Prepare now for value-based competition
February 23, 2012
Shay Pratt, Health Care Advisory Board
Health care purchasers are intent on transitioning away from value-blind fee-for-service payment. Both commercial payers and the Centers for Medicare and Medicaid Services continue to launch pilot programs, demonstration projects, and other programs designed to test payment models that assess provider performance on the cost, quality, and utilization of care.
Yet many hospitals and health systems are taking a “wait and see” approach before reorganizing for value-based competition. While many markets appear safe from seismic payment transformation in the near term, Health Care Advisory Board research indicates that in several markets the competitive landscape has already shifted well in advance of sweeping payment change.
One market, multiple ACOs
In one large, metropolitan area, several systems are launching accountable care organization (ACO) strategies and are looking to lock down patient populations in advance of risk contracts. One large system is trying to sign an exclusive contract with a large payer to be the provider of choice, while another system is engaging employers in direct contracting, hoping to lock in bases of employees via a strategy that includes worksite clinics and virtual access.
One hospital in the East planned to build an ACO with the intention to enter a shared savings pilot in a few years. However, a large number of PCPs have decided to partner with a physician-only ACO. The hospital is now evaluating whether it’s more appropriate, given their market, to support a second population manager or if they should become the workshop of choice for the specialist-led ACO.
Partnering to remain independent
One standalone hospital, hoping to prevent losses to encroaching systems, engaged tertiary hospitals in distant markets to assist with keeping care local. The organization has found a way to stay independent, while also limiting leakage to adjacent competitors.
What is our new market identity?
As the above case studies illustrate, taking a passive approach to competitive strategy in the transition to value-based payment may put many organizations at undue risk of market irrelevance. Organizations with aspirations of becoming a preferred network, an ACO, or a population manager will make decisions today to transform the way they are reimbursed and how they organize and deliver care. Even organizations that envision a future firmly rooted in acute care will need to have a competitive strategy that sufficiently differentiates the hospital or health system beyond standard cost and quality expectations.
To assist member executives with forging a new competitive identity in a transitioning market, the Health Care Advisory Board’s 2012 CEO national meeting, Future in Focus, will address the following critical strategic questions:
- To whom are we pitching our future value proposition?
- How ambulatory-centric will we become?
- What is the future of the acute care core?
- Where do I draw the line between population manager and ACO?
- What are the warning signs that tell us it is time to transition our business model?
Learn more in our CEO Special Sessions
The 2012 CEO Special Sessions are open exclusively to members of the hospital and health system C-suite. C-suite executives are invited to register for this year’s CEO national meeting, Future in Focus. Not a member? Please visit our website for more information.
How hospitals accommodate Catholic, secular care
Balancing access with religious mission
February 22, 2012
The New York Times this week examined the increasing trend of Catholic-secular hospital mergers, highlighting how organizations have changed strategies to accommodate both types of facilities.
Rise in partnerships
According to the Times, U.S. hospitals over the past three years announced about 20 deals involving mergers or partnerships between secular and Catholic institutions.
The new alliances are partly driven by sector-wide efforts to improve operational efficiency in the wake of federal health reform and a struggling economy. Notably, small hospitals and health systems with no religious affiliation increasingly are turning to financially stable, Catholic-run hospitals.
Lisa Goldstein, who tracks not-for-profit hospitals for Moody's Investors Service, says she expects the trend to continue.
Strategies to accomodate religious affiliation
Because certain services conflict with Catholic doctrine—including contraception and sterilization—many partnering hospitals have altered their strategies to address concerns from both types of organizations.
For example, Illinois-based OSF HealthCare—a Catholic-run system—has made an arrangement that allows affiliated physicians to prescribe contraception through a separate practice. Meanwhile, Catholic Healthcare West last month ended its governing board's affiliation with the Catholic Church—and changed its name to Dignity Health—to facilitate potential partnerships with secular hospitals.
While some health industry stakeholders have expressed concern that such accommodations may limit access to care, Catholic Health Association President Sister Carol Keehan notes that Catholic facilities interpret their mission more broadly. For example, she says they strive to treat all patients with respect and provide care to the less fortunate (Abelson, Times, 2/20).
Cleveland Clinic, North Shore-LIJ partner to advance innovation
Alliance aims to bring medical innovations to market
February 23, 2012
Cleveland Clinic Innovations (CCI) is collaborating with North Shore-Long Island Jewish (LIJ) Health System for its second innovation partnership, a move that CCI officials say could foreshadow a "national innovation alliance."
In January 2011, CCI partnered with MedStar Health—which operates nine hospitals in Maryland and Washington, D.C.—and placed two Cleveland Clinic staff members on site. Since then, MedStar has reported more than 100 new innovations, according to CCI Executive Director Chris Coburn.
The new deal is intended to provide North Shore-LIJ with the expertise to turn ideas into marketable innovations. CCI officials say the Clinic will place two to four staffers at North Shore-LIJ, which includes 15 hospitals and more than 200 ambulatory care facilities across the New York metropolitan area. At the same time, North Shore-LIJ will share its expertise in pharmacology production.
