HEALTHCARE NEWS FLASH December 16, 2013
Table of Contents Sales & Marketing ................................................................................................................. 3 Finance ................................................................................................................................. 9 Technology .......................................................................................................................... 13 Strategy .............................................................................................................................. 21
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Sales & Marketing Marketplace Plans’ Networks Are Very Small, Study Finds December 12, 2013 | Kaiser Health News http://capsules.kaiserhealthnews.org/index.php/2013/12/marketplace-plans-networks-are-verysmall-study-finds/ To keep premium prices down for individuals and small businesses buying coverage through new online marketplaces, insurers have created smaller networks of hospitals. But consumers and policy experts have wondered, just how small? Turns out, many are very small. “About two-thirds of hospital networks on the exchanges are narrow or ultra-narrow,” said Paul Mango, a director at the consulting firm McKinsey & Co., at a conference of insurance industry leaders in Washington Thursday. Based on research he says it took his team weeks to develop, Mango said the majority of the lowestpriced insurance plans sold through the new online marketplaces use very small networks of hospitals. The study did not evaluate doctor participation in those networks. The issue of whether doctors or hospitals are in a network is often of utmost importance to consumers choosing an insurance policy. But prices also are important. Mango said his research looked at 20 urban areas representing about 25 percent of the uninsured. To develop a definition of broad or narrow, McKinsey identified the biggest 20 hospitals by their number of beds. Insurance plan networks with 15 or more big hospitals were tagged as broad networks. Those with 7 to 14 were considered narrow, and those with 6 or fewer of the top 20 were considered ultra-narrow. But just because a policy has a narrow network, Mango cautioned, doesn’t mean it’s the lowest priced in the market. In fact, he said, the majority of ultra-narrow network plans were not the lowest priced in their regions. Still, across the 20 areas evaluated, broad networks resulted in a median price that was 26 percent higher than the smaller ones, he said. Michael Leavitt, who served as George W. Bush’s secretary of health and human services and now runs a consulting firm, said the ability of insurers to craft large or narrow networks — and the resulting demand for both in the marketplace — is “fundamental to the success of health reform.” Some customers, he said, will want the lower prices that narrow networks bring, while others will gravitate toward broader choice even at the cost of higher premiums.
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Mango said his group also analyzed enrollment data, finding that signups in four states — California, New York, Florida and Washington — make up about half of all enrollees and they tend to be older, rather than younger. The mid-level silver plans appear to be the most commonly chosen by consumers. Enrollment so far in three states — California, Maryland and Washington — “skews toward the aged and mimics the background of the [current] individual market [policyholders], not the uninsured,” Mango said. In an earlier McKinsey study, the firm found that premiums for similar policies in the same market can vary by as much as half, meaning that consumers would do well to compare prices before selecting. “There may be several potential factors contributing to these pricing differences within a given rating area, including the degree of network narrowing, different costs of care and different assumptions about the risk pool,” in terms of who will enroll.
CVS, Cardinal Health Enter Generic Drug Joint Venture December 11, 2013 | Becker's Hospital Review http://www.beckershospitalreview.com/supply-chain/cvs-cardinal-health-enter-generic-drugjoint-venture.html Woonsocket, R.I.-based CVS Caremark and Dublin, Ohio-based Cardinal Health have signed a 50/50 joint venture agreement, forming the largest generic drug sourcing operation in the U.S., according to a Reuters report. The initial agreement will last ten years and is expected to be operating by July 1. The two companies also announced a three-year extension on their existing distribution agreements, which will last through June 2019. The U.S. is the largest generic drug market, and the demand for generic drugs is rising as patents for brand-name treatments are expiring and the healthcare system pushes for lower costs, according to the report. It adds that 80 percent of prescriptions are now filled with generic drugs.
Implementing Health Reform: The November Exchange Enrollment Report December 11, 2013 | Health Affairs Blog http://healthaffairs.org/blog/2013/12/11/implementing-health-reform-the-november-exchangeenrollment-report/ On December 11, 2013, the Department of Health and Human Services released its second Health Insurance Marketplace enrollment report. The report covers the period from October 1 to November 30, 2013, rather than just November, as HHS has decided to issue cumulative exchange activity reports rather than discrete monthly totals. HHS is doing this to avoid duplicate counting of the same individuals — an applicant one month may receive an eligibility determination the next and enroll in a plan the following month. Nonetheless, it also makes sense to compare activity in discrete categories from month to month, the focus of this post.
