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The Jackson & Coker Industry Report is a compendium of healthcare news,
commentary, and other important information for busy physicians and hospital /
practice administrators. The monthly newsletter incorporates original research
and studies supplied to Jackson & Coker by a nationally recognized research
firm.
Clinical skills, workload, and medical liability protection don’t always equate with what doctors perceive as “adequate compensation.”
Practicing physicians are among the most highly compensated professionals within the healthcare industry. The question is, are they comfortable with their compensation level considering the demands placed upon them, the changes in reimbursement models, and the challenges facing our nation regarding the impetus toward major healthcare reform? Jackson & Coker addresses this question and related concerns in its latest annual Physician Compensation Survey.
Survey Impact and New Features
First of all, we were pleased with last month’s survey response. Over 1,000 physicians and health professionals expressed their strong opinions on healthcare reform, especially as it is packaged by politicians as “Universal Health Care.” And we are still tracking their responses!
By publishing respondents’ raw, unedited comments as part of the survey results, we were able to capture well-thought-out opinions of those who are on the frontlines of healthcare delivery, but whose voices are not always heard by those in other arenas. We transmitted the survey results to the campaigns of Senators McCain, Clinton and Obama. Time will tell whether their proposed health plans might be modified somewhat in consideration of our survey results and analysis.
Starting this month, we are presenting two new features. Our partnering research staff has written a Special Report on “Pay for Performance,” certainly a controversial topic throughout the medical profession. Determining how physicians are paid in terms of assessing the quality of their patient care is especially significant to the ongoing discussion.
A companion piece is a guest article by Tim Sheley, principal author who serves as Executive Vice President with Jackson & Coker, entitled “What’s a Doctor Worth?” An effective physician recruitment and retention program must take into account the direct and indirect costs of not having a doctor in place, costs associated with hiring a prime candidate, and the expected return on investment linked with a top revenue producer.
Lastly, we’re introducing a new article category: “Practice Management.” The articles we have selected address matters of extreme importance to physicians who are concerned about building a successful, profitable practice that meets the needs and concerns of a diversified patient base, while reducing malpractice liability and enhancing patient satisfaction.
There is a lot of exciting, informative content in this edition. Enjoy!
Cordially,
Calvin Bruce
Managing Editor
Physicians Face Medicaid’s April 1 Deadline for Tamper-Proof Rx Pads
Source: AMA News
Date: 03/24/2008
On April 1st, new Medicaid regulations go into effect that will require physicians to adopt tamper-resistant prescription pads. While various medical organizations claim most doctors are ready for the new regulations, efforts to inform still more continue.
The regulations require physicians to have at lest one measure on their written Medicaid prescriptions to prevent unauthorized copying, erasure, or modification. The new regulations were put forth as part of a bill on military spending passed in May of 2007 and developed by the Centers for Medicare & Medicaid Services in conjunction with various healthcare professional organizations.
The April 1st deadline is just a beginning. By October 1, 2008, prescriptions will require at least three security measures to meet Medicaid standards. While these standards are set by the states themselves—with Medicaid regulations serving as a baseline—a number of states haven’t chosen to go beyond the Medicaid-prescribed standards. The following is a list of the categories of features to be required by October 1, 2008, as well as a sampling of possible implementations:
-Features to Prevent Copying: pantograph, watermarking
-Features to Prevent Erasures or Modifications: non-white backgrounds, chemically reactive paper, paper-toner fuser
-Features to Prevent Counterfeiting: serial numbers, batch numbers, embedded metallic strips
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How Hospitals Can Prepare for the New MS-DRGs
Source: HHN Magazine
Date: 03/01/2008
Through 2008, the Centers for Medicare & Medicaid Services will roll out the most significant alterations to Medicare payment in twenty five years. The system—MS-DRG—is aimed at aligning CMS payment to actual treatment costs. The resulting system is more complex, and an article in the March 2008 issue of HHN Magazine explores the steps hospitals will need to take to adjust.
