The Daily Briefing

News for Health Care Executives

ED makeover: Meet the market's demands for efficiency and coordination

February 14, 2012

Succeeding under tomorrow’s accountable payment models will require providers deliver efficient, cost-effective care, while improving transitions across care settings. Furthermore, expanded health care coverage for millions of Americans will exacerbate the existing challenges of patient throughout, utilization management, and care coordination.

The pressure from changing accountable payment models will be most acutely felt in the already overcrowded front door of the hospital—the emergency department. Rather than reactively responding to this challenge, hospital executives can embrace an opportune moment for change, using this as a turning point to capitalize on the ED’s potential, rethinking its role from “front door” to “hub of an integrated enterprise.”  The Clinical Advisory Board’s national meeting will present four key areas for opportunity.

#1:  Migrate from a “move faster” to a “move smarter” operational strategy
To transform the ED, the first step is to position the ED for success in light of near-term volume pressure. It will be critical for EDs to move beyond traditional efficiency tactics to adopt a more comprehensive appetite to drive appropriate resource utilization.

It’s time to rethink how EDs are allocating their most precious—and costly—assets: ED physicians, nurses, beds, and diagnostic testing. While there have been some successes improving front-end processes (registration, triage, etc.), there are still many opportunities to rethink methods for getting ED patients into inpatient beds to avoid or manage boarding. This year’s Clinical Advisory Board national meeting will profile some of the latest innovations in reducing back-end processes that stymie patient flow.

#2:  Don’t think about observation status as a “default status”—approach with a clear purpose and vision
Furthermore, when optimizing resource utilization, progressive hospital leaders are observing a goldmine of missed opportunity in how hospitals can rethink their use of observation status to better support enhanced patient throughput and quality care. This year’s research will cover three areas in observation medicine. Attendees will learn to: 

  • Improve operations of dedicated observation units
  • Drive efficiency for virtually managed observation status patients through cohorting, aggressive rounding, and smarter relationships with consulting specialists
  • Prepare for the future of observation medicine

#3:  Hardwire post-ED continuity of care to improve quality and reduce repeat ED visits and avoidable admissions
The next step to position your ED ahead of the curve—to truly dominate the future’s accountable care era—is to bridge patients to the most appropriate care setting. This year’s national meeting will provide best practices for improving communication sharing between the ED and ambulatory providers and practical guidance to position patients discharged from the ED for success. These practices will not only be helpful to elevate quality, but will also serve the dual purpose of reducing ED recidivism.

#4:  Develop a targeted strategy to manage high utilize populations
Every organization has its own set of vulnerable high utilizer patient populations (e.g., behavioral health and pain management patients, etc.)  While some may categorize these patients as ED-exclusive challenges, in reality, high-utilizers of the ED are often high-utilizers of services across the health care system. By better meeting their needs, EDs can work to reduce over-utilization—and to lower costs—across the healthcare enterprise. This year’s research will help hospital leaders understand methodologies to identify high-utilizers, and then provide a roadmap to help EDs identify their own users and develop principled interventions to more appropriately direct their care.

The presentation, “Hub of the Enterprise,” will guide hospitals through the balancing act of addressing added volume pressure and elevating the role of the ED to serve as a bridge across the system of care providers. Members will leave this presentation with a heightened understanding and a set of tools to truly transform the role of their ED.

Register now
Clinical Advisory Board members may register now for this year’s national meeting, Enterprise in Transition. Not a member of the Clinical Advisory Board? Visit our website to learn more.

Tavenner: CMS will review ICD-10 implementation

February 14, 2012

CMS will review its timeline for ICD-10 implementation, Acting Administrator Marilyn Tavenner said at a conference hosted by the American Medical Association (AMA) on Tuesday morning.

The Obama administration has advocated the coding system as a way to improve medical diagnostics, but switching to the new coding system has sparked concern among physician groups.

According to the AMA, adopting the ICD-10 coding system would force physician offices to deal with about 68,000 codes and add as much as $2.7 million in annual operating costs to large offices.

Tavenner told the audience that she is "committing…to work with you to reexamine the pace at which we implement ICD-10," The Hill reports. She added to reporters that CMS would formally announce its intention to craft new regulations "within the next few days."

