Briefs

The CMS said improper Medicare claims declined to 3.9% in 2007 from 4.4% in 2006 and 14.2% in 1996—the result of aggressive oversight efforts involving detailed data analysis in targeting areas where there might be waste, fraud and abuse. During the past three years, error-rate reductions in Medicare fee-for-service have led to approximately $11 billion less in improper payments, the CMS said. The CMS pays more than 1 billion fee-for-service claims each year. The report, which is released annually in November, was based on detailed reviews of randomly sampled Medicare claims submitted between April 1, 2006, and March 31, 2007.

California hospitals have gotten a reprieve on upcoming seismic safety deadlines, potentially saving them $4 billion in construction costs. A state commission ruled unanimously that hospitals could use new computer software, called HAZUS-MH—short for Hazards U.S.-Multi-Hazard—to more accurately assess how vulnerable their buildings are to collapse or damage during an earthquake than previous estimates. Developed by the Federal Emergency Management Agency, HAZUS calculates risk in a variety of natural disasters. The California agency that oversees the hospital construction projects, the Office of Statewide Health Planning and Development, has set guidelines for the software’s use. The agency estimates that 50% to 60% of 1,110 hospital buildings statewide required to meet a seismic-safety deadline of 2013 could be reclassified at a lower risk of collapse and not need to be rebuilt until 2030. The rest of the buildings will still need to meet the 2013 deadline or face closure, and many of those construction efforts are already under way or completed. The total cost of hospital reconstruction in the state, paid for by the hospitals, could reach $110 billion.

Baptist Health System of East Tennessee and St. Mary’s Health System, both based in Knoxville, said that they have signed a definitive agreement to merge their systems under a new, still-to-be-named umbrella organization. The deal was announced in September. Six months after the deal is completed, the organization will develop a strategic plan for fully merging the operations of the two systems and provide a capital spending plan. Each of the eight hospitals in the new system will keep its current name. Baptist and St. Mary’s said that they expect to receive regulatory approval in time to complete the merger effective Jan. 1, 2008. The new organization’s board will include 18 directors, drawn from the systems’ current boards. Debra London, president and chief executive officer of St. Mary’s, will be chief executive officer of the umbrella organization, said Craig Griffith, a St. Mary’s spokesman. Janice James, acting CEO at Baptist and a principal with Wellspring Partners, will stay on during a transition period, Griffith said.

Stryker Corp., Kalamazoo, Mich., and former subsidiary Physiotherapy Associates have agreed to pay $16.6 million to settle allegations that Physiotherapy’s clinics submitted false claims for state and federal reimbursement. The agreement with the U.S. Justice Department resolves allegations that originated in separate whistle-blower lawsuits filed by employees of Physiotherapy, which Stryker sold in May to a Chicago-based private equity firm. Stryker acknowledged in a June news release and filing with the Securities and Exchange Commission that the company would retain responsibility for “certain cash damages” in connection with the investigation involving Physiotherapy’s billing and coding practices. A Stryker spokeswoman said the company has a policy of not commenting on litigation. Physiotherapy, under the terms of the settlement, will enter a corporate integrity agreement with HHS’ inspector general’s office. Physiotherapy’s general counsel, Rick Binstein, said the problems were limited to “technical billing errors and insufficient documentation” in a handful out of about 450 clinics. “There was no finding of fraud or a systemic problem,” Binstein said.

Elizabeth “Betsy” Ryan was named the next president and chief executive officer of the New Jersey Hospital Association, succeeding Gary Carter, who will retire next year after 14 years in the position. Carter, 63, will remain at the association through June. Ryan, 47, currently serves as the association’s chief operating officer and was the unanimous choice of the trade association’s board of trustees. Ryan, an attorney, oversees the hospital association’s daily operations and its advocacy efforts in Trenton and Washington. Among her multiple roles, she oversees the NJHA’s legal and legislative activities, communications, clinical affairs and human resources. She has also served on the New Jersey Board of Medical Examiners, the Clinton-Gore transition team, the transition teams for New Jersey Govs. Jon Corzine and Jim McGreevey, and the legal audit team for former President Clinton’s Task Force on National Health Care Reform.