The Wild West Sits One Out: AB 52 is delayed until 2012 as California backs down to health insurance company interests0

As expected, the 2010 Patient Protection and Affordable Care Act (PPACA) has had a dramatic impact on the American health care system. One of the more admirable objectives deeply entrenched in health care reform is the establishment of a clear and understandable infrastructure so that its many moving parts and pieces can seamlessly coexist under proper supervision. To this effect, at the end of 2010, the federal government published proposed regulations addressing health insurance rates, including strict disclosure and careful review of any significant price adjustments by insurers.

Focusing on the exorbitant 131 percent increase in health insurance premium rates for families since 1999, these reform-based regulations required all rate increases of 10 percent or more to be publicly disclosed and justified as of 2011. With an eye to the future, PPACA further dictated that by 2012, each state shall be responsible for setting and enforcing its own rate threshold to reflect appropriate cost trends and other meaningful date when reviewing future rate hikes. For states that fail to establish such a system of oversight, either by design or due to lack of resources, the U.S. Department of Health and Human Services (HHS) will step in and satisfy the intent of the legislation.

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Preparation Does Not Guarantee Perfection0

This article first appeared on California Healthcare News.

California has always found its way into the public spotlight, and 1975 was no exception. That is the year in which Jerry Brown became the state’s 34th governor, Nolan Ryan started the season for the California Angels, President Ford survived an assassination attempt in Sacramento, actors Jon Voight and Marcheline Bertrand gave birth to their daughter Angelina Jolie Voight in Los Angeles, and the state’s Medical Injury Compensation Reform Act of 1975 (MICRA) was passed.

At its core, MICRA was the end result of efforts to save California’s physicians from the fallout of a multitude of lawsuits, runaway jury verdicts, and draconian responses by insurance liability companies. With its $250,000 cap on non-economic damages in medical malpractice litigation, MICRA made history as its backers trumpeted the salvation of medicine in California. Controversial from the day Governor Brown first signed it into existence, MICRA continues to face challenges these 36 years later. For better or worse, however, MICRA addressed a critical issue and assuaged what were at the time very real fears that issues of liability and catastrophic jury verdicts would bring California’s medical system to a halt.

California’s hospitals are not alone in their need to proactively address situations involving unforeseen events. In this present era of health care reform, providers across the nation have an even greater abundance of legal issues on which they must focus their attention. For example, in the not too distant past a new concern appeared on the horizon some 2,700 miles from Sacramento. August 2005 saw Hurricane Katrina wreak havoc throughout southeastern Louisiana, with a death toll in excess of 1,800 and an $80 billion price tag, to say nothing of the sociological and environmental collateral damage that quickly followed.

Once the storm had passed and the dust had begun to settle, a frightening discovery at Memorial Medical Center in New Orleans captured the nation’s attention anew and resonated in the hearts and minds of every hospital administrator across the nation. Forty-five Memorial Medical Center patients died from the Hurricane, a number greater than any other New Orleans hospital, and blame was quickly directed to the hospital and its failure to provide for its community in an emergency situation. … Read more →

Instructions Never Included0

“Man cannot discover new oceans unless he has the courage to lose sight of the shore.”

— André Gide, French author

This article was first published on the PBS affiliated website This Emotional Life.

I have decided at last to forgo my search for instructions. Though it was nearly a decade ago that I first hoped to uncover an operational manual at work during my first tenuous days in an unfamiliar hospital environment, such guidance always escaped my discovery.

Seven months ago a new job of sorts presented itself to my wife and me, and not surprisingly, this owner’s manual also turned up missing. The resultant experiences brought about by new fatherhood have only served to reinforce my decision to trust my instincts from this point forward, as while there is an abundance of literature that purports to bridge such gaps in both professional and personal knowledge, I have yet to encounter any crisis brimming with patience, be it related to emergency department protocol or an unexpected and unexplainable late night tantrum.

