October 1, 2004 News



Money Issues





The Joint Commission moves slow but they finally did the correct thing.  They have removed the accreditation from Drew/King Hospital.  This comes just after the LA Board of Supes agreed to get rid of the trauma service at the hospital.  This also saves the Board the wrath of the community and puts the onus on the unseen outside force.  The Joint stated that the hospital had failed to correct seven deficiencies.  The Supes stated they would appeal.  The community should look at election time to replace their Board member, who should have known about the crisis several years ago and failed to act.  If the hospital loses the accreditation, as it should, they can later re-apply for reinstatement. 

The remainder of the Board of Supes are no dummies.  At a meeting after the trauma closure was announced, they had a bunch of community which has no understanding of the problem in the audience.  After several hours of raucous, the Board agreed to hold a public meeting on the issue.  They would need to do this in ant case but it got the crowd out of it.

The LA County Board of Supes is now being assailed as a last ditch effort for meeting in closed session.  Closed session meeting are allowed in only a few instances.  One of them is that the Board is discussing personnel issues or receiving legal advice and no votes are taken.  Here no votes were taken but the question is was one of the other permissible items present.  There will be a lawsuit against the Board, which lost one on the same issue previously and had to pay $116,000 in legal fees to the LA Times.  This would be a poor use of County money and it would not change the decision to close the trauma unit at the substandard hospital. The Board has agreed to hand over the closed session minutes to the DA who is investigating the possible violation.

Staying in the LA area, another hospital is closing its doors.  This makes the 6th one this year.  The hospital saw 41,000 people a year in their ED, which now must be seen at other surrounding hospitals.  This puts more strain on them and lowers their cash flow.  The Robt. Kennedy Hospital in Hawthorne does not have many sophisticated testing facilities and with the nurse ratio law, the treatment of the uninsured and the seismic upgrades they ran out of money.  

A second hospital run by a county Board is about to lose its federal certification.  The Alameda, California County hospital has been put on notice that they are about to lose their CMS accreditation.  The areas of deficiencies are nursing, governance, patient's rights and quality assurance.  The hospital was cited for this in February and needed to show corrective action, not just a plan.  The four areas resulted in 309 deficient actions.  In August a follow-up showed deficiencies in dietary, physical environment medical records and pharmacy. The Coo is not very bright.  He doesn't believe the institution is in any danger.  He obviously doesn't read about the County institution in LA, Drew/King.

Continuing in the Golden State, in Santa Clara County in the Bay Area, the Board of Supes is considering ending a policy allowing the surrounding counties to first respond transport their trauma victims to their county.  The patients would need to go to their local hospitals and then be transported to the Santa Clara hospitals.  This comes after one of the trauma centers in Santa Clara is closing and the remaining two would be overcrowded if the surrounding areas could automatically have their patients come to Santa Clara for care.

In Ventura County the Board of Supes has agreed to bypass the Santa Paula Hospital Board and purchase the closed hospital.  The hospital Board filed for Bankruptcy protection soon after the hospital closed.  The hospital Board is also working with another private company to run the hospital if it opens.

About half of the hospitals in California are not meeting their charity mission, says Health Access California.  The hospitals do not have signs posted regarding charity care.  This was published now to help Guv terminator to sign a bill requiring the hospitals of the state to abide by mandatory charity care guidelines.  The bill would also prohibit collection efforts for almost six months following the treatment.  Those families with income below 400% of the poverty limit could only be charge Medicaid rates.

In Minneapolis/St. Paul there are 11 hospital heart centers.  They got a flunking grade for customer service.  The receptionists and information desk personnel were inattentive to the needs of the people.  The people at the reception desks didn't know answers to basic questions.  This shows poor hospital administration and lack of attention to their image and detail.  It also shows that the administrations may just not care.  The worst of the bunch Allina's Abbott Northwestern Hospital just didn't get it.  The vice-president in charge of communication needs to take lessons in communication as she stated, "What matters most is when you get in the exam room."  This shows complete lack of rationality as to customer service.

All knew who they were but the whistleblowers against Phoebe Putney Health System finally stepped out of the shadows and identified themselves.  The are Albany Surgical Centers accountant and a major physician.  They had sent faxes to newspapers about the hospital's illegal contributions and other charges.  They also turned the hospital in to Richard Scruggs for improper charging of uninsured patients which started the country-wide law suits against the non-profits.  The two state they did nothing wrong and told no lies in their faxes and will defend themselves with more dirty laundry as the hospital sues them for defamation.  (See Legal for response by one of the whistleblowers)

Last month a hospital in Florida fired or suspended nurses that did not report for their shifts during one of the monstrous hurricanes.  Now Chalmette Medical Center in New Orleans have done the same dastardly deed.  The hospitals should be ashamed of themselves.  This one never even asked for explanations.  The hospital said the employees were all on the hospital disaster plan and should have been present.   

