The Daily Briefing

News for Health Care Executives

Why medical group standardization initiatives fail

February 29, 2012

  • This is a preview of the Medical Group Strategy Council's inaugural meeting. Learn more.

Raghu Bukkapatnam Raghu Bukkapatnam, Medical Group Strategy Council
Successful clinical and operations process standardization is vital to health systems’ physician alignment strategies and implicit in their decisions to employ.

However, Medical Group Strategy Council research indicates that to date, most standardization efforts are incremental and occur at the margins, becoming severely constrained or derailed by physician resistance. In order to overcome this, progressive and tenured medical group leaders are adopting principles of “evidence-based management” to activate medical group members and drive performance improvements.

The Council’s 2012 national meeting series, Heart of the Enterprise, will showcase organizations pursuing this physician activation strategy to elevate the value of care. Craft a thoughtful physician activation strategy with these key take-away lessons from the national meeting research.

Physician Activation in Action

Overcome semantic barriers. The most immediate barrier to implementing standards is use of the phrase “standardizing care.” In this situation, semantics do matter. A “standard” is achieved, not engineered, and use of the term communicates the wrong message to physicians and patients. Council research uncovered multiple communication and campaign strategies that are both more engaging and more palatable to physicians, with demonstrable impact on performance.

Understand physician motivators. Leading medical groups successfully isolate the strongest tactics to influence physician behavior, and understand the limits of others. The most effective tactics are patient-focused and data-driven, combining greater transparency, peer comparisons, and outcomes measurement. The Council’s early findings indicate that medical group leaders over-utilize compensation as a lever for change. Over-manipulating compensation frequently fails to drive the desired changes, and creates new engagement challenges. Thus, high performing medical group leaders utilize compensation as a lever for change sparingly and strategically.

Foster a culture of innovation. In high performing medical groups, culture is king. Council research identified a handful of progressive medical group leaders who successfully transformed isolationist physician mindsets to create a culture of innovation, where physicians self-motivate and encourage one another. Medical group members lead initiatives, isolate opportunities, identify best practices, and challenge themselves to provide a higher standard of care.

Register now
To learn more about evidence-based management and activating physicians, Medical Group Strategy Council members may register for the Medical Group Strategy Council national meeting, Heart of the Enterprise. Not a Medical Group Strategy Council member?  Visit our website to learn more.

Physician charged in record $375M Medicare, Medicaid scam

Federal officials also charge six others in connection with case

February 29, 2012

The Obama administration on Tuesday announced that a Texas physician and six others were arrested for allegedly defrauding Medicare and Medicaid of nearly $375 million.

According to administration officials, it is the largest case of home health care fraud ever committed and the biggest case to be brought against a single physician.

Jacques Roy, the physician and owner of Medistat Group Associates, allegedly organized the scheme over the past six years. "Between January 2006 and November 2011, Medistat certified more Medicare beneficiaries for home health services and had more purported patients than any other medical practice" in the United States, the Department of Justice and HHS said in a joint statement.

According to investigators, Roy or others certified 11,000 beneficiaries who were recruited by a network of more than 500 home health service agencies, and then billed Medicare for services and home visits that were unnecessary or not provided. Some of the owners are accused of luring beneficiaries into the scheme by offering no-cost health care and other incentives, such as food stamps, in exchange for Medicare identification numbers.

CMS also suspended another 78 home health agencies linked to Roy. The agencies have been collecting about $2.3 million monthly, according to Peter Budetti, CMS' deputy administrator for program integrity (Horowitz, Washington Post, 2/28; Fox, National Journal, 2/28 [subscription required]; AP/New York Times, 2/28; Pecquet, "Healthwatch," The Hill, 2/28).


Health care CEO turnover outpaces other industries

Experts attribute leadership changes to regulation challenges

February 29, 2012

Twenty-five health care CEOs left their posts in January 2012, up from just nine in January 2011, according to a recent report.

The report—which was issued by outplacement company Challenger, Gray & Christmas—also found that CEO turnover in health care outpaced other industries in 2011; an average of about 16 health care CEOs left their positions each month.

Some of the increased health care turnover can be attributed to hospital leaders moving into consulting work as they face regulation challenges, particularly those presented by federal health reform law implementation, The Fiscal Times reports.

"We're seeing a growing number of executives…say, 'I've gone through major changes in health care, and I'm not really in a position where I want to go through this major change again,'" says Mark Madden, a senior VP at health care executive recruitment firm B. E. Smith.

