistants, but also from medical assistants to clerical staff, whose numbers will soon grow in Cheney's clinic to accommodate the domino-like transfer of duties. New financial incentives The same strategy is playing out at health systems across the country as new financial incentives to cut costs proliferate under Medicare and private insurance. The focus on more tightly defined roles has grown. Some have done so strictly to cut costs. Others have sought to maximize the efficiency of teams used to manage patients' care. The result has been an ongoing, sometimes uncertain evolution in the daily tasks of healthcare's front-line workforce. As a result, roles for medical assistants, pharmacy technicians and other workers, including clerical staff, have expanded. Those

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without extensive medical credentials or a high salary are being asked to work more closely with patients. Advanced practice nurses see primary-care patients. Medical assistants meet with clinic patients to collect basic information once gathered by nurses. These practices have increased demand for such workers, including occupations with more advanced clinical training such as advanced practice nurses and physician assistants, whose median salaries are nearing $100,000 less than those of physicians. Advance practice nursing hires represent the fastest-growing segment for recruiter Merritt Hawkins, said Travis Singleton, a senior vice president for the firm. Jobs for medical assistants are projected to grow 29% by 2022. Physician assistants and advanced practice nurses will see demand increase 38% and 31%, respectively. The pressure to squeeze labor expenses has been amplified as health systems invest in workers to more heavily promote prevention and manage medical care, regardless of its location, from hospitals to clinics to homes, and to provide support as patients move between them. Hospitals' need to cut costs and coordinate care is driving healthcare systems to give greater responsibility for direct patient services to less-credentialed workers such as medical assistants, pharmacy technicians and even clerical staff. The upfront employee investment, industry executives say, is expected to yield a return by preventing disease complications and costly hospital visits and producing the quality of care required to earn incentives under new payment contracts, such as accountable care. But managing labor costs is a top priority.

Accountable care organizations have hired scores of care coordinators as they launch their efforts. Advocate Health Care in Illinois initially hired 60 coordinators. Partners HealthCare, Boston, doubled its care coordination staff to 50 as it ramped up its early ACO efforts. But that investment can drag down margins. Universal American, a publicly traded insurer that owns the most Medicare accountable care organizations, said its $63 million investment in care coordination and information technology last year eroded its earnings. Greater investment in care coordination has also intensified efforts to reorganize roles and shift responsibilities, not solely to increase efficiency but to better coordinate medical care among multiple professionals who jointly care for those patients at the highest risk for costly complications. Care coordination strategies increasingly rely on teams of social workers, health coaches, doctors, nurses, physician assistants and medical assistants who collaborate to provide patient care. A team model seeks to leverage each individual's expertise to increase efficiency, said Dr. Dave Krueger, executive director and medical director for the Bellin-ThedaCare Healthcare Partners. “We shouldn't be asking the nurse to become an expert on the social work side and vice versa,” he said. “A group of us is going to be taking care of a group of patients. Instead of a doctor with a patient panel, it will be more of a clinic with a clinic panel.” 'Big economic lift' That care team is expanding to include pharmacists, pharmacy technicians and psychiatrists to tackle medication errors and prevalent but untreated mental illness that can undermine patients' ability to care for themselves. Advocate Health Care soon will add psychiatrists and psychologists to teams that meet with hospitalized patients. Dr. Lee Sacks, chief medical officer for Advocate and chief executive of its physician group, said a 2011 study of its hospitalized patients found one-third had mental health conditions, and those patients spent more time in the hospital and were more likely to return. Advocate also will add mental-health professionals to emergency-department teams and primary-care clinics, with the hope of improving care and lowering costs. “If we did a better job, there would be a big economic lift,” he said. But the switch to teams and newly defined roles isn't straightforward or without risk, experts say. Communication breakdowns among team members can compromise care. Tensions may arise as roles are reassigned. Health systems do not yet know what configurations work best for various patients or settings, and efforts vary as organizations test and tweak different models. “We're experimenting,” Banner Health's Smith said. September 2014

