The Knives Come Out on Capitol Hill Between Hospitals, Insurers and Physicians

In a congressional hearing about the state of competition in the health care marketplace, representatives of the nation’s largest health care associations defended their constituencies and raised questions about “the other guy”. AHA President Rick Pollack drew a sharp contrast between the realignment taking place in the hospital and health system field and the consolidation proposed in the health insurance industry. Click here for his testimony. The AMA’s representative sharply criticized the health insurance mergers saying consolidation removes marketplace competition. Click here for the NY Times report on the AMA study on the insurance mergers. She also criticized some aspects of hospital acquisition of physician practices. Click here for her testimony. The health insurance industry said the mergers enhance competition. Click here for AHIP’s testimony. To watch the hearing, click here for complete coverage.

  • When a hospital buys a physician practice, those doctors are more likely to refer patients to that facility, raising concerns about costs and quality, according to a research report released last week. Researchers at Stanford University in California pored over millions of patient admissions in 2009 and determined that doctors who worked for medical groups owned by the hospital admitted patients to that facility 83 percent of the time. Click here.

Rating Agencies Giving High Marks to Not-for-Profit Hospitals

During the past two weeks, three of the nation’s major ratings agencies have revised their financial outlook for the country’s not-for-profit hospitals. Standard & Poor’s Ratings Service has revised its outlook to stable from negative. (Click here.) For the first time in six years, Moody’s Investors Service upgraded its assessment of the financial outlook to stable. (Click here.) The outlook had been negative since 2008. Additionally, median operating profitability for U.S. not-for-profit hospitals showed strong gains over the past year, though growth in operating cash flows show the credit gap widening between higher- and lower-rated borrowers, according to Fitch Ratings. (Click here.)


MedPAC Outlines Plans for Unified Payment System for Post Acute Care

Congressional Medicare advisers outlined their plan for a two-part “unified” payment system for post-acute care services that sets reimbursement for home health providers separately from the rest of post-acute care providers. The Medicare Payment Advisory Commission last week for the first time publicly discussed replacing Medicare’s four post-acute care payment systems.The Improving Medicare Post-Acute Care Act requires the Medicare Payment Advisory Commission to design by next June a prototype of a unified pay system spanning long-term care hospitals, inpatient rehabilitation facilities, nursing homes and home health providers. Click here for MedPAC’s detailed slide presentation.


More Hospitals, Clinicians Switching Their EHR Vendors

Eight percent of eligible professionals replaced their EHRs with options from other vendors in 2014, up from 2% in 2013, according to a government report released last week. Among eligible hospitals, 4% “ripped and replaced” in 2014, compared with less than 1% in 2013. The trend could grow this year and next, particularly among eligible professionals, and some groups that had used multiple systems are moving toward relying on single vendors. Click here for the 10 detailed slides presented last week.

  • Epic Systems tops the list of the 10 most popular EHR platforms, followed by Allscripts and Practice Fusion, according to a report published by Software Advice. Several factors, including the number of product users and the brand’s social media presence, were considered by the firm when ranking the platforms. Other products on the list are the EHR systems of Cerner, MEDITECH and eClinicalWorks. Click here to see all the rankings.

Congress Considering Changes to Medicaid to Reduce Fraud

The Energy and Commerce Subcommittee on Health last week reviewed six bills authored by committee members to strengthen the Medicaid program by closing loopholes and eliminating fraud in the program. One bill addresses issues raised in a new HHS report (click here) that found health care providers terminated from Medicaid in one state were still participating in Medicaid and CHIP programs in other states. Another bill would close a loophole by counting portions of income from annuities of a community spouse as income available to institutionalized spouses for purposes of determining Medicaid eligibility for long-term care services. Click here for more details.