However, Tavenner's pledge to "re-examine" ICD-10's timeline does not equate to officially moving the date, the Advisory Board's Mike Davis told the Briefing.

Davis noted that CMS provided a "30-day enforcement extension" for the v5010 EDI deadline, and the agency may offer a similar extension for organizations "who are now realizing the extent of impact of ICD-10 on both clinical and financial operations, and are ill-prepared to make the transition date."

Meanwhile, Government Health IT's Tom Sullivan writes that "it’s incredibly unlikely that Tavenner or CMS would actually stop ICD-10 in its tracks, for a whole host of political reasons." According to Sullivan, CMS could face lawsuits, given that many providers and payers have already spent millions preparing for the new coding system.

According to the Advisory Board's Davis, organizations should continue moving forward with the ICD-10 transition preparation; "any time extension will benefit the organizations for providing a longer ICD-10 testing period with their payers," he added (Zigmond, Modern Healthcare, 2/14 [subscription required]; Pequet, The Hill, 2/14; Sullivan, Government Health IT, 2/14).

Budget breakdown: Hospitals push back against Obama's proposals

President's proposed budget seeks cutbacks for hospitals, other health organizations

February 14, 2012

Hospitals and other health care groups are pushing back against President Obama's fiscal year (FY) 2013 budget proposal, which they call "shortsighted" and detrimental to the health care safety net.

The administration on Monday released an FY 2013 budget that aims to reduce the federal deficit by $4 trillion over the next decade and includes changes in health care spending. Specifically, the proposal seeks to reduce Medicare and Medicaid spending by about $360 billion over the next decade.

The Medicare and Medicaid cuts would occur in part through lower payments to health care providers. For example, a White House fact sheet says that under the proposed FY 2013 budget, Medicare would reimburse 25% of hospitals' bad debt resulting from beneficiaries' non-payment, down from the current 70%. Meanwhile, Medicare funding for graduate medical education would drop by $9.7 billion.

In addition, payments to critical-access hospitals (CAHs) would decrease by $1.4 billion and the criteria to qualify as a CAH would narrow, a change that is expected to save $590 million.

Obama's FY 2013 budget proposal also would provide CMS with a $1 billion, or 26%, increase in its program management funds, which reflects the agency's role in implementing federal health reform law provisions. Meanwhile, the proposed budget freezes NIH's biomedical research budget at $30.7 billion and cuts $660 million, or 11%, from CDC.

Hospitals criticize budget proposal
Hospital groups widely panned the proposed budget, CQ HealthBeat reports.

According to American Hospital Association (AHA) President and CEO Richard Umbdenstock, the proposal "once again targets funding for hospital care and could result in fewer nurses, less access to cutting-edge treatments, and longer waits for emergency care."

Meanwhile, Federation of American Hospitals President and CEO Chip Kahn called the cuts "shortsighted" and "counterproductive." He said, "[n]ot only will they weaken the hospital safety net and reduce access for seniors and other vulnerable citizens, they also threaten the vital role that America's hospitals play as the largest private employers and source of good, new jobs in most communities across the country."

Budget unlikely to be adopted
However, the president's budget proposal faces significant challenges in Congress and is unlikely to be passed into law. Republicans already have signaled they will fight the proposal, and Senate Majority Leader Harry Reid (D-Nev.) has said he will not bring a budget resolution to the floor.

According to Reid, Congress agreed to discretionary spending levels for 2012 and 2013, which is a key component of the budget process, during last year's negotiations over the nation's debt ceiling (Davis, USA Today, 2/13; Reichard/Norman, CQ HealthBeat, 2/13 [subscription required]; AHA News, 1/13; Norman, CQ HealthBeat, 2/13 [subscription required]; Barr, Modern Healthcare, 2/13 [subscription required]; Zigmond/Daly, Modern Healthcare, 2/13 [subscription required]).

Mapping Obama's shifting health care priorities

New budget shows cuts to some health spending

February 13, 2012

Dan Diamond Dan Diamond, Managing Editor  

Today's big story: President Obama's latest budget calls for $360 billion in cuts to Medicare, Medicaid, and other health services.

But as The Hill's Sam Baker points out, those proposed budget cuts are largely familiar and were pushed by the Obama administration during last year's deficit talks; they don't really tell us anything new about the White House's health care strategy. 