Banner has shifted numerous responsibilities to medical assistants, reducing its reliance on registered nurses. Banner now sees an expanded role for registered nurses to work with more complex patients. And Advocate patients who call to speak with a nurse now are triaged to clerical staff unless the request is medical in nature. New roles, new relationships Some doctors and other professionals are struggling to adapt to the new roles and new relationships required to make care coordination successful. Older physicians who have long been in the workforce typically struggle more to work within a team after years of independence and more entrepreneurial practice, recruiters say. Conversely, younger doctors are often more eager to make the switch to teams, despite limited training. Medical groups are looking for cost-effective alternatives to replace retiring physicians as Medicare and private insurers squeeze reimbursement and new financing models grow more common, said David Cornett, a senior executive vice president at Cejka Search, a healthcare recruiting firm. “The initial waves of bundled payments are telegraphing that doctors will be paid less and not more,” he said. Employers increasingly hire doctors, young or old, who can embrace the common goal of team-based care, Singleton said. They can be difficult to find when training does little to prepare doctors to work collectively. “A team of experts does not equal an expert team,” he said. “We've trained them to work alone, and we're asking them to practice completely differently.” Banner's Cheney, who joined the same practice where she was a resident until last summer, said she feels more comfortable delegating now that she has built a relationship with a medical assistant. Assigning tasks to the medical assistant clearly can improve her efficiency, but she says she must resist the urge to do more, as was the case when she was a resident. “You're used to doing everything,” Cheney said. “I know the ins and outs of the office. It's been an adjustment.” Alleviate frustrations Patients, too, must adjust. Diane Ekstrand, vice president of human resources for Banner, said it was a medical assistant who called to remind her of an upcoming annual physical and who initially discussed her medications, weight and family life during the appointment. Too little time with a doctor, however, may frustrate many patients. Teams should not be a barrier to appropriate physician visits, said Dr. Bob Williams, a director with consulting firm Deloitte who helps oversee the company's accountable care consulting. But teams with clearly defined responsibilities can help alleviate workers' frustration and boost job satisfaction, executives and consultants say. Jobs with more responsibility can be more fulfilling and show an employer values workers' expertise and talents. That can be an asset for employers in a competitive labor market, said Jennifer Radin, a principal with Deloitte who specializes in workforce and operations. “Those who are more satisfied are more likely to stay with the organization.”

Hospital Rounds

Atlantic Health System CEO Trunfio Retires By Beth Fitzgerald

Joseph A. Trunfio, 67, is retiring as president and chief executive of Atlantic Health System, the Morristown-based, five-hospital health care organization announced Monday. Trunfio, who has led Atlantic for the past 15 years, will remain at the helm while the board of trustees conducts a national search for his successor, Atlantic said. During his tenure, Trunfio led the strategic expansion of the system with the additions of Newton Medical Center and Chilton Medical Center. Atlantic’s hospitals include Morristown, Overlook and Newton medical centers. Last year, Trunfio led the organization to develop AllSpire Health Partners, an alliance of seven health care systems that have come together to serve patients, families and communities in New Jersey, New York, Maryland and Pennsylvania. Through collaboration among the systems, AllSpire seeks to improve the quality and affordability of, as well as access to, health care by sharing clinical, intellectual and economic capabilities. Trunfio also oversaw the 2011 creation of the Atlantic Accountable Care Organization, one of the largest in the nation, which serves to keep communities healthy and focuses on prevention and wellness. “Joe has been an outstanding strategic leader of the organization during a period of accelerated growth and expansion,” said Karen Kessler, chair of the Atlantic Health System Board of Trustees. “We are forever grateful for his dedication and exceptional service.” Atlantic has grown in size and scope — from 5,000 employees in three counties when Trunfio joined in 1999 to nearly 14,000 employees throughout northern New Jersey and along the Pennsylvania border in 2014. “It has been a career highlight to lead Atlantic Health System,” Trunfio said. “I leave knowing that the best days for Atlantic are ahead, and that the path we forged will continue to position us as the premier health care system in the region. The organization’s