The article projects that the new guidelines will result in an increased workload for hospital coding departments, possibly reducing productivity by up to 50 percent. This will require greater collaboration between coders and clinicians for information sharing. The authors recommend an increase in staffing for coding and clinician departments and closer monitoring of the revenue cycles for hospitals as well as monitoring of coding practices.
In terms of financial input, the shift is likely to benefit the larger teaching institutions and urban facilities treating patients with higher levels of acuity. Rural hospitals and hospitals treating lower acuity level patients are likely to lose a noticeable amount of reimbursement revenue, though not an overwhelming amount.
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High Costs Force Third of Americans to Skip Needed Health Care
Source: The Washington Post
Date: 03/25/2008
According to a new study presented by the AFL-CIO, high costs in health care force one in three Americans to skip needed medical treatments. This is true, says the study, even among insured Americans.
The study—the online 2008 Healthcare for America Survey—surveyed 24,619 people between January 14 and March 3, 2008. Of those surveyed, 95% said healthcare needs fundamental change or a complete overhaul. More than 50% of insured respondents said their insurance couldn’t cover needed treatments at a cost they could afford. This ran across education levels as well, with a third of college graduates reporting that they had had to skip care at some point in the last year due to the cost of treatment. Among the uninsured, 76% said they or a relative had had to forego seeing a doctor while sick due to the cost of treatment.
The study’s authors and sponsors claim that the results of the survey are indicative of the overwhelming need for a restructuring of the current American healthcare system.
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Senate Hearing Questions Doctors’ Ties to Medical Device Makers
Source: American Medical News
Date: 03/17/2008
The U.S. Senate Special Committee on Aging met in February of this year to discuss the relationship between physicians and medical device manufacturers. A bill was proposed by Committee Chairman Senator Herb Kohl of Wisconsin that would require full disclosure of any gift worth over $25 from any medical device maker to a physician.
Between 2002 and 2006, the top 4 manufacturers of artificial hips and knees paid doctors over $800 million in consulting agreements. Though many of the payments were legitimate and fair, government officials argue, further investigation should be made to see whether device manufacturers were forcing their products on doctors in an unethical manner.
Most of the manufacturers involved in the case, citing existing disclosure practices at the company level, have denied any wrongdoing. The consulting agreements, they argue, are the best way to test and continually improve new equipment in a clinical setting. Some groups such as the Advanced Medical Technology Association, which represent the makers of nearly 90 percent of health care technology in the United States, created a code of ethics in 2004 that prevents doctors from receiving gifts totaling more than $100 at fair market value. While remaining compliant with the Senate’s investigations, these organizations seek to protect the valuable feedback they are receiving from physicians who use their new technologies.
The Senate group recognizes that over-regulating the physicians’ consulting market will ultimately harm medical practices in the United States. Their actions rather seek to prevent manufacturers from unfairly influencing physicians to use their equipment. The proposed bill would limit unnecessary perks while continuing to allow companies to use physicians as a source of research and development. Penalties for violating the bill would not extend to individual doctors.
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Hospitals Reuse Devices to Lower Costs
Source: Wall Street Journal
Date: 03/19/2008
To save on costs and reduce waste, hospitals are recycling a growing number of “single-use” products. A recent article in the Wall Street Journal examines the causes behind this recycling and delves into the question of its safety.
Reprocessing companies, hospitals, and environmental groups claim recycling is a safe process due to new procedures that lower risk of product failure or contamination. Reprocessing of medical equipment also results in equipment that is 40 to 60 percent cheaper than new materials. Furthermore, environmental groups state that thousands of tons of waste are eliminated from already crowded landfills through reprocessing. For their part, the medical device manufacturing industry counters by touting the higher risk of device failure, essentially calling the “single-use” label on their devices non-negotiable.
A recent study by the Government Accountability Office found no elevated risk incurred from the use of reprocessed single-use devices. Hospitals and reprocessing centers trumpet this finding as additional motivation for recycling medical devices. The process could save the healthcare industry about 1.8 billion dollars a year, according to Ascent Healthcare Solutions, a leading reprocessing company. Ascent also claims a reduction in waste of 1,684 tons by its customers.
