More military facility closings likely. A Defense Department report released last week is calling for two more rounds of military base closings in 1999 and 2001, which also would likely result in the shuttering of some military hospitals and clinics. Groups representing military retirees said such closings could jeopardize retirees' access to medical care, particularly in communities surrounding closed bases where many retirees settle. The groups renewed calls for allowing military retirees and family members to join the Federal Employees Health Benefits Program.
Hospital prices unchanged in April. Wholesale prices for acute-care hospital services were unchanged in April and up 1.3% for the 12 months ended in April, according to the U.S. Labor Department's Producer Price Index. The PPI measures changes in net revenues per episode of care. Wholesale prices for physician services, meanwhile, rose 0.2% in April and were up 1.2% for the 12 months.
MedPartners, InPhyNet adjust deal. Birmingham, Ala.-based MedPartners and InPhyNet Medical Management, Fort Lauderdale, Fla., adjusted the terms of their merger as a result of discussions with the Securities and Exchange Commission that led InPhyNet to restate its earnings. InPhyNet shareholders will receive 1.18 shares of MedPartners stock for each InPhyNet share, rather than 1.31 shares as previously announced. InPhyNet adjusted downward its 1996 earnings and its first-quarter 1997 earnings to expense $9.3 million of costs associated with a global capitation agreement with Physicians Corporation of America. In a related matter, MedPartners purchased Durham, N.C.-based Piedmont IPA, which has 172 physicians and 2,275 prepaid patients. Terms weren't disclosed.
Bids sought for Denver facilities. Sisters of St. Francis, Denver, will seek bids for its three hospitals and two other healthcare facilities. The order, which operates its hospitals under Sacred Heart Corp. in Denver, said it is divesting its healthcare businesses because it has fewer sisters and because healthcare is growing more complex. The hospitals for sale are UniMed Medical Center, Minot, N.D.; Kenmare (N.D.) Community Hospital; and St. Anthony's Hospital, O'Neill, Neb.
Medical education trust fund urged. A multibillion-dollar national trust fund should be set up to pay for medical education, biomedical research, and highly specialized and innovative patient care, according to a report released this month from the Commonwealth Fund. The report contains recommendations from the philanthropy's task force on academic health centers. The group said Medicare and other private payers should support the trust fund. The idea is to pay academic health centers separately to support their missions so they don't pass on the costs to patients. A trust fund of $15 billion would support academic health centers in 1997 and reflect a 20% decrease in the number of doctors trained, the report said.
OccuSystems starts 2 joint ventures. OccuSystems has launched joint ventures with hospital systems in Little Rock, Ark., and Harrisburg, Pa. One is a 50-50 venture with St. Vincent Infirmary Medical Center, Little Rock, which is expected to serve as the basis of a statewide occupational healthcare network. The venture will include OccuSystems' three occupational healthcare centers in that market along with St. Vincent's MedWorks occupational health program. OccuSystems will run the network for a management fee. In the second venture, OccuSystems will consolidate its center in Harrisburg with those of two local providers, Pinnacle Health System and Community General Osteopathic Hospital. Dallas-based OccuSystems will own 51% of the venture and receive a fee based on the venture's net revenues.
Conn. passes consumer insurance bill. Lawmakers in Connecticut, the nation's insurance capital, last week overwhelmingly approved a bill that gives consumers the right to appeal to the insurance commissioner when their medical plan denies treatment. The measure, which Gov. John G. Rowland promised to sign, may influence other states, industry observers said (May 19, p. 12). Meanwhile, California Gov. Pete Wilson proposed a 73% budget increase for the state Department of Corporations, which oversees HMOs, to $15 million for the fiscal year starting July 1.