To Cover or Not to Cover 300,000 Poor Tennesseans, That is the Question

The way things are shaping up, it appears neither the state legislature nor the administration has the appetite to take on what should be a no brainer.

Some of the poorest Tennesseans—300,000 of them—have no insurance coverage. Many show up in hospital emergency rooms looking for care, while others do not.

It may seem odd, but the latter individuals are the ones who worry me the most. Despite what some people think, not all poor Tennesseans are looking for a handout. The ones I have talked with would love to be able to buy affordable health insurance.

Like all of us, they are proud. They wait until they are critically ill and show up in hospital emergency rooms (ERs), which ends up costing the system much more than it would have if they had received care earlier in a doctor’s office. For some, it is too late—they are too sick for hospitals to help them.

The Nashville Healthcare Council recently held its annual Wall Street session and the Wall Street analysts could not understand why Tennessee would not take advantage of three years of “free” federal money to expand Medicaid. The only correction I would add is it is not free money—Tennessee hospitals already have paid for it to the tune of $5.6 billion and Tennessee taxpayers have paid the rest as a result of federal tax increases. These dollars currently are going to California, Massachusetts and New York, states that already have agreed to expand their Medicaid programs.

So what will it take to change the minds of the General Assembly and the administration? Hospital closures? Sicker Tennesseans? I wish I knew, because I have seen the devastation caused by people waiting too late to seek care. There is a solution just sitting there, waiting for Tennessee to take advantage of it.

Medicaid and Medicare were not embraced when they were first introduced. Arizona was the last state to sign up, waiting 18 years and citing them as socialist programs. Now, even Arizona has said it will expand its Medicaid program. 

Frankly, for the sake of the 300,000 Tennesseans, I hope the state will not wait 18 years before providing coverage for this most vulnerable population. 

Everyone Dealing With Same Issues

I have just returned from a three-day meeting with my 50 national counterparts, where we spend time sharing ideas, discussing issues with the American Hospital Association (AHA) and commiserating about how difficult times are in our field. Very therapeutic!

One surprise at the meeting was a presentation by Scott Serota, president of the Blue Cross and Blue Shield Association. What was so surprising is the 38 Blue Cross organizations throughout the nation are struggling with implementing the Affordable Care Act (ACA) as much as hospitals are, only in a different way.

Listening to Scott, clearly the Blues plans are worried about their future just like hospitals. Obviously, the Blues plans are all pretty healthy, while many hospitals are on the financial brink. However, when you think about the exposure they have going forward, it does help you better understand their concerns.

Scott acknowledged the providers’ world is significantly changing, but so is the Blues. In the past, the big employers were the customer. Once the boss signed the contract, the insurer had hundreds or thousands of covered lives. In the new world order, insurers now must try to sign subscribers in onesies and twosies. On top of that, trying to figure out the actuarial costs of this population will be difficult at best since insurers no longer can deny coverage. The challenge, according to Scott, is making sure in this onsies and twosies world, you have enough healthy folks to pay for the not- so-healthy individuals.

Scott also is worried large employers may, in the future, just throw their hands up and put all of their employees in the exchanges. While this obviously has larger implications for providers, it still is not without challenges for the insurers.

On another point, which we are experiencing in Tennessee, the Blues will have limited networks of providers. Scott said employers and individuals will focus on price, along with quality, especially as more and more healthcare dollars come out of individuals’ pockets.

Like many of us, Scott believes we are moving to a population-based healthcare model. In this model, data will be important to determine how to best care for these populations. There was a lively give-and-take over the sharing of all payer data, with several of us state execs challenging him to work with us to share data so we can plan for that population-based world. Scott returned the challenge and said many of the Blues hospital clients put in their contracts this information must be kept confidential. In the end, there was agreement to work towards a solution where everyone could have access to the data.

I have to say, I was very encouraged and impressed with Scott’s forthright outline of the problems insurers and hospitals face in the future. His belief that we all need to work together to get it right certainly appeals to what Tennessee is attempting to accomplish. While we have our differences with Tennessee’s Blue Cross organization, we are in a much better position to work together on those common issues to implement the ACA and develop a new healthcare model. 

Summertime Blues

Back in the dark ages, when I was young, there was a song written by George Gershwin and recorded by several singers and groups with lyrics that said, “Summertime, and the living is easy.” Apparently, Gershwin wasn’t referring to Tennessee and the healthcare market.

I use to say changes in health care moved glacially, but we have graduated to turtle speed and are heading toward lightning speed. The Affordable Care Act (ACA) totally has changed the healthcare landscape everywhere, especially here in Tennessee. Cuts to the disproportionate share hospital (DSH) payment, marketbasket updates, sequestration and recovery audit contractors (RACs) have made budgeting hospital revenue an art, not a science. THA members are faced with arbitrary and unscheduled cuts, which has already resulted in layoffs and diminished services, slowed capital outlays and shelved renovation plans. 

