Wind chills aside, the first month of the election year gets hot. Providers receive both good and bad grades, and the theme of access to healthcare, which recurs throughout the year, moves to center stage.
* HHS' Agency for Healthcare Research and Quality publishes its first annual report on healthcare quality during Congress' winter recess. The government says providers have made strides in quality improvement but qualified the praise by saying there's still a long way to go. The report says about 95% of the $1.4 trillion spent in the U.S. on medical services each year goes to treatment and only 5% to preventing disease and keeping people healthy.
* The American Hospital Association's annual statistical report shows that hospital profits inched up for the first time in six years. The aggregate hospital profit margin increases to 4.4% in 2002 from 4.2% in 2001, and the number of admissions and emergency room visits continues to climb. The number of U.S. hospitals declines slightly to 5,794 from 5,801 in 2001. The number of general acute-care facilities edges up by 19 to 4,927. At the same time, expenses increase because of higher drug, technology and labor costs.
* An Ohio health system engineers the largest revocation of hospital privileges to date in an escalating war over specialty hospitals.
The image of hospitals becomes a political concern as the industry tries to deal with issues of access, cost and quality. The AHA launches campaigns to trumpet the economic benefits of hospitals to the nation and to enunciate principles for providing affordable healthcare.
* Troubled Tenet Healthcare Corp. announces another sell-off of hospitals as part of its corporate restructuring.
* The White House Office of Management and Budget acknowledges that the Medicare prescription drug law will be much more expensive than originally advertised. It puts the price tag at $534 billion.
* Several polls indicate healthcare is the top issue on voters' minds as Massachusetts Sen. John Kerry wins the New Hampshire Democratic primary, but voters cite his electability as the reason for their choice.
* The CMS says healthcare spending growth slowed to 7.8% in 2003 after six years of accelerating increases. Still, the total tab is $1.7 trillion.
* The Bush administration names Mark McClellan, head of the Food and Drug Administration, to be CMS administrator.
* For-profit hospital chains report that lower ad-missions and more bad debt are hurting earnings.
Training of the next generation of healthcare executives grows as an issue. An online survey by Modern Healthcare reveals that executives and educators think current advanced-degree programs are adequately preparing students for a changing field, but most respondents call for greater emphasis on certain subjects, including compliance, ethics, finance, information technology and relations with medical staff.
* The Healthcare Financial Management Association says it will establish a task force to help hospitals deal with discounts to patients who can't pay their bills.
* The issue of hospitals and the uninsured heats up as Tenet announces a discount policy and a key member of Congress says he wants to hold hearings on the subject.
* St. David's HealthCare System in Austin, Texas, wins a court battle over a government challenge to its tax-exempt status.
* After intense public scrutiny of group purchasing organizations' business practices, Premier and the Greater New York Hospital Association renew their contract. The move follows a review of the contract by a consultancy formed by former New York Mayor Rudolph Giuliani.
* Medicare program trustees predict that the hospital trust fund will go broke in 2019, seven years earlier than forecast in their 2003 report.
Court action heats up in three cases challenging the constitutionality of the federal ban on so-called partial-birth abortions. Hospitals win most of their challenges to U.S. Justice Department subpoenas seeking patient medical records related to these cases.
* An American College of Healthcare Executives survey reports that CEO turnover remained stable in 2003 at 14%.
* A bill to limit noneconomic damages in malpractice lawsuits fails to get past a Democratic filibuster in the U.S. Senate.
* A lawsuit by three hospitals in the Robert Wood Johnson Health System and St. Francis Medical Center in Trenton, N.J., leads to a federal court injunction against a planned physician gain-sharing demonstration project in New Jersey. In the fall, the CMS quashes the project, backed by the New Jersey Hospital Association, after association officials say they have given up hope of reviving the effort.
The health insurance industry continues a trend of consolidation as UnitedHealth Group announces plans to acquire Oxford Health Plans in a $4.9 billion deal. The deal was to make UnitedHealth dominant in the highly competitive Northeast. The companies complete the merger in late July.
* HealthSouth Corp. chooses veteran HCA executive Jay Grinney as CEO of the scandal-plagued rehabilitation company.
* Ascension Health CEO Douglas French announces he will step down after three years in the top post, marking the fourth time in two months that a CEO at a Catholic system has resigned.
* Blue Cross and Blue Shield of Rhode Island ousts Ronald Battista, its president and CEO, as it tries to cope with public outrage over corporate excesses and soaring premiums.
