NEW YORK-A federal judge, in a split decision favoring New Jersey hospitals, last week quashed an effort by the Greater New York Hospital Association to reverse the addition of three New Jersey counties to a New York wage-index area used to adjust Medicare reimbursement for area wage differences. Susan Waltman, senior vice president and general counsel at the GNYHA, said the association was considering an appeal. U.S. District Judge Lawrence McKenna in New York ruled the CMS had broad discretion to adopt new metropolitan service areas as a proxy for the labor market, Waltman said. McKenna, however, sided with the association on occupational-mix adjustments, an issue worth approximately $200 million to New York hospitals over the next 10 years. The new wage-index area, which took effect Oct. 1, 2004, will cost New York hospitals $53 million in federal fiscal 2005 and $980 million over the next 10 years, the GNYHA said. Waltman noted that the CMS had the authority to redefine its wage-index areas at its discretion. The New Jersey Hospital Association declined to comment until its officials could read the ruling.
HARTFORD, Conn.-Total malpractice insurance costs for Connecticut hospitals rose 65% in fiscal 2003, the latest data available in a report released last month by the state Office of Health Care Access. Statewide pension costs climbed 63%, and benefit costs increased 17%, according to the annual report on hospital finances. The 31 hospitals providing data had a median net margin of 0.4% in 2003, up from 0.1% in 2002, but the median operating margin decreased to 0.3% from 0.6% in 2002. Nineteen of the hospitals had positive margins overall, with the highest margins at Danbury (Conn.) Hospital (5.8%), Greenwich (Conn.) Hospital (4.97%) and Yale-New Haven (Conn.) Hospital (4.89%). The worst performers, marginwise, were Windham Community Memorial Hospital, Willamantic, (negative 5.7%); Bradley Memorial Hospital, Southington, (negative 5.65%); and Stamford (Conn.) Hospital (negative 5.07%).
PORTLAND, Maine-Mercy Health System received state approval last month to renovate its current facility and build a new hospital for a total of $66 million. The new hospital would open in 2008 as a short-stay inpatient and full-service outpatient facility but would eventually replace the existing hospital.
NEW YORK-The Greater New York Hospital Association and Service Employees International Union Local 1199 presented a 10-point plan last month to modernize the state's Medicaid program and right-size its healthcare system, including creation of a healthcare facilities commission to recommend restructuring steps. The plan by the Healthcare Education Project, a joint effort of the GNYHA and SEIU 1199, came in response to Medicaid reimbursement cuts proposed by Gov. George Pataki. The plan included a federal-state partnership to encourage restructuring and efficiency; local tax relief; disease management for Medicaid beneficiaries; and Medicaid payment revision to encourage hospitals to lower costs and allow nursing homes to innovate. The group called for raising revenue for restructuring through taxes on large employers that don't offer health insurance and on health plans with high administrative costs. It also proposed an "obesity prevention" tax on junk food and a charity-care fee levied on niche providers "that destabilize the healthcare system."
PHILADELPHIA-Community Health Systems, Brentwood, Tenn., said last week it completed the purchase of Chestnut Hill Hospital from not-for-profit Chestnut Hill HealthCare. The University of Pennsylvania Health System will have a 15% interest in the hospital. Community owns or operates 71 hospitals in 22 states.