An antitrust challenge from the Federal Trade Commission has prompted Northern Virginias five-hospital Inova Health System to abandon plans to acquire Prince William Health System, which consists principally of 163-bed Prince William Hospital in Manassas, Va. In similar statements, the systems blamed their decision on the challenge and unusual process changes by the FTC that threatened to prolong the merger by as much as two years. David Wales, deputy director in the FTCs Bureau of Competition, called the outcome a victory for the residents of Northern Virginia and said that he was puzzled by the notion that the FTCs procedural approach to the case would slow it down. In our view it would have done the exact opposite, Wales said. In early May, the FTC filed an administrative complaint arguing that the addition of Prince William Hospital would allow Falls Church, Va.-based Inova to squeeze managed-care payers for higher rates for inpatient services. In an unusual move characterized as a means to expedite the case, the FTC picked one of its commissioners, J. Thomas Rosch, to preside over it. Rosch rejected the systems request for him to recuse himself, and he also snubbed their efforts to delay the proceedings until a federal judge ruled on a preliminary injunction.
Senate Finance Committee Chairman Max Baucus released his Medicare reform bill containing a physician-payment fix that increases payments by 1.1% in 2009. That increase is higher than what Baucus originally proposed in his draft bill several days ago. Sen. Chuck Grassley (R-Iowa) has an alternative proposal that includes a 0.5% pay increase through 2008, and a 1.1% increase in 2009. Its likely that Grassleys bill will be released this week, said an aide to the finance panels ranking member. The Congressional Budget Office has yet to estimate the cost of Baucus bill, although Baucus, in a meeting with physician representatives, said the bill could cost just under $20 billion over five years. Baucus bill also includes a provision that revokes the authority of the Joint Commission to deem hospitals in compliance with Medicare conditions of participation. Also, the bill requires private fee-for-service plans in Medicare Advantage to develop networks of providers to ensure care for beneficiaries, and to measure and report on quality of care. Baucus and Grassley may be at odds over certain details, yet their respective draft bills contained similar provisions, such as establishing a rewards/penalties system on e-prescribing use, extending the Physician Quality Reporting Initiative, and requiring HHS to develop a value-based purchasing plan for providers.
The National Alliance for Health Information Technology named two prominent healthcare executives to co-chair the struggling Chicago not-for-profit. The alliance has operated with an interim chief executive officer since late March when Scott Wallace resigned as president and CEO. George Lynn, former president and CEO of AtlantiCare health system, Egg Harbor Township, N.J., and past chairman of the American Hospital Association; and John Glaser, vice president and chief information officer of Partners HealthCare System, Boston, were named co-chairmen, effective immediately, succeeding Curt Selquist, retired chairman of Johnson & Johnson Health Care Systems. Selquist also stepped down as the alliances interim CEO, a job he assumed after Wallaces exit. Jane Horowitz, NAHITs former vice president and chief marketing officer, was named chief operating officer, effective immediately. Horowitz will be the organizations lone employee. The organization will operate without a CEO, spokeswoman Lois Padovani said. NAHIT will shift its focus to healthcare ITs strategic issues for executives, the association said in a written statement announcing the appointments. The AHA and the College of Healthcare Information Management Executives have agreed to provide staff, office support, member services and Web site support, according to the statement, which described the arrangement as formal alliances.
The New York State Medicaid program said it will end reimbursements for avoidable hospital complications and medical errors deemed never events. Beginning in October, the state will not reimburse for care needed as a result of 14 hospital-caused conditions: wrong-site surgery; wrong surgical patient or procedure; foreign objects left in body; medication error; air embolism; blood incompatibility; failure to identify and treat hyperbilirubinemia in newborns; patients oxygen line is wrong item or contaminated; patient disability from electric shock, contaminated drugs, wrong function of a device; and burns or restraints. Hospitals caring for the states 1.4 million Medicaid beneficiaries will have to provide information indicating such conditions were present on admission to obtain reimbursement, the state said. New York also will continue to revise and expand its never-events list. The state joins Medicare in its policy to end never-event reimbursements, which also starts in October.
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