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					                                                                                                        January 25, 2008



The
NEWSSTAND
       i t e m s             o f       i n t e r e s t             f r o m        t h e         m e d i a

                                                                                       USA Today – January 24, 2008

   Employers put health coverage in workers' hands
By Julie Appleby
Nick Trikolas plans to drop health       Critics say the change would end         The idea comes as the percentage of
insurance for his employees and          the long-standing, implicit social       employers providing insurance
give them money to buy their own         pact to provide coverage to sick and     shrinks and the number of uninsured
coverage. He says doing so will put      healthy workers alike in favor of a      Americans grows. Last year, 60% of
him in the vanguard of a movement        more Wild West, go-it-alone              employers offered group coverage,
by employers searching for answers       approach that could benefit young        down from 69% in 2000. The
to rising health costs.                  and healthy workers but leave those      number of uninsured rose to 46.6
                                         older and sicker unable to get           million, up from 44.8 million in
"This may be the future of health        medical insurance.                       2005.
insurance," says Trikolas, CEO of
Ilios Partners in Chicago, which         That's because ending group              Large companies use group
plans to switch its 100 employees        coverage removes a key protection        coverage as an important
from group to individual coverage        in group insurance plans. Insurers       recruitment and retention tool, but
this year.                               cannot reject members of group           smaller firms struggle more with
                                         plans for health reasons, and            costs and are less likely to offer
As health insurance costs continue       everyone in the group pays the same      group coverage.
to rise, some employers are              premium.
adopting a controversial new                                                      Proponents of individual coverage,
approach: ending group coverage          In most states, insurers can reject      including Paul Zane Pilzer, whose
and giving employees $50 to $200         individual applicants for health         Zane Benefits firm offers services
or so a month to help them buy their     reasons and can charge widely            that help employers make the
own.                                     varying premiums based on the            switch, say most workers will be
                                         applicant's age, health history and      able to buy coverage on their own.
The shift is touted as a lower-cost      other factors. Only in a handful of
way for employers to offer workers       states, such as New York,                The healthiest, Pilzer says, will get
some kind of health coverage, while      Massachusetts and New Jersey,            coverage for less than they pay now.
making smaller and more                  must insurers sell coverage to           Monthly premiums can be less than
predictable financial contributions      everyone, regardless of their health.    $100 for some younger, healthier
toward that coverage. Like other                                                  people but several times that for
companies considering the switch,        "What scares me is it's tempting for     others.
Ilios will pay a portion of              an employer who may have one or
employees' medical costs into tax-       two sick employees to say, 'You're       "The healthy employees don't have
free accounts that workers can tap.      not my problem, try to get coverage      to pay for sick employees," says
It also will provide a link to an        from the state,' " says John             Pilzer, a software entrepreneur and
independent website where workers        Hickman, an Atlanta attorney who         author. He says employers can save
can compare price quotes from a          advises businesses on their benefit      money because they contribute a set
variety of insurers.                     plans. "It could leave a lot of people   amount per employee — often far
                                         without coverage." He says the new       less than they pay for group
If broadly adopted, the new model        model could work if Congress             coverage.
would represent a fundamental shift      passes national rules requiring
in health coverage in the USA. Most      insurers to take everyone, regardless    Sara Rosenbaum, a law professor at
people with health insurance are in      of his or her health.                    George Washington University
group plans offered by their                                                      School of Public Health, says
employers.                                                                        offering money toward individual
policies "may be somewhat helpful         access plans that would make            "Those scenarios present widely
for workers in businesses that have       insurance available to people with      varying health care needs.
never been able to offer insurance        serious medical conditions.             Something like this gives us and our
coverage," but it is a "radical step                                              employees a little more flexibility."
backward" for those who decide to         The group said insurers should
cancel group policies.                    provide coverage to those who           What happens if some can't get
                                          aren't sick enough to qualify for the   coverage?
She says proponents may mislead           state plans. And, it said, insurers
employers into thinking individual        should not cancel policies solely       "Currently, we don't have any issues
and group coverage are the same,          because applicants provided             like that at all," Davis says. "We'll
when there are often striking             incomplete medical information, so      have to address that if it occurs. As
differences.                              long as any omissions were              we bring new people on, we'll get a
                                          unintentional.                          better sense of how it will work. We
"Many employees may find                                                          may jump into it and say it's the best
themselves shut out of the                Because individual policies are tied    thing we've ever seen, but we will
individual market," Rosenbaum             to each applicant's medical history,    evaluate that as we go."