Turnover up across all industries
The report found that overall CEO turnover in January 2012 surged: 123 executives left their posts. The number represents a 48% increase in turnover over December 2011 and the most monthly turnover since May 2010.

Although leadership switches can lead to change, Matt McGreal, a principal at CEO search firm Christ|Kolder Associates, says they rarely bring about massive restructuring and instead create opportunities for other high-performing employees to be promoted (Challenger, Gray & Christmas release, 2/8; Hirsch, The Fiscal Times, 2/23; Sell, "Philly Parma," Philadelphia Inquirer, 2/13).


When COE status goes wrong

Bariatric surgery case offers lessons in oversight, clinical quality

February 29, 2012

Dan Diamond, Managing Editor

A tragic case in Florida should remind hospital leaders: It's not enough to earn "Center of Excellence" status.

You have to vigilantly maintain your excellent standards, too.

A Florida jury last month ordered a hospital to pay $178 million to plaintiff Clay Chandler—$168 million for a post-bariatric surgery medical error in 2007 that left Chandler with brain damage, and an additional $10 million for illegally advertising its bariatric surgery program as a COE.

The case turned on whether the operating surgeon was sufficiently qualified for the hospital to claim COE status.

While the hospital was accredited as an American Society of Bariatric Surgery COE—which requires bariatric surgery programs to perform 125 cases per year—the surgeon had yet to perform the minimum 50 surgeries required for accredited programs. (He had completed just 21.) The surgeon also had taken just one bariatric education course before independently performing the operation, having not fulfilled the 20 hours of mandatory education.

Changing, competitive market  
Beyond the issues of accreditation compliance, the case points up the risk and reward for hospitals and COE status.

Some service lines, like bariatric surgery, rely on being accredited COEs not just to advertise to patients, but to secure reimbursement, too. For instance, Medicare generally won't reimburse for bariatric surgery performed at non-COE centers.

Instituting a volumes threshold for COE status is one way to steer patients to experienced programs and surgeons, who are likely better prepared to manage a patient's procedure and recovery.

But trying to hit procedure thresholds isn't always easy, and falling short can add some financial pressure for hospital service lines.

Matt Garabrant, director of the Advisory Board's Technology Insights team—which provides research and guidance for hospital bariatric surgery programs—notes that the bariatric surgery market has become steadily more competitive in recent years.

"The number of new centers pursuing and securing ASMBS COE status each year has been declining since 2006," as more hospital and ambulatory center-based programs join the fray, Garabrant said.

Rural and small-volume programs are in a particularly difficult position. These organizations increasingly are interested in ASMBS's bariatric surgery COE status—but they have difficulty hitting the 125 procedure annual requirement, the organization notes. As a result, ASMBS has suggested it's reevaluating how it identifies COEs, such as using risk and reliability-adjusted data.

What hospitals can take away from the case
Garabrant and Charlotte Tsui, who specializes in bariatric surgery research for Technology Insights, stressed several lessons for hospital leaders.

First, "administrators should not forget that COE accreditation is a means to an end and not the end itself," Tsui said. "The overarching goal should always be clinical quality—and COE requirements are meant to facilitate that." 

Unfortunately, payers’ COE requirements and increasing pressure on margins means that this important distinction can often be overlooked, Tsui added. The result is that hospitals may emphasize the pursuit of COE accreditation, rather than viewing COE as an instrument for high quality care.

Tsui also stressed that hospitals must maintain credentialing standards before and after COE accreditation. She highlights an excerpt from ASMBS’s criteria that states:

    “To obtain laparoscopic bariatric surgery privileges that involve stapling the GI tract the surgeon must….document 50 cases with satisfactory outcomes during either 1) general surgery residency or 2) post-residency training under the supervision of an experienced Bariatric surgeon.”


Merger crackdown? Feds to take Georgia hospital deal to Supreme Court

FTC maintains that hospital merger should come under antitrust scrutiny

February 29, 2012

U.S. Solicitor General Donald Verrilli Jr. this week disclosed plans to take a major hospital merger in Georgia all the way to the Supreme Court, underscoring government interest in hospital market power.

Background on the case
Last year, the public Hospital Authority of Albany-Dougherty County acquired Palmyra Medical Center (PMC) from HCA. The Authority folded PMC into Phoebe Putney Health System (PPHS), a not-for-profit organization that operates the Authority's Phoebe Putney Memorial Hospital (PPMH).

