late-breaking news from your medical association volume XXI / no. 4 SUMMER 2014
local NO on Proposition 46 SMCMA has brochures, posters, buttons, and lab coat cards that we will gladly deliver to your offices—please help us to defeat this measure, which will be on the November ballot. If you are not sure what the initiative is about, please visit our website, www.smcma.org, where detailed information is available. If you still have questions, call us at 650-312-1663 or email smalone@smcma.org. There is also a video you are encouraged to share on your social media pages, office website, and through your networks. You can visit the official “No on 46” campaign website at www.NoOn46.com. We do appreciate your efforts.
SMCMA Offers Opportunity to Join ACO SMCMA is offering its members the opportunity to join its Medicare Shared Savings Program ACO. The program has a threepronged aim: to deliver better care for individuals, improve the health of populations, and lower growth in Medicare Parts A and B expenditures. SMCMA is working with the Physicians Accountable Care Solutions (PACS) ACO model. This model is flexible and aggregates beneficiaries under a single ACO. This means that any physician practice can participate, from a single practice location to large groups of physicians such as IPAs. The ACO operates under an upside shared savings only model, there is no down side risk, and physicians still receive their Medicare fee-for-service payments. To learn more about this opportunity contact the SMCMA at 650-312-1663 or email smalone@smcma.org.
Mills-Peninsula Names New CEO to Succeed Merwin Janet Wagner, who now runs Sutter Health’s hospital in Davis, has been named to succeed long-time CEO Bob Merwin at MillsPeninsula. Merwin has led the organization for 27 years, helping to convert it from a public district hospital to part of the Sutter network, and oversaw completion of the $640 million rebuild and seismic upgrade in 2011. Merwin will retire at the end of the year, but Janet Wagner will take on her new role in late September, working with Merwin to ensure a smooth transition. Wagner has run Sutter Davis since 1998 and before that served as chief nursing executive at Sutter Medical Center in Sacramento.
Blue Shield Forms Santa Clara ACO Blue Shield, SCCIPA, the Santa Clara County IPA, and HCA’s Far West Division have launched a three-year ACO to provide coordinated care to 13,000 Blue Shield HMO enrollees in Santa Clara County. Good Samaritan and Regional Medical Center will be the participating hospitals. This is Blue Shield’s 16th ACO in the state.
Daughters of Charity Health System—Is Sale Nearing? Plans for the Daughters to sell its six hospitals in California, including Seton, has stirred up a lot of talk on all sides. The SEIUUnited Healthcare Workers West and the CNA are convinced that the Daughters system is preparing to sell out to Prem Reddy’s Prime Healthcare Services, long disliked by the unions. Throughout the nation, Prime owns or operates 28 acute care facilities. The Daughters is losing roughly $10 million a month. The UHWs are worried about the system’s $700 million pension fund for union workers and retirees, which could be at risk if the hospitals are dragged through bankruptcy proceedings. The system says they need to find a buyer this year or they may be forced to close. The unions are concerned that a new buyer, particularly Prime, may put the system through bankruptcy proceedings. The Ontario, CA-based Prime has just filed suit against the SEIU-United Healthcare Workers, claiming the union had violated provisions of the RICO Act, a federal statute typically used to prosecute organized crime figures, claiming that the SEIU is attempting to destroy its business. The Daughters also have another suitor, Blue Wolf Capital Partners, a union-friendly private equity firm.
state Coverage Among California’s Previously Uninsured According to a recent survey of the Kaiser Family Foundation, sources of coverage among California’s previously uninsured are: 1) 29% remain eligible and uninsured; 2) 13% remain undocumented and uninsured; 3) 25% are covered under Medi-Cal; 4) 9% are insured under Covered California; and 5) 58% are newly insured. Note: Sources add up to more than 100%, as multiple sources may apply.