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board of trustees, donors and nearly 14,000 employees and 4,000 physicians deserve so much credit.” Atlantic cited several other accomplishments led by Trunfio, including: •

U.S. News & World Report’s “Top Hospitals” list;

•

FORTUNE magazine’s “100 Best Companies to Work For” list for six straight years — this year at No. 25;

• A spot in the top three for AARP’s list of “Best Employers for Workers Over 50” — the sixth consecutive time the organization has been recognized by AARP; • “Inside Jersey”/Castle Connolly named Morristown Medical Center as the No. 1 New Jersey hospital for four consecutive years (350 beds or more) and Newton Medical Center as the No. 1 New Jersey hospital for three consecutive years (350 beds or fewer); • Championed the critical role of technology in patient care, introducing palm-recognition systems to confirm patient identity and other mobile innovations that have won Atlantic Health System recognition as a one of Health Care’s “Most Wired” organizations for five consecutive years.

Two N.J. health care systems announce merger By Beth Fitzgerald

Meridian Health and Raritan Bay Medical Center on Wednesday announced they are planning a merger that would unite two health care systems serving adjacent territories across central New Jersey. The announcement of a letter of intent to merge now begins several months of due diligence prior to a definitive merger agreement. “We are very excited about this opportunity with Raritan Bay Medical Center,” said John K. Lloyd, president of Neptune-based Meridian Health. “While Meridian serves primarily Monmouth and Ocean counties and parts of Middlesex County, Raritan Bay services Middlesex County and parts of northern Monmouth County. Our neighboring geography will allow us to give residents in those areas more choices for accessing care and tertiary services.” Meridian Health and Raritan Bay said the due diligence period will examine the merger’s financial, clinical and legal issues. That process, which is already underway, is expected to take about four months, followed by a definitive agreement and regulatory review. Both not-for-profit organizations offer both hospital and non-hospital services, including outpatient facilities, and said their combination would provide more community access to physicians and health services. Meridian is among state’s largest health systems, with more than $1.6 billion in annual revenue. And it is in the forefront of the drive to transform health care into a system that incentivizes higher quality care and less wasted spending. Meridian operates one of New Jersey’s nearly dozen Medicare Accountable Care Organizations, in which doctors and hospitals began partnering with Medicare in 2012 to improve the efficiency of the federal health care program for the elderly. Meridian’s ACO is one of only three in New Jersey to achieve savings so far: Last week, Medicare announced the Meridian ACO has saved Medicare $14.89 million and will get a shared savings payment from Medicare of $7.30 million. Meridian Health is a member of AllSpire Health Partners, an interstate consortium of six health systems that is addressing population health management, best practices and medical research. “From our charitable missions and Magnet-recognized nurses, to our commitment to services in cardiovascular, stroke, cancer and orthopedics, our health systems share similar interests and cultures,” says Michael D’Agnes, president and chief executive of Raritan Bay. “We are optimistic about the good things that could happen for our communities from this proposed partnership.” D’Agnes added that the two organizations already participate in a group purchasing organization together, and have partnered on services in the past, including Raritan Bay’s cardiac catheterization laboratory. “This is a challenging time for health care organizations,” said Lloyd. “Forward-thinking organizations are always looking for partners who want to enhance patient care and experience and improve the health of our communities, all while achieving needed efficiencies. We see that fit with Raritan Bay.” Meridian Health is among the largest health care systems in New Jersey, comprising Jersey Shore University Medical Center and K. Hovnanian Children’s Hospital in Neptune; Ocean Medical Center in Brick; Riverview Medical Center in Red Bank; Southern Ocean Medical Center in Manahawkin; and Bayshore Community Hospital in Holmdel. Its Meridian Partner Companies provide home health services, skilled nursing and rehabilitation centers, ambulatory care, ambulance services, fitness and wellness centers and outpatient centers. Raritan Bay Medical Center has hospitals in Old Bridge and Perth Amboy and is one of less than 7 percent of hospitals nationally to achieve Magnet Recognition for nursing excellence three times. Raritan Bay is an affiliate of Joslin Diabetes Center. September 2014