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The headline is that the number of eligible individuals who selected a plan is up dramatically in November. 106,185 individuals chose a plan in October through all exchanges; 258,497 additional individuals chose plans in November, 2.4 times as many. The increase in the federal exchange was even more dramatic, from 26,794 to 110,410, an over four-fold increase. Obviously, the enrollment process has become much more navigable. By other metrics, however, exchange participation has increased less dramatically. 846,184 applications were completed for all exchanges in October; 981,256 more in November, an increase of only 16 percent. The number of completed applications in the federal exchange increased from 519,561 in October to 632,514 in November, an increase of 22 percent. The number of individuals determined eligible for enrollment in all exchanges increased from 1,081,592 in October to 1,225,891 in November, an increase of 13 percent. The federal exchange determined 822,789 individuals eligible in November, up about 17 percent from 702,619 in October. The number of discrete visitors to the exchange actually dropped dramatically from 26,876,527 in October to 12,214,691 additional visitors in November, some of whom were surely duplicates. It is likely that many potential applicants (and certainly the navigators, application counselors, agents, and brokers working with them) took to heart the message that the exchange was broken and decided to stay away until the promised repair was completed at the end of November. I will be surprised if December numbers are not up dramatically. The report contains information on state exchange enrollment, which yields few surprises. California’s exchange has enrolled 107,087 in marketplace plans; New York, 45,513, Washington 17,770, and Kentucky, 13,145. Oregon, on the other hand, has not yet begun processing applications electronically, and had only enrolled 44 individuals by the end of November. Among federal exchange states, Florida leads the way, having enrolled 17,908 individuals; Texas comes in second with 14,038 enrollees. In general, plan enrollment in the federal exchange states correlates roughly with population, but several states — Idaho, Maine, Montana, Utah, and Wisconsin — seem to overachieve, while New Jersey’s enrollment seems to lag. Overall, 83 percent of completed applications were submitted online; 17 percent were on paper. HHS was unable to determine how many were submitted through direct enrollment through insurers, although the number is likely to be small. Sixty percent of applications were submitted through the federal exchange, 40 percent through state-based exchanges. Medicaid/CHIP. Medicaid and CHIP enrollment through the exchanges continues to be strong. 803,077 individuals were assessed or determined eligible for Medicaid and CHIP during October and November; 534,103 through the state exchanges, 268,974 through the federal exchange. Moreover, this is only a fraction of the total individuals found eligible for Medicaid and CHIP during this period of time. During October alone, for example, a total of 1,460,367 individuals were determined eligible for Medicaid and CHIP by state Medicaid agencies.
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Breaking down enrollment by tax credit eligibility. Two interesting trends can be observed in the report. First, the proportion of individuals determined eligible to enroll through the exchange who are also eligible for premium tax credits grew significantly during November. In October, only about 30 percent of individuals determined eligible for exchange enrollment were determined eligible for premium tax credits (34 percent in the federal exchange). In November, 50 percent were determined eligible for tax credits (42 percent in the federal exchange). Although this is still a far lower proportion than was anticipated, it would seem to indicate that more lower-income individuals are discovering the exchange and the benefits it affords. Higher-income individuals — many of whom no doubt have received nonrenewal notices from insurers in the nongroup market — continue to make up a large proportion of applicants. Pending applications. Second, the number of pending or “other” applications continues to increase, from 201,137 in the October report to 583,473 in the October-November report. Reports of applicants facing a difficult time producing and submitting documentation to verify eligibility have become increasingly common as the exchanges attempt to ensure that individuals who receive premium tax credits are truly eligible for them. This (and website defects) seems, however, to be leaving a fair number of applicants in limbo. What’s next? The December report does not answer perhaps the most important question about enrollment: How many Americans will the exchanges enroll for 2014? Although enrollment numbers are increasing dramatically, and interest in the exchanges seems high, the number of enrollees who have selected plans through November is only a small fraction of the seven million expected for 2014. In its October report, HHS noted that in other exchange-like programs, such as the Federal Employees Health Benefits program and Medicare Part D, there is an enrollment surge near the end of the open enrollment period. With healthcare.gov reportedly now able to handle 800,000 applications a day, enrollment could easily get to 7 million by the end of March. But a lot will depend on its actual functionality, including its ability to handle direct and broker/agent enrollment, as well as on efforts to publicize the availability of the program and the success of efforts by ACA opponents to discourage enrollment.
Report: Most States Do A Poor Job Informing Consumers About Physician Quality December 10, 2013 | Kaiser Health News http://capsules.kaiserhealthnews.org/index.php/2013/12/report-most-states-do-a-bad-jobinforming-consumers-about-physician-quality/ When it comes to providing consumers with easily accessible information about physician quality, a report out today gave most states grades of ‘D’ or ‘F,’ often because they compile data only about primary care doctors, not specialists. Washington state and Minnesota were the only states that got an A from the Health Care Incentives Improvement Institute, a nonprofit group that designs programs aiming at boosting health care quality and affordability. California received a ‘C,’ and the rest of the states got either ‘D’s or ‘F’s.
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The report scored states on several factors, including the percentage of doctors they rated, whether those ratings included information about patient outcomes and consumer experiences and how easy it was to find them through an Internet search. Using a Robert Wood Johnson Foundation directory of websites that evaluate health care quality, researchers examined whether the information was current, free to consumers, produced by independent third parties and included a range of physicians, including specialists. Programs that failed to meet any of those criteria were excluded, as were physician “report cards” produced by health insurance companies because “patients distrust quality information coming from their insurance providers,” the report said. “I was shocked because I honestly thought the availability of information on the quality of physicians was far more prevalent … It’s a very mixed bag,” said Francois de Brantes, co-author of the report. The information is becoming increasingly important as consumers face higher deductibles and outof-pocket costs and “want a sense of whether or not that money is being spent on physicians that will deliver high quality care,” de Brantes said. Many states had information about primary care doctors, but not specialists. “That’s only 10 or 15 percent of the cost of care,” de Brantes said. “They now might want to focus on the rest. When patients go and have procedures done by cardiologists or orthopedists or oncologists, they deserve to know the quality of care they are going to get.”
