Neil McLaughlin's editorial on events in healthcare in 2005 was right on the mark ("An embarrassment of riches," Dec. 19/26, 2005, p. 21). I got into hospital administration 40 years ago when administrators were there because they had an interest in taking care of people. I'm back from retirement and at age 71 am CEO of a small, rural hospital because I missed not using my experience to make a difference. Contrast that with the for-profit chains with their entrepreneurs and investment bankers who see a place to make money off sick people.
As abhorrent as are the actions of Richard Scrushy, at least he started out as a caregiver. The likes of Richard Scott, who made a ton of money but nearly brought down Columbia/HCA Healthcare Corp., and Allan Miller (awarded a $2 million bonus, see Newsmakers, Dec. 19/26, p. 34) never worked in the trenches, just at the top of large companies where they were isolated from the poor and sick from whence came their fortunes. Unfortunately, nowadays even not-for-profit executives have been corrupted by unconscionable compensation.
Chief executive officer
Flint River Hospital
Medicaid thoughts ...
As a provider in a rural area of Georgia that has a healthcare shortage, Todd Sloane's editorial on Medicaid touched a nerve ("Medicaid needs your help," Dec. 5, 2005, p. 22). I lead a multispecialty clinic of 34 doctors. About 7% of our patients are on Medicaid; that number is growing. I just attended a summit sponsored by the Georgia Department of Health, which was about trying to prioritize services amid Medicaid funding cuts. I have some thoughts for those in Washington looking at Medicaid.
First, either healthcare is a business and should be treated as such, or it is an entitlement and the federal government needs to find the money to pay for it. You can't have it both ways. The public believes that if you are sick, you should be able to go and get care and someone should pay for it. As providers we can't pay the bills; I have watched physicians leave the business because of inappropriate reimbursement. Physicians can make more money by not practicing medicine; many are doing so. A crisis is coming soon if we stay with the same old methods to pay for healthcare.
One problem that needs to be addressed is immigration. We need to separate the costs of caring for legal and illegal immigrants from Medicaid. States with high populations of immigrants can't afford to provide care for them. If the federal government adopts policies of paying for them, it ought to foot the bill.
Nowhere in Medicaid is there any coherent means of assessing new technologies in medicine. When a new drug or procedure gets into the system, it is as if it has always been there. There are huge costs to many of the new innovations. Because I believe we don't have unlimited funds, a cost-benefit analysis should be required. We have to show where the funds will come from to cover the new item. We can't cut payments to providers while adding costly new technologies.
We can't think of Medicaid in a vacuum. We are short 15 to 20 physicians in our community. The shortage may get worse as the supply of physicians nationally continues to shrink. The potential cut in 2006 Medicare payments to doctors would force a reaction from providers, and I believe you will begin to see a limit on taking new Medicare patients. Medicaid patients would also be evaluated at that time.
I have been in the business for more than 25 years, and it is as tough to keep physicians above break-even today as I have ever seen. We have pulled out every stop, including shipping transcriptions to India for savings. There is no way the providers can take another cutback without cutting care.
... and questions
Regarding Gov. Jeb Bush's commentary, the Medicaid reform proposed for Florida is doomed to failure ("Medicaid revisited," Nov. 21, 2005, p. 24). In no way is this an effort to provide better care or continuity of care. It is simply a means for the state of Florida to transfer responsibility for Medicaid recipients to private industry.
The state will give these private concerns 90% to 95% of the yearly allocated dollars per recipient. The health plans will get their costs and overhead for administering the program reimbursed plus a healthy margin for themselves.
The expectation will be that providers will accept even less payment than the fee-for-service program so that Medicaid recipients will have a network of providers. That is not going to happen.
It is ridiculous to create a middleman who will demand a profit from Medicaid dollars when providers have had the state shoving their version of what they call cost reimbursement down the throats of Florida providers. These hospitals and physicians have, in reality, been subsidizing the state Medicaid program for years.
Here are a few questions concerning this great experiment:
* If all Medicaid in Florida will be administered through private companies that are assuming the responsibility and authority for taxpayer dollars, will they be subject to the Florida Sunshine Law, making their records and board meetings public?