In my professional role as health care attorney and consultant, I have come to grips with the fact that the federal government may not publish an “executive summary” covering all 2,700 pages of last year’s Patient Protection and Affordable Care Act (PPACA, more commonly referred to as health care reform) anytime soon.  … Read more →

Looking Back to Move Ahead: Leading Hospitals Through Fast-Paced Change (Becker’s Hospital Review)0

The article was first published August 26, 2011 on Becker’s Hospital Review (written by Molly Gamble).

Healthcare executives might remember time moving a bit more slowly before March 23, 2010. That was the day President Obama penned his signature, supposedly letter by letter, onto the Patient Protection and Affordable Care Act. The average workday for healthcare or hospital CEOs was probably filled with slightly different concerns or agendas before that moment. Since then, though, the industry has been flung into fast motion to accommodate the policy changes mandated in that 2,700 page bill along with its larger overarching themes that are shaping modern-day healthcare.

For the rest of the article, visit the Becker’s Hospital Review Website.

PBS’s ‘This Emotional Life’: Medicine By the Numbers

PBS’s “This Emotional Life”: Medicine By the Numbers

Lewis Carroll wrote: “If you want to inspire confidence, give plenty of statistics. It does not matter that they should be accurate, or even intelligible, as long as there is enough of them.”

When people are first told that a loved one is in the hospital, they want answers. Straight answers. And they want them fast.

But oftentimes in today’s medical centers, what patients and family members alike are met with is numbers: Hypotheticals, probabilities and percentages. When combined with complex medical jargon, this can quickly lead to confusion and uncertainty, as those involved must make sense of the stats before they can understand the state of the patient’s condition. Without the proper frame of reference, this type of information can quickly exacerbate fears and increase emotional distress. Rather than serve as beacons to shed light on a patient’s chances, these figures quickly become barriers to the truth. For many of us, the numbers are to be feared, not followed.

Still, whether we like it or not, playing the percentages is a medical necessity. In the modern age, health care is all about the bottom line. As technology advances and life expectancy increases, today’s treatment options become more and more focused on the probabilities of success or failure. From prenatal care to geriatric services, every patient ultimately wants to know one thing: “Where do I stand?” More and more, the answer is delivered as a number, culled from experience, testing, and appropriate clinical research trials. This often leaves the physician to mediate between patient and procedure, as he or she attempts to present new information in such a way that those involved can both understand and take comfort from that most dispassionate of messengers, the statistic.

The numbers themselves are not to be blamed. At the risk of making modern health care sound like a sports bar in Las Vegas, the purpose of statistics in a medical environment is to give the facts about a patient’s condition in black and white, which, if not done humanely, can seem lacking in compassion. The key to recognizing the value of such numbers is to use them as guidelines, not ultimatums.

Properly used, statistics perform a dual function: When correctly interpreted and explained, these numbers can act as a security blanket, breaking down frightening uncertainties into hard facts in which patients can wrap themselves during a time of emotional upheaval, while also providing a solid understanding of treatment options and outlooks. From a doctor’s perspective, they stand as a buffer, protecting the physician from being forced into the unrealistic role of savior, no matter what the condition. In their way, percentages help to reinforce the idea that nature, and not the doctor, will ultimately make the final call as to a patient’s future. Such impartiality goes a long way toward strengthening the doctor-patient relationship, especially when the prognosis is not as good as a patient might have expected.

Numbers can be persuasive to those patients faced with making important yet difficult lifestyle changes or deciding upon end-of-life treatments. For patients diagnosed with serious illnesses and their families, much of today’s medical data provides hope. For example, according to the information available at the end of 2009, life expectancy in the United States reached an all-time high in 2007 — 77.9 years (75.3 years for men and 80.4 years for women). Between 2006 and 2007, rates dropped for nearly half of the leading causes of death in the United States (cancer, heart disease, stroke, hypertension, accidents, diabetes, homicides and pneumonia), reaching a new low of about 0.76 percent of the population (760.3 deaths per 100,000 people). That is approximately one half the rate from 1947. Once fatal illnesses are slowly being reclassified, provided the patient heeds the warnings found among the numbers and takes the appropriate steps to live in a healthier manner.