OSF HealthCare Strikes Deal to Add Rochelle Community Hospital December 06, 2013 | Becker's Hospital Review http://www.beckershospitalreview.com/hospital-transactions-and-valuation/osf-healthcarestrikes-deal-to-add-rochelle-community-hospital.html Peoria, Ill.-based OSF HealthCare and Rochelle (Ill.) Community Hospital have signed an agreement that would add RCH to OSF HealthCare's network. Financial terms of the transaction were not disclosed. Under the deal, 25-bed RCH will keep its independence and local governance but will become an OSF HealthCare affiliate. Both groups will collaborate on clinical integration, cost sharing of resources and other initiatives to reduce the cost and improve the quality of care. No timetable was given for when the transaction would close. RCH marks the second critical access hospital OSF HealthCare has targeted in the past several months. In October, OSF HealthCare signed a definitive agreement to acquire 25-bed Kewanee (Ill.) Hospital.
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Aurora Health Care, Bay Area Medical Center Enter Into Formal Partnership Agreement December 03, 2013 | Becker's Hospital Review http://www.beckershospitalreview.com/hospital-transactions-and-valuation/aurora-health-carebay-area-medical-center-enter-into-formal-partnership-agreement.html Milwaukee-based Aurora Health Care has signed a letter of intent with Bay Area Medical Center in Marinette, Wis., to explore a partnership, according to a report from The Business Journal. Aurora Health Care CEO Nick Turkal told the Journal the aim of the discussions is not to make an acquisition but to leverage Aurora's expertise through BAMC and its physicians. The hospital initially decided to enter into negotiations with Aurora in September. Aurora was one of nine health systems that showed interested in partnering with BAMC. According to previous reports, the medical center isn't interested in a full-asset merger or sale and intends to maintain a local board with local control. BAMC's key requirements for a partnership include access to capital to support expansion, a future growth strategy, access to managerial and clinical expertise and access to an established accountable care organization. A timetable for the partnership discussions was not disclosed.
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Finance 11 Statistics on Average Hospital Costs Per Stay December 12, 2013 | Becker's Hospital Review http://www.beckershospitalreview.com/racs-/-icd-9-/-icd-10/11-statistics-on-average-hospitalcosts-per-stay.html In 2011, hospital stays cost a cumulative $387.3 billion, which averages out to about $10,000 per stay, according to a new statistical brief from the Agency for Healthcare Research and Quality. AHRQ's Healthcare Cost and Utilization Project has issued several reports breaking down the costs and finances of the country's healthcare system. The most recent brief breaks down costs for U.S. hospital stays in 2011. Here are 11 statistics on average hospital costs per stay in 2011, based on the AHRQ and HCUP statistical brief. Mean hospital cost per stay by age •
85 or older: $9,900
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65 to 84: $12,600
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45 to 64: $12,500
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18 to 44: $7,400
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1 to 17: $8,400
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Younger than 1: $4,500
Mean hospital cost per stay by payer •
Medicare: $11,900
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Medicaid: $8,000
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Private insurance: $9,200
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Uninsured: $8,300
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Other: $10,700
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Centene buys $200M stake in home health manager December 12, 2013 | Healthcare Payer News http://www.healthcarepayernews.com/content/centene-buys-200m-stake-home-health-manager Centene is expanding its role servicing high need populations, buying a majority stake in a home care management company. St. Louis-based Centene has signed an agreement to acquire a 68 percent interest in the Troy, Michigan based U.S. Medical Management, the manager of the Visiting Physicians Association, for about $200 million. Along with the new investment, Centene announced the formation of a new holding company connecting Centene and other health service firms like U.S. Medical Management. "The partnership with USMM is the next step in Centene's strategy to provide a continuum of high quality services that allow us to effectively manage the complex needs of our growing high acuity populations,” said Michael Neidorff, Centene chairman and CEO, in a media release. “The integrated, home-based primary care model is a capability expansion for Centene,” Neidorff said, arguing that it will position the firm “to offer quality healthcare services and programs for an aging population in the comfort of their own homes. We believe that there is significant opportunity to enhance access to health services and quality of life for complex populations by removing barriers to receiving care in the home,” he said. Founded in 1993 and employing almost 2,000 nationwide, U.S. Medical Management is the administrative and managerial supporter of the Visiting Physician Association, a company also founded in 1993 that provides a range of medical, supportive, diagnostic and hospice care to about 50,000 seniors and homebound patients in Colorado, Florida, Indiana, Kentucky, Michigan, Missouri, Ohio, Texas, Virginia and Wisconsin. U.S. Medical Management also owns Pinnacle Senior Care, Grace Hospice, The Home DME and Visiting Podiatry. Centene, which has about 150,000 high acuity members in seven of the states serviced by USMM and Visiting Physicians, is financing the $200 purchase with about $66 million in cash and the rest in stock. Annually, Centene said it’s expecting the new stake in U.S. Medical Management to add $220 to $240 million in revenue.
Fitch: 2014 Outlook for Nonprofit Hospitals and Healthcare Negative; Profitability Challenged December 11, 2013 | Business Wire http://www.businesswire.com/news/home/20131211006427/en/Fitch-2014-Outlook-NonprofitHospitals-Healthcare-Negative The 2014 outlook for U.S. nonprofit hospitals and healthcare is negative, reflecting pressure on patient volume, continued uncertainty related to healthcare reform, and reimbursement challenges, according to a new Fitch Ratings report.