says, "and even if they can get in,       insurers can limit or exclude certain
the coverage is dramatically less         conditions. For example, an insurer     Canopy's Kashyap says most people
than what they can get in group           may offer a person with hay fever a     can get insurance. Those who
products."                                policy that excludes coverage of any    cannot, he says, should be looked
                                          upper respiratory condition.            upon like bad drivers, who have to
Reimbursement accounts                    "Something as simple as hay fever       pay more for auto insurance. He
                                          may mean you are not covered if         expects health insurers, possibly
Though no one tracks the number of        you get pneumonia," Rosenbaum           with the help of government or
employers who send workers out on         says.                                   employers, ultimately will develop
their own, it is only a fraction of the                                           coverage for higher-risk people.
total number who offer health             Bosses offer assurances
insurance. Pilzer says he has more                                                "There are some people in the
than 100 clients; his company sets        Like some other employers               minority who will be adversely
up and manages tax-free medical           contacted, Trikolas says he doesn't     impacted, but the system in general
reimbursement accounts for the            expect his employees, who are           is designed for the majority,"
clients' employees. He sold his first     mainly in their 20s and 30s, will       Kashyap says.
company to Steve Case's Revolution        have a problem qualifying for
Health, which offers the service          individual insurance. If any do, he     Bret Berneche, chief executive
through Sam's Club.                       says the company will help them         officer of Cardinal Homes in
                                          find coverage.                          Wylliesburg, Va., used Zane
"This is a multibillion (dollar)                                                  benefits to help get health insurance
opportunity," says Vik Kashyap,           "I can guarantee you that no            for himself and his 112 employees.
founder of Canopy Financial. Last         company would leave those people
month, Canopy began a similar             high and dry," Trikolas says.           In August, Berneche told his
reimbursement service and steers                                                  employees that their group health
workers to insurers who sell              David Davis, executive vice             insurance would end that month.
individual health policies.               president of Sweet and Sassy
                                          Franchising, which franchises salon     Between premium increases and
The insurance industry has                and spa services aimed at girls ages    mounting state and federal rules,
acknowledged the difficulties some        5 to 12, says his company plans to      offering insurance was costing the
people face in getting coverage. In       introduce the Canopy program this       company too much — $846,000 a
2007, officials in California and         year and end its group coverage.        year.
Connecticut fined several insurers        Davis, whose company is based in
for canceling individual policies         Southlake, Texas, says the main         "It was certainly a blow," Berneche
after patients racked up large            goal is to give workers more            says. "The choice was having the
medical bills.                            options.                                health plan we had or going out of
                                                                                  business."
A proposal released last month by         "We have employees who have
America's Health Insurance Plans,         families with young kids, some          After he canceled the group plan, he
the industry's lobbying arm, called       have older kids and some                heard about Pilzer's program and
on states to create guaranteed-           employees are single," Davis says.      signed on. Cardinal puts $100 to
$200 a month into each employee's       kicks in each year. The cost of               must cover and how applicants can
health reimbursement account.           prescriptions adds $200 to his                be scrutinized.
                                        monthly costs. He says his total
Even if Berneche carries out his        costs are at least $1,000 a month             The Department of Labor and the
plan to nearly double the size of his   more than under his group policy.             Treasury Department are
company, he still expects to save at    Still, he says, "I am happier today           considering whether federal rules
least $360,000 this year with the       with this program … than I was                that apply to group insurance also
new program. Zane Benefits              before."                                      apply in programs such as Zane's, in
handles the accounts and reimburses                                                   which an employer makes a
employees out of their individual       Berneche says he can talk more                contribution but doesn't offer a
accounts for medical expenses.          openly with company employees                 group plan, a statement from the
                                        about health issues. He does not feel         Department of Labor says.
Many employees were able to buy         as constrained by federal and state
individual policies for less than the   rules and has more control over               For instance, says Mila Kofman, a
monthly amount put in by Cardinal,      health costs.                                 health policy professor at
Berneche says. The money also can                                                     Georgetown University, "what
be used for eyeglasses, dental care     "I had to worry about that every              happens if an employee can't buy an
and other medical expenses.             year," Berneche says. "We're no               individual policy" but others in the
                                        longer in the health care business."          company can? "Then you have a
"I don't know if everyone bought                                                      potential violation of the non-
insurance. But there are various        Legal issues                                  discrimination provisions" in
ways to get some kind of health                                                       federal law.