Insurance Report

Sharp decline in uninsured New Jerseyans in wake of Obamacare, report finds By Beth Fitzgerald

The number of uninsured New Jersey non-elderly adults plunged 46 percent — from 21.2 percent in September 2013 to 11.5 percent in June 2014 — according to a new report Friday from the Robert Wood Johnson Foundation. According to the report, co-authored by Joel Cantor, director of the Rutgers Center for State Health Policy, and Katherine Hempstead of RWJF, the decrease is statistically significant — and suggests that more than 520,000 New Jerseyans have obtained health coverage since September 2013. "This are the first numbers showing the impact of the Affordable Care Act on the number of uninsured in New Jersey," Cantor said. "They show a robust response to the ACA." Cantor said the survey shows that "People are responding to the availability of subsidies for private plans (on HealthCare.gov) and to the expansion of Medicaid eligibility. It appears that the problem of the uninsured was cut nearly in half since the third quarter of 2013. We can expect the number gaining coverage to rise a bit further this year, as people eligible for Medicaid can still sign up. The next opportunity for other individuals to buy coverage will begin in November, when the HealthCare.gov annual enrollment period opens for 2015 plans." These data come from the Health Reform Monitoring Survey in New Jersey, a New Jersey supplement of a national survey conducted by the Urban Institute. A quarterly survey of the non-elderly, it is designed to provide timely information about the Affordable Care Act, whose new health insurance exchange this year began providing billions of dollars in taxpayer subsidies that have gotten millions of Americans covered via HealthCare.gov and other state-run websites. According to the survey, completed in June 2014, 7 percent of respondents reported that they obtained coverage through the ACA exchange at HealthCare.gov. Nearly two-thirds said they have employer-sponsored insurance, about 11 percent reported Medicaid or other public coverage and approximately 14 percent reported non-group or other coverage. These report said the results are consistent with HealthCare.gov enrollment data for New Jersey from the federal Department of Health and Human Services, which reported in May that 162,000 New Jerseyans enrolled in plans on HealthCare.gov from the start of open enrollment last October through April 2014. The report said it is not known how many of those 162,000 were previously uninsured. However, the non-group market in New Jersey is reported to have grown by approximately 50,000 between thefourth quarter of 2013 and the first quarter of 2014, the study said. And while official estimates for the second quarter have yet to be released, it is anticipated that enrollment will again increase considerably. The number of new Medicaid enrollees is estimated to be approximately 250,000. However, this number does not take into account the considerable backlog of applications facing many New Jersey counties, as well as the fact that the New Jersey Medicaid expansion began in 2013. Christine Stearns, vice president of the New Jersey Business & Industry Association, said: “The survey appears to confirm that the high cost of health coverage resulted in many New Jerseyans being uninsured. Subsidies and expanding Medicaid eligibility has reduced those barriers.” Betsy Ryan, chief executive of the New Jersey Hospital Association, added: “It’s important to note that this is survey data, but it signals a positive trend. We look forward to helping enroll many more New Jerseyans. We still have more than a half-million New Jersey residents without health insurance, plus an estimated 525,000 undocumented immigrants who are not eligible for coverage under the health reform law. Plus, the majority of New Jersey’s newly insured are on the Medicaid program, which has its own set of challenges. There’s still more work to do.” And Ray Castro, senior policy analyst for New Jersey Policy Perspective, said: "While there have been complications in the implementation of the Affordable Care Act, this report clearly shows that it is exceeding its most important goal, which is reducing the uninsured. Its findings are consistent with enrollment in he Marketplace, which also exceeded projections. The state was also very smart to opt for the Medicaid expansion, which is the main reason the uninsured is dropping at a faster rate than the national average. The big increase in federal funds that will be spent in premium subsidies and Medicaid will also help stimulate New Jersey's economy. Good news all around."