Lawmakers Wants Medicare “Smart Card” to Fight Fraud

Two GOP lawmakers are pushing a plan aimed at replacing traditional Medicare cards with smart cards containing computer chips to guard against fraud and identity theft. Rep. Peter Roskam’s (R-IL) proposal (HR 3220) would create a test program to distribute Medicare common access cards to store personal and health»-related data. The senior tax writer predicted the measure would draw broad support as a stand-alone bill or as an add-on to other legislation in the Ways and Means Committee, as the GOP hunts for ways to curb the growth of entitlements. Senator Mark Kirk (R-IL) has the same bill in the senate. CMS estimates that improper payments made up about 12.7 percent of all Medicare fee-for-service payments in fiscal 2014. Click here for more information.


Health Spending Continues Moderate Trend

National health spending in July was just 5.6 percent higher than the year prior – down from last winter’s high 6.8 percent growth rates, according to a new analysis from Altarum Institute. Health care price growth, meanwhile, stayed at just 1.1 percent – its fourth consecutive month at such a low figure. The health sector also added a whopping 314,000 jobs in the first eight months of this year – almost twice the number that were added during the first eight months of 2014. It’s the highest rate of year-over-year job growth in the sector since 2002. Click here for details.


Medical Schools Now Teaching Cost, Value and Effectiveness

In a stark departure from the past, the vast majority of the country’s medical schools now integrate discussions of cost, value and effectiveness into their curricula. A recent AAMC survey finds that 129 of 140 responding medical schools offered a required course on the cost of health care during the 2013-2014 school year. Nearly 40 percent of the schools said they also present the issue in elective courses. Click here for the story.


Medicare Considering New Payments for Physician Services

Imagine physicians getting paid for sitting down with a nutritionist and a nurse practitioner to discuss how to manage a Medicare patient with diabetes, even though the patient is not present. Or getting paid for analyzing a patient’s blood pressure and glucose readings transmitted from his or her home to the office. Or getting paid for simply talking with the patient on the telephone. CMS is giving serious consideration to proposals that would pay for these services and more. Click here.


ICER Continues Challenge of High Priced Drugs; Medicare Rx Spending Reviewed

Novartis’ new high-priced heart failure drug Entresto is cost-effective given the added health benefits the treatment provides over the current standard of care for heart failure patients, according to a new draft analysis from the Institute for Clinical and Economic Review. However, the drug’s $4,560 annual list price may still place “excessive cost burdens on the overall healthcare system,” said ICER, which predicted that nearly 2 million U.S. patients could be prescribed the drug over the next five years. Click here to see the report.

  • ICER gave a less positive review of another new heart failure treatment, St. Jude’s CardioMems HF System. The group said current evidence is insufficient to determine that the device improves overall patient outcomes, and at a list price of nearly $18,000 it would create excessive costs to the health care system. ICER suggested a 60 percent discount, or $7,622, is a more appropriate price based on the value the device provides.
  • ICER was also critical of the pricing of new cholesterol drugs called PCSK9 inhibitors. Click here.
  • MedPAC last week provided more details on the impact of Rx prices on the Medicare program. Click here for its slide presentation.

Congress To Focus on Medicare Beneficiary Premium Increases

Should 30% of Medicare beneficiaries shoulder a 52% premium hike next year while the other 70% pay no more at all? Advocates for seniors do not think so, and they are making a push to convince Congress to stop it from happening. For these 16.5 million enrollees facing the stiff increase, monthly premiums would rise to $159.30 from $104.90, according to the recent annual report of the Medicare trustees. Meanwhile, 36 million Medicare Part B enrollees would have their premiums hold steady at $104.90 because increases are tied to Social Security cost-of-living adjustments as part of a “hold harmless provision” in the Social Security Act. Click here for the story from Time.


MedPAC Tackles Growth in Freestanding EDs

MedPAC last week took a closer look at freestanding emergency departments and noted that Medicare payment growth at hospital-based EDs grew substantially from 2008 to 2013 ($4.4 to $6.1 Billion) while utilization grew about 1.6 percent a year. MedPAC also revealed the meteoric growth of freestanding EDs not affiliated with hospitals – thereby ineligible for Medicare – in Texas, Colorado and Arizona with 90 percent pf them in the Lone Star state. Click here for the MedPAC slide presentation.