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'Slowdown in revenue growth evidenced in 2013 will likely deepen in 2014, driven by the declining trend of inpatient volumes, increasing use of high-deductible health plans, the expectation for another year of Medicare sequestration cuts and lower reimbursement rate increases from both governmental and private insurers,' says Jim LeBuhn, Head of Fitch's Non-Profit Health Care group. 'Despite projected increases in the overall insured population, higher utilization may not equate to improved profitability given the general trend in the shift of services to the outpatient setting.' The expectation for insurance coverage expansion through the federal health insurance exchange has been severely impacted by the delay and uncertainty of the federal website functionality. While the state run exchanges have had better success, the expectation that 7 million individuals will gain coverage through state and federal exchanges is highly uncertain. Regardless of timing, Fitch believes the long-term impact to hospital providers in states not expanding Medicaid will be negative. Given the expected pressure on volumes and reimbursement in 2014, hospital financial performance will be more impacted by management's ability and willingness to proactively control expenses, generate improved clinical efficiencies and quickly flex staffing to changes in patient volume. Fitch expects mergers and acquisitions activity will continue to be robust, as hospitals seek partners to fulfill varying needs including improving economies of scale, expanding and deepening their market presence or bolstering service offerings across the continuum of care.
30% of adults delay medical treatment for financial reasons December 10, 2013 | Fierce Healthcare http://www.fiercehealthcare.com/story/30-adults-delay-medical-treatment-financialreasons/2013-12-10 Thirty percent of adults say either they or a relative delayed medical treatment for financial reasons in the past year, according to a new Gallup poll. The poll found that 59 percent of the uninsured have delayed treatment, making them more than twice as likely to put it off as Medicare or Medicaid beneficiaries, or people with private insurance. Twenty-two percent of Medicaid and Medicare patients reported that they had put off care, and 25 percent of adults with private insurance said the same. Lower-income Americans and Americans in the 18-to-29 age bracket, both of whom are among the demographics least likely to have insurance, were also significantly more likely to have delayed treatment, according to the poll. Americans are more likely to delay treatment for a serious condition than a minor one, a trend the poll says has remained generally consistent since the survey began in 2001. More and more Americans have put off treatment for serious conditions since then, due to increases in cost of care, but the percentage putting off treatment for minor conditions has barely changed at all, according to the poll.
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Cost was named the most urgent health problem in the nation in an earlier poll. A higher percentage of Americans put off treatment due to cost than did so in the early 2000s, which Gallup speculates may be due in part to high-deductible health plans increasing out-of-pocket costs. "Although successful implementation of provisions of the Affordable Care Act may result in fewer Americans feeling they cannot afford treatment, the possible uptick in the number of patients seeking medical treatment may put additional strain on the healthcare system, creating new problems," the poll states.
ACA delays could hurt insurers' bottom lines, Moody's says December 05, 2013 | Fierce Health Payer http://www.fiercehealthpayer.com/story/reform-law-delays-could-hurt-insurers-bottom-linemoodys-says/2013-12-05 Insurers will see major financial losses now that the Obama administration has delayed several aspects of the reform law, including postponing canceled plans, extending enrollment deadlines and pushing back the small business exchange, according to Moody's. The problem, the investor service company says, is that these last-minute fixes could have a negative impact on the risk pool for insurers selling plans on the health insurance exchanges. For example, the enrollment deadline extensions mean insurers will lose up to two months of premiums from healthy consumers while increasing their adverse risk pool, Insurance Business America reported. These delays expose the insurance industry to "financial and operational risks," including higher administration costs and uncertainty about how the changes will affect the ratio of healthy and sick consumers, LifeHealthPro reported. "There are a lot of risks and uncertainty for the Affordable Care Act at the moment," Steve Zaharuk, senior vice president of the U.S. Insurance team for Moody's, told ABC News. "Insurance companies can deal with risk if they know the playing field. But when you keep changing the rules and adding more uncertainty into a situation, then it becomes even more risky and more difficult to deal with." Zaharuk added that if the Obama administration decides to delay the individual mandate or extend the exchange open enrollment period beyond March, the situation could worsen for insurers. "At that point, insurance companies might want to reassess their position in the exchanges and possibly even lobby to have the premium rates changed," he said. "We'd consider those very significant rule changes." The future isn't all gloom and doom for insurers, though. Humana CEO Bruce Broussard, for example, believes that the exchanges present significant opportunities, including financial benefits, in the long-term, FieceHealthPayer previously reported. Similarly, WellPoint CEO Joseph Swedish has said the company is "optimistic about the long-term membership growth opportunities on the exchanges."
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Technology Humana, Regional HealthPlus Ink ACO Deal December 13, 2013 | Becker's Hospital Review http://www.beckershospitalreview.com/accountable-care-organizations/humana-regionalhealthplus-ink-aco-deal.html Health insurer Humana has partnered with Spartanburg, S.C.-based Regional HealthPlus for an accountable care organization. Regional HealthPlus is a network of three hospitals, four ambulatory surgery centers and other care providers. Its ACO with Humana will benefit the payer's HMO and PPO Medicare Advantage members. The agreement includes a value-based incentive that rewards providers for keeping patients healthy, according to the news release. The relationship is focused on promoting evidence-based, highquality care as well as improved outcomes and experience at a lower cost. "Regional HealthPlus has been a leader in patient care coordination in the upstate, and this opportunity with Humana provides an avenue to expand our services to reach more patients," Chris Skinner, Regional HealthPlus' executive director, said in the release.
