NJ Physician Magazine December 2015

DECEMBER JULY 2015 2012 Visit us now online at www.NJPhysician.org

National Study Points Out Potential Danger of Monopolies in NJ Healthcare Can Telemedicine Be the Future of Health Care?

Judge Denies Halt in OMNIA Rollout

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CONTENTS

4

National Study Points Out Potential Danger of Monopolies in NJ Healthcare

6

Can Telemedicine Be the Future of Health Care

9

Meridian Health to Offer Virtual Physician Visits via Teledoc in 2016

9

Judge Denies Halt in OMNIA rollout

11

Senate Committee Amends Bill to Regulate Tax Burden on Nonprofit Hospitals

12

Out-Of-Network Bill Tabled at Commerce Committee Hearing

13

Bill Would Help Patients Get Small Quantities of Medicine to Synchronize Their Prescriptions

14

Barnabas Turns to Quest for Lab Operations in Cost-Cutting Move

14

For Profit Prime Buying Another NJ Hospital

14

Temple University Hospital CEO to Join University Hospital in Newark

December 2015

3

National Study Points Out Potential Danger of Monopolies in NJ Healthcare Andrew Kitchenman private payer data shows state is in line for prices of private inpatient hospitalizations, despite having some of highest Medicare costs in country A national study of the prices paid by private insurers for hospital services has pointed out a potential danger for New Jersey -where hospitals have monopolies, healthcare costs are higher.

This is of particular import in this state, where hospital mergers are becoming more prevalent.

The Health Care Pricing Project found that prices are 15.3 percent higher across the country in places where there’s only one hospital system compared with places with four or more competing hospitals.

In addition, the study found that hospitals are paid wildly different amounts for the same procedures. One unidentified South Jersey hospital received roughly four times as much as another to perform colonoscopies.

And in another striking finding, the study indicated that the payments from private insurers for inpatient hospital stays in New Jersey were average compared with other states, especially when adjusted for resident’s income.

The state has long been recognized as having some of the highest Medicare hospital payments in the country.

Health researchers said the report shows the potential benefit of providing access to healthcare payment data that’s long been hidden from public view. But they also acknowledged that the study is incomplete. Two companies that insure patients in New Jersey -- Aetna and UnitedHealthcare -- participated in the study, while New Jersey’s largest insurer, Horizon Blue Cross Blue Shield of New Jersey, didn’t participate.

Study coauthor Martin Gaynor said the information about monopolies pointed out the need for regulators at both the state and federal levels to be on the watch for antitrust violations.

“We find these very, very wide differences in prices -- some of those prices appear to be associated with how many competitors there are in a market,” Gaynor said.

Rutgers Center for State Health Policy Director Joel Cantor said that New Jersey is a “a little bit late to the game” of hospital consolidation that’s associated with higher prices elsewhere.

“There’s a very solid body of research showing that (in) more consolidated hospital markets, where there’s less competition, prices are higher,” Cantor said.

He added that with more mergers likely in the future, those active in New Jersey health policy should have their “collective antennae up” over the possibility of less competition driving up costs.

Wardell Sanders, president of the New Jersey Association of Health Plans, noted that the Federal Trade Commission has been scrutinizing proposed hospital mergers for this very reason.

More broadly, Gaynor said state governments could benefit from requiring payment information publicly available.

New Jersey legislators have proposed such a mechanism in the form of a “Health Care Price Index.” The bill would make the typical prices paid by private insurers for healthcare services publicly available. While the Assembly Financial Institutions and Insurance Committee released the bill, A-952, it hasn’t been scheduled for a vote in either legislative house this session.

Making this data available could put downward pressure on the reimbursement rates remitted to the highest-paid hospitals, said Gaynor, an economics and health policy professor for Carnegie Mellon University in Pittsburgh. For example, employers with access to the data could question why insurers include high-cost hospitals in their networks, if the differences in prices aren’t matched by similar differences in quality.

Gaynor imagined what an employer would tell an insurer.

“Why is that place in your network? It’s wasting money,” Gaynor said of hospitals that receive more for identical services. “Higher benefits costs for us come out of our employees’ hides,” since it reduces the amount available for worker pay.

And the growing trend of high-deductible plans -- which require patients to pay more out of pocket -- could increase pressure for more transparency.

While Gaynor said the data indicates that higher-quality hospitals are paid more, differences in quality don’t account for all of the price differences.