Health Exchange Customers Will Have More Selection

More than 90 percent of exchange customers across 28 states had at least six silver plans to choose from when shopping for coverage this year, up from 80 percent of customers who had a similar level of choice in 2014, according to an analysis released last week by the GAO. Silver plans, which cover 70 percent of medical costs on average, are by far the most popular products sold through the government-run marketplaces, with nearly 70 percent of customers choosing such plans. Click here for the GAO report.


Judge Says Fixed Indemnity Insurance Plans OK

A federal judge last week issued a permanent injunction prohibiting the Obama administration from enforcing a rule restricting the sale of “fixed indemnity” insurance plans. CMS prohibited the sale of the skimpy plans last year to individuals unless they also have coverage that meets the ACA’s individual mandate requirements. Fixed indemnity plans typically offer a fixed amount of benefits, such as $100 per month. Companies that violated the CMS rule would be subject to fines of up to $100 per day per customer. Central United Life Insurance Company, which sells these plans, sued the Obama administration on grounds that the rule violated federal law explicitly allowing fixed indemnity plans. D.C. District Court Judge Royce C. Lamberth, a Reagan appointee, agreed. You can read his opinion here.


ACOs Have Trouble Getting Outside Data: Survey

Accountable care organizations report difficulty in accessing data outside the organization and data integration as their top two challenges in a new survey from the eHealth Initiative. Though 62 percent of the 69 ACOs responding to the survey said that integrating data is getting easier in primary care–and a like percentage said so of lab results–behavioral health, long-term care and home health agencies were among the least likely to be integrated with an ACO. Click here for the survey.


CMS Unveils Health Equity Initiative

CMS last week unveiled the first plan to address health equity in Medicare. The CMS Equity Plan focuses on Medicare populations that experience disproportionately high burdens of disease, lower quality of care, and barriers accessing care. These include racial and ethnic minorities, sexual and gender minorities, people with disabilities, and those living in rural areas. Click here for the CMS announcement.


NIH: More Intensive High Blood Pressure Management Lowers Death Risk

More intensive management of high blood pressure, below a commonly recommended blood pressure target, significantly reduces rates of cardiovascular disease, and lowers risk of death in a group of adults 50 years and older with high blood pressure. This is according to the initial results of a landmark clinical trial sponsored by the National Institutes of Health called the Systolic Blood Pressure Intervention Trial (SPRINT). Click here for details from NIH.


Senators Challenge OxyContin OK for Kids

A group of senators, led by Joe Manchin (D-WV), have requested hearings on FDA’s decision to approve OxyContin for use in children, as well as a broader investigation into the growing abuse of prescription painkillers. FDA approved OxyContin for use in children as young as 11 earlier this year following new studies by its manufacturer, Purdue Pharma, about the drug’s use in children. Click here for their letter requesting the hearing.


Anesthesiology to Change Competency Review Process

The American Board of Anesthesiology says it will retool its process for assessing physicians’ competency, putting an end to a practice of testing every 10 years that has drawn critics across multiple specialties. The certifying body for anesthesiologists announced last week it was redesigning its Maintenance of Certification in Anesthesiology Program, or MOCA. The move was several years in the making, as more physicians complained that preparing for the more than 300-question exam interrupted their clinical practice. Others said some of the questions had nothing to do their particular specialties. Click here for details.


Chicago’s South Side Will Get New Trauma Center

Chicago’s South Side will become home to a medical center able to handle adult patients with some of the most urgent, traumatic health problems, officials announced late last week, answering what has been a years long fight over inequities in health care and the dearth of nearby care for people living in some Chicago neighborhoods. At a cost of $40 million, a new Level 1 trauma center will open at Holy Cross Hospital, officials from the University of Chicago Medicine and Sinai Health System said. The two organizations said they would jointly operate the center. Click here for the story.