coverage, through state programs        Legal questions remain about
and self-pay programs and               whether to classify this hybrid               Daryl Richard, a spokesman for
catastrophic insurance programs,"       coverage as group or individual               UnitedHealth, says, "A number of
he says. "Everyone here has a health    policies. Consumer protections are            groups, including brokers, insurers
reimbursement arrangement that          not as strong in individual plans             and government agencies, are
they can spend the way that best        because states allow them more                seeking to fully understand the
suits their families' needs."           leeway than group plans.                      nuances of how individual and
                                                                                      employer-sponsored coverage may
Though some pay less for premiums       Berneche had to certify on his                best work together in compliance
than they did under the company-        individual insurance application that         with both state and federal
subsidized group plan, others,          his company was not reimbursing               regulations."
including Berneche, pay more.           him. Yet the contributions his
                                        company provides are at least a               The main goal, he says, "is finding
He and his wife, Dorothy, both in       partial reimbursement.                        ways to make health coverage
their 40s, pay about $900 a month                                                     available to as many Americans as
in premiums, and each has annual        In Virginia and many other states,            possible."
deductibles of $5,000, meaning          policies sold as individual plans
that's what they pay before coverage    have different rules on what they

                                                                                  HealthLeaders Media – January 23, 2008

 Survey compares rural and urban/suburban physicians
By Ben Cole
The nation's current doctor shortage    perceptions of practicing medicine            "Most of the physicians were pretty
is most acute in rural America, and     in rural America versus practicing            pleased with how rural medical
an aging U.S. population combined       in areas with populations of 50,000           practices worked for them," says
with an increased interest in           or more.                                      Tim Skinner, executive director of
"quality of life" issues will likely                                                  the National Rural Recruitment and
make the situation worse before it      The survey found that there may be            Retention Network in La Crosse,
gets better, according to               fewer differences, at least clinically,       WI. "There are a lot of plusses to
representatives from                    between practicing in rural areas             the practice of rural medicine--and
LocumTenens.com. The physician          and urban ones than one might                 actually many of the rural practices
recruitment firm recently surveyed      think.                                        have the same equipment, the same
doctors to better understand their                                                    technology as suburban and urban
practices do. Much of it is quite up-    MD, a surgeon who practices in             Perhaps the most telling finding
to-date."                                Ogdensburg, NY. "Rural settings            from the LocumTenens.com survey
                                         can be more attractive to physicians       was why physicians who had not
Of those surveyed who have               who are interested in control of           practiced in a rural setting had never
practiced in rural areas, for            lifestyle: no traffic, little pollution,   done so. The three top answers were
example, 31 percent said they think      first-name basis for many                  never found the right opportunity
profitability among rural practices      conversations, really getting to           there (26 percent), never been
was about the same when compared         know the people in a community.            offered a position there (23
with their urban counterparts, and       For the physician who likes the            percent), and never considered it
23 percent even said rural practices     anonymity of a big city, rural life        (19 percent). Only 4 percent
were more profitable. Only 18            would probably not be desirable;           answered they never practiced in a
percent said practicing in a rural       however, for someone who enjoys            rural setting because they did not
setting was more frustrating than        solitude and space, rural life can be      want to work there.
working in an urban facility, and 45     attractive."
percent said urban and rural settings                                               "As a former physician recruiter, I
were "about the same" in regard to       Because of this, Skinner says rural        thought it was stunning to see that
frustration.                             facilities need to look at a potential     only 4 percent of responding
                                         physician's background and                 physicians with no rural practice
There are, however, stark                interests when trying to recruit. "A       experience said they didn't want to
differences between the two--            physician who is going to go to a          practice medicine in rural America,"
especially when it comes to              small, rural community in                  says LocumTenens.com Senior
connecting with patients. Of those       Wisconsin is probably going to be          Vice President Pamela McKemie.
surveyed who had practiced in rural      very interested in hunting and             "What we'd like rural hospital
areas, 52 percent said they think        fishing, as opposed to the physician       executives to 'get' from our survey
doctors have a closer relationships      who is going to go to a desert area        results is that physicians from all
with patients in a rural practice,       in Arizona and New Mexico who              types of environments are open to
compared with 3 percent that said        might be more interested in cultural       practicing rural medicine, but
they think doctors have closer           artifacts, archeology, anthropology,       you've got to approach them about
relationships with patients in an        and desert life," Skinner says. "You       your opportunity before they can
urban or suburban practice.              have to look at those preferences."        consider it."