Almost half of hospital execs have no intention of implementing ACOs December 12, 2013 | Fierce Healthcare http://www.fiercehealthcare.com/story/almost-half-hospital-execs-have-no-intentionimplementing-acos/2013-12-12 Almost half of hospital executives have no plans to implement an accountable care organization (ACO)-like model in the near future, according to a Purdue Healthcare Advisors survey. Executives are also struggling to find solutions for lower reimbursements and increased costs, all while complying with the changes under the Affordable Care Act and maintaining quality care, states the survey, which polled more than 206 executives in October. "This survey has identified a significant need for advocacy and education to support hospitals and help them survive the wave of changes brought on by the Affordable Care Act," Mary Anne Sloan, director of Purdue Healthcare Advisors, said in the survey. "Hospital executives are charged with enhancing patient care and managing margins with a shrinking workforce and diminishing patient volumes."
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The survey found: Hospital executives think ACOs are unstable and financially risky. Fifty-two percent said there were too many unknowns and want to see more consistency in successful models. Forty-nine percent thought their hospitals were too small for an ACO model, and 26 percent said the investment outweighed potential incentives or bonuses. Financial concerns were prominent among hospital executives. Eighty-nine percent of executives are concerned with their hospitals' ability to address cost pressure. To combat those costs, more than half want to focus on reducing waste and inefficiencies, while almost 20 percent are considering salary and staff reductions, and 15 percent are working to improve quality of care to reduce costs. Electronic Health Records (EHRs) drive a higher need for support. Executives are most concerned with the following EHR-related problems: interoperability with other providers, data retrieval and analytics, ongoing staff readiness and training, infrastructure and technology, patient engagement, security breaches, disaster recovery planning and long-term preservation of the records. They see physician adoption and usage, financial, employee training and readiness, technology, Meaningful Use qualification, vendor engagement and partnership, and patient engagement as the biggest challenges to implementing EHRs. The success of ACOs has come into question in recent months. In July, the Centers for Medicare & Medicaid Services confirmed that nine will leave the experimental Pioneer ACO program, seven of which did not produce savings and intend to apply to the alternative ACO model, according to a previous FierceHealthcare report. Securing financing, overcoming cultural resistance and complying with regulations are three of the biggest challenges to developing ACOs, FierceHealthcare previously reported.
Local hospitals partner with state agency to boost health data sharing December 06, 2013 | LVB http://www.lvb.com/article/20131206/LVB01/131209883/Local-hospitals-partner-with-stateagency-to-boost-health-data-sharing St. Luke’s University Health Network and Lehigh Valley Health Network are looking to create easier access to electronic health information for both providers and patients, while maintaining a secure web application. The Fountain Hill-based St. Luke's is using its health information exchange organization, eVantageHealth, to partner with the Pennsylvania eHealth Partnership Authority, an independent state agency, to become a pilot organization in the authority's network of community shared services. Lehigh Valley Health Network, based in Salisbury, is the second pilot. A third, Val-U-Health, is an organization based in the southwest part of the state, said Alix Goss, Pennsylvania health information technology coordinator.
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The end result will connect exchanges such as eVantageHealth, healthcare providers and other organizations statewide. These exchanges involve electronically moving health-related information among unaffiliated organizations. "This is a secure web application that providers can use to access the information," said Brandon Neiswender, senior director of Health Information Exchange at St. Luke's University Health Network. "It will be safe and secure all the time. Privacy and security are the number one drivers." Neiswender said both health care providers and patients would be able to use a smart phone, PC or iPad to access their health information. "It's kind of been an evolution of how we use the technology," Neiswender said. Over the next five months, PA eHealth, eVantageHealth, and Caradigm (St. Luke's health information exchange vendor) will be working to apply the structure and technology capabilities for this process and complete the pilot by early 2014. PA eHealth is working to meet federal requirements for health insurance exchanges in Pennsylvania, which was awarded $17.1 million under the Health Information Technology for Economic and Clinical Health Act to help establish a health information exchange. St. Luke's received $1.5 million in grant funding to build out eVantageHealth and has at least matched that amount of money itself to introduce it to the community, Neiswender said. Connecting to the state's network will help to centralize patient demographic management and improve awareness of clinical data sharing among different health care entities, Neiswender said. Both PA eHealth and eVantageHealth offer an opt-out format, allowing patients to determine how their clinical data is shared with providers, he added. Neiswender said eVantageHealth currently has more than 40 member organizations that are committed to sharing health care data, including St. Luke's main hospital campus and St. Luke's Physician Group. The data sharing is also for organizations not owned by St. Luke's, Neiswender said. "We want to make it easier for them to have access to the health information that's required by providers to provide quality of care," Neiswender said. This data covers a wide range and includes lab results, documents from hospital stays, and immunization information, Neiswender said. Over the past two years, eVantageHealth has been creating efficiencies for providers by eliminating paper results into electronic medical records technology, Neiswender said. "Other organizations are starting to build out their health information exchanges but we've been doing this work for two years now," Neiswender said.
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The Pennsylvania eHealth Partnership Authority has been using its federal grant money to solidify its approach to modernizing health care in the state, with the ultimate goal of improved patient care, more cost effective health care and overall population management, Goss said. "The work with St. Luke's is really helping us," Goss said. "We have hundreds of representatives from various parts of the health care continuum. What they [St. Luke's] are doing is proving out the framework for how we are going to be playing together in this brave new world." This 'brave new world' includes effectively exchanging health care data easily and leveraging that data so consumers are more actively engaged in all aspects of their health care, she added.