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Hospital Rounds

By Beth Fitzgerald

Sloan Kettering Breaks Ground on N.J. Cancer Center, Which will Cost $217M and Create 160 Jobs

Memorial Sloan Kettering Cancer Center broke ground Thursday in Middletown for its second New Jersey outpatient cancer center, a 285,000-square-foot facility expected to open in late 2016. The new center, to be called MSK Monmouth, will cost a total of $217 million and is expected to create more than 160 jobs. New York-based MSKCC, which performs cancer surgeries, has been expanding throughout the region with outpatient cancer centers where patients receive chemotherapy, radiation treatments and other cancer care that doesn’t require a hospital stay. MSKCC has had an outpatient facility in Basking Ridge since 2006; it has a similar facility on Long Island and will open another in Westchester County, New York next month. Dr. Richard Barakat, deputy physician-in-chief for Memorial Sloan Kettering Regional Care Network and Alliances, said about 6 percent of MSKCC’s patients live in the region served by the new Middletown outpatient facility. He said many of those patients currently get care in Basking Ridge, but many also make the trip into Manhattan. “This provides the opportunity for patients to receive all of their post-operative care closer to their home,” he said. The Middletown facility will be larger than its Basking Ridge counterpart. It will have an ambulatory surgery center for minor surgeries and for procedures like colonoscopies, and will also provide interventional radiology procedures. New Jersey has a number of hospitals with major cancer specialties, but Barakat said MSKCC is unusual in that it is a major cancer research institution. “We have access to the most cutting edge treatments and the latest clinical trials,” he said, including a portfolio of more than 900 clinical trials. “Ultimately in cancer care what improves outcomes for patients is research and clinical trials. This is an effort to bring those trials out into the community. And we will have a phase one clinical trials center in the facility so we are really bringing the latest, most cutting edge treatments out to the community,” Barakat said. MSKCC said that, in 2013, its physicians had 571,922 outpatient visits, of which 108,198 took place at its regional locations in Basking Ridge and in Long Island and Westchester County, New York. Physicians will practice in both New York and in Middletown, he said, and a number of the MSKCC clinicians live in New Jersey and are looking forward to working in the Middletown facility. “We will provide provide convenient, compassionate, cutting edge care to our patients in a manner that is right in their back yard,” he said. It is estimated that by 2015, 80 percent of cancer care will be delivered in an outpatient setting, Barakat said. “We have been doing this for 20 years and we will continue to do it. This is the way health care is going, with more and services delivered in an ambulatory setting.” Lt. Gov. Kim Guadagno spoke at the groundbreaking for the center. She said MSKCC’s decision to expand in New Jersey was supported by a $7.9 mlliion Grow NJ Legacy award from the state Economic Development Authority. The incentives helped the company purchase 200,000 square feet of office space and create more than 160 jobs, while retaining 100 jobs from the relocation of its Lyndhurst data center operations to Middletown. Guadagno said the Partnership for Action — which includes the New Jersey Business Action Center EDA — assisted in bringing the project to fruition. “This is a perfect example of the Partnership for Action’s ability to help make a complex project a reality,” Guadagno said. “In addition to the delivery of premier services to its patients, Memorial Sloan Kettering’s decision to expand in Middletown will bring a corporate campus that had been vacant for a decade back to life, strengthening the tax base and stimulating the local economy by creating jobs.” In April 2013, MSKCC purchased the 40-acre former Alcatel-Lucent property in Middletown that was vacated in 2003. September 2014

