HARVARD PILGRIM PROGRESS. Harvard Pilgrim Health Plan soon will be free from judicial oversight now that the Massachusetts Supreme Court has approved the plan to rehabilitate the nearly bankrupt HMO.
The state put Harvard Pilgrim, the largest HMO in the state, in receivership in early January. As part of releasing it from supervision, the insurance commissioner will appoint a new board of directors.
State officials say they expect to release Harvard Pilgrim from receivership within a month.
The HMO's financial performance during the first three months of 2000 was slightly better than budgeted. It had a net loss of $13.4 million on income of $634 million; it had projected a net loss of $14.9 million.
In January, February and March more than $500 million in provider claims were paid, and the HMO reduced its claims inventory by 20% from its Dec. 31, 1999, level.
The 2000 budget projects a $5 million loss compared with a net loss of $54 million in 1998 and a $228 million loss in 1999.
HEALTHCARE IT SPENDING TO SLOW. Despite full-force marketing blitzes by healthcare technology companies, a healthcare consulting firm predicts that IT spending will slow over the next three years. Sheldon Dorenfest and Associates, a Chicago-based healthcare market analysis and consulting firm, forecasts that healthcare IT spending will grow at a rate of 10.3% in 2000, down from an annual growth rate of more than 15% between 1995 and 1999. Dorenfest also predicts expenditures will increase from $18.5 billion in 1999 to $20.4 billion in 2000.
"Healthcare buyers are taking a long, deep breath after Y2K as they evaluate their return on investment in information systems deployed in the late '90s," says President and CEO Sheldon Dorenfest. "There is a real disconnect between what the IT industry is selling and what the healthcare industry needs."
Dorenfest's predictions are based on a database containing demographic information on 40,000 healthcare facilities associated with 1,500 integrated delivery networks and their information technology programs.
DOCS BUILD HOSPITAL. A group of physicians in Moore, Okla., plans to break ground on their own hospital. The physicians will begin construction on the 33-bed primary care hospital this fall and hope to open in the summer of 2001.
The 66,000 square foot, $24 million facility will include three surgical suites and 12 birthing suites and will be connected with an existing medical office building via a skyway. Emergencies, cardiology, oncology and neurology cases will be referred to tertiary facilities in Oklahoma City, according to John Resneder, M.D., spokesman for the physicians.
"We are not wanting to compete with the larger area hospitals," he says.
Other physician-owned hospitals in larger markets have failed recently, including Precedent Health Center in Denver and Doctors Hospital of Hyde Park in Chicago.
There are currently only about a dozen physicians practicing in Moore, the growing community can actually support 45 to 50 physicians, and the new hospital will enable that growth, Resneder says.
BARGAINING RULES. Texas' attorney general finalized the rules allowing physicians to collectively negotiate with health plans.
John Cornyn announced the final rules May 17 and says they are less burdensome than the proposed rules, requiring less supporting paperwork from physicians petitioning to negotiate.
The final rules will be published June 2 and will become effective June 6.
The law, passed last year, makes Texas the first state to allow physicians to collectively negotiate with health plans. Antitrust laws generally prohibit such action. However, the limited state action doctrine insulates physicians against prosecution if they follow the law.
The attorney general's office estimates 112 groups will apply each year for collective bargaining rights, with most concentrating on fee negotiation.
In a statement, executives of the Texas Medical Association say they expect more "revisions and adjustments to come as these rules are applied to very specific, real-life practice settings."
Officials at the Texas Association of Health Plans say they have no plans to fight the law in court.
HCA'S NAME CHANGE. Attempting to put its tarnished image behind, Columbia/HCA will rename itself HCA-The Healthcare Company. The name change is effective immediately.
The name change is designed to build on recent changes in the company and affirms the "culture and values of our more than 168,000 employees," says Thomas Frist Jr., M.D., chairman and CEO.
But the move also could be a way to repair its damaged public image. The company recently agreed to pay the government $745 million in fines for Medicare fraud.
The company's ticker symbol on the New York Stock Exchange changed to HCA effective May 30.