"What's different is you have a more     Smaller facilities should also take        This is another example of why
personal connection," says Jim           steps to show potential physicians         rural facilities need to be a little
Stone, MD, who practices in              that they will not be overwhelmed          more cognizant of making sure the
Atlantic, IA. "Medicine has become       by being the only, or one of few,          invitation to practice isn't restricted
a volume-based profession, and in        doctors in a community.                    to a small group of physicians who
an urban setting you have much less      McLoughlin suggests community              are born in rural areas, Skinner says.
time to spend with patients."            and rural hospitals seek partnerships
                                         with larger city or teaching hospitals     "We really need to emphasize the
The survey also gauged the               by becoming part of an extended            connection between the community
physicians' thoughts on lifestyle        telemedicine network. That way,            development piece and the medical
comparisons between urban and            physicians practicing in the rural         staff development piece," Skinner
rural settings. Predictably, the         location don't feel isolated from          says. "In a small town they have to
findings were all over the map--31       colleagues, McLoughlin says.               put that together because lifestyle
percent said they liked rural settings                                              issues have a great deal to do with
more, 19 percent said they preferred     "When a 'tough case' comes into the        people either appreciating a smaller
urban settings, and 15 percent said      hospital, the rural practitioner would     community or not."
life was about the same.                 have access for input from a larger
                                         department of physicians or                Skinner says it is crucial that
Doctors say where one prefers to         possibly even from those practicing        facilities not only promote
practice is simply a matter of the       at an academic center," McLoughlin         satisfaction among staff working
type of person they are and the          says. "Avoiding the isolation of           with patients and practices in rural
lifestyle they are accustomed to. "I     'now I'm stuck with this patient that      facility, but also work with the
think it really has a lot to do with     I can't figure out' should be a major      community as a whole to help draw
the physician's personality and also     goal of any rural hospital trying to       potential physicians. He suggests
the desires of the physician's           recruit physicians."                       healthcare providers tout agencies
family," says James C. McLoughlin,                                                  and resources such as social and
human services that can potentially      work with the community to attract       recreational and cultural activities.'
support physician practices.             physicians.                              If the community piece is missing,
Stipulating how close the nearest                                                 they might pass on a rural practice
college is for potentially furthering    "The smaller the town, the more          even if they offer the physician and
the physician's education,               important the community                  the physician's family everything
developing a strong community-           development piece is," Skinner           that they need."
based Web site, and promoting            says. "What they can do is they can
available leisure activities in the      really step up and say, 'This is what    Ben Cole is associate editor with
area are all ways providers can          our schools offer, here are our          HealthLeaders Online News.

                                                                                     Boston Globe – January 20, 2008

                  State health plan saves towns money
By John Laidler
Three area communities are helping       Bisignani said Saugus has been           increases have been in the "double
to blaze a trail for other cities and    averaging 15 to 20 percent increases     digits and high double digits" in
towns seeking to ease soaring            in its healthcare costs the last         recent years.
employee health insurance costs.         several years. With its much larger
                                         pool of subscribers - 285,000            He said preliminary estimates
Groveland, Saugus, and Winthrop          compared with Saugus's 2,500 - the       indicate the town will spend
are among five municipalities that       insurance commission has been able       $250,000 less in healthcare next
have taken advantage of a state law      to limit its cost increases to 6 to 10   fiscal year than the current one, and
adopted last July that allows public     percent, he said.                        $750,000 less than what it would
groups to join the state's employee                                               have paid had it remained with its
healthcare system as a way to save       Bisignani projects savings this fiscal   current insurer.
money.                                   year at about $300,000. Employees
                                         will save on average $6 a week in        Joel Barrera, senior project director
The five communities - the others        premiums for a family plan,              for the Metropolitan Area Planning
are Holbrook and Millis - along          depending on what plan they              Council, said the fact that only a
with four regional school districts, a   choose.                                  handful have enrolled in the system
charter school, and two regional                                                  to date is not surprising since the
planning councils, all met a first-      "What it does is stabilize the current   law did not pass until July 25, and
year deadline last October to enroll     fiscal year's costs . . . and it         communities had until Oct. 1 - later
in the Group Insurance                   minimizes the increases in future        extended to Oct. 29 - to join.
Commission, the agency that              fiscal years," said Bisignani, who
administers the state's health           estimated the town will save             Under the law, a municipality can
insurance plan. One other                $600,000 in fiscal 2009.                 enroll only if the option is approved
community, Springfield, was able to                                               by at least a 70 percent weighted
join the insurance commission in         While the state plan requires some       vote of a committee representing its
2006 because it was under a state        higher copayments, Bisignani said        employee unions following a
financial control board.                 most employees will save money by        coalition bargaining process, where
                                         sharing in the overall cost savings.     the municipality's chief executive
With the exception of Saugus, the        In Saugus, the town pays 90 percent      negotiates with the multiunion
enrollments will become effective        of health insurance costs.               committee.