Some hospitals are allowing family to witness the efforts to revive family members.  There is someone with the relative while the resuscitation is proceeding to explain the process in real time.  This allows the family to see that all is being done and to participate in the decision to quit if continuation is futile.  Others are not so agreeable.  They are afraid of the possible psychological trauma the efforts might give the family member or not be as aggressive if a family member is present.  Those that have watched have almost all said they are happy that they did.  There are about 5% of hospitals that have written policies regarding the issue.  Most ask the families if they would want to watch and the family is also screened for excessive agitation that may get in the way of a code.    

In New York, there is a law that states that hospitals must report medical errors that harm patients.  These must be promptly reported.  The hospitals are not complying.  The errors are reported days to months later. The rationale for the quick reporting is to allow other hospitals to know and correct their processes in a timely manner.       Top


At Nashoba Valley Medical Center in Massachusetts, the nurses are now able to go online and bid on working extra shifts.  This allows the hospital to forego hiring expensive outside registry nurses and also allows the nurses to make extra money.  The hospital posts needed job shifts and the highest amount they are willing to pay.  The nurses then bid on the shifts and bid down the pay to get the job.  It also allows the nurses to work flex time.  The idiot and running scared nurse's union doesn't like it since the nurses may work for less than union scale, but the nurses love it.  A disconnect.   

As all know, nurses are in high demand.  One of the problems is that the schools are limited in how many they can train per year.  Why is that?  There is a faculty shortage and schools are not known for their thinking but for rote.  If they can not get enough nurses to teach, they may try others in medicine or other fields to do the teaching.  This includes retired physicians and nurses or college professors.         Top

Money Issues

The Civil Society Institute in the People's Republic of Massachusetts did a poll of all of 1000 adults.  The poll is headed by an activist, so the report is suspect prior to even hearing the results.  The results showed that 85% of those polled has health insurance and over 50% of them had higher copays or decreased coverage.  That should be no surprise to anyone since premiums have increased and more employers have gone to PPO and HSA models.  The survey also "revealed" that 66% of those polled wanted socialized medicine ala England or Canada.  Also 78% of those polled, which translated in the pollsters eyes to all Americans want government regulation of health care.  The pollees either don't understand the implications of their votes or the questions were written in such a way to get the desired results.   

In a corollary to the above, the Association of American Medical Colleges state that there will be a marked shortage of physicians due to the baby boomer generation.  The young physicians are also working shorter hours than those who started the practices.  The other problem is that about 50% of medical students are female.  This will also translate to fewer full time physicians as they balance the profession and the home and retire early.  The flip side is that there are many more physician assistants and nurse practitioners around than in the past to care for the patients.   

The approximately $2000 home AED has been approved by the FDA.  This means that no prescription is needed for the device.  It also means that more should be produced and the price should come down so more people and businesses can purchase one or more.  This may be a boon to lifesaving since about 80% of cardiac arrests occur at home. 

Summit, Wisconsin has hired an attorney since it expects to be sued.  There is a proposed new hospital and the city will need to either accept or reject it.  In either case there will be a suit.  The attorney is to review all state statutes and land use regulations prior to any decision.  The hospital is targeted for a business park on the city's master plan.  There are, of course, other hospitals in the area owned by competitors who want to remain non-competitive.  

Congress is now second guessing themselves.  Nothing new.  This time it is looking into why Medicare is spending up to 122% of traditional Medicare for M+C plans.  The original idea was to use HMOs to save money.  That everybody knew at the time but no one voiced was an impossible task.  The HMOs weren't making enough money so they began to drop Medicare HMOs.  The Congress last year raised the amount they pay the HMOs to entice them back into the game.  Now they are wondering why they did that.  The new trend is to take away the overpayments and pay no more than traditional Medicare, a wise idea.        

Oh, Canada.  My Canada.  Those who wish to follow the Canadian way (see story above) may wish to think it issue through again.  As I reported in the last issue Canada has serious problems with enough physicians for its sparse population.  The lack of physicians is hurting some cities in Canada being able to attract industry.  Now the government has stated they will send more money to the provinces and territories, but not enough.  They have long waits for cancer care and surgery and believe it or not they also have increasing pharmaceutical costs or an aging population.  One of the liberal members of their Senate stated that Canada should institute a national health care insurance premium instead of paying for all by taxation.  That sounds like Medicare.  