In addition, Coburn notes that through the collaboration, the Clinic, MedStar, and North Shore-LIJ will work together to develop ideas. "These providers are working together based on competencies and not on geographic proximity," Coburn says. According to the Cleveland Plain Dealer, the partnership also could unite physicians and other staff members to improve treatment, solve medical problems, and enhance medical education.
"The days are over of mom and pop working in a little lab bench and inventing a cure," says Kevin Tracy, president of North Shore-LIJ's Feinstein Institute. "To be excellent requires large teams of people with expertise" (Tribble, Plain Dealer, 2/22; Pogorelc, MedCity News, 2/22).
Medical first: Texas hospital live-tweets open-heart surgery
Surgeons posted photos and videos, answered questions from followers
February 23, 2012
Surgeons at Houston-based Memorial Hermann Northwest on Tuesday provided the first live coverage of a double coronary artery bypass procedure via Twitter, KPRC reports.
The surgery was performed by Michael Macris, the hospital's medical director of cardiovascular surgery. His colleagues began posting 140-character messages to the hospital's Twitter account during surgery preparations—which began around 7:30 a.m.—and continued streaming updates throughout the entire three-hour procedure. Sample tweets included:
The team ultimately posted more than 100 messages and included videos and still photos captured using a "helmet camera."
The surgeons also answered questions submitted by Twitter followers. For example, they explained to one follower that Macris was wearing a cooling jacket during the operation because they had heated the room to keep the patient, who was not connected to a heart lung bypass machine because of his emphysema, from getting too cold.
"It's [nice] to see how the team works together—how the various aspects of the operation are brought into play," says Macris, who compared the mechanics of live-tweeting a major surgery to choreography.
Although the hospital's Twitter account has roughly 5,000 followers, the social media event—which aimed to promote awareness of Heart Month—could have reached up to 225,000 viewers after it was re-posted and embedded on various websites, Texas Monthly reports (McNeill, KPRC, 2/21; Silverman, "MedBlog," Houston Chronicle, 2/20; Cohen, Texas Monthly, 2/22).
Survey: 15% of surgeons struggle with alcohol misuse
Alcohol issues more prevalent among women than men
February 23, 2012
About 15% of surgeons report having an alcohol use disorder, according to a new national survey published in the Archives of Surgery.
Researchers examined online, anonymous surveys completed in 2010 by members of the American College of Surgeons. More than 25,000 surveys were emailed to participating members, and about 7,200 surgeons (29%) responded.
According to the results:
- 1,112 surgeons—or roughly 15%—reported drinking behaviors that suggest alcohol abuse or dependence.
- Specifically, about 26% of female surgeons and 14% of male surgeons reported such behaviors.
Surgeons who reported alcohol misuse also were more likely to report a major medical mistake in the last three months, as well as feelings of depression and burnout. However, lead author Michael Oreskovich, a clinical associate professor of psychiatry and behavioral sciences at the University of Washington in Seattle, notes that "a number of studies have shown that direct patient harm associated with impairment due to chemical dependency is very, very rare."
According to the study authors, the findings suggest that a proactive approach is needed "to identify and treat a prevalent disorder that may affect the surgeon's ability to practice with skill and safety."
In an accompanying editorial, University of Texas Southwestern Medical Center's Edward Livingston and JAMA's Joseph Wislar note that "[n]onresponse bias is particularly salient when the topic is considered sensitive and the respondents would prefer to not discuss such matters." They add, "Surgeons who drink more heavily are potentially less likely to respond, which might underestimate the prevalence of alcohol abuse" (Mozes, HealthDay, 2/20; Fiore, MedPage Today, 2/20).
Young women with MI have less chest pain, higher mortality
JAMA: Patients with less chest pain may present later
February 23, 2012
Women younger than 55 years old are less likely to experience chest pain when having a myocardial infarction (MI) than older women or men, according to a new study in JAMA.
For the study, researchers from Lakeland Regional Medical Center and colleagues examined 1.1 million records in the National Registry of Myocardial Infarction from 1994 to 2006 to determine the relationship between gender, age, and in-hospital mortality.
The study found that 42% of women were admitted to the hospital for an MI without experiencing chest pain, compared with 30.7% of men. In addition, the findings showed that the in-hospital mortality rate was 14.6% for women, compared with 10.3% for men.
"Our data suggest that the absence of chest pain is associated with increased mortality, especially among younger women," the researchers said. "Patients without chest pain and discomfort tend to present later, are treated less aggressively, and have almost twice the short-term mortality compared with those presenting with more typical symptoms" (Hughes, Medscape Medical News, 2/21; Cortez, Bloomberg, 2/21).
ACO roundup: Key news from Feb. 17-Feb. 23
ACO leaders push to streamline EHRs
February 23, 2012
The Daily Briefing editorial team rounds up the top accountable care stories of the week.
- ACO leaders and other health care executives say that hospitals and clinics must streamline electronic health records (EHRs) to better manage diseases and avoid complications, Modern Healthcare reports. "That's the hardest thing to accomplish," says Edward Gold of New Jersey-based Old Hook Medical Associates. "You can have case managers and you can have education, but the information's got to be coordinated." In an effort to address the growing technology needs of ACOs, eHealth Initiative has released IT guidelines for various ACO models (Evans, Modern Healthcare, 2/18 [subscription required]).