The Authority and HCA finalized the deal in December after the 11th U.S. Circuit Court of Appeals in Atlanta upheld a district court ruling that deemed the merger immune to antitrust scrutiny because the Authority is a state-created entity. According to Modern Healthcare, Supreme Court precedent establishes states' power to create monopolies under the state action doctrine. 

Taking it to the highest court
In a deadline extension application filed with the Supreme Court, Verrilli disclosed his decision to appeal on the Federal Trade Commission's (FTC) behalf, Modern Healthcare reports.

According to FTC, the deal places all acute-care hospital beds in Dougherty County and 86% of beds in the six-county surrounding area under PPHS' control. "This case is about whether normal antitrust laws apply to an agreement that allegedly would centralize control of health care in Albany, Georgia, into a monopoly," FTC General Counsel Will Tom said in a statement. "Monopolies in health care usually raise prices substantially, harming patients and employers alike." The FTC also has said that the Authority was serving as a "straw man" in an otherwise private acquisition.

Hospital officials say they will continue transitioning the hospital into the system as the case proceeds. "We are stunned and disturbed by this recent development," said Ralph Rosenberg, who chairs the Authority, adding, "The FTC continues to waste taxpayers' money and our community's money to challenge an already decided case" (Carlson, Modern Healthcare, 2/27 [subscription required]; Bleau, WFXL-TV, 2/26).


Treating toothaches: ED visits for dental health on the rise

ED treatment costs 10 times more than routine care

February 29, 2012

The number of ED visits for routine and preventable dental conditions increased by 16% between 2006 and 2009, and the trend appears to be rising, according to a report from the Pew Center on the States.

For the report, Pew researchers analyzed hospital data from 24 states, and information from the Agency for Healthcare Research and Quality and dental care studies. The report found instances of increased ED use for dental care nationwide. For example, the findings showed that in 2009 dental-related ED visits in South Carolina increased by nearly 60% from four years earlier. Meanwhile, Tennessee hospitals in 2009 reported more than 55,000 dental-related ED visits—about five times the number of visits for burns.

The report found that ED visits for routine dental care, such as toothaches, can cost 10 times more than preventive care and provide fewer options than a dentist's office. According to Frank Catalanotto, a University of Florida College of Dentistry professor who reviewed the study, routine teeth cleaning costs between $50 and $100, compared with $1,000 for treatment in the ED.

Meanwhile, the study also showed that many of the same patients are presenting in the ED with dental problems. For instance, roughly 20% of dental-related ED visits in Minnesota are repeat trips.

Commenting on the findings, Catalanotto said the trend may be attributable to a growing shortage of dentists nationwide, particularly among those willing to accept Medicaid patients. Catalanotto also noted that the economic downturn could be a factor because families tend to put off dental care if a member loses a job and insurance coverage (Tanner, AP/Sacramento Bee, 2/27).


Snowe—the lone GOP health reform vote—to resign from Senate

Moderate senator's announcement comes as 'complete surprise'

February 29, 2012

Maine Sen. Olympia Snowe—the only Republican in the Senate to vote for a version of the federal health reform law—on Tuesday announced she would not seek re-election this fall, CQ HealthBeat reports.

After 33 years in Congress, the moderate, three-term senator said the "atmosphere of polarization and 'my way or the highway' ideologies has become pervasive in campaigns and in our governing institutions." Although she said she expected to be re-elected, she questioned "how productive an additional term would be" given the political climate, which she considers unlikely to change in the short term.

During the reform law debate, Snowe expressed support for efforts to expand health insurance coverage to the uninsured. In a highly public move, Snowe voted for a version of the overhaul approved by the Senate Finance Committee, becoming the only Senate Republican to approve of any version of the law. However, she refused to vote for the final version of the law because it included employer mandate provisions and tax provisions to fund insurance subsidies. 

Snowe's announcement on Tuesday came as a "complete surprise," said Sen. Susan Collins (R-Maine). Although some GOP members have criticized her willingness to cross party lines, Snowe remains a popular figure in Maine politics, and pundits say she likely would have been re-elected in November. Snowe already had staffed her re-election campaign and raised more than $3.4 million by the end of December 2011.