On the other end of life’s spectrum, many newly pregnant couples become surprisingly imaginative upon first hearing their good news and spend much time contemplating the worst. To calm the parents’ nerves (and to protect the doctor’s interests), it is now standard practice to administer a series of tests to assess the baby’s health throughout development. Then end result of most of these tests comes back in numbers. Statistics again.

Without debating the ethics and morality of abortion, which is not a doctor’s role, many of these tests seek to ascertain the health of the fetus and predict the odds of certain birth defects such as Down syndrome, trisomy 18, or trisomy 13. The number of things for a pregnant couple to worry about can be staggering, yet doctors are often obligated to advise them of the chances in advance. For example, in North America, 1 in 260 females carry the chromosome for Fragile X (also known as “Martin-Bell”) syndrome, a genetic disorder that results in an array of physical and mental limitations, ranging from severe to mild in manifestation. Likewise, 1 in 149 Ashkenazi Jewish individuals carry the gene for Nemaline Myopathy, a neuromuscular disorder that causes muscle weakness of varying severity. In its most potent form, Nemaline Myopathy results in death after just a few years. By incorporating these tests with such relevant factors as the age and overall health of the mother and the genetic background of each parent, doctors can provide a statistical model on which to gauge the probability of the baby’s being born to normal health. This can provide parents with peace of mind if the chances of defects are low, or the opportunity to prepare themselves or consider their options if the outlook is not favorable.

At least one reason behind the surge in statistical diagnosis is the continued rise in medical malpractice claims. Having been forced into the role of omniscient healer as a result of advances in diagnostic testing, doctors must now use this same technology to cover themselves in the event of a statistical improbability. A recent study by the American Medical Association concluded that “defensive medicine” (defined as medicine relying upon diagnostic and other therapeutic measures to safeguard against malpractice claims first, and the health of the patient second) increase health care costs by as much as $150 billion each year. To be sure, throwing the title of statistician into a doctor’s medical bag of magic tricks does not help to further the doctor-patient relationship.

There is no numeric substitute for direct and clear communication between a doctor and patient. That said, making sense of medical statistics can go a long way in helping a patient understand diagnosis, prognosis and treatment. If you or a loved one has been diagnosed with a potentially life-threatening illness, your decisions about treatment can often be linked to “quality of life” concerns. No matter what age, patients want answers to certain questions, often combined with supporting statistics, such as:

  • How will this disease affect my life on a day-to-day basis
  • Is this disease terminal, or if left untreated, will it become terminal?
  • How will the treatment affect my life on a day-to-day basis?
  • How will the disease, treated and/or untreated, alter my life expectancy compared to my anticipated decline in health as I age?

It is important to remember that statistics are numbers, plain and simple. While numbers may not lie, they have no bedside manner and can be interpreted in a variety of methods and made to suit many arguments. The best way to know where you or your loved one stands is to discuss your situation clearly and openly with your doctor, taking into consideration the big picture as well as the percentages.

This Emotional Life is a two-year campaign to foster awareness, connections and solutions around emotional wellness. Join our community at www.pbs.org/thisemotionallife.

340B and Hospital Systems0

The Department of Health and Human Services (“HHS”) responded to comments published in the Federal Register that a hospital  enrolled in the 340B program as a Covered Entity may treat its off-campus clinics and satellite hospitals as part of the Covered Entity, provided the off-campus clinic or satellite hospital is included on the Covered Entity’s Medicare Cost Report.[1]  HHS also declared that off-campus clinics and satellite hospitals may be properly included on the Covered Entity’s Cost Report where they meet Medicare’s tests for provider based status, as outlined at 42 C.F.R. § 413.65(d-e).[2]

(1)        Criteria For All Facilities

42 C.F.R. § 413.65(d) outlines the criteria for all facilities to receive provider-based status.  The requirements are divided into five main categories, with two categories in particular that typically affect hospital systems: (a) licensure and (b) clinical services.