July 1. Because of its severe fiscal
crunch, state lawmakers allowed          In Winthrop, Town Council                "I think the real test is next Oct. 1,"
Saugus to join Jan. 1.                   president Thomas E. Reilly said,         Barrera said, referring to the
                                         "The financial impact of this is         deadline for communities seeking to
Andrew Bisignani, Saugus town            enormous for the town."                  join the group in fiscal 2010.
manager, said joining the insurance
group is expected to bring modest        "As with most communities, we            Barrera said a number of other
long-term financial relief to the        have a huge problem with                 communities, including some in this
town, which has a $5 million budget      healthcare. Ours, given the size and     region, have discussed joining.
shortfall this fiscal year, about $2     claims history we have, was a
million of it caused by a deficit in     particularly bad one," Reilly said,      He anticipates 30 municipalities and
its self-insurance program.              noting that annual healthcare            other entities will attempt the union
negotiations needed to join the          the town and the union were able to     communities, Groveland's employee
system, and that about 10 will end       reach agreement, but Bisignani said     contracts do not include any
up enlisting by the deadline.            it took considerable negotiation.       guarantees of copay levels or the
                                                                                 selection of any particular
"The good thing is that this is a new    "We started negotiating probably in     providers.
option that communities have," he        April and we finished in
said. While not the only vehicle for     September," he said. "It was not        He said that limited the issues on
cutting costs, he said it is a "solid    easy. We had some very hard             the table.
one and the right one for some           bargaining and we had to give back
communities."                            some benefits to the unions."           Labrecque said the town is pleased
                                                                                 by the financial relief it stands to
Dolores L. Mitchell, executive           Reilly credits early and active         gain from taking advantage of the
director of the Group Insurance          discussions among town officials        new law. Had Groveland belonged
Commission, said joining might not       and union leaders for Winthrop's        this year, he estimates it would have
be in the best interest of those         ability to achieve an agreement.        saved about $105,000 of its
communities that are already                                                     $400,000 in health insurance costs.
aggressively moving to reduce            "The key to it was there was a great    He said the actual savings next
health costs. "But there are some        deal of cooperation and mutual          fiscal year could be more significant
that would really save money, and I      respect between the town manager,       since the town's premium, which
think they ought to give it serious      the superintendent of schools, and      had been rising 12 to 15 percent a
thought. We will help in any way to      the unions," he said. "As a result,     year under its current insurer, could
make the transition work for them,"      they were able to put something         have climbed as high as 18 percent
she said.                                together within the timeline."          more.

For some communities, achieving          Groveland finance director Greg         "I think any law that gives us
the needed support from unions is        Labrecque said the negotiations in      options is a good law," Labrecque
proving a difficult or                   his town went relatively smoothly       said.
insurmountable hurdle. In Saugus,        because unlike in some larger

                                                                                   For the Record – January 21, 2008

                                            Price Check
By Elizabeth S. Roop
In today’s healthcare environment,       estimates increases patient trust and   The Push for Transparency
more patients are requesting cost        satisfaction.                           Through its Patient Friendly Billing
estimates before selecting a                                                     Project, the HFMA has been a vocal
hospital. By automating that             “There is always angst if someone       advocate of greater transparency
process, facilities could gain an        asks how much something costs and       and overall reform of the healthcare
upper hand on the competition.           you can’t provide an estimate.          pricing structure through the
                                         People in the corporate world don’t     establishment of a pricing system
Heeding the call for greater             understand why it’s a problem [for      that does the following:
transparency in response to the rise     hospitals],” says Richard L.
in high-deductible and consumer-         Gundling, CMA, vice president of        • is simple to administer and
driven health plans, a growing           the Healthcare Financial                communicate;
number of hospitals are                  Management Association (HFMA).
implementing or refining systems         “To have a system in place to give      • establishes a framework that is
and processes to support the             up-front pricing goes a long way        rational and defensible in relation to
increased patient demand for price       toward communicating with the           objective benchmarks;
estimates.                               patient and establishing a greater
                                         trust in the community and with         • creates accountability by
Given the number of unknowns that        decision makers. If you can’t give at   empowering consumers to make
can impact the final price for           least a range, people think you’re      price comparisons;
services provided, it can be tricky to   hiding something or you’re not
achieve a suitable level of accuracy,    running your operations as              • allows for full coverage of
but those hospitals making the effort    efficiently as you can.”                financial requirements related to
have discovered that providing
providing care and other community      much now. But a lot of people want       by one when a patient calls. But that
benefits; and                           a certain idea of … their out-of-        is not a streamlined process or an
                                        pocket costs.”                           efficient way to handle estimates,
• provides stability and                                                         especially as transparency and
predictability in the administrative    Effective Systems Required               defensible pricing emerges and
process.                                The trick, particularly for hospitals,   becomes more of a priority to
                                        is to provide an estimate that           hospitals and consumers.”
