Hospitals and health systems in Houston have increased the intensity of their dealmaking. Baylor College of Medicine and St. Luke's Episcopal Health System agreed to begin exclusive negotiations to merge, the two organizations said. St. Luke's had been part of informal negotiations to merge with Memorial Hermann Healthcare System, but David Fine, St. Luke's president and chief executive officer, said in a news release that the system concluded that its first obligation was to try to build on its existing affiliation with Baylor. Terms of the Baylor-St. Luke's merger will be set during the negotiations. Meanwhile, Christus Health, Irving, Texas, said it plans to sell Christus St. Joseph Hospital in downtown Houston because the system doesn't want to undertake renovations the 315-bed hospital needs to adjust to the greater prevalence of outpatient medicine, Christus officials said. Christus, which owns or leases 27 acute-care hospitals and manages four others, said it will seek a buyer "who will invest in the facility, strengthening the healthcare services in downtown Houston" in a sales process that could take up to a year.
New inspector general confirmed
The Senate confirmed Daniel Levinson, former inspector general at the General Services Administration, as HHS' inspector general, a nomination long held up by political horse-trading. President Bush nominated Levinson, 56, for the HHS post in July 2004 and appointed him acting inspector general through an executive order in September 2004. Several Democrats delayed the career civil servant's Senate confirmation, seeking various concessions from the Bush administration. HHS spokeswoman Christina Pearson said Levinson has not yet been sworn in, but will be soon. "Dan brings great credentials to the position and will do a great job." HHS hasn't had a permanent inspector general since June 2003, when Janet Rehnquist resigned under pressure after her judgment was called into question. As acting principal deputy inspector general, Dara Corrigan took on many of Rehnquist's duties. Corrigan resigned in October 2004.
HMO rate increases slowing
HMO rates will rise by the lowest amount in more than five years in 2006, about 12.4% nationally, according to a preliminary analysis by consulting firm Hewitt Associates. Despite indications that HMO costs will continue to moderate, companies still face double-digit rate increases and are adjusting their offerings to share more of the costs with employees, the data showed. For example, the number of companies with $20 office copayments jumped to 25% this year from 16% in 2004, while the number of employers offering $10 copayments dropped to 22% from 29%. Higher copays are also being used to shift more of the cost of prescription drugs, specialty care and emergency room visits to employees.