How is pay for performance going, you ask.  Quite well to date.  Using claims figures for the years preceding the pay for performance PacifiCare found an improvement of 4% per annum.  since the pay for performance there has been a 34% increase in 12 of 16 measured areas.  The interesting thing is whether or not this is sustainable and whether physicians will get rid of non-compliant patients so their statistics will look better. 

The Wall Street Journal had an interesting article regarding the uninsured medical bill and the huge mark-ups.  The patient, an uninsured 43 year old, had chest pains.  He went to the local ED who forwarded him to Inova Fairfax Hospital in Fairfax, Virginia for specialized care.  He underwent angiography and coronary artery stent placement.  His stay was one night or 21 hours.  The bill is $29,500 which doesn't include the $1000 ambulance transfer, $6,800 cardiology bill and $2000 local ED bill.  The same services under Medicare would have cost not $37,000 but about $13,000.  This major difference has enabled the patient to file a law suit against Inova for price gouging as a non-profit hospital and asking for class action status.  This will cost Inova in legal fees at least the amount of the bill to just get this suit dismissed.  Others will follow. The problem is that the patient's bill was individually itemized and each item had a significant mark-up.  The insurers only pay a fixed rate and not on individual charges. The hospital states it offered the patient a 20% discount, which is peanuts on a bill that size and would still be more than 200% more than they would have received from any insurer.  The physician reduced his price from $6800 to $3000, alot more than 20%, but still 300% more than he would have received from Medicare.  Is this all the mean hospital's fault?  Of course not.  The patient made a conscious decision to not take medical insurance when he could have afforded it.  He rolled the dice and it came up  craps.  He needs to pay the piper but a fair mark-up.   

In Sacramento, California, the local newspaper went through the Superior Court records and found that Catholic Healthcare West, with four hospitals, interestingly called Mercy, in the area, had the most suits against patients.  They had more than four times the next most frequent hospital chain and the suits were for 11 times the amounts of the other suits.  In the same time frame Mercy gave $4.8 million in charity care, the lowest share of its competitors at 0.5%.  Mercy has now stated that they will no longer file garnishment and other liens against low income patients that are cooperating.  Even though they say it, their actions say something else.  Their legal actions have increased since they changed their policy.  Do what I say, not what I do.

The not for profits have a major image problem coming.  With the round of law suits and the hopeful consolidation of them into a single class action suit, the Chronicle of Philanthropy just issued a report on the highest paid not for profit CEOs in the country.  They are all healthcare hospital CEOS.  The top five were all over $1 million per year without benefits.  The median was $291,000.

In Connecticut, the HMOs have received fewer complaints than in prior years.  That could be because there are fewer complaints, the complaints did no good or there are fewer people enrolled in the HMOs. 

California should be so lucky.  The HMOs got a good rating for caring for chronic illness but did poorly in keeping people healthy and customer service.     

In California, CalPERS has dropped many Sutter Health hospitals and physicians from their roster.  In the Sacramento area this is about 36,000 patients that now must choose between continuing with their physician or going with a cheaper health plan.  The choice is between going to Kaiser, dropping Sutter, or continuing with Blue Shield to continue with Sutter physicians but with the PPO and not the HMO potion. There is currently a war between the hospital and the HMO in the local advertising media.   

The hospitals in western New York are, like many others in the country, refusing federal funds for emergency charity care that is tied to asking about immigration status.  They are taking the harder road of not asking versus taking about $90 million in the area last year.  In the country there is an $22 billion shortfall for treating uninsured patients and the MMA provision which goes into effect October1, is only for $1 billion for the country.  

Blue Cross/Shield of Texas is back at the rationing board.  In the PPO plan the physicians will now need prior approval, which will be hard to get, prior to ordering the expensive diagnostic imaging studies.

In the People's Republic of Massachusetts, the people are flocking for scans.  There are so many people that the scanners are open 16 hours a day.  There are many MRI scanners, PETs and CTs coming into offices and hospitals with expensive upgrades.  This worries insurers and employers that there will now be too many scans performed and of course need to be paid for.  There are also many new uses for the scanners that are non-invasive.  This allows good images of the carotid arteries that used to need invasive arteriography.  This invasion is because of the prior laws in the state that bottled up the scanners in only a few locations.  The laws have loosened and the physicians have found the loopholes so the pent up need is now being fueled. The hospital radiologists are not happy.  They now have competition but they are still busy.        Top


In southern Indiana's Clark Memorial Hospital the entire female OB medical staff has quit OB.  Five OBs quit including the only female OBs on the staff of 12 OBs.  The reason was the Indiana malpractices increases and the declining reimbursements.  Indiana is actually the best of the surrounding states for malpractice reform.  One of the problems in the state is the state fund that pays all claims over $250,000.  This fund is paid by the state's physicians via a surcharge.  The fund recently has had to raise its surcharge about 72% due to high jury awards.  