But Gaynor added that wasn’t the only possible outcome; low-priced hospitals could use the data to argue for higher pay.

4 New Jersey Physician

Gaynor noted the differences in hospital colonoscopies in the Camden Hospital Referral Region -- a sprawling area that includes nearly all of South Jersey. From 2008 to 2011, the average price ranged from roughly $750 at the lowest-priced hospital to roughly $3,000 at the high end. The hospital names were excluded from the data for both contractual and antitrust reasons.

“A colonoscopy is a colonoscopy is a colonoscopy,” Gaynor said. “How is it you can go to one place in the Camden region and it can cost four times as much as some other place? It’s hard to justify.”

Cantor described the price differences as “certainly a marker of failure in the economics of markets, when you see such huge variation for what is essentially the same product -- with no good reason for that variation.”

Cantor added that the lack of price transparency compared with other consumer products adds to the price differences.

“There’s no competition for the individual consumers loyalties,” he said of the South Jersey colonoscopies. “There’s no legitimate reason for it. There is a reason for it. It’s because there’s no competition.”

But Cantor added that even with more transparency, employers might not push down prices. That’s because most small- to medium-sized business don’t have the large human-resources departments to do the research.

“It means the employer has to be not just in the business of producing their own good or service, but also in the healthcare business,” Cantor said.

The maps accompanying the report also tell a somewhat surprising story for New Jersey, which is established as a national leader in Medicare payments, as well as total healthcare spending in the final months of life. But while the maps show New Jersey in deep blue in Medicare prices – showing that it’s a national leader – it’s a much lighter shade for private-insurance prices, and below the national average in private prices adjusted for residents’ income.

Sean Hopkins, senior vice president of health economics for the New Jersey Hospital Association, noted that Medicare payments are based on the state’s labor costs.

“That said, even in New Jersey, Medicare is a less-than-cost payer,” Hopkins said in an emailed response to questions. “Medicare payments to New Jersey hospitals, on average, only cover about 96 percent of a hospital’s actual cost.”

Hopkins also suggested that the national data on hospital monopolies might not be as relevant to a high-density state like New Jersey. Rural areas have less competition and higher prices.

“Density of both population and hospitals can have an impact on price,” he said. “Consumers want and have choices for where they receive hospital care, so a natural byproduct of that competitive environment could a drive of price.”

Sanders said that the study’s conclusion that New Jersey hospital prices are average or lower than average is open to question, without all of the data available.

“My sense is that we have higher hospital costs,” Sanders said.

Gaynor acknowledged that there were limits to the data, which he said is all the more reason that Blue Cross Blue Shield organizations should add their data for future studies. However, Gaynor said that the researchers found similar price trends in areas with high numbers of Blue Cross members, as well as areas with fewer Blue Cross members.

Cantor added that while the absence of Horizon data means that the study results come with an “asterisk” for New Jersey, he didn’t expect that adding Horizon would change the results dramatically. That’s because, as the largest insurer in the state, Horizon generally doesn’t feel pressure to pay less than other health plans.

The study used information compiled by the Washington, D.C.,-based nonprofit Health Care Cost Institute. The data covers 5 percent of all health spending, and 1 percent of the gross domestic product.

December 2015

5

Can Telemedicine Be The Future Of Health Care?

Telemedicine allows patients to receive medical treatment regardless of time and distance. But why have U.S. states been so slow to embrace it?

Michael Ollove Telemedicine has been praised as a cost-effective way to link doctors and patients, enabling physicians to monitor their medical conditions and consult with specialists in a way that overcomes time and distance.

But despite a half-century of technological advances, the ready availability of interactive devices, and the full-throated encouragement of the Obama administration, advocates say telemedicine has failed to reach its full potential, due largely to policies in some states that make it difficult to practice, and pay for, such care.

“The technology has opened up this huge opportunity, this game changer,” said Allison Wils, director of health policy for the ERISA Industry Council, a trade association that advocates on issues related to health care for large, multistate employers. “The problem is that there are still varying levels of comfort with it across the states.”

Some states require that patients be accompanied by a health professional during telemedicine sessions. Hawaii, Indiana and Ohio limit Medicaid coverage to patients who live a minimum distance from their providers. (In Indiana, for example, the standard is 20 miles.) Another significant hurdle is the requirement that doctors be licensed in every state where they practice medicine, digitally or otherwise.