* If all Medicaid is private, why would a hospital maintain a contract with the state to be a Medicaid provider if it chose not to participate? If it didn't have a Medicaid contract, why would the hospital have to submit a cost report to the state to determine reimbursement? If there is no cost report, what will a health plan have to pay a hospital that is not contracted with Medicaid? Current state law requires charges from a payer who is without a contract with the provider.
No hospital in Florida should participate in an experiment wherein private companies can make a profit on state Medicaid while hospitals have been subsidizing the program for years.
Chief executive officer
Baker County Medical Services
No place like home
Thank you for your recent story "Hospital-at-home care `effective' " (Dec. 12, 2005, p. 14). The study by Johns Hopkins Medicine actually echoes what home health agencies have been studying and reporting for years.
For many patients, positive outcomes can be achieved just as safely and more cost-effectively in the privacy and comfort of their own homes. Hopefully, the Hopkins study and others will be considered as the CMS and Congress consider changes in the funding for agencies. Funding should be improved, so home health agencies can continue to deliver the positive results mentioned in the article to a growing number of patients.
Home Care Division
More data on costs
Laura B. Benko's special report on insurers providing hospital- and physician-price information to consumers did an excellent job of revealing one of the great mysteries of healthcare: how much healthcare services actually cost ("Price check!" Nov. 14, 2005, p. 48).
The complex public and private insurance financing systems of chargemasters, negotiated rates, allowable amounts and the actual paid claims has made smart comparison shopping all but impossible. In no other sector of the economy is the relationship between the cost of service delivery and charged amounts so inscrutable.
Despite the insurers' efforts, however, there is still a general lack of data regarding how much insurers pay for these same services. With the shift to high-deductible plans, this information is becoming essential to the purchasing consumer.
In March 2005, the New Hampshire Institute for Health Policy and Practice -- in cooperation with the New Hampshire Insurance Department -- unveiled a new Web site detailing health costs. The institute used actual paid claims data from the major insurers in the state. Working with an advisory group of stakeholders, the institute selected approximately 25 common inpatient and outpatient procedures, analyzed the claims data for these procedures, determined a typical price and a range of prices, and then created a user-friendly Web site for consumers to obtain this information.
The Web site (nhhealthcost.org/#purpose), displays the typical cost for certain inpatient and outpatient procedures, based on insurers' reports of their most common claims diagnoses. It is intended as a guide to give consumers a benchmark as to what a carrier would pay for certain types of services. The site includes a brief explanation of how healthcare is priced, including information on co-insurance and deductibles, and provides links to medical and clinical information on the conditions priced on the site.
The institute, working under contract with the Department of Insurance, is expanding this site to provide price information that is hospital-specific. New Hampshire is one of the few states in the country that requires carriers and third-party administrators to file their claims data with the state.
We recognize that the Web site is in its infancy. In addition to displaying hospital-specific pricing information, we are also planning to add hospital charge information to the site, as well as the discounts from charges provided by hospitals to indigent people.
The site has a link to the University of New Hampshire survey center, and most of the feedback indicates that site users want provider-specific information.
We feel that we are making progress in the effort to make healthcare pricing understandable to consumers and remove, at least in part, a barrier to the development of new types of insurance products.
Senior policy analyst
New Hampshire Institute for Health Policy and Practice
Senior policy analyst
New Hampshire Insurance Department
Savings and patient safety
Your Dec. 5, 2005 special report, "Waging war on inefficiency" (p. 26), implied that containing labor costs in the laboratory and elsewhere can sometimes conflict with protecting patient safety. But that need not be the case.
At El Camino Hospital, a 395-bed facility in Mountain View, Calif., laboratory automation has enabled us to dramatically improve productivity and reduce labor costs. At the same time, automation has improved patient safety.
Our automated systems handle everything from pre-analytic processing to testing to storage and retrieval. In the two years since it was installed, our lab's productivity has improved 35% and our labor costs have dropped by 16%, despite a 22% increase in the average hourly rate paid to lab staff. We've absorbed a 47% increase in test volume without adding staff.
Meanwhile patients are safer because turnaround time for results is speedier, leading to more timely diagnoses. In addition, the system's bar-code technology helps prevent mismatches between patient and sample. We are not alone; other clinical laboratories have been improving productivity and patient safety, while reducing unit labor costs through automation. This trend will no doubt continue.
Clinical and support services
El Camino Hospital
Mountain View, Calif.
What do you think?
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