Despite the protests of the device manufacturers, the reprocessing industry is thriving. The FDA has stepped up its oversight of the industry and is currently at work on guidelines and standards. Currently, efforts focus on ensuring the safety of patients as well as developing a notification system for patients who will be treated with reprocessed products.
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Steps to Better Board Accountability
Source: HHN Magazine
Date: 03/01/2008
According to a report by University of Iowa Researchers, nearly 90 percent of health systems boards have oversight of quality of care and patient safety, but only 43 percent have a standing committee to look exclusively at community benefit programs. With this figure in mind, a column in the March issue of HHN Magazine lists recommendations for improving hospital governance.
The article argues that hospitals need to do more to ensure fulfillment of their community benefit obligations on the whole, noting that the study should open the eyes of hospital administrators as to their obligations and the degree to which they are not meeting them in their particular hospitals. In the face of increased legislative scrutiny on hospitals, their finances, and the degree to which they serve their communities, the author makes the following recommendations on improving governance:
-Board development programs should be reviewed and improved to ensure board members are up to date with best practices in hospital governance.
-The board’s effectiveness should be regularly evaluated in a manner that can lead to substantial alterations to board policy and makeup if necessary.
-The board should state and assign responsibility for clear improvements in its structure to board members and subcommittees with authority to institute changes.
-The boardroom culture should be a healthy one that is conducive to change and adaptation and motivated for the improvement of the hospital on the whole.
-Governing boards should, as best as possible, reflect the diversity of the hospital’s staff and constituency.
-The board should focus on setting and meeting lofty goals regarding its community obligations.
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Coordinating Care - A Perilous Journey through the Health Care System
Source: The New England Journal of Medicine
Date: 03/06/2008
When patients see multiple physicians and specialists for their medical conditions, coordinating between different facilities and practices can be an administrative and financial mess. Opening communication between different physicians and reducing the number of duplicated medical tests can be crucial for limiting the costs to physicians and patients alike. Care coordination, defined as “the deliberate integration of two or more participants involved in a patient’s care to facilitate the appropriate delivery of health care services,” should be employed to simplify healthcare wherever possible
The New England Journal of Medicine recommends several key coordinated care strategies. Electronic referrals, where primary care physicians will send information on a patient’s condition to a specialist, is becoming increasingly popular. A dermatologist, for example, may only need to see the patient’s medical history and a photograph of the skin condition in order to make an accurate diagnosis. Referral agreements between a PCP and a specialist can also be made where the doctors agree what sorts of treatments should be handled by each physician. These agreements are typically rarer than electronic referrals, but achieve similar effects.
When a patient is in a hospital, there are also useful strategies that can be employed. Advanced-practice nurses can take over some of the responsibilities of overworked physicians or specialists while the patient is in the hospital. Other programs send advanced nurse “coaches” to recovering patients’ homes to educate their families about maintaining a basic level of care. Both of these initiatives save substantial sums of money by preempting an expensive visit to an M.D. in the hospital.
There are currently several problems associated with coordinated care. Primary care physicians are typically overworked and cannot handle the time commitment required to collaborate with other physicians. There may also be great discrepancies between different practices, such as how a patient’s medical information is stored on a computer, or how the physician will be compensated for his or her work. Small practices may be incredibly susceptible to these sorts of problems.
Despite these problems, there are many hospitals that have improved efficiency and costs by reducing unnecessary procedures and utilizing as few personnel resources as possible.
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PA’s Chronic Care Management Project
Source: Physician’s News Digest
Date: 04/01/2008
During the first six months of 2007, Pennsylvania’s hospitals reported over $2 billion in charges for persons with chronic conditions for “avoidable hospitalizations” as defined by the Agency for Healthcare Research and Quality. In other words, many patients in Pennsylvania are being unnecessarily hospitalized for chronic conditions, a trend that likely cost the state in excess of $4 billion over the course of the year.
This information was recently presented by the Chronic Care Management Reimbursement and Cost Reduction Commission (CCMRCRC), which has developed a strategic plan to:
-Implement a new primary care reimbursement model that permits primary care practices to provide additional resources to proactively care for patients with chronic conditions;
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