Because of those barriers, telemedicine advocates say, the elderly, the infirm, the isolated and the busy are being denied full access to needed health care.

States that have been slower to embrace telemedicine, including Arkansas, Rhode Island and Texas, are merely being prudent, waiting to be assured that the new technology does not diminish the quality of care patients receive, say some physician regulatory boards. “There is a concern that whatever is put in place not be dangerous,” said Lisa Robin, chief advocacy officer for the Federation of State Medical Boards, which represents the state boards that license and discipline doctors.

But those pushing for a less restrictive approach to telemedicine say it is not an inferior form of medicine but a vehicle for extending quality health care to more places. And, they argue, some policies hampering the spread of telemedicine have been motivated by fear of competition among more traditional practitioners.

“In some states, the issue comes down to protecting their doctors from outside competition,” said Latoya Thomas, director of state health policy at the American Telemedicine Association (ATA). “Their doctors with brick-and-mortar practices assume that someone who uses telemedicine is trying to take away patients.”

NASA Origins Telemedicine’s origins date back to the early days of the U.S. space program, when NASA scientists developed technology that enabled doctors to monitor the physiological conditions of astronauts in space. Thanks to rapid advances in interactive technology, telemedicine developed quickly, principally to link physicians to remote populations in such places as Alaska and Arizona's Tohono O'odham Indian Reservation.

Telemedicine also spread from rural to urban areas. Doctors now monitor or communicate with patients from afar on everything from routine preventive care to chronic disease management and psychiatric conditions. Primary care doctors and their patients consult with specialists and diagnosticians who might otherwise be beyond their geographic reach.

The industry received a major boost from the American Recovery and Reinvestment Act of 2009 and the Affordable Care Act of 2010, both of which increased federal spending on health information technology and telemedicine. President Barack Obama has often extolled its potential to increase access to quality health care while cutting costs. Nearly 13 million Americans use telemedicine, according to the ATA. Regulating Coverage As telemedicine spread in the 2000s, more state legislatures and state medical regulatory boards adopted telemedicine policies.

Some state laws and regulations govern insurance coverage of telemedicine.

Twenty-nine states now have parity laws that require private insurers to pay for telemedicine at the same rate as in-person services, according to the ATA. Arkansas, Michigan, Oregon and Vermont only require parity if the technology is both audio and visual or in real-time rather than recorded. Arizona only enforces parity when patients live very far from providers.

In addition, 48 state Medicaid programs offer at least some coverage for telemedicine. Connecticut and Rhode Island are the only states that largely refuse to pay for telemedicine in their Medicaid programs. About half of state Medicaid programs require that a patient be in some sort of medical facility during telemedicine encounters, rather than at home.

Earlier this year, Connecticut enacted a law requiring private insurers to cover telemedicine.

6 New Jersey Physician

Joseph Wendelken, of the Rhode Island Health Department, said that, because of Rhode Island’s small size, “what is generally referred to as telehealth is less common in our state.” Rhode Islanders, he noted, are generally located within an hour’s drive of first-class medical centers with topflight specialists.

Restrictions on Telemedicine Many states have also adopted laws and policies concerning how physicians practice telemedicine. Some states require that a health professional be physically present with a patient during a telemedicine session. Most states require patients to sign special consent forms.

Some states require in-person follow-ups. Texas is locked in a federal lawsuit with the provider Teladoc, which digitally links patients and doctors, over the state’s requirement that doctors meet with patients in person before moving to a digital relationship or have other providers physically present with patients when treating them remotely for the first time. Arkansas has a similar law.

Russell Thomas, a family practice doctor in the small town of Eagle Lake, Texas, and former member of the Texas Medical Board and of the Federation of State Medical Boards, provides primary care through videoconferencing to at-risk students at a high school 300 miles away. He also consults with cardiologists and dermatologists in Houston for his patients.

But, he said, doctors should first meet with patients before moving to a digital relationship. “I can’t imagine that I can provide the best care to my patients if I never laid eyes on them, if I never physically assessed them.”

For its part, the ATA argues that telemedicine doctors should be governed by the same policies and restrictions that apply to traditional physicians. “Our belief is that if you license a health care provider, you expect them to uphold the standard of care—whatever tools they are using,” the ATA’s Thomas said. In other words, it should be left up to each physician who practices telemedicine to determine if a remote session suffices or if a face-to-face visit is necessary.