Aetna, Humana add ACOs in Pennsylvania December 05, 2013 | Healthcare Payer News http://www.healthcarepayernews.com/content/aetna-humana-add-acos-pennsylvania Aetna has formed an accountable care organization with PinnacleHealth System for its commercial plan members in the Harrisburg-Central Pennsylvania area, one of multiple value-based models launched recently in the state. Aetna will create products for fully and self-insured health plans in the region that will use PinnacleHealth’s hospitals and physician network, starting for groups of more than 51 employees available April 1, 2014. Small-group plans for groups between two and 50 employees will start in July. Under the agreement, PinnacleHealth has committed to quality and cost outcomes for Aetna members who get treatment from its physicians and agreed upon a set of quality, efficiency and patient satisfaction measures. The co-branded plans will offer a variety of designs and funding options that emphasize a collaborative team approach “to make healthcare more affordable while improving quality and efficiency,” said Patrick Young, president of Aetna’s Pennsylvania, West Virginia and Delaware operations, in a news release. Humana’s new accountable care agreement with St. Luke’s University Health Network will serve Medicare Advantage beneficiaries in the Allentown/Bethlehem and Eastern Pennsylvania region with competing HMO and PPO plan designs using the health system’s six hospitals, physicians and affiliated facilities. The agreement includes incentives in which St. Luke’s will be “rewarded for improvements in patient outcomes, quality and cost,” said Neil Steffens, Humana vice president for Pennsylvania, in a news release. Under the ACO, Humana will offer a range of population management tools, like predictive analytics and chronic care, disease management and wellness programs.
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The ACO will incorporate HEDIS (Healthcare Effectiveness Data and Information Set) measures around diabetes care and treatment, breast cancer screenings, colorectal cancer screenings and high-risk medication management. In another value-based model in the state, Blue Cross of Northeastern Pennsylvania and Susquehanna Health have launched a patient-centered medical home pilot with the health system’s primary care practices in Lycoming and Clinton counties. The medical home pilot started Nov. 1 and will continue through the end of 2015, according to media release. Blue Cross will assist the physicians in making the necessary office and technology upgrades and the integration of care coordinators into the practices for all of the medical group’s 45,617 patients, regardless of insurance coverage and a key component of this program.
Incorporating Pharmacists Into ACOs: The Next Step for Cost Savings December 04, 2013 | Becker's Hospital Review http://www.beckershospitalreview.com/accountable-care-organizations/incorporatingpharmacists-into-acos-the-next-step-for-cost-savings.html Since the start of the accountable care movement, hospitals, health systems and physician groups have been looking for ways to improve care quality and patient experience while lowering costs. One aspect of patient care that is relatively untapped by accountable care organizations but has a major impact on cost and quality outcomes is medication management. For instance, major cost savings can be achieved by prescribing generic drugs instead of brandnames: on average, the price of a generic drug is 75 percent lower than the cost of a brand-name drug at retail, according to a 2012 report by the U.S. Government Accountability Office. Additionally, medication non-adherence costs the nation's healthcare system nearly $300 billion annually, according to a 2009 study by the New England Healthcare Institute, because of increased risks of hospitalization and other medical risks. By increasing generic prescriptions and improving medication adherence, ACOs can achieve major cost savings and can improve patient outcomes at the same time. One of the more efficient ways to do so is by incorporating pharmacists in to ACOs. "Because of the role that medications play in improving quality and reducing overall costs, it behooves ACOs to take a close look at medication use in a new way and to consider the role that pharmacies and pharmacists, who are the medication experts, can play in that space," says Kristina Lunner, senior advisor with Leavitt Partners. Rich Cassidy, MD, chief accountable care officer for Walgreens, agrees. "I think we're going to see increasingly coordinated collaborative care partnerships that leverage pharmacists."
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What ACOs are doing now There are several ways ACOs are currently working with pharmacists to improve medication adherence, better manage chronic diseases and reduce overall medication spend. Care teams. Several ACOs employ clinical pharmacists and incorporate them into their clinical care teams. Minneapolis-based Allina Health, a Pioneer ACO, developed advanced care teams that include pharmacists as well a social workers, care managers and health coaches. The pharmacists, who are embedded in clinics, conduct comprehensive medication reviews for high-risk patients, according to Lee Mork, director of ambulatory pharmacy services at Allina. The program at Allina has caught several drug therapy issues with patients, Mr. Mork says. "The dose might be too high or low, or there may be adverse effects or even unnecessary drug therapy," he says. Though it is too early to see concrete results, early trends show this program has had positive effects on emergency room visits and admissions from drug therapy issues, according to Mr. Mork. Similarly, Phoenix-based Banner Health's ACO has also incorporated pharmacists into care teams. "Pharmacists are definitely part of the team," says Pamela Nenaber, CEO of pharmacy services at Banner. Research, done by Walgreens, shows that patients who receive face-to-face counseling with a pharmacist had a 7.2 percent higher medication adherence rate than patients who did not receive counseling. Prescription guidance. Another way pharmacists can use their skills to drive ACO success is by helping control how much is spent on medications. At Hunterdon Healthcare Partners, a physicianhospital organization affiliated with Hunterdon Healthcare in Flemington, N.J., that has three commercial ACO contracts, pharmacists help educate physicians on generic vs. brand name prescribing from an academic point of view. They also communicate directly with physicians about their generic prescribing rates, according to Jeff Weinstein, the CEO. Pioneer ACO Atrius Health, an alliance of six community-based medical groups and a home healthcare and hospice agency in Newton, Mass., employs clinical pharmacists who create a formulary for the group. The formulary is a set of recommendations for physicians for what they believe are the best drugs in class to use, Rick Lopez, MD, CMO of Atrius Health, explains. These pharmacists also meet individually with primary care physicians once a quarter "to review the physicians' individual prescribing practices," Dr. Lopez says. "We also don't allow pharmacy reps on our sites to talk to physicians, so that physicians do not receive conflicting messages to the quality [and] cost prescribing practices promoted by the clinical pharmacy program." Encouraging physicians to prescribe generic medication when appropriate helps lower the overall cost of care and it positively impacts patient medication adherence. "It doesn't do any good to prescribe something that [patients] can't afford," says Mr. Weinstein.