One bright spot has been the potential of additional coverage for Tennessee’s 900,000 uninsured. We know 500,000 will be eligible for subsidies from the exchanges, another 80,000 are eligible, but not enrolled in TennCare and another 200,000 could be covered if the state chooses to expand its TennCare program, an iffy proposition at best.

THA pushed hard last winter and spring to get the governor and state legislature to approve moving forward with expansion. We got close to the goal line, but failed. The governor has proposed the Tennessee plan, which will look similar to a plan being implemented in Arkansas and has tied its implementation to any attempt for expansion. 

We will be going back to the legislature and governor this summer and fall and, with your help, hope to be successful in obtaining coverage for those 200,000 Tennesseans who have no insurance coverage. We need you to be calling your legislators now and remind them of the importance of Medicaid expansion. Let them know the pain you already are feeling and the services in jeopardy because of the ACA cuts.

There was another song out during my salad days and its lyrics included, “there ain't no cure for the summertime blues.” Let your legislators know the livin’ ain’t easy and we want a cure for the summertime blues that only they can provide.

The Image of Hospitals

Every year, I get together with 15 of my peers from around the country to discuss what we believe are the emerging issues we will have to address sooner or later. This year, we focused quite a bit on the hospital field’s image among the general public and decision-makers in Washington and Nashville.

Unfortunately, we all agreed it is not a very pretty picture.

California recently did a poll among its residents and 68 percent had a very low opinion of hospitals, especially on their pricing and billing structures. Of course, those of us who have been in the business a long time recognize this is not a new issue. Our billing system is indecipherable, even for those in health care.

Why should we even worry about this? After all, we know charges are irrelevant to what hospitals get paid. Only a very small number of payers actually pay a percentage of charges.

The most important reason is it affects hospitals’ advocacy efforts, whether in Washington or Nashville. Hospitals are criticized for their ridiculous and incomprehensible billing system and the general public gives legislators the green light to cut, cut, cut “the fat cats.”

Second, the hospital billing and collections system undermines relationships with their communities. The general public does not understand the ins and outs of how hospitals get paid or the games institutions have to play with insurance companies in order to collect what they are owed.

The general consensus among those of us in the meeting room was if hospitals continue to use charges and refuse to develop a more rational billing system, the industry will lose all credibility with their legislators and communities. Many of us even went as far to say that perhaps a single payer system would be a much better way to go.

Hospitals need to start the dialogue now to bring order to this chaos before it is too late. 

To Expand or Not to Expand, That is the Question

Not really. When one looks at the facts behind the benefits of expanding coverage to 180,000 Tennesseans, there really is no contest. Yes is the only reasonable answer.

First, from an economic standpoint, expanding coverage will help save jobs. A THA-sponsored model shows up to 90,000 jobs could be lost if there is not total coverage for the population. Some critics have said hospitals are crying wolf, but even if half that number of jobs were lost, it would deepen Tennessee’s already stagnant economy. Several hospitals and health systems have announced layoffs and spending cuts to deal with the losses from the Affordable Care Act (ACA) and now the sequestration.

Second, there is a moral obligation. Study after study has shown people with insurance are more likely to be healthier and to seek care before they are in a crisis. In addition to being a moral imperative, this will help save the system money.

Third, as a taxpayer in Tennessee, it makes me mad to think Tennesseans’ tax dollars and federal savings generated from cuts to our hospitals will go to California, New York, New Jersey and other states that already have signed on to the expansion. Make no mistake about it, Tennessee hospitals already are paying for Medicaid expansion through reduced Medicare payments and the federal government is redistributing Tennessee dollars to other states. 

Governor Bill Haslam challenged THA to go out and educate legislators, the public and businesses to make the case for expansion. We have gone to every major city in the state and have been endorsed by every major chamber of commerce and editorial board. Once the facts are known, these folks all asked the same question, “Why wouldn’t we do this?”

THA needs your help. Many of you have contacted your legislators, but many have not. Now is the time for CEOs, trustees, business leaders and all other Tennesseans to make their opinions known to their elected officials. If you need to know who your legislator is, go to  and put in your zip code and your senator’s and representative’s contact information will come up.

Please write, call or email now. Your health and the financial health of your community are at stake!

Physician Changes Critical to Hospitals’ Future

As hospitals move into the new era of community-based care as opposed to singular patient care, working with physicians is going to be mission critical.

Many hospitals are in the doctor-hiring business in a big way and are struggling to figure out how to best partner with them in this new world.

According to data collected by Merritt Hawkins (MH), a physician placement firm, there are over 400 physician suicides every year. That is equal to a full class of graduating doctors from a large medical school! Why is this?