States that put additional requirements on telemedicine doctors, she said, are depriving people of access to medical care. “It’s a delivery model that may not be familiar to everyone, but where it is available, it should be used fully.”

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December 2015

7

REMEMBER WHY YOU BECAME A DOCTOR?

SOVEREIGN HEALTH DOES. To take care of patients, not paperwork To deal with health conditions, not health plans To be a physician, not an administrator

Join our physician-owned, physician-led medical group, and practice medicine the way it’s meant to be practiced – with the patient always coming first and the physician truly sovereign.

JOHN HAJJAR, MD, FACS, MBA Founder, Chairman, and CEO

My reason for becoming a physician is simple: I wanted to help people. Sovereign truly is a physician-led, vertically integrated healthcare system that does just that. Our mission is to deliver high-quality, cost-effective care through our exceptionally skilled physicians and staff at our conveniently located state-of-the-art facilities.

GLENN A. GMYREK, MD Chief Medical Officer

My goal as a physician, first and foremost, is to help people feel better. In today’s healthcare environment we all know this can be very challenging. Fortunately, at Sovereign Health Medical Group, I have been able to practice medicine without any of the distractions that can make a physician’s job tougher than it already is.

PHYSICIAN-LED, MANAGEMENT DRIVEN To learn more about “The Sovereign Difference,” contact Paul Angresano, Vice President, at 201-855-8376 or pangresano@sovms.com, or visit www.sovereignhealthsystem.com CORPORATE OFFICE: SOVEREIGN MEDICAL SERVICES, INC., 85 HARRISTOWN RD., GLEN ROCK NJ, 07452, 201-834-1100

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Meridian Health to Offer Virtual Physician Visits via Teladoc in 2016

by Heather Landi

New Jersey health system Meridian Health will launch telehealth services in the first quarter of 2016 and has tapped Lewisville, Texas-based Teladoc to provide the telehealth physician consults.

In offering virtual physician visits, Meridian expects to enhance convenient and affordable access to quality non-emergent care within its catchment area, the heath system said in a release.

“Adding telehealth options to Meridian’s wide range of health care services is a natural extension of our commitment to highquality and affordable health care, patient-centered practices and the overall health and well-being of our communities,” Sal Inciardi, senior vice president of business development, Meridian Health, said in a statement. “Teladoc’s reputation for clinical quality, along with its size and scalability, is ideally suited to Meridian’s dedication to quality and to our continuing growth and expansion.”

“Teladoc shares Meridian Health’s commitment to quality, affordable care and we are honored to be selected as a strategic telehealth partner by such an impressive organization,” Alan C. Roga, M.D., senior vice president and general manager of the provider market for Teladoc, said.

Meridian Health is a five-hospital system and provides healthcare services through more than 100 locations, including hospitals, skilled nursing and rehabilitation centers, outpatient centers, fitness and wellness centers and numerous other facilities and services.

Judge denies halt in OMNIA rollout

By Anjalee Khemlani A New Jersey court denied an injunction in the rollout of a new Horizon Blue Cross Blue Shield of New Jersey health plan.

St. Peter's University Hospital filed what became the first of three lawsuits attempting to halt the rollout of the OMNIA Health Plans — a new tiered network plan that divided the state's hospitals into two in-network groups.

Many of the state's suburban hospitals are in the first tier and many Catholic and urban hospitals are in the second tier.

St. Peter's was provided materials from Horizon to show why it was placed into the second tier, and was seeking a legal path to be allowed into Tier 1.

The judge determined the remedy sought was extraordinary, said Jeffery Greenbaum, who represents St. Peter's.

The case was filed in Middlesex County and heard by Judge Frank Ciuffani, who originally denied the halt in marketing of the plan, but asked Horizon to turn over details of how it chose to place St. Peter's in the second tier.

The hospital previously said it could lose anywhere between $4.5 million and $36 million in the future, as the OMNIA Alliance is geared toward steering patients — through low or no copays, along with physician referrals — to Tier 1 providers.

St. Peter’s heavily relies on private payers, according to court documents. The payer mix is 53.2 percent commercial insurance, 23 percent Medicaid, 19.4 percent Medicare and 4.4 percent uninsured, including charity care.

Horizon is also largely responsible for the reimbursements received by St. Peter’s, including $79 million in 2014, which was about 20 percent of total revenue and about 25 percent of its net patient service revenue, according to court documents.