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Possible roadblock While incorporating pharmacists into accountable care efforts seems makes sense, it may not be feasible for all developing ACOs. "We're not receiving any reimbursement — Medicare doesn't cover in-office pharmacy visits," Mr. Mork says of the situation at Allina. "There's a lack of reimbursement for pharmacist services," Ms. Lunner agrees. However, she notes that the cost savings achieved by the pharmacist services often outweigh the cost of paying the pharmacists. "While lack of payment may dissuade some, more and more, ACOs are moving in that direction because of the overall savings gained," she adds. Looking ahead The role of pharmacy in accountable care doesn't have to stop at care team inclusion and encouraging generic drug prescription. There are other ways to incorporate pharmacists and pharmacies into ACO activities. For instance, incorporating pharmacists more in the retail space — instead of the office-based care team work — is a possibility for the future, especially because patients with chronic diseases tend to visit their local pharmacy to refill medication much more often than they visit their primary care physicians. "Pharmacists are likely to see them 20 times a year," says Dr. Cassidy. "Each visit is an opportunity to reinforce what the primary care or leading physician wants the patient to do." Walgreens is the only national pharmacy chain directly involved in three Medicare Shared Savings ACOs in this way. As more hard data becomes available on how relationships with pharmacists affect medication adherence, readmission rates and medication spend, the trend of incorporating pharmacists into ACOs is likely to grow and evolve.
Aetna, PinnacleHealth Form Accountable Care Collaboration December 03, 2013 | Becker's Hospital Review http://www.beckershospitalreview.com/accountable-care-organizations/aetna-pinnaclehealthform-accountable-care-collaboration.html Health insurer Aetna and Harrisburg, Pa.-based PinnacleHealth System have announced a new accountable care agreement that will create fully insured and self-insured health plans using PinnacleHealth locations and physicians. The collaboration aims to create a more coordinated patient experience, save employees money when they use PinnacleHealth-aligned providers and improve healthcare outcomes, according to the news release. As part of the agreement, PinnacleHealth committed to quality and cost outcomes for Aetna members. Aetna and the system agreed to quality, efficiency and patient satisfaction metrics.
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The first product, for employers with 51 or more employees, will be available April 1, 2014. A second product for groups with 50 or less workers will be available July 1, 2014. "PinnacleHealth continually works to find solutions for our community, including its businesses. We are one of the lowest-cost providers in the state, yet we offer care that's nationally recognized for its high quality. This is a great opportunity for us to use both attributes to help employers manage healthcare costs and contribute to their employees' health," Michael Young, president and CEO of PinnacleHealth, said in the release.
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Strategy McCullough-Hyde Memorial Hospital, Mercy Health to Explore Affiliation December 13, 2013 | Becker's Hospital Review http://www.beckershospitalreview.com/hospital-transactions-and-valuation/mccullough-hydememorial-hospital-mercy-health-to-explore-affiliation.html McCullough-Hyde Memorial Hospital in Oxford, Ohio, and Cincinnati-based Mercy Health have announced they will explore a strategic affiliation. McCullough-Hyde and Mercy will now enter into exclusive discussions concerning the affiliation, according to a news release. McCullough-Hyde officials will consider a variety of relationship models, although they intend to retain local ownership and control. The process will take an estimated six to eight months. The McCullough-Hyde board began investigating potential affiliations in October 2012. The hospital decided to explore affiliation options to maintain a position of financial strength and prepare for future changes and challenges. "We are fortunate to be making this decision from a position of strength," Bryan Hehemann, CEO of McCullough-Hyde, said in the release. "We are financially strong, but being proactive allows us to take our future into our own hands. Maintaining a strong local health system has always been and will remain our mission. A relationship with Mercy Health will only reinforce that charge."
Merger Between Lehigh Valley, Greater Hazleton Systems Receives Clearance December 12, 2013 | Becker's Hospital Review http://www.beckershospitalreview.com/hospital-transactions-and-valuation/merger-betweenlehigh-valley-greater-hazleton-systems-receives-clearance.html The merger between Lehigh Valley Health Network in Allentown, Pa., and Greater Hazleton (Pa.) Health Alliance has received the green light from regulatory officials. The Federal Trade Commission, the office of Pennsylvania Attorney General Kathleen Kane and the Orphans' Court of Luzerne County approved the deal, which will become effective Jan. 1. According to the merger agreement, LVHN will absorb Greater Hazleton and its entities, becoming the sole corporate organization. The 150-bed Hazleton (Pa.) General Hospital will be renamed Lehigh Valley Hospital-Hazleton. Financial details of the deal were not disclosed.