In “Reconstructing Hospital Pricing     accounts for as many variables as
Systems: A Call to Action for           possible and presents them in a          Craneware’s answer is the Patient
Hospital Financial Leaders,” the        meaningful, defensible, and              Charge Estimator, a software tool
HFMA notes that a driving force         comparable way. There is no              that provides estimates for inpatient
behind the call for price               “industry standard” for compiling        and outpatient procedures based on
transparency is the rise of             price information, and the process       a hospital’s historical claims data,
consumerism. Higher deductibles         for doing so varies from facility to     chargemaster files, and negotiated
and copayments, as well as the          facility. However, price information     third-party contracts. The
growing popularity of consumer-         should ultimately be able to             information can also be filtered by
driven plans such as health savings     withstand scrutiny and be easily         procedural descriptions, CPT and
accounts (HSAs), are forcing            compared across providers.               HCPCS codes, ICD-9-CM
consumers to take on more of the                                                 procedure and diagnostic codes,
financial burden.                       “Getting the functions up and going      diagnosis-related groups, etc.
                                        and having a centralized pricing
This has prompted many hospitals        area is all part of it. The              With each estimate, a customized
to make their prices public, a          marketplace is moving that way           letter is created that can be sent
strategy that includes posting price    anyway,” says Gundling. “But             directly to the requester
and quality information on the Web.     hospitals have traditionally operated    electronically or by fax or mail.
Others are cooperating with state       in a wholesale environment where         Estimates are also saved within
hospital association initiatives to     most of their customers were the         Patient Charge Estimator’s
consolidate pricing information into    government and large insurance           database, allowing the hospital to
a single location. Even Medicare is     companies, so the systems are set up     analyze market trends and behaviors
publishing payment information on       for that. But now, with consumers,       and compare estimates with final
the most common procedures.             it’s more of a retail environment.       charges.
                                        It’s a whole new paradigm.”
Legislation is also ratcheting up the                                            A Better Way
pressure for increased transparency.    Tim Weakley, product marketing           University Hospital in Augusta, Ga.,
Currently, more than 30 states          manager at Craneware, Inc., agrees       deployed the Patient Charge
require hospitals to report pricing     that the key to keeping up with the      Estimator after it noticed a
information, and six have voluntary     demand for transparency in an            significant upswing in calls from
reporting systems in place. The         evolving healthcare market is            consumers facing the prospect of
American Hospital Association           having the right systems in place to     significant out-of-pocket costs. In
supports legislation that would         efficiently develop accurate,            the past, estimates were based on
require insurers to provide more        defensible price estimates. The          historical data compiled annually in
information on out-of-pocket            problem is that many hospitals don’t     a spreadsheet. When a patient called
expenses and require the Agency for     realize that their existing processes    with a procedure code or
Healthcare Research and Quality to      are not adequate for handling the        description, someone would search
conduct a study on what consumers       high demand for estimates and            the document for the data needed to
want to know about pricing.             accountability that the growth in        provide an estimate. It was a time-
                                        consumerism may generate.                consuming process that could not
The ultimate goal is to arm patients                                             account for extraneous charges.
with enough information about cost      “If you talk to [hospitals] now, most
and quality so they can open a          of them do not have a process in         “It’s easy to find a procedure code,
dialogue with their providers to        place to do this,” Weakley says.         but sometimes there are supplies,
determine the best care options.        “They may think they do, whether         pharmaceuticals, and other
                                        they’re referencing handwritten          procedures that go along with the
“It starts the conversation,” says      notes or spreadsheets of common          main procedure. If we were quoting
Gundling. “I don’t know that a lot      procedures, or printing out reports      based only on a procedure code, a
of people will necessarily price        from the business office and             lot of times those other items were
shop; I don’t see that happening        manually going through them one          left off,” says Brian Patterson, RN,
chargemaster coordinator in              go back into the claims database         can’t because patients respond
University’s revenue management          and see what procedures have been        differently. That’s the biggest
department.                              done that are like those to              challenge in estimating.”