"Horizon is pleased that the court has refused this effort by St. Peter’s to change the implementation of Horizon’s OMNIA Health Plans. This is good news for the thousands of individuals who have purchased OMNIA Health Plans to date. They can rest easy over the holidays knowing their new, lower-cost OMNIA Health Plan coverage will be effective come Jan. 1, 2016," Horizon said in a statement.

Greenbaum said the judge determined a hearing to allow a full opportunity to argue its claim of Horizon's breach of contract would be scheduled within the next four months.

"We are optimistic" in ultimately being able to prove a breach of contract, Greenbaum said.

December 2015

9

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Senate committee amends bill to regulate tax burden on nonprofit hospitals

By Anjalee Khemlani A bill to regulate the potential tax burden on not-for-profit hospitals was amended at a Senate committee hearing Monday to protect satellite emergency centers, too.

The bill seeks to thwart an onslaught of lawsuits after a recent tax settlement between Atlantic Health and the city of Morristown put the non-profit hospital on the line for property taxes since 2006, as well as for the next 10 years.

Senate President Steve Sweeney (D-West Deptford) and Sens. Robert Singer (D-Lakewood) and Joe Vitale (D-Woodbridge) introduced the bill earlier this month. The bill would collect an amount based on licensed acute care beds at hospitals as “community service contributions.”

In lieu of taxes, these contributions would be strictly used toward local public safety funding or to reduce the property tax levy for the municipality. The towns would then remit 5 percent to the counties.

Hospitals would be on the line for $2.50 per day per licensed bed. Satellite emergency care facilities would pay $250 per day --a $500 reduction from the original bill draft. All fees would be collected in four installments throughout the year.

There are a few ways out for the hospitals and satellite centers, though. The language in the bill was specifically included to avoid penalizing urban safety-net hospitals.

The bill states that any voluntary contributions by the hospitals would be deducted from the community service payments - and that any hospital that is losing money could apply for an exemption from the payments for the current tax year.

The exemption now also applies to satellite centers, and along with the reduced fee assessed, aims to avoid a dire financial situation for the centers, which can also operate on small profit margins.

The bill seeks to avoid more legal situations like the one recently settled between Atlantic Health and Morristown. The hospital system recently settled for a 10-year property tax agreement with Morristown for 40 percent of its operations deemed nonexempt from taxes. This agreement is protected under the bill.

Morristown will see a total of $10 million up front and about $15 million over the next 10 years.

In the first version of the ball, Atlantic Health would have been charged per day for 724 licensed beds – a total of more than $6.6 million in the next 10 years to Morristown.

“Clearly, the Morristown tax court decision had created a great deal of uncertainty, for hospitals and municipalities alike,” New Jersey Hospital Association CEO Betsy Ryan said in a statement. “Our goal was to support a statewide solution that would strike a fair balance between hospitals and municipalities and allow them to carry on together in their shared goal of community health, safety and well-being.”

Atlantic Health supports the bill, and reiterated comments from when the settlement was announced that hospitals should pull their weight in supporting the communities they are located in.

“Atlantic Health System pays a fair share community service contribution on certain portions of its other hospitals and remains in discussion with those communities to address and resolve their current fair share community service contribution questions,” according to a statement to NJBIZ. The exemption for voluntary contributions works in favor of hospitals which already invest in their communities.

AtlantiCare, with locations in Atlantic City and Egg Harbor Township, estimates contributions between $35 million to $40 million for community and uninsured/underinsured benefits.

The bill also establishes a nine-member committee appointed by the Senate president, Assembly speaker and Governor, to study the impact of the bill on both hospitals and the communities they are located in. The committee would be dispersed 90 days after a report is issued.

Members of the committee include the Health commissioner, two Senate and two Assembly representatives not from the same party. Additionally two non-profit hospital CEO’s and two mayors will be selected by the Governor.

The New Jersey Hospital Association said it was in full support of the many issues addressed by the bill.

“New Jersey hospitals have long supported their communities beyond traditional healthcare services. Their added annual community benefit activities total $2.4 billion – not to mention the jobs and other economic contributions that hospitals bring to their communities,” Ryan said.

Hospitals are the largest employers in some towns in the state, and already contribute significantly to property taxes through employees, according to a recent EY survey commissioned by the New Jersey Hospital Association.