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LVHN and Greater Hazleton signed an agreement to merge assets in April. LVHN now has four hospitals within its network. In October, LVHN and Westfield Hospital, also in Allentown, signed an asset purchase agreement. Under that deal, LVHN will buy Westfield Hospital for an undisclosed amount and convert it into an orthopedic center. LVHN will also acquire Westfield Surgery Center.
WestCare Health System, Duke LifePoint Healthcare Reach Acquisition Agreement December 11, 2013 | Becker's Hospital Review http://www.beckershospitalreview.com/hospital-transactions-and-valuation/westcare-healthsystem-duke-lifepoint-healthcare-reach-acquisition-agreement.html WestCare Health System, based in Sylva, N.C., has signed a memorandum of understanding to merge with Duke LifePoint Healthcare, a joint venture of Durham, N.C.-based Duke University Health System and Brentwood, Tenn.-based LifePoint Hosptials, according to a Mountain Xpressreport. WestCare initially decided to partner with Duke in October. After due diligence and the negotiation process is completed in 60 to 90 days, the parties will enter into a definitive agreement, according to the report. The proposed transaction will involve Duke purchasing WestCare members Harris Regional Hospital in Sylva, N.C., and Swain County Hospital in Bryson City, N.C. Financial details were not disclosed. It appears the acquisition will end WestCare's ties with Haywood Regional Medical Center in Clyde, N.C. WestCare and Haywood teamed up several years ago to become MedWest Health System, which Charlotte, N.C.-based Carolinas HealthCare System has operated as a unit. However, there was no merger of assets, and the funds generated and spent by WestCare and Haywood remained separate.
Halifax Regional Medical Center to Merge With Novant Health December 09, 2013 | Becker's Hospital Review http://www.beckershospitalreview.com/hospital-transactions-and-valuation/halifax-regionalmedical-center-to-merge-with-novant-health.html Novant Health in Winston-Salem, N.C., and Halifax Regional Medical Center in Roanoke Rapids, N.C., have agreed to a merger deal. Financial details of the proposed transaction were not disclosed. Before Halifax Regional merges with Novant, the two organizations will enter a one-year management agreement, beginning this March. Due diligence also will occur during this period. Bob Patterson, Halifax Regional's board chairman, said he expects the deal will result in Novant investing $35 million over five years for capital projects.
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The 204-bed Halifax Regional has been searching for a strategic partner since the beginning of this year. In September 2012, Fitch Ratings downgraded Halifax Regional to "BB" due to its "inconsistent operating performance" and poor payer mix. The hospital also experienced large declines in admissions, surgeries and births in 2012, and physician recruitment has also been a challenge, Fitch said. If the deal is finalized, Halifax Regional would be Novant's 15th hospital.
Tulare Regional Medical Center to Affiliate With Healthcare Conglomerate Associates December 09, 2013 | Becker's Hospital Review http://www.beckershospitalreview.com/hospital-transactions-and-valuation/tulare-regionalmedical-center-to-affiliate-with-healthcare-conglomerate-associates.html Tulare (Calif.) Regional Medical Center's board of directors has unanimously selected Healthcare Conglomerate Associates as a possible affiliation partner, according to a Visalia Times-Delta report. Healthcare Conglomerate Associates is led by developer Iddo Benzeevi, Benny Benzeevi, MD, and Jim Doty, senior principal for physician strategies and services at VHA, a national healthcare provider network. The group told the Tulare Regional board members their construction and turnaround expertise will help them develop the Tulare district into a "best-in-class" healthcare system, according to the report. The 112-bed public hospital began its search for a lease or affiliation partner in September. Officials have said Tulare Regional is suffering from patient leakage to Kaweah Delta Health Care District, a 581-bed public hospital system in Visalia, Calif. The hospital district and Healthcare Conglomerate Associates will now negotiate a short-term management contract, with the ultimate goal of a long-term lease, according to the report. The expected time frame for the completion of those negotiations was not disclosed.
St. Elizabeth Healthcare, TriHealth Create Joint Venture Focused on Triple Aim December 06, 2013 | Becker's Hospital Review http://www.beckershospitalreview.com/hospital-transactions-and-valuation/st-elizabethhealthcare-trihealth-create-joint-venture-focused-on-triple-aim.html Citing the triple aim — better health outcomes, improved patient care and reduced costs — Covington, Ky.-based St. Elizabeth Healthcare and Cincinnati-based TriHealth signed a letter of intent to create a joint venture organization.
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Under terms of the deal, St. Elizabeth Healthcare and TriHealth will jointly own the new group, Healthcare Solutions Network. HSN will be a regional health organization coordinating care through physician alignment and partnerships with local employers and payers. The systems said the transaction is neither a merger nor an acquisition. HSN is a joint venture only. TriHealth CEO John Prout and St. Elizabeth Healthcare CEO John Dubis will lead HSN as co-CEOs. Together, in the first year, St. Elizabeth Healthcare and TriHealth will create a new Medicare Advantage plan, build a common infrastructure for employed and independent physicians, develop a population health management program and adopt best practices across several service lines. "We recognize healthcare is changing rapidly," Mr. Dubis said in a news release. "It's imperative to be able to accelerate ways to streamline patient care, improve quality outcomes and help eliminate or lower unnecessary costs. This kind of innovative teamwork is needed to accomplish these goals." St. Elizabeth is comprised of six acute-care hospitals with almost 1,200 licensed beds. TriHealth, an affiliate of Englewood, Colo.-based Catholic Health Initiatives, has four acute-care hospitals and an expansive ambulatory network throughout the Cincinnati metropolitan area.
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