(a)        Licensure

With respect to licensure, as stated above, “the satellite facility and the main provider are operated under the same license, except in area where the State requires a separate license for the . . . satellite facility.”[3]  One example of a state with this requirement is Nevada as Nevada law requires all hospitals and clinics, among other providers, to be licensed by the Nevada State Health Division[4].

(b)       Clinical Services

With respect to clinical services, the two entities need to be integrated such that (i) the professional staff of the off-campus clinic must have clinical privileges at the Covered Entity’s main campus; (ii) the Covered Entity provides the same monitoring and oversight as it does for any department; (iii) the medical director of the off-campus facility needs to maintain a reporting relationship with the CMO of the Covered Entity and be supervised and accountable to the CMO; (iv) the Covered Entity’s staff committees are responsible for the off-campus clinic’s medical activities, including, quality assurance, utilization review, and coordination and integration of services; (v) the entities have integrated medical records; and (vi) the off-campus clinic and the Covered Entity are integrated such that patients treated off-campus have full access to facilities and services of the covered entity.[6]

(2)       Criteria For Off-Campus Facilities

42 C.F.R. § 413.65(e) outlines the criteria for off-campus facilities to receive provider-based status.  The requirements are divided into three categories: (a) ownership and control, (b) administration and supervision, and (c) location.

(a)        Ownership and Control

With respect to ownership and control, the Covered Entity’s control of the off-campus clinic must be evidenced by: (i) 100% ownership; (ii) accountability to the same governing body; (iii) organization under the same governing documents and bylaws; (iv) and final administrative responsibility laying with the Covered Entity.[7]

(b)       Administration and Supervision

With respect to ownership and control, the Covered Entity must hold the off-campus clinic accountable as evidenced by: (i) direct supervision of the off-campus clinic; (ii) accountability to the Covered Entity’s governing body, and (iii) integrated billing, records, human resources, payroll, employee benefits, salary structure, and purchasing services.[8]

(c)        Location

With respect to location, the Covered Entity and the off-campus clinic must meet one of the following: (i) located within a 35 mile radius of each other; (ii) the Covered Entity is disproportionate share adjustment of greater than 11.75% and is owned either by the state or local government, is a nonprofit corporation granted governmental powers by the state, or is a private hospital with a State contract to provide clinic services to low-income individuals; (iii) the off-campus clinic has at least 75% of its patients from the same zip code as the Covered Entity or 75% of the off-campus clinic’s patients were treated at the Covered Entity; (iv) 75% of patients in the off-campus facility’s zip code receive treatment at Covered Entity; or (v) the off-campus facility is a children’s hospital and meets 6 other criteria.



[1] 59 Fed. Reg. 47884, 47885 (Sep. 19, 1994).

[2] Id.  The response in the Federal Register directs the reader to “Provider Certification, State Operation Manual, section 2024.”  Section 2024 in turn directs that, “all non-hospital providers of service under Medicare that state they are part of a single hospital must meet the criteria for provider-based designation in §2004 in order to be treated as a single hospital for payment purposes.”  Next, Section 2004 directs the reader to 42 C.F.R. § 413.65 for the criteria used to determine provider-based status.  Finally, the Federal Register cited above enumerated several criteria as examples, all of which are found in C.F.R. § 413.65.  Thus, while the Federal government (surprisingly) was less than clear on the test for determining whether an off-campus clinic or satellite hospital may be treated as part of a Covered Entity, I am confident that the provider-based status test is the applicable test to make such a determination.

[3] 42 C.F.R. § 413.65(d)(1) (2012).

[4] See Nevada Revised Statues § 449.030 (2012).

[5] 42 C.F.R. § 413.65(d)(1) (2012).

[6] 42 C.F.R. § 413.65(d)(2) (2012).

[7] 42 C.F.R. § 413.65(e)(1) (2012).

[8] 42 C.F.R. § 413.65(e)(2) (2012).