Rutgers Receives $10 Million Pledge to Advance Treatment of Cancer Patients Two-year gift will support precision medicine approach involving clinical practice, research and teaching; clinical trials will benefit patients with rare and resistant cancers NEW BRUNSWICK, N.J. – A $10 million anonymous pledge to the Rutgers University Foundation will help advance the treatment of patients with rare and virulent cancers that don’t respond to standard therapies. The gift will strengthen the university’s research and clinical practice of identifying genetic abnormalities that make tumors cancerous and using those details to fine-tune treatment. This rapidly growing approach to research and care is known as precision medicine. The gift, to be given over two years, will increase the number of patients that Rutgers Cancer Institute of New Jersey can serve in clinical trials of targeted therapies. It will enhance their care by quickly and more precisely identifying the genetic mutations that cause or accelerate the growth of their cancers. “We will be able to analyze patients’ tumors – their individual tumors – in a way we never could before,” said Robert DiPaola, director of Rutgers Cancer Institute of New Jersey, the state’s only National Cancer Institute-designated comprehensive cancer center. “We will do that by bringing together expertise across many disciplines at Rutgers, from physicians who take care of patients to laboratories that do research on genetic abnormalities.” The gift includes support for advanced genomic analyses of cancers within the Clinical Genomics Laboratories of RUCDR Infinite Biologics, a unit of the Rutgers Human Genetics Institute of New Jersey. “Cancer is a disease where you can’t wait a long time between diagnosis and treatment,” said Jay Tischfield, chief executive officer and scientific director of RUCDR Infinite Biologics and the Duncan and Nancy MacMillan Distinguished Professor of Genetics in the School of Arts and Sciences. “We will provide very rapid turnaround – typically 72 to 96 hours – to our Cancer Institute colleagues, who will examine the data to determine their clinical response. Our capability is unique, and there is nothing comparable to it at any university.” The gift also supports teaching within the university’s Department of Genetics. It includes a $1 million endowment for cancer biology curriculum development to support undergraduate education in cancer genetics, preparing students to pursue research and clinical careers in precision medicine. It also will fund two new faculty positions, one of which will be an endowed chair in genetics. The gift provides $1.5 million in funding for the chair, with a matching $1.5 million coming from an earlier $27 million challenge grant to establish 18 new endowed chairs at the university. “On a personal level, I think everyone has been touched by cancer – if not themselves, then a close family member or friend,” said Linda Brzustowicz, professor and chair of the Department of Genetics. “The educational component of this gift is going to be a tremendous asset, to bring people together to work on these projects and develop a new breed of cancer researchers and oncologists.” The opportunity to combine clinical research and treatment with academic research and education has been strengthened by the integration of Rutgers with schools, centers and institutes that were part of the University of Medicine and Dentistry of New Jersey. RUCDR Infinite Biologics – the world’s largest university-based biorepository – is providing services that extend beyond third-party laboratories or the limited internal facilities that many university medical centers use for similar clinical trials. Those often provide a fixed panel of tests with little flexibility to incorporate new genetic discoveries. “As new genetic markers evolve, we can put them in our panels very quickly,” Tischfield said. “We can tailor our panels to the kinds of cancers seen by the physicians at the Cancer Institute of New Jersey.” Shridar Ganesan, medical oncologist and associate director of translational science at the Cancer Institute of New Jersey, says the gift will allow him and his colleagues to put theoretical principles into practice. “I’m personally excited to see what this will do for patients,” he said. “This should allow not only more clinical trials, but better, more effective and more efficient trials. The capabilities we develop will eventually be integrated into the routine care of our patients.” This gift is part of the largest fundraising year in Rutgers’ history and supports Our Rutgers, Our Future, a $1 billion campaign publicly launched in 2010 to broaden and enhance the myriad ways the university serves students, the state, and the world. Established in 1766, Rutgers, The State University of New Jersey, is America’s eighth oldest institution of higher learning. The Rutgers system educates more than 65,000 students and serves the people of New Jersey at universities, research centers and clinical practices throughout the state. The flagship, Rutgers University-New Brunswick, is one of the nation’s premier public research universities and is the only public institution in New Jersey represented in the prestigious Association of American Universities. Rutgers University is also a member of the Big Ten Conference and its academic counterpart, the Committee on Institutional Cooperation – a consortium of 15 world-class research universities. Carl Blesch / Rutgers media relations / 848-932-0550 (office) / cblesch@ucm.rutgers.edu