According to a survey by MH, physicians are more depressed and down on medicine than ever before. They are working longer hours for less pay, more paperwork and less satisfaction. According to Kurt Mosely, vice president with MH, they somehow have gone from Marcus Welby to House.

Specialization has contributed to this alienation. At the end of World War II, there were 11 specialty societies and today, there are over 200 groups. According to Mosely, doctors on average for the first three years are seeing 6.5 percent less patients and spending 22 percent more time on paperwork, all of which contributes to this growing depression among clinicians.

What can hospitals do to help this situation? For starters, Mosely said, they can be more sympathetic to the plight of physicians. It used to be doctors leaving residencies wanted location, location, location. Now, it is lifestyle, lifestyle, lifestyle. According to the MH study, 77 percent of the physicians who responded are or will be employed and not in private practice. This is up from 43 percent in 2000, a remarkable shift in medicine.

So it is up to hospitals to provide the rewarding workplace for physicians. Mosely notes this will be especially true in the primary care market. He says hospitals need to show their physicians how use of nurse practitioners can make primary care doctors’ lives much simpler. The nurse practitioners should care for the chronically ill and leave the tough cases to the primary care physicians. Nurse practitioners, through the nursing model, are better trained to spend the time necessary to educate and care for the chronically ill.

In addition, evidence-based medicine versus “eminence-based medicine” should be the way of the future. Mosely believes having this evidence-based medicine at a physician’s fingertips will arm him and her with information that could take some of the stress out of the job. He also believes medical schools will have to change to the new order and train physicians with nurse practitioners, physician’s assistants, pharmacists and the entire care team.

 Converting care to a team approach will be a difficult culture change but taking stress off caregivers, especially physicians, will be critical going forward. 

Exciting Times Are Ahead for Health Care

“You must have chaos within you to give birth to a dancing star.”
Friedrich Nietzsche

This time is both dangerous and exciting. We stand on the edge of a changed healthcare system; one I believe will be stronger and more patient friendly. It is more and more evident our country no longer can afford the current brand of hospitalization, but at the same time, can’t afford to lose it, either. What a conundrum!

In talking with Tennessee’s congressional delegation, it is pretty clear hospitals are going to be facing significant cuts to their reimbursement. In some of THA’s modeling, hospitals will have 25 percent less dollars by 2019 than they are getting right now. Obviously, something must be done.

In looking to a future healthcare system, Tennessee has a rare, once in a lifetime opportunity to help redesign the delivery of care. State government is willing, our payers are willing and I believe THA members are willing. But what will it look like?

Joe Landsman, THA’s new chairman and president at the University of Tennessee Medical Center (UTMC), has such a vision. It calls for hospitals and doctors to stop focusing on the haphazard way they provide care. Through care paths, physicians and nurses can determine and carry out the best course of treatment for their patients by using protocols established by physicians. In this way, the variation is taken out of providing care. It can be standardized, making it safer and more cost-effective, all the while allowing the physician to still make his or her independent decisions.

UTMC is focusing on the top 80 percent of its DRG volume. It is in the first year of implementation and already has seen impressive results. Tennessee, through the Tennessee Center of Patient Safety, has seen dramatic reductions in central line infection by using protocols and bundles. Early elective deliveries have pretty much ended through education, data, physician awareness and compliance.

Tennessee hospitals are heading into a time of tremendous chaos and change. We must look for many more innovative ways to provide health care in more safe and efficient manner. 

Hospitals in Bull’s Eye of Congressional Cost-Cutters

We are all waiting for the campaigning to end, along with the endless ads and promises that we know won’t be honored.

But once this circus ends, we will be faced with the reality that health care, specifically hospitals, will be directly in the bull’s eye of congressional cost-cutters.

Hospitals in the U.S. already are faced with $155 billion in cuts over the next 10 years through the Affordable Care Act. Of that amount, Tennessee owns $4.2 billion, most of which is back-loaded and scheduled to go into effect in 2014.

In addition, unless congress acts, sequestration is scheduled to hit hospitals on January 1 next year, which means another $800 million in additional cuts to Tennessee providers would be thrown into the pot over the next 10 years. Hospitals also are dealing with the alphabet soup of CMS auditors, including RACs, MICs, MACs, ZPICS and MIPs, that are taking back payments received in the past. One of the major issues is the focus on observation versus inpatient stays, which is resulting in a significant take back of dollars from hospitals.

For those who remember reading Ulysses in high school, the Cyclops’ eye is upon us!

Think about it. Hospitals are faced with an average of $500 million a year in cuts over 10 years, with much of it back-loaded. 2013 will involve ONLY $179 million in cuts, which leads me to ask, “How do hospitals deal with this?”
This is one of those times in my 30-year plus history dealing with congress that I have no answer. I frankly can’t get my head around these kinds of cuts. However, I do know we, as stewards of health care, must develop a way to keep a medical presence in our communities.