Snowe's decision not to seek re-election opens a seat once considered relatively safe for Republicans, the Bangor Daily News reports. According to Maine Republican Party Chair Charlie Webster, Snowe's withdrawal could shake up Maine's Congressional races. The state's two Democratic U.S. House members and the president of the state Senate—a Republican—now may consider running in the election (Reichard, CQ HealthBeat, 2/28 [subscription required]; Miller, Bangor Daily News, 2/28; Jan, "Political Intelligence," Boston Globe, 2/28).


Insurers' focus: The top 1% of health spenders

Companies shift strategies as they prepare for reform law

February 29, 2012

Insurers are expected to more closely monitor the heaviest users of health care—partly by pressuring providers—as they aim to curb costs before new federal health reforms take effect in 2014, the New York Times reports.

Under the overhaul, insurers no longer will be permitted to deny coverage to individuals with pre-existing conditions or put lifetime limits on coverage. As a result, health insurers are expected to look for ways to control costs for expensive customers.

According to a recent study, 1% of patients account for more than 25% of private insurance health spending, and their medical bills average about $100,000 annually.

Many insurance executives say their companies already are developing programs targeting such patients. For example, health insurers often work with self-insured employers to manage employees' health conditions, the Times reports.

Meanwhile, some insurers also are experimenting with strategies to identify more costly patients and those who could develop serious complications. For example, HealthPartners' health plan in some instances assigns high-risk patients a case manager—who monitors the patient's health post discharge—and a social worker, who assists with medication costs.

According to the Times, insurers also are experimenting with quality-based payment models. For example, Cigna plans to pay physicians higher rates to coordinate care and is looking at ways for physicians to share savings generated by helping patients avoid hospital visits (Abelson, Times, 2/27).

Research and services to improve chronic care

The Advisory Board offers a comprehensive suite of best practices, services, and support for organizations seeking to better serve their sickest patients. 


ONC releases Stage 2 proposed rule on certification of EHRs

Draft rule redefines certified EHR technology

February 29, 2012

The Office of the National Coordinator for Health IT (ONC) has released a proposed rule on the standards and criteria for the certification of electronic health record systems (EHRs) under Stage 2 of the meaningful use program.

The EHR certification proposal accompanies the new proposed rule outlining requirements for health care providers attesting to Stage 2 of the meaningful use program. The Stage 2 proposal for health care providers was posted online on Feb. 23.

Both proposed rules are scheduled to be published in the Federal Register on March 7, after which they will undergo a 60-day public comment period.

Details on standards, criteria for EHR certification
ONC's Stage 2 EHR certification proposal calls for vendors to ensure that their EHR systems support certain functionalities, such as:

  • Adopting a single data standard when transmitting information for certain health care transactions; 
  • Enabling the exchange of electronic health data among health care providers; and 
  • Providing patients with online access to their health records.

In response to public comment on Stage 1 rules, the Stage 2 proposed rule on EHR certification redefines certified EHR technology to allow for greater flexibility.

Under the Stage 2 proposal, EHR products can receive certification if they can help a health care provider achieve core meaningful use criteria and only the specific optional menu items selected by the health care provider. Under the Stage 1 rule, health care providers would need to use EHR systems that were certified to meet all applicable meaningful use criteria.

The proposed rule also notes that ONC plans to phase out its temporary EHR certification program and transition to a permanent EHR certification program when the final Stage 2 rules are released in late summer (Conn, Modern Healthcare, 2/27 [subscription required]; Goedert, Health Data Management, 2/27; Mosquera, Government Health IT, 2/27).


Bat flu begins

Scientists uncover first evidence of flu virus in bats

February 29, 2012

Scientists have discovered the first genetic fragments of a never-before-seen flu virus in bats—and the risk to humans remains unclear.

Scientists uncovered the virus at a CDC outpost in Guatemala, where researchers were investigating rabies in the winged mammals. Specifically, they found the genetic fragments inside the intestines of yellow-shouldered bats. The findings were published in the Proceedings of the National Academy of Sciences.

The discovery represents the first time influenza was found and properly documented in bats. According to study co-author and CDC researcher Ruben Donis, most people until now believed that scientists already had found flu in all the animals that could contract it.

Researchers do not yet know how bat flu spreads and have been unable to grow it in chicken eggs or human cell cultures, as they can with other flu strains (AP/Fox News, 2/28).