There are four states that are voting in November on the physician versus trial lawyer issues of tort reform.  They are Oregon, Nevada, Florida and Wyoming.  The Wyoming issue would be a yet to be determined constitutional amendment for a cap on non-economic damages.  In Oregon there would be a $500,000 cap, in Florida the measure would cap attorney fees and in Nevada the caps would be reduced and the attorney fees capped.  The advertising in those states by both sides have reached presidential proportions.

In Texas the fourth largest malpractice carrier and the carrier of last resort, JUA originally asked for a 35% increase.  The Insurance Commission asked the insurer to wait and see the impact of the new tort reform  They did wait and now will not raise premiums in the foreseeable future.  The legislature had passed a $250,000 cap on non-economic damages which restrained the premium cost.  It also allowed ten other companies to come to the state.   

The Dallas Business Journal op-ed piece recently had an article about the promises of the state malpractice reform and how it is accomplishing it's goals.

In Maryland (see New Legislation) and some other states with Democratic legislators, the physicians have begun asking for voluntary help of anywhere between $10 to $40 to help pay their malpractice premiums. Even if the patient doesn't voluntarily give, they will still become involved in the tort reform controversy.  This might not be good for some Democratic legislators.  The consumer groups aren't happy about this but they aren't happy about much anyway.

The physicians in western Maryland are going one step further.  They have stopped doing elective surgery and many will stop seeing elective patients.  The action will start on November 15 and go to December 1, when the next malpractice premiums are due.  If the state does not act by then, many physicians will go on extended vacations or other such things for six months.  The Democratic President of the Senate stated that they would not bow to this type of action.  They always say that but will respond when the patients in their districts demand that they do.  These physician have done this in the past.  They have stopped participation in the local trauma service for four months which necessitated the state's paying more money to the physicians for uninsured patient care.  This is the same action that California physicians used in 1975 to get the best med mal solution in the country. All the state's physicians should join those in the western part of the state.  

St. Clair County, Illinois is about to pass a resolution in favor of caps for non-economic damages.  This will have no effect on the Democratic legislature except for the upcoming election.  The reason the resolution was drafted was the Democratic drafter was afraid his Democratic successor to the Board would be defeated.  The resolution would allow the county to make its own malpractice company and but the taxpayors of the county at risk.       Top


A suit has been filed against Albertson in the San Diego courts for selling private customer prescription information to drug companies.  The list is being used for marketing purposes.  Albertson's is getting paid between $3 and $4.50 for each letter sent and $12 to $15 for each customer contacted by phone.  These action, if true, are against California and federal laws.  The fine per infraction under HIPAA could be up to $250,000.  

The Charlotte Observer recently had an article about the a hospital releasing a patient and not telling the police about it.  The police are not bright.  They had not issued a warrant for the arrest of the subject and they erroneously believe its the hospitals duty to tell them when a subject is being released.  It is up to the police to have the subject under control so when ready for release the person goes directly to jail.  This is what the police get for saving money.  If they arrest the person at the hospital, thy become responsible for the patient's bill.          Top


The physician who had a sidearm at the hospital while he was working in the ER has been fired.  The rationale was a breach of hospital policy.  There was a policy given to all new employees stating no guns on campus.  He stated he did not know about the policy.  The gun was legally registered.

There was a study by the American College of Emergency Medicine that showed 2/3 of emergency rooms had problems with on-call physicians.  The problem became more acute after the EMTALA rules were changed.  The problem stems from the high liability risk, the lack of EMTALA applying after admission and the narrowing of the definition of an emergency room.  It needs to be mentioned that the organization that commissioned the study had a bias against the loosening of the rules.  The responses could be on-line or in writing which means they had to choose between the responses offered.  Over 1/3 of the hospital that responded were paying money for call, giving a guarantee or paying money toward the med mal policy.  It was interesting that the conclusions did not contain many of the answers that did not agree with the original premise.        Top


DISCLAIMER: Although this article is updated periodically, it reflects the author's point of view at the time of publication. Nothing in this article constitutes legal advice. Readers should consult with their own legal counsel before acting on any of the information presented.