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Health care data breach has hit 1 million N.J. patients since 2009 The data of more than 1 million patients at New Jersey hospitals and medical facilities has been compromised since 2009, according to an investigative report by NJ Advance Media released Sunday morning. The story, reported and written by Carla Astudillo, explains how a number of instances of lost encrypted data — including Social Security numbers and payment information — have occurred more often and in more places than most likely realize. The report sites statistics available on a U.S. Department of Health and Human Services database. According to the report, the information has been compromised in a nearly every sector of the medical health industry, including insurance, hospital systems and medical groups, laboratories and state government agencies. In all, 17 different facilities have been compromised. Even more alarming, the report said the instances are become more common, saying 850,000 patients had their information compromised in 2013, the most since reporting on the issue was mandated in 2009.

Barnabas Health system appoints VP to lead wellness initiatives By Beth Fitzgerald

A world that strives not merely to cure disease but to keep people healthy in the first place has long been the vision of Barry Ostrowsky, chief executive of Barnabas Health, the state's largest health care system. And for years Barnabas has advanced that vision by pioneering sustainable wellness programs like KidsFit, in which dieticians go into Newark classrooms and work side-by-side with teachers to tackle childhood obesity by spreading the word about healthy eating and exercise. Ostrowsky has just promoted Barbara Mintz, wellness chief at Newark Beth Israel Medical Center, to a newly created position: vice president of healthy living and community engagement. In her new post, Mintz will champion wellness programs throughout the seven-hospital Barnabas system, fostering programs tailored to the different needs of the diverse communities that Barnabas serves, from Jersey City to the Jersey Shore. “We see ourselves as a beacon of wellness and health education,” Mintz said. “We want to be the place people come to for the information that they need to stay out of the hospital. I know that sounds funny, but that’s really what we are doing.” Right now, Mintz is assessing the community wellness programs now underway throughout the Barnabas system, so the best ones can be expanded to reach more people. To date, Barnabas has funded community wellness initiatives out of the operating surplus that it uses to reinvest in all its programs. Ostrowsky said government and commercial payers for the most part still compensate the health care system for curing ailments, not for preventing them. But Ostrowsky shares the view of many experts that health care is transitioning to a new world, where instead of being paid a fee for every service they provide, health care providers will get a lump sum or “capitated” payment to deliver everything the patient needs — whether it’s an exercise program to strengthen the heart, or surgery to clear clogged arteries. And Ostrowsky believes when that day comes, the Barnabas focus on wellness could be just what the doctor orders. Meanwhile, getting the health care system to focus on wellness and prevention alongside traditional “sick care” is a monumental undertaking, Ostrowsky said. “It has to be about community health, lifestyle, better eating and nutrition and averting illness,” he said. Medicare and commercial payers in the last couple of years have started supporting “accountable care organizations” that compensate health care providers for improving clinical outcomes and controlling costs, a movement that is in its infancy but has begun showing results. Ostrowsky pointed out that Barnabas got into the wellness arena years ago, without waiting for health care payers to figure out how to use their dollars to reward the changes that the health care system needs to make. Today, spending on wellness programs represents a small fraction of the resources of the $3 billion Barnabas health care system — but this is where the future lies, Ostrowsky said. “When you are running an organization like ours, you have to take the plunge to invest in people and invest in positions and you have to accord those positions the authority and the responsibility to make the vision a reality,” he said. “Barbara has been a star for a very long time and has accomplished great things for the communities with which she has dealt. She is the perfect person to take on a system-wide and enterprise-wide responsibility to ensure that this philosophy is turned into operational plans.” The Beth Challenge is the kind of sustainable program New Jersey can expect to see more of from Barnabas, Mintz said. Modeled on television’s “The Biggest Loser,” it started in 2009 as a weight-loss program for employees of Newark Beth Israel Medical Center September 2014