December 2015

11

“We are also very pleased that the measure today addresses some important concerns for hospitals – including an exemption for financially challenged hospitals, a clarification that only acute care hospital beds will be used in determining the community contribution and language that addresses the uncertainty of retroactive hospital tax bills based on ‘omitted assessments’ from prior years,” Ryan said.

The bill states it would clarify “complex, modern nonprofit hospitals … to offset the costs of public safety services, such as police and fire safety services, that benefit these hospitals.”

The current tax exemptions date back to 1913 and do not address the changes in health care today, said Senate president Stephen Sweeney.

"The business has changed, but the tax laws have stayed the same. This will have the hospitals pay their fair share while at the same time preserving their tax-exempt status," he said.

Out-of-network bill tabled at Commerce Committee hearing

By Anjalee Khemlani A bill to safeguard consumers against surprise bills from out-of-network health care providers was tabled at a Senate Commerce Committee hearing Thursday.

The highly anticipated bill, which has been struggling through the legislative process, hit yet another snag, more than a year and a draft later.

Assembly representatives who sponsored the version of the bill that went through their house were adamant the bill would not hit a snag, but acknowledged the New Jersey Hospital Association and Medical Society of New Jersey had vocalized opposition to the bill in its current form.

New Jersey Policy Perspective analyst Raymond Castro said the tabling of the bill is a major defeat for insurance consumers.

“This was a clear case of the Legislature bowing to the pressure of special interest groups in the health industry who benefit from the status quo at the expensive of ordinary New Jersey families,” Castro said.

This bill would also have benefited taxpayers, because it would reduce health costs for public employees by up to $100 million, according to Castro.

This has thrown legislators into the spotlight and the NJPP said they lack the will to lead the state into reducing health care costs.

“As a result, many New Jerseyans will continue to go to an in-network hospital thinking that their medical bill will be fully covered by their insurer, only to receive a major bill from the anesthesiologist or radiologist as an out-of-network provider for the exorbitantly high sticker price for their services,” NJPP said in a statement.

“Changing the culture of greed that victimizes innocent patients with billing scams and financial ruin takes time," state Sen. Joseph Vitale (D-Woodbridge), one of the bill's sponsors, said in a statement. "A new law to protect consumers from these baitand-switch tactics will happen sooner rather than later. Our residents deserve greater transparency and full disclosure that will ultimately lead them to making informed choices about their health care, not surprise bills that will push them into bankruptcy.

"I remain deeply committed to working with all stakeholders and my colleagues in the Legislature to ensure that New Jersey’s health care consumers are protected from these unethical practices."

12 New Jersey Physician

Bill would help patients get small quantities of medicine to synchronize their prescriptions

By Anjalee Khemlani A bill to help align prescription drug refill dates for patients, making it easier to coordinate pharmacy trips, was approved by both state houses recently and is headed to Gov. Chris Christie's desk.

The legislation, sponsored by Assemblymen Daniel Benson and Craig Coughlin, synchronizes medication refills to help increase adherence to prescriptions, which in turn will lower the cost of health care expenses for New Jersey residents.

A prescription would be filled for the remainder of time until the patient is set to pick up the next fill for other prescriptions. This would require insurance companies to provide a prorated cost and not a special charge for the short fill.

Benson said that, because some insurers may deny claims for a short fill, patients may be left to cover the cost of these partial fills, which are inherent to the synchronization process.

The bill requires a prorated rate for a supply less than 30 days if the pharmacist determines it is in the best interest of the patient to synchronize medications. It also calls for coverage of synchronization of chronic illness medications.

“For some patients dealing with conditions that require several medications, making multiple trips to the pharmacy can be burdensome, and in the case of those with limited mobility, simply arranging to get there may be difficult in and of itself,” said Coughlin (D-Woodbridge). “In addition to being more cost-effective, synchronizing refills will make it easier for patients to access all their prescription drugs, making it more likely that they will take medications as prescribed.”

The language includes individual health benefits plans, small employer health benefits plans and the State Health and School Employees’ health benefits commissions.

“By making it more convenient for patients to pick up prescription drugs, we can increase the likelihood that people will take the medications they need, which will keep them well and reduce overall health care costs,” said Benson (D-Hamilton Square). “This legislation is a simple way to move us toward a healthier New Jersey.”

The New Jersey Association of Health Plans, which represents insurance companies in the state, said if the bill is signed by the governor, plans will be required to follow the law after 180 days when it goes into effect.