Daily roundup: Feb. 29, 2012

Bite-sized hospital and health industry news

February 29, 2012

  • District of Columbia: CareFirst BlueCross BlueShield this week announced that it will distribute $8.5 million in grants to help 12 safety-net clinics better coordinate care for vulnerable patient populations. The clinics hope to use the funds to expand on the patient-centered medical home model for up to 66,000 patients with chronic conditions (Sun, Washington Post, 2/27).
  • Maryland: LifeBridge Health next month plans to open the Herman & Walter Samuelson Children's Hospital, which will replace the current children's hospital at Sinai Hospital of Baltimore. The new hospital—which was built in response to patient demand—features a larger playroom, video games in all patient rooms, and other amenities to improve the patient experience (Walker, Baltimore Sun, 2/27).
  • Massachusetts: Hospitals in the state will lose millions of dollars as a result of recent legislation that delayed scheduled cuts to Medicare physician reimbursement rates. Included in the legislation are reductions to the rates paid to hospitals to care for low-income and elderly patients, in addition to a provision that cuts prevention and public health funding. The cuts amount to at least $62 million over a decade for Massachusetts hospitals. The cuts are on top of the overhaul's $5.7 billion reduction in payments—about 9% from Medicare—to state health care providers over the next 10 years, according to the Boston Globe (Jan, Globe, 2/28).
  • Pennsylvania: Penn State Milton S. Hershey Medical Center and Penn State College of Medicine in June will open an institute dedicated to personalized medicine. Although the institute likely will focus on cancer treatments, hospital officials say it also will seek to develop personalized treatments for diabetes and cardiovascular disease (Baum, MedCity News, 2/27).


Physician Alignment in the Era of Accountable Care

Clinical Integration and the Pluralistic Medical Staff

February 29, 2012

Join a complimentary webconference on Mar. 13 to hear Southwind experts discuss their experience building CI programs in over 40 markets. More.


Executives on the move

This week’s industry transitions

February 29, 2012

Each week, the Daily Briefing highlights executive transitions among the nation's hospitals and health systems. Are you moving to a new institution? Please e-mail transitions@advisory.com to let us know.

  • Jeanne M. Fallon named CIO at Cape Cod Healthcare, Inc. (Hyannis, Mass.)
  • Randall R. McVay named CEO at Ocala Health System (Ocala, Fla.)
  • Charles Briscoe named CEO at Coliseum Health System (Macon, Ga.)
  • Sean Whilden named CFO at Houston Medical (Warner Robins, Ga.)
  • Christine Aucreman named Chief Revenue Cycle Officer at The Surgical Hospital at Southwoods (Boardman, Ohio)
  • Sean Hogan named President at SSM DePaul Health Center (Bridgeton, Mo.)
  • Peter A. Marmerstein named President at HCA West Florida Division (Palm Harbor, Fla.)
  • Carolyn Allen named CFO at Southcoast Hospitals Group (Fall River, Mass.)
  • Ryan Gehrig named President at St. Edward Mercy Health (Fort Smith, Ark.)
  • Van Noy named CFO at Tehachapi Hospital (Tehachapi, Calif.)
  • Brian Smith named CEO, North Division at Catholic Health Partners (Cincinnati, Ohio)
  • Jeff Drapalik named CFO at West Chester Medical Center (West Chester, Ohio)
  • Gaurov Dayal, MD named CMO, SVP Physician Innovation & Integration at SSM Health Care - St. Louis (St. Louis, Mo.)
  • Edwin Gast named CEO at Marshall Browning (Du Quoin, Ill.)
  • Nancee Hofmeister named CNO at Evergreen Healthcare (Kirkland, Wash.)


Mobile devices aid individuals with PTSD, substance use problems

Researchers have published preliminary data in the Journal of Medical Toxicology on a new device that uses wireless sensors and smartphone technology to provide support for individuals with substance misuse problems or post-traumatic stress disorder (PTSD).

The mobile device—called iHeal—can measure symptoms and detect patterns of an emerging drug craving or anxiety attack. It is worn around the wrist to measure skin temperature, heart rates, and other stress indicators.

The band sends signals to a smartphone, where software applications process and monitor the incoming data. When the software detects high stress levels, it sends a message to the wearer's smartphone asking how they are feeling. Feedback is used to create personalized interventions, according to researchers.

According to lead study author Rich Fletcher—an assistant professor of psychiatry at the University of Massachusetts and research scientist at the Massachusetts Institute of Technology's Media Laboratory—the technology could be used to supplement care given by a psychiatrist or therapist. It also could increase a patient's engagement in drug misuse or PTSD treatment programs (Johnson, Boston Globe, 2/27; Valigra, Mass High Tech, 2/23).