Medicare and Medicaid spending also may be less a barometer of a president's priorities than you might think. Those budget requests are largely mandatory and can be shaped by years of congressional legislation, broad deficit-cutting decisions, or demographic trends.

What's getting less coverage, but bears watching for health wonks: The president's proposals on discretionary spending, and how they've changed over time.


On that front, here's what the latest budget tells us:

  • Even in a year where overall HHS funding is getting tighter, the president is making a larger request to fund CMS, given its role in implementing his health reform law. 
  • Government efforts to fight health care fraud, which picked up steam under the Bush administration, remain aggressive compared to previous years. As a result, they've also produced record takebacks in recent years—but funding has been shifted or scaled back since the FY 2012 request.
  • The Obama administration has significantly ramped up funding for the FDA, after several high-profile outbreaks and recalls during the Bush administration. However, this year's request comes in a bit below last year's. (Although as Politico Pro reports, FDA is getting an overall increase compared to last year's actual spending.)

Of course, a president's budget always relies a bit on hocus-pocus—a recent exposé revealed how White House officials tweaked the impact of the Affordable Care Act to show better long-term savings—and an election-year budget is naturally in flux. A program's actual spending may be significantly different than the budget document's figures, too.

But if you're trying to quantify a president's influence beyond the big budget numbers in the headlines, here's one place to look.

Data show more complications at major teaching hospitals, but is it reliable?

Experts say complication rates should not be used to compare hospitals

February 14, 2012

A Kaiser Health News analysis of Medicare patient safety data suggests that major teaching hospitals are nearly 10 times as likely to have a high number of complications as other hospitals.

As mandated by the federal health reform law, CMS has begun publicly rating hospitals based on certain patient safety measures using Medicare billing records. The patient safety ratings could be used to determine hospital payments as early as the fall of 2013.

In its summary rate for complications, CMS found that 190 of 3,330 hospitals had very high complication rates. According to KHN, 82 of those hospitals were major teaching institutions. About 31% of all major teaching hospitals had high complication rates, compared with less than 4% of other hospitals, KHN reports.

Some experts say differences in rates may be attributable to the unique characteristics of teaching hospitals. According to Leapfrog Group's Barbara Rudolph, it is "much more difficult in a large institution to adequately train everyone to do the right thing. You tend to have more residents and fellows flowing through."

Meanwhile, the discrepancy in rates may reflect a culture of documenting diligence, according to Shannon Phillips, a quality and patient safety officer at Cleveland Clinic. Phillips says the hospital's high rates of accidental tears and lacerations and serious blood clots were because "people are careful at documenting, almost to a fault, things that are incidental to the case."

Hospital officials also note that high complication rates may reflect complex case loads and high-risk patient populations at teaching hospitals.

Should the safety ratings be used to compare hospitals?
Although CMS already is posting patient safety data to its Hospital Compare website, many experts say the complication measure may not be a reliable way to compare facilities.

For example, Gregg Meyer—who helped create the formula for assessing complication rates when he worked at the Agency for Healthcare Research and Quality 10 years ago—says the rates "were supposed to be hypothesis generating." According to Meyer, "Using this as a mechanism to report something conclusive about safety is what we would term politely an off-label use."

Institute for Healthcare Improvement Senior Vice President Donald Goldmann expressed similar concerns, noting that Medicare billing records are not refined enough to adequately assess complication rates and safety. Meanwhile, Atul Grover, head of public policy at the Association of American Medical Colleges, urges CMS to "either revisit and refine [the measure] or drop it completely" (Rau, KHN, 2/13).

GOP updates payroll tax plan, but doc fix still up in the air

Republicans: Conference committee will weigh doc fix proposals

February 14, 2012

House Republicans on Monday said they will introduce legislation to extend the payroll tax break through the end of the year without cost offsets, but they will allow the conference committee to continue negotiating proposals to delay scheduled Medicare physician pay cuts.

The move comes after GOP leaders for weeks insisted that they would not accept extensions to the payroll tax cut and unemployment benefits or a "doc fix" without offsets.