“As this bill progressed, NJAHP and its member plans raised two key concerns: an exclusion for controlled substances; and prorated/ partial dispensing fees for partially filled prescriptions. While the bill amendments differed from our preferred approach, we believe they improved the bill and appreciated the amendments,” NJAHP said in a statement.

December 2015

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Barnabas turns to Quest for lab operations in cost-cutting move

By Anjalee Khemlani In a move to cut costs, Barnabas Health will now use Quest Diagnostics to manage lab operations at seven locations.

As a result, lab testing costs will be reduced and patients will have more options to access information.

“As Barnabas Health transforms into an organization that focuses on the health of populations of people, we are continually looking for partners that enable us to find creative solutions to deliver high-quality, cost-effective services," said Barry Ostrowsky, CEO and president of Barnabas Health. "Our agreement with Quest enables us to offer patients a standardized level of care throughout our laboratories at all seven Barnabas Health hospitals."

Quest will manage operations at Clara Maass in Belleville, Community Medical Center in Toms River, Jersey City Medical Center, Monmouth Medical Center Southern Campus in Lakewood, Monmouth Medical Center in Long Branch, Newark Beth Israel Medical Center and Saint Barnabas in Livingston.

"Leading hospitals are increasingly focusing on their core business and turning to Quest to help them evaluate and execute their lab strategy so they can do what they do best — deliver great patient care," said Steve Rusckowski, CEO and president of Quest Diagnostics. "This partnership follows a model for delivering high-value diagnostic information services for our nation's costpressured health systems."

Nationally, this is the sixth such agreement for the Madison-based company.

For-profit Prime buying another N.J. hospital Prime Healthcare is set to acquire another New Jersey hospital: The Memorial Hospital of Salem County.

The for-profit hospital is being sold by Tennessee-based Community Health Systems Inc., which bought the facility in 2002 for $34 million, according to the Philadelphia Business journal.

In a statement Tuesday, CHS said it plans to “sell substantially all of the assets of The Memorial Hospital of Salem County, a 126bed hospital, along with related outpatient services, to Prime Healthcare Foundation. The divestiture is expected to close by the end of the second quarter of 2016, subject to customary regulatory approvals and closing conditions.”

Prime Healthcare Foundation is the nonprofit arm of California-based Prime Healthcare Services, and currently has seven members, according to Prime.

“There is no significant difference between how the foundation operates the hospitals and how Prime Healthcare operates the hospitals. The mission is to provide quality, compassionate health care for the community, including those most deserving and in need. The foundation also gives back through various charitable and educational initiatives,” Prime said in a statement.

"Prime Healthcare looks forward to continuing The Memorial Hospital’s history of quality and success, because we believe exceptional health care should be part of every community," said Prem Reddy, chairman, CEO and president of Prime Healthcare.

"The experienced team of physicians, nurses and staff at The Memorial Hospital of Salem County are recognized for their exceptional care and will be a welcome addition to the Prime Healthcare family of hospitals.”

Prime was recently approved by a U.S. bankruptcy judge as the purchaser of Saint Michael’s Medical Center in Newark. It also recently acquired St. Mary’s Hospital in Passaic and Saint Clare’s Health System in Denville.

Temple University Hospital CEO to join University Hospital in Newark John Kastanis is moving from one university hospital to another when he joins University Hospital in Newark in March of next year.

“Kastanis is a highly experienced and accomplished executive who has been the chief executive officer at safety-net hospitals in New York, Massachusetts and Pennsylvania. He has proven to be an effective and productive leader working closely with hospital and medical staff leadership,” University Hospital said in an email to NJBIZ. Kastanis will replace interim CEO and President Nancy Hamstra.

The move was first reported in the Philadelphia Business Journal.

“By virtually every metric, John leaves TUH a stronger and more vibrant academic hospital than it was when he arrived,” said Larry Kaiser, CEO and president of Temple University Health System and dean of the Lewis Katz School of Medicine at Temple University, according to Philadelphia Business Journal. “He will be missed, especially by the many of us throughout Temple Health who have come to respect and rely upon his steadfast commitment to TUH, his astute decision-making, his steady demeanor and his many leadership contributions to the organization’s success over the years.”

Kastanis has been the CEO of Temple University Hospital since 2011, and is required to remain there until March due to a 90-day notification clause in his contract with Temple, according to University Hospital.

14 New Jersey Physician