“We thought we would get 50 people to sign up — and we got 500,” Mintz said. One employee lost 200 pounds and avoided weight loss surgery. “We took the Beth Challenge out into the community, because we need to lead by example,” Mintz said. Barnabas is an academic health care system that trains doctors: “We have all this expertise under our roof and we need to share that with the community.” Seven Newark churches enrolled in the Beth Challenge, and Barnabas nutritionists visit the churches weekly, teaching classes on healthy eating and lifestyles. “This is really about taking our clinical teams and putting them in the middle of the population and being there for them in the places where they lead their daily lives,” she said. First lady Michelle Obama visited the KidsFit program at a Newark school in 2010 as part of her “Let’s Move” campaign, and Mintz has been honored by the American Hospital Association with its NOVA award for excellence, wellness and community education. Mintz led the Barnabas partnership with the 2014 Special Olympics USA Games that were held in New Jersey in June. Starting last November, a team of Barnabas dieticians and nurses provided wellness counseling to the 265 Team New Jersey Special Olympics athletes, resulting in weight loss and lowered blood pressure for a significant number of the athletes. And this turned into yet another sustainable wellness program: Each month, a Barnabas dietician is teaching a class at a residence for individuals with developmental disabilities. Ostrowsky said the appointment of Mintz “is really a major step for us. Not because we just decided to believe in it now; we’ve always believed in it. It’s about putting our money where our mouths are. “We’ve finally said to an executive: ‘We know you know this stuff. Put together a real operational program, enterprise-wide, hold our colleagues responsible for implementing it and report on a regular basis on how we’re doing at getting it done.’” Ostrowsky said when it comes to wellness, there is no one-size-fits-all solution — and obesity is a prime example. “The percentage of obese people in this country is off the charts and we know scientifically that obesity leads to every conceivable negative clinical status.” But he pointed out that obesity exists in inner cities that lack supermarkets, as well as suburban areas with lots of places to buy healthy food. “If people don’t have access to healthy food and we want to talk about healthy food, it’s a pretty empty message until we figure out a way to give them access to healthy food,” he said. But for those who lives in places with lots of grocery stores, “It’s not a matter of access. We have to find a way to encourage them to shop there and buy the right stuff.” Keeping people well frees up resources the health care system needs to deliver expensive, advanced medical care to those who need it, he said. “I think you could probably take 20 percent or more of the people that we now serve for sickness and not see them get sick if our programs work over the next five to 10 years,” he said. And by averting illness where possible, “There will be so many more resources available for the people who do get sick. You’ll have more than enough by way of resources to do that — and you’ll have a lot healthier population.”

Palisades Medical Center joins HackensackUMC health network

Palisades Medical Center became a full member of the Hackensack University Health Network Wednesday when it signed a formal Letter Of Intent (LOI) at a signing ceremony. Palisades Medical Center, a 202-bed facility in North Bergen, will remain an acute care hospital, known as HackensackUMC Palisades. The two organizations have been working together since June 2012. “We are thrilled to be taking this next step with our friends at Palisades Medical Center,” Robert C. Garrett, president and CEO of Hackensack University Health Network, said. “Our physicians and staff at HackensackUMC and Palisades Medical Center are the best in the state, committed to providing world-class quality care to our patients. This new venture will place our hospitals on the cutting-edge of medicine and health care delivery for our patients.” Palisades is noted for its efforts in pediatric and neonatal areas, according to a release by Hackensack. “For over a century, Palisades Medical Center has committed itself to providing exceptional care for our patients,” Bruce J. Markowitz, president and CEO of Palisades Medical Center, said in a release. “Joining HackensackUHN, the premier healthcare system in New Jersey, is just one more step toward strengthening that mission. This affiliation will give our patients access to world-class physicians and the best specialty care programs available.” The LOI is expected to lead to a definitive agreement between the two organizations in the coming months. This joint partnership is expected to be finalized later this year after receiving approval from the New Jersey Department of Health and other authorities.

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