Kaiser Posts Healthy First-Half 2014 Numbers Kaiser released data comparing its 2013 and 2014 first half-year numbers, reflecting net income of $1.58 billion compared to first half 2013 of $1.28, and operating income of $2.18 in 2014 versus $1.58 in 2013. Their investment income also increased from $363 million in 2013 (first half) to $672 million in first half 2014. Apparently, enrollment got a big boost from Obamacare.
Silicon Valley Startup Pitches Self-Insurance Software for Smaller Firms CollecdtiveHealth says it can help employers save money with software that helps them pay workers’ health costs directly. The founders of CollectiveHealth, a Silicon Valley startup, say they can help employers save money by self-insuring rather than paying premiums to a health insurance company. The company describes its “sweet spot” as companies with a few hundred or a few thousand employees, typically in the TECH sector. Surprise, can you imagine a better place to market this self-insuring software other than to the young and healthy? By the way, Apple is preparing to roll out “HealthKit,” a monitoring app as part of the iPhone 6 this fall. It does underscore how Apple is intent on making health data, such as blood pressure, pulse and weight, available for consumers and health providers to view in one place.
national Physician Compensation Report 2014 Medscape has recently issued this year’s Medscape Compensation Report with 24,000 physicians in 25 specialties responding to the survey. For a copy of the report, visit www.medscape.com/features/slideshow/compensation/2014/public/overview.
Residents’ Salary & Debt Report 2014 Medscape has also recently released its report on medical residents’ salary, debt, and their overall experiences in residency. More than 1,200 residents across 25 specialties participated in this survey. For a copy of the report, visit www.medscape.com/ features/slideshow/public/residents-salary-and-debt-report.
U.S. Employers Expect Increase in Health Care Costs A Towers Watson Health Care Survey predicts a 4% increase in 2015 health care costs, with a 5.2% growth rate. A large percentage of employers (73%) are concerned their benefit programs will trigger the ACA’s excise tax rule..
Doctored: The Disillusionment of an American Physician A new book by Sandeep Jauhar, MD, discusses his experience as a physician. He is quoted as saying, “I don’t think outright fraudulent behavior is all that widespread. I do think there are perverse incentives of our fee-for-service system, which puts pressure on doctors to see more and more patients because of decreases in reimbursement and increases in overhead. There’s also an increase in paperwork and having to hire more office staff to deal with all the administrative burdens. All of those things make a perfect storm that creates incentives that can compromise even the best doctor’s better judgment.”
What Exactly Is a “Nonprofit Hospital”? David Nash, MD, wrote an interesting article for MedPage, suggesting that many nonprofit hospitals today are a far cry from the “charity hospital”—Bellevue Hospital in NYC, Cook County Hospital in Chicago, and SF General. The author suggests that decades of legislation have brought about sweeping changes in hospital financing, accounting and social responsibility to the nonprofit hospital. Dr. Nash uses as an example Ascension Health, now the third largest healthcare system in the U.S. This Catholic not-forprofit health system based in Missouri owes its unprecedented growth to purchasing nonprofit hospitals and other healthcare
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facilities, creating a large, venture-backed fund for making strategic investments in the for-project sector. Ascension’s holdings now include 220 tax-exempt subsidiaries, and its for-profit subsidiary (Ascension Ventures) has invested $550k million in startup companies that produce medical devices and provide technology services. For a copy of the article, visit www.medpagetoday. com/Columns/FocusonPolicy/47311.
Misconnected IV, Drug, and Feeding Tubes Expected to be Less Likely with New Standards With at least 21 hospital patient deaths and nearly 100 other adverse events occurring because plastic tubing intended to deliver food instead went into an IV, the Joint Commission issued a Sentinel Event Alert urging healthcare providers to be extra diligent. In addition to the 2006 death of a pregnant woman whose feeding tube was placed into her bloodstream, 116 other case studies have involved misconnections directing external feeding solutions into IV lines in the last ten years. What’s more, tubing misconnections are under-reported even when an adverse tubing event occurs. TJC is working on new tubing connector standards. New connectors are expected to reach the market this fall, which will include small bore (less than 8.5 mm inner diameter) connectors being engineered to make it nearly impossible to connect one delivery system to another delivery system that serves a completely different function.