                                         defensively set a price going
With the automated system in place,      forward to make sure we are              In “Reconstructing Hospital Pricing
estimates are now generated in           recovering our cost. It ultimately       Systems,” the HFMA agrees that
minutes and are more accurate and        gets back to overall productivity        the need to adjust treatment to
complete than those created with the     because we are not reinventing an        address unique patient needs or the
manual system. University’s current      estimate that we’ve already done. If     degree of clinical difficulty is a
estimating process “empowers the         it’s in our system, anyone in the        complicating factor when quoting
patient to prepare financially for a     network can use that estimate            estimates. For example, while it
procedure,” says Patterson. “It          again.”                                  may be easy to provide an estimate
speeds up our workflow because the                                                for a mammogram, the same cannot
estimate can be done fairly quickly.     Communication and Clarity                be said for a more complex
It is also a satisfier because if we     Despite the improvements both            procedure such as a mastectomy.
have provided an estimate and the        these facilities have seen as a result   Providing price range estimates is
patient responds as all other patients   of automating the process, there are     one way to deal with these kinds of
did to the treatment or procedure        still too many variables that affect     discrepancies, although the best
with no additional treatment needed,     the final cost of care to consider any   course of action is for a hospital to
the estimate is fairly accurate and      estimate binding. A significant issue    “establish a frank and ongoing
shows that we are credible in what       is the fragmented nature of the          dialogue with its community about
we do.”                                  healthcare payment system. For           pricing systems and the steps the
                                         example, while the hospital can          provider is taking to make the
The story at Mercy Medical Center        provide an estimate for its own          situation better,” the report says.
in Cedar Rapids, Iowa, is similar. In    charges, separate charges may also
the past, when a prospective patient     be levied for care and services          The HFMA also recommends that
would call for an estimate, the          provided by nonaffiliated clinicians.    communication initiatives
counselor would contact the              Differences between estimated and        surrounding pricing should focus on
appropriate department to obtain the     actual charges can also crop up          the following:
requested information or go to           when the quote provided does not
medical records to research the          include additional charges beyond        • cost differences in relation to
information necessary to provide a       the procedure itself.                    nearby facilities;
price range. According to Mercy
Medical reimbursement specialist         “If you’re just quoting out the          • charity care policies and discounts
Kara Arnold-Arons, the biggest           procedure and not the room charges       for the uninsured and underinsured;
problems with that largely manual        and other procedures, it may not be
system were time, accuracy, and          an accurate representation of the        • how healthcare financing works;
standardization. With demand for         full, true charges,” says Arnold-
estimates on the rise, the facility      Arons.                                   • the “hidden tax” or cost shift that
knew it needed a better, more                                                     results from Medicare/Medicaid and
efficient process for generating and     Variances also occur when the            self-pay shortfalls and its effects on
tracking estimates.                      patient’s care requires more than the    hospital prices; and
                                         norm for the procedure in question,
Mercy Medical also implemented           which is possibly the most               • the different ways prices are
the Patient Charge Estimator, which      significant issue at University          reported and what can and cannot
allows the hospital’s financial          Hospital.                                be learned from them.
counselors to rapidly respond to
estimate requests and provide more       “While we can give a ballpark            That dialogue is something every
accurate pricing information. It has     figure, patients respond differently     hospital needs to have with patients
also become an important analytical      to treatment. These estimates are        if they want them to have any
and pricing tool for Arnold-Arons.       being given without medical              confidence in the estimates they are
                                         knowledge or information other           providing, says Arnold-Arons.
“I can go back and see what patient      than the procedure in question,”
counselors are quoting out vs. what      says Patterson. “Sometimes, the          “We need to get our patients
is actually getting billed,” she says.   patients feel like we should be able     educated and understanding where
“I run into situations where new         to honor an estimate like a              [these charges] come from and how
procedures are occurring, and I can      mechanic honors an oil change. We        this price is defensible, how it is fair
and reasonable,” she says. “It’s         generated and to educate their            me?’ They will start having that
going to be a learning game for          patients on the factors that affect the   conversation about cost and quality
most organizations right now.”           cost of care provided as well as how      with their doctors, and price
                                         to balance cost with quality.             estimates are the best way we can
Eventually, hospitals will have little                                             communicate that. It’s like any
choice but to implement systems to       “That’s what consumerism is,” says        other business that needs to put its
increase the speed and accuracy          Gundling. “Patients will stop and         customers’ interests first.”
with which estimates can be              ask, ‘Are there other options for

                                                                                   Washington Post – January 22, 2008

                            Speaking Their Own Language
By Sue Anne Pressley Montes
Lilian Diaz, an emergency room           2002, according to Martine Charles,       requests are for Spanish interpreters,
technician, used to feel                 Inova's director of cultural              the first course was in Spanish, but
apprehensive when a doctor or            competence. The District's largest        Pesquera hopes to hold sessions in
nurse at her Takoma Park hospital        hospital, Washington Hospital             Mandarin, Korean, Vietnamese,
would ask her to interpret for a         Center, relies largely on eight           French and Russian, languages that
Spanish-speaking patient. She knew       people specifically hired as Spanish      are also in demand locally.
she was chosen because of her            interpreters, with Chinese, French        Employees who complete the
Spanish surname, but what if she         and Vietnamese interpreters also          course receive extra pay for their
told someone the wrong thing? Her        available, said Brian Miller, the         services.