House Speaker John Boehner (R-Ohio), House Majority Leader Eric Cantor (R-Va.), and Rep. Kevin McCarthy (R-Calif.) said the plan is "not our first choice." However, they added, "Because the president and Senate Democrats have not allowed their conferees to support a responsible bipartisan agreement, today House Republicans will introduce a backup plan that would simply extend the payroll tax holiday for the remainder of the year while the conference negotiations continue regarding offsets, unemployment insurance, and the 'doc fix.'"

Democrats prefer single proposal, criticize GOP plan
Democratic leaders said they would prefer to advance a single piece of legislation that addresses all three issues, but did not flat out reject the House Republicans proposal.

House Minority Leader Nancy Pelosi (D-Calif.) said the plan "to decouple the payroll tax jeopardizes both the ability of seniors to see their Medicare doctors and benefits for millions of Americans who lost their jobs. There is no reason all three of these priorities cannot proceed at the same time as both the House and Senate agreed."

Rep. Sandy Levin (D-Mich.) also was critical of the plan, saying it is "completely irresponsible to leave behind five million unemployed Americans whose benefits will expire and 47 million seniors and disabled Americans whose access to health care would be jeopardized" (Bendavid, Wall Street Journal, 2/14; Steinhauer, New York Times, 2/13; Mascaro, Los Angeles Times, 2/13; Zigmond, Modern Healthcare, 2/13 [subscription required]; Kane, Washington Post, 2/13).

Hospitals may run out of crucial cancer drug within two weeks

Nation's largest methotrexate supplier shut down production last year

February 14, 2012

FDA and oncologists last week warned that dwindling supplies of a crucial drug used to treat childhood leukemia could run out by the end of February, the New York Times reports.

According to the Times, the shortage of methotrexate, an injectable leukemia drug that also is used to treat rheumatoid arthritis, was triggered when Ben Venue Laboratories in November suspended production of the drug because of "significant manufacturing and quality concerns." The Ohio-based plant was one of the nation's largest manufacturers of the drug.

Since November, methotrexate supplies have continued to shrink. "This is a crisis that I hope the FDA's hard work can help to avert," says American Society of Clinical Oncology President Michael Link, adding, "We have worked very hard to take what was an incurable disease and made it curable for 90% of cases. If we can't get this drug anymore, that sets us back decades."

According to Valerie Jensen, the associate director of FDA's drug shortages program, there are four other methotrexate manufacturers in the United States. Those companies are working to increase production. Meanwhile, FDA is seeking a foreign producer to supplement supplies as it searches for a domestic solution (Harris, Times, 2/10).

For orthopedists, defensive medicine costs $2B annually

Survey finds 96% of orthopedists order unnecessary tests

February 13, 2012

Approximately one-quarter of tests and referrals ordered by orthopedists were medically unnecessary, resulting in more than $2 billion in annual health care costs, according to a recent survey.

For the survey, Vanderbilt University researchers analyzed the responses of 1,241 orthopedic surgeons who are listed in the American Academy of Orthopaedic Surgeons (AAOS) registry. According to the results, about 96% of respondents said they had practiced defensive medicine, including ordering scans, lab tests, and hospital admissions to avoid malpractice suits. On average, 24% of tests were ordered for defensive reasons.

Specifically, the percentage of certain procedures ordered for defensive purposes include:

  • Plain X-rays: 19%
  • CT scans: 26%
  • MRI scans: 31%
  • Ultrasound studies: 44%
  • Subspecialty referrals and consultations: 35%
  • Hospital admissions: 7%

Based on American Medical Association billing codes, the researchers found that orthopedic surgeons spent about $8,500 monthly on defensive medicine—or about $102,000 per physician annually. Overall, orthopedists nationwide spend nearly $2 billion on defensive medicine each year, according to the study.

"Defensive medicine drives up the cost of patient care and limits patient access to specialty care, neither of which are in the interest of our patients who deserve the best and least costly care possible," says AAOS spokesperson Douglas Lundy. "Unfortunately, the current legal climate forces good doctors to order these tests and practice defensive medicine" (Gever, MedPage Today, 2/9; Salamon, HealthDay, 2/9).

Are you a workaholic?

Research shows it may not be a bad thing

February 14, 2012

A recent study by researchers in the Netherlands finds that the distinction between a workaholic and an "engaged workaholic" may have far-reaching physical and psychological effects.