Physician Payments Sunshine Act Hits Snags Four years ago Congress enacted the Physician Payments Sunshine Act, though the federal government is still trying to make the information public. The most recent snag is the result of CMS’s decision to shut down testing of its Open Payments website, which is intended to serve as the public portal for disclosing industry-physician relationships, because of numerous reporting errors by the manufacturers, such as identifying a physician in one state who has the same name as a doctor in another state. Somehow it seems this “technicality” should have been addressed during initial programming. CMS is now saying the shutdown will delay the site opening to the public. The AMA is asking CMS to delay public access for at least six months due to the data inconsistencies.
Entrepreneurial Prospective Doctor Starts With Fundraising Twenty-five-year-old Charles U. Lanman wants to be the first physician in his family to become a doctor, but applying to medical school is a multi-thousand-dollar enterprise, given the cost of the MCAT, application fees, and travel and accommodations. This young Tennessean decided his best bet was to raise money through a fundraising site called Rally, a site similar to the better known Kickstarter. So far he has raised $2,403 from 86 supporters, along with many messages of support. He just got his MCAT score, and while he didn’t achieve the score he wanted, he did score “29.”
Companies Continue to Shift Cost of Health Care Costs to Workers The main way companies are seeking to cut health care costs is by moving workers into high-deductible plans, according to a survey conducted by the National Business Group on Health (NBGH). Nearly a third of employers are offering such plans as the ONLY option to their workers in 2015, compared to 22% in 2014. NBGH reports that large employers who want to avoid the 40 percent Obamacare “Cadillac tax” are finding ways to shift the costs to workers. This tax, while four years away, will affect health plans that spend more than $10,200 per worker per year. Another 16 percent of large employers are planning to offer low-benefit “Skinny” Plans despite the Affordable Car Act’s requirements for value and affordability. Many thought such low-benefit plans would be history once the health law was fully implemented; instead 16 percent of large employers surveyed by NBGH said in 2015 they will offer lower-benefit coverage.
Wellpoint to Change Name to Anthem Wellpoint, the second-biggest U.S. insurer, plans to change its name to Anthem Inc., elevating the brand that it now uses for most of its health-insurance products. The change is the latest move by a health insurer aimed at promoting a more consumer-focused identity, as the industry sells more coverage directly to individuals rather than its traditional commercial audience of business owners and human-resource executives.
FDA Approves DNA Test for Colon Cancer A DNA test to screen for colon cancer in people with a lower risk of developing the disease, the first test of its kind, cleared in the U.S. The test, Cologuard, is used to detect genetic mutations in patients’ stool associated with cancer and precancerous growths in the colon. Doctors must prescribe the test, but patients collect stool samples at home and ship the samples to laboratories for analysis. CMS has proposed that Medicare cover the costs for the new test. Exact Sciences, the molecular diagnostic company that developed the test, is based in Madison, Wisconsin.
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medicare Results from Medicare’s ACO Demonstration Project The precursor to Medicare’s ACO program, which ran pilot programs for five years and ended a month after the Affordable Care Act became law, shows that the experiment saved a little money without compromising quality, as least on a limited set of measures. Financial success varied widely across the ten medical groups in the demonstration. One pilot saved an average of $818 per person, per year, while another pilot saw per-person per year spending increase an average of $323. On average, the ten medical groups reduced Medicare spending by 2% per person per year ($171), which split the savings between the doctors ($102) and Medicare ($69), or 0.8% less than the program would have spent otherwise. In the early demonstration the medical groups focused their cost-saving efforts on the most expensive place to treat patients (hospitals) and the most expensive patients (complex, chronically ill, and vulnerable). Spending for hospitalized patients dropped an average of $228 per patient, per year. Spending for patients at high risk of costly care declined $1,922 per patient, per year. The researchers found that the medical groups in the demonstration program encouraged patients to do more to manage their medical care and health, and established programs for doctors and nurses to more closely monitor and manage patients’ care. 4
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