Some of the solutions we may need to experiment with include creating a first class emergency room, with clinics geared towards chronic care, all of which will need to be tied to a regional referral center. Is this what our communities want and expect? No, they will fight tooth and nail to keep a full-service facility in their community, but it may no longer be possible. We may have to start looking at something less than a full-service hospital and gear up to make sure doctors, nurses and pharmacies remain in our communities.

This is a bitter pill for many towns to swallow. Just ask individuals who live in Scott and Sequatchie counties and other areas that have totally lost their hospitals.

THA will continue to fight for those dollars necessary to keep all hospitals open, but the cruel reality is some communities may have to settle for something less than a full-service hospital. A recent study by BlueCross Blue Shield of Tennessee showed many patients are bypassing rural hospitals and heading to the big cities for their health care despite the fact the quality is as good as the larger towns and costs are significantly less.

These are tough times and call for difficult decisions to be made. However, let’s make sure we keep an adequate medical presence in all of our communities so we can continue to serve our missions.  

Accuracy Important for Reporting, Patient Safety

I am sure you are like me and can’t wait for the election season to be over.

I am already tired of the talking heads in the media prognosticating on which candidate has a better handle on what ails America. The 24/7 approach to reporting is a far cry from when I was reporter for the Trenton Times and the Wall Street Journal newspapers.

Of course, both my boys will tell you I am so old-fashioned in that I love to hold a newspaper in my hands. Somehow, I just can’t get past reading a newspaper from a tablet or even my Android.

Another way I am old-fashioned is how I approached reporting stories as compared to today’s standards. In my “Intro to Journalism” class at Rider University in Trenton, NJ, my professor, Willard Lally, would pound into us Joseph Pulitzer’s three rules of journalism – “accuracy, accuracy, accuracy!”

I was sitting with my media and lobbying team at THA’s summer conference in Sandestin, waiting for the official call on the constitutionality of the Affordable Care Act from the U.S. Supreme Court. Suddenly, on my laptop came the CNN headline, “Court Strikes Down the ACA,” and my stomach sank. But almost as quickly, someone else who was monitoring another source said, “The Supreme Court bloggers say it has been upheld!”

For five interminable minutes, we waited to find out who was correct. As it turned out, the bloggers had it right and CNN was dead wrong.

When I was a reporter, my night editor at the Trenton Times was Jack Mather, self-described as half American Indian, half rattlesnake. Jack taught the importance of getting it right the first time. He would crumple up my stories and throw it at me if I ever wrote “according to sources…” He would force me to get someone to go on the record and state it publicly. Even then, he would make me get two collaborating sources before he would print it.

There is a correlation between good journalism and patient safety. Get it right the first time, ensure you have followed protocols to insert that central line, and if you have doubts, stop the process and start over. No one died because CNN got the court’s decision wrong. The same can’t be said about ignoring safety procedures or doing short cuts for patient procedures.

Just remember, it is about “accuracy, accuracy, accuracy!”

Mulling Over the Supreme Court Decision

It has been over a week since the U.S. Supreme Court handed down its landmark decision, upholding the constitutionality of the Affordable Care Act (ACA) and the repercussions still are being felt across the country. More importantly, those for and against healthcare reform have been putting their own spin on the decision.

Well, I am no different and here is my take on this decision.

I believe the court, especially the conservative Chief Justice John Roberts, tried to find a middle ground that would give everyone something to crow about. The mandate lives for another day (perhaps at least until after the November elections), which cheers the liberals. However, the Medicaid expansion now is left up to the states, which can be problematic for those of us in the red states.

To me, all of this is mainly irrelevant. Why? Because health care is responding to the market, which is driving change much faster than the Supreme Court can.

The biggest change for hospitals is getting ready for the end of fee-for-service. There are some who believe this won’t happen, but I am not one of them. Fee-for-service drives volume, which drives costs and, in some cases, even drives negative patient safety. Most hospitals and systems are putting their toes in the water, looking at bundled payments or capitation.

The jury is still out as to whether or not this will actually halt the steady drive of ever increasing healthcare costs, but something definitely needs to be done. I believe it will force all hospitals to look at population health and prevention instead of episodic care, which, at least in the short run, can’t help but drive costs ever higher.

The biggest impediment to getting there is congress’ lack of action to moving hospitals away from fee-for-service (FFS). Almost universally, hospital CEOs I have talked to say they want to get all they can out of the FFS system while they can. There is no reward in keeping patients out of hospitals and until that happens, it will be a FFS world.

If I were the healthcare czar or congress, I would decree hospitals would be moved from fee-for-service within five years. I find if hospital executives are told where the system should be, we find a way to get there. If we don’t act soon, it may be too late for all of us.

There are ways to keep the best of what health care has to offer and control costs. Hospital executives can lead the way if given the chance.