For the study, Dutch researchers tested 1,246 workers to measure on-the-job engagement, workaholism, motivation, and burnout. The study also considered typical working hours per week.

The researchers identified three types of hard workers:

  • Social workaholics, who are motivated by social rewards or bad consequences;
  • Engaged workers, who are loyal and reasonably hard-working; and
  • So-called "engaged workaholics," who work extremely hard out of sheer enjoyment.

Overall, engaged workaholics displayed considerably lower levels of burnout, suggesting that enjoying work acts as a significant buffer against stress, according to the study.

Lead study author Wilmar Schaufeli and his team say the difference is that classic workaholics are "pushed" to do their work, while engaged workaholics are "pulled." Workaholics are driven to work by feelings of guilt and restlessness, a motivation Schaufeli notes is "totally different than when you work intensely because you like the job" (Doheny, Los Angeles Times, 2/13).

Wishing readers a happy Hospital Valentine's Day

Reader submissions and stories from the archives

February 14, 2012

The Daily Briefing team is feeling the love today—mostly for its witty readers.

After #HealthPolicyValentines took the Internet by storm across the weekend, we invited readers to submit their own #HospitalValentines via Twitter. Here were some of the favorites that we spotted:

Advisory Board staff share their own #HospitalValentines too.

To further mark Valentine's Day, here are some of the most popular Briefing stories from the archives about love and loss:

Love and your waistline
Although both marriage and divorce seem to cause weight gain, each marital occasion affects women and men differently, according to a study presented at the American Sociological Association's annual meeting.

Scientists: We fib to make an online match
After mining websites like OKCupid for dating data, researchers are sharing several findings about how and why people fall in love—and how it sometimes requires a few white lies.

How losing a loved one can break your heart
In the heartbreaking days that follow the death of a loved one, a person's myocardial infarction (MI) risk may soar to up to 21 times higher than normal, according to a study in Circulation.

Featured opportunity: The Advisory Board Fellowship

February 14, 2012

The Advisory Board Fellowship prepares emerging executives to become health care’s next generation of leaders. Help your high-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. 

Learn more.

Daily roundup: Feb. 14, 2012

Bite-sized hospital and health industry news

February 14, 2012

  • Michigan: Detroit Medical Center—along with its parent company Vanguard Health Systems—last week announced plans to open a $50 million, 100,000-square-foot outpatient facility in Royal Oak. According to The Detroit News, two-thirds of the new facility would be devoted to pediatric specialty services, while one-third would house adult outpatient services (Burden, The Detroit News, 2/10).
  • New York: New York Attorney General Eric Schneiderman (D) has released a proposal to establish a real-time online database for prescription drugs, answering calls for improvements to the state's existing prescription tracking system. The AG said the database would help prevent doctor shopping and would "render useless" prescriptions that are stolen or forged (Campbell, Ithaca Journal, 2/10; Campbell, Rochester Democrat and Chronicle, 2/12).
  • Ohio: Ohio State University Medical Center has been renamed the Wexner Medical Center at Ohio State University in honor of Les Wexner, an alumnus who donated $100 million to the school's expansion project. The $1.1 billion, 21-story construction project is slated for completion in 2014 (Selvam, Modern Healthcare, 2/11 [subscription required]).
  • Virginia: Hospitals and health systems in the state provided more than $2.2 billion in community support and $27.7 billion in economic activity in 2010, a recent Virginia Hospital & Healthcare Association report found. In addition, Virginia hospitals and health systems provided 129,000 jobs in 2010, an increase of more than 7,000 positions from the year prior (Brimmer, Healthcare Finance News, 2/10).

Medicare Advantage enrollment increases by 10% to 12.8 million

Enrollment in Medicare Advantage plans has increased by 10% over 2011, with 12.8 million beneficiaries enrolled in such plans in 2012, according to new federal data.

According to the data, about 25% of all Medicare beneficiaries now are enrolled in Medicare Advantage plans. Average premiums have decreased by 7%, from $33.97 to $31.54, the data show.

However, the Congressional Budget Office (CBO) estimates that enrollment in MA plans will decline by four million by 2019.

CBO said the decline will result from rising premiums caused by $200 billion in spending cuts to MA plans through the federal health reform law (Fiegl, American Medical News, 2/13).