Hospital industry executives get grilled on Capitol Hill as lawmakers hold hearings on not-for-profit tax exemptions, executive compensation and billing of the uninsured. Three congressional panels-the House Ways and Means Committee's oversight subcommittee, the Senate Finance Committee and the House Energy and Commerce Committee's oversight subcommittee-have executives testify under oath about their business practices. To add to industry woes, class-action lawyers file a second round of lawsuits against not-for-profit hospitals and the AHA, accusing them of using tax exemptions to benefit board members and physicians while charging unfairly high prices to the uninsured.
* A report by the Center for Studying Health System Change states that hospital prices increased for the sixth year in a row in 2003 and saw the highest one-year spike in a decade.
* HHS' top fraud-fighter, Acting Principal Deputy Inspector General Dara Corrigan, recuses herself from hospital cases because she is talking with a hospital system about a job. The news creates further uncertainty about the inspector general's post, which was vacated a year earlier by Janet Rehnquist.
The controversy over specialty hospitals continues to grow. Florida enacts a law banning the creation of facilities that focus on cardiac care, orthopedic services or cancer treatment. New Jersey hospitals persuade the governor and state Legislature to boost charity-care funding in part by levying a tax on gross revenues of ambulatory surgery centers.
* Sen. Kerry selects Sen. John Edwards of North Carolina as his vice presidential running mate, drawing criticism from Republicans who say he is a trial lawyer and unfriendly to tort reform.
* Congressional Democrats call for an independent investigation after HHS' inspector general's office clears former CMS Administrator Tom Scully of criminal misconduct in suppressing cost estimates of the Medicare prescription drug bill. But the report says the CMS withheld information from Congress and that Scully threatened to fire the agency's chief actuary if he shared cost estimates with congressional Democrats.
* President Bush nominates Daniel Levinson, inspector general at the General Services Administration, to lead HHS' inspector gen-eral's office.
* HHS issues a broad outline for advancing healthcare information technology, but the plan lacks pledges of substantial new funding.
A Mississippi hospital system stuns the industry with its multimillion-dollar settlement of uninsured billing issues. North Mississippi Health Services, Tupelo, settles the case before Richard Scruggs' law firm actually files suit. Some industry officials worry that the move would be the beginning of a wave of such settlements with Scruggs, who became famous for his anti-tobacco litigation.
* Speaking of the uninsured, the government announces that 1.4 million people lost health coverage in 2003, with a loss in employer-sponsored coverage largely fueling the drop.
* Modern Healthcare readers in an online poll select David Brailer, the government's healthcare information technology czar, as the most powerful person in healthcare.
A commission spearheaded by former HHS Secretary Louis Sullivan says there is still too much disparity between the ethnic makeup of the populations of patients and healthcare providers. The report calls for greater diversity in U.S. healthcare and an immediate emphasis on improving all medical workers' cultural sensitivity.
* Not-for-profit giant Ascension Health teams up with for-profit United Surgical Partners International to create a string of ambulatory surgery centers across its network of 67 hospitals.
* A study by the Kaiser Family Foundation and the Health Research and Educational Trust finds that job-based health insurance premiums soared an average of 11.2% from spring 2003 to spring 2004.
Studies prepared by Dartmouth Medical School researchers report large variations in the quality and cost of care around the nation. They take issue with the notion that higher spending and greater intensity of care result in better quality.
* A new study shows that hospital executives ranked as the five highest-salaried CEOs at large not-for-profit organizations.
* Coventry Health Care agrees to acquire First Health Group Corp. in a $1.8 billion deal that would expand its presence into all 50 states.
President Bush wins re-election and Republicans strengthen their hold on both houses of Congress. Political observers say the ballot results suggest a continuation of market-oriented health policies. They also point to threats to Medicare and Medicaid funding as federal deficits continue to balloon.
* After campaigning by business interests, California voters approve a measure effectively rescinding a law that would have required businesses with 50 or more employers to provide health insurance coverage.
* AHA figures show the nation's hospitals reported a slight gain in overall financial health in 2003 despite sluggish growth in operating margins.
* MedCath Corp. pulls the plug on a heart hospital in Milwaukee, signaling possible market problems for some specialty hospitals.
Consolidation in the insurance sector races forward as Anthem, after a year of regulatory squabbles, closes its $16.4 billion acquisition of WellPoint Health Networks, creating the nation's largest health insurer. UnitedHealth agrees to acquire Definity Health Corp. for $300 million, underscoring a shift from tightly managed care toward consumer-directed alternatives.
* HHS Secretary Tommy Thompson says he will not serve in Bush's second-term Cabinet. Bush nominates EPA Administrator and former Utah Gov. Michael Leavitt to succeed Thompson.
* The Rev. Michael Place announces he will step down as head of the Catholic Health Association, saying he is not the person to lead the CHA's three-year effort to lobby for coverage of the uninsured.
* The year closes with a wave of multimillion-dollar mergers and acquisitions among healthcare providers, insurers and suppliers.