- The Advisory Board’s David Willis explores how imaging services will change under accountable care and offers three areas of focus: reducing downstream patient cost, coordinating care, and limiting referral leakage. See what imaging leaders and radiologists should be doing now to ensure a role in the delivery system of the future. More.
Studies point to overlooked culprit of health woes: The aging eye
Lack of light may affect circadian rhythm, researchers suggest
February 23, 2012
Several recent studies show that the gradual yellowing of the lens and the narrowing of the pupil that occur as people age can disturb the body's circadian rhythm and lead to several health problems, the New York Times reports.
As eyes age, less sunlight gets through the lens to reach photoreceptive cells in the retina that transmit messages to the part of the brain that regulates the body's internal clock. That part of the brain, called the suprachiasmatic nucleus, adjusts the body to its environment by triggering the release of melatonin at night and cortisol in the morning.
According to a study in the British Journal of Ophthalmology, by age 45, the photoreceptors receive just 50% of the light needed to fully stimulate the circadian system. By age 55, individuals receive just 37% of needed light, and the number drops to 17% by age 75.
"Anything that affects the intensity of light or the wavelength can have important consequences for the synchronization of the circadian rhythm, and that can have effects on all types of physiological processes," says David Berson of Brown University.
According to the Times, out-of-sync circadian rhythms could increase an individual's risk for insomnia, heart disease, and cancer. In addition, a study in the Journal of Biological Rhythms found that younger subjects were more alert, less tired, and had better moods after exposure to blue light, while older subjects had none of these effects.
Because of these potential health effects, researchers suggest that as people age, they should make an effort to expose themselves to natural sunlight or bright indoor light if they cannot get outdoors (Tarkan, Times, 2/20).
Daily roundup: Feb. 23, 2012
Bite-sized hospital and health industry news
February 23, 2012
California: In an Office of the Patient Advocate report card released Wednesday, California's largest health plans showed improvement in caring for patients with diabetes in 2010 but continued to have difficulties treating patients with other conditions. Plans were ranked with one to four stars in different care categories, depending on how well they met national standards and how patients rated them in areas such as customer service and scheduling appointments (Kleffman, Contra Costa Times, 2/22).
Massachusetts: Steward Health Care and Fallon Community Health Plan have launched Steward Community Care, a health insurance plan for small businesses that provides coverage with a premium savings of 20% or more. The plan, which includes options with no deductibles, will be available beginning April 1 (Saia, Worcester Business Journal, 2/15).
New York: The newly-renovated third floor of the Katz Women's Hospital, a 73-bed facility attached to 812-bed North Shore University Hospital in Manhasset, has received LEED platinum certification, the U.S. Green Building Council's Leadership in Energy and Environmental Design program's highest rating. Based on the renovation's design, the floor is expected to use 18.6% less energy than it consumed in 2004 and pay at least $11,200 less for its annual energy bill (Robeznieks, Modern Healthcare, 2/21 [subscription required]).
Rhode Island: Two state legislators have proposed a bill that would require Rhode Island health insurers to disclose hospital reimbursement rates. "There is far too much disparity among the rates at which different hospitals are reimbursed for the same services," says state Sen. Dennis Algiere (R), a bill co-sponsor, adding, "This bill will shine a light on this unfair practice" (Swanson, Westerly Sun, 2/17).
Featured opportunity: The Advisory Board Fellowship
February 23, 2012
The Advisory Board Fellowship prepares emerging executives to become health care’s next generation of leaders.
Help your hi-potentials develop the agility, expertise, and influence they need to navigate health care’s ever-evolving terrain or expand your own ability to effectively drive long-term competitive advantage for your organization.
Hepatitis C adult mortalities surpass HIV deaths
Hepatitis C in recent years has surpassed HIV as one of the leading contributors to adult mortality in the United States, according to a pair of studies in the Annals of Internal Medicine.
For the first study, researchers examined the causes of death for more than 21.8 million U.S. residents between 1999 and 2007. In 2007, more than 15,000 deaths were linked to hepatitis C, exceeding the nearly 13,000 deaths that were tied to HIV. Nearly three-quarters of hepatitis deaths involved patients in middle age and older, the researchers found.
The study's authors note that nearly two-thirds of the estimated 3.2 million individuals with chronic hepatitis C are "baby boomers" born between 1945 and 1964, but roughly half of them do not know they have it. Health experts have recommended that recipients of blood transfusions before 1992, individuals with HIV, and people who use injection drugs be screened regularly for hepatitis. However, some researchers believe that approach is ineffective.
The second study assessed the cost effectiveness of one-time hepatitis screenings for baby boomers. It found that such screenings could detect an additional 808,580 cases of hepatitis C and prevent 82,000 deaths. However, the additional screening would cost $2,900 for each additional case of hepatitis C that was caught (Norton, Reuters, 2/21; Brown, "Booster Shots," Los Angeles Times, 2/21; Neergaard, AP/San Francisco Chronicle, 2/21).