Spanish was fine for everyday            hospital's manager of international
matters, but was it really good          services. At Suburban Hospital in         Elfred Deynes-Morales, a
enough, she wondered, to explain a       Bethesda, about 50 employees, with        respiratory technician who has
life-threatening illness to a fearful    varying degrees of Spanish fluency,       worked at Washington Adventist for
patient?                                 recently attended Spanish classes         20 years, said he jumped at the
                                         provided by Montgomery College,           chance to attend the class. He used
Now Diaz and a dozen of her co-          where they learned health-care-           to be asked to assist with
workers have new confidence in           related terms, senior vice president      interpreting once or twice a week,
their skills. They are the first         Dennis Parnell said.                      he said. As the number of non-
graduates of a program at Adventist                                                English-speaking patients has
Health Care Systems that trains          The Adventist program, offered            increased, requests have risen to 10
already-bilingual staff in the           through the system's year-old             to 12 a day.
technical terms and cultural nuances     Center on Health Disparities, was
of interpreting in a hospital setting.   born of necessity. There never seem       "One of the reasons I took the class
It is one way area health-care           to be enough trained interpreters on      is I didn't think I knew it all," he
providers are trying to meet the         site, and the alternatives -- using       said. "Before, it was an impromptu
demand for qualified interpreters to     telephone interpreting services or        type of scenario, where I walked in,
help inform and reassure a growing       enlisting a patient's relatives -- are    not knowing what was going on
community of non-English-                sometimes problematic.                    with the patient, and moved right
speaking patients.                                                                 along. Now by introducing myself
                                         "When family members, for                 and talking to the doctor, it gives
"Coming here, I was surprised how        example, interpret for patients,          me an idea what the doctor is
much my Spanish was needed," said        many things could be omitted," said       looking for, and I can build a little
the Guatemalan-born Diaz, 25, who        Marcos Pesquera, the center's             bit of trust between me and the
has worked at Washington                 executive director. "If the son is        patient."
Adventist Hospital for less than a       interpreting for the mother, the son
year. She is called on, she said,        might be embarrassed by certain           A native of Puerto Rico, Deynes-
"every day, multiple times a day."       things. "                                 Morales said his training came in
                                                                                   handy recently when two members
Communicating with patients who          Pesquera started out by training six      of a Salvadoran family drove up to
speak little or no English is an         employees to be teachers, and by          the hospital from North Carolina,
urgent priority at area hospitals. In    October 2007, the employees had           searching for a lost brother. The two
Virginia, the Inova Health System        settled in for the three-day program.     spoke little English. After talking
has trained 400 employees since          Since 80 percent of Adventist's           with them in Spanish, Deynes-
Morales determined that the man           to be "cultural brokers," Pesquera       Spanish-speaking home. "Instead of
they sought was not an Adventist          said, understanding that many of the     rambling on . . . I learned to let the
patient. Then he began calling other      patients are frightened and may          doctors talk to the patients -- I'm the
area hospitals. Finally, he contacted     have had minimal contact with            vessel."
police and helped the family fill out     doctors or hospitals in the past.
a missing-person report.                  They learn how to handle terms like      Lilian Diaz said she has come to
                                          "gallstones" and "blood thinners"        think of her role as "the voice."
He does not know whether the two          that have no exact Spanish
ever found their brother -- "We are       translations, and how to blend into      Now she feels more qualified to
taught not to get too caught up           the background to allow the patient      help out in an exchange between
emotionally," he said -- but he said      to feel as if he or she is conversing    doctor and patient. "I took a test. I
he was glad he could relieve some         directly with the doctor.                can do this," she said.
of the stress they were feeling by
helping them work out a plan of           "It could be as basic as 'I need you     And at the end of the workday, she
action.                                   to take your medicine,' to 'You're       said, "I can say, 'Okay, I did my job,
                                          having bypass surgery and this is        I helped someone out' and walk
Participants in the class, who are        what that means,' " said Vashti          away with a smile."
tested for proficiency in both            Mann, 43, a registered nurse in
Spanish and English, also are taught      intensive care, who was raised in a

                                                                                        USA Today – January 21, 2008
  Rising health care costs put focus on illegal immigrants
By Richard Wolf
BENSON, N.C. — Juan Perez had             As the debate over the residency         •On a national level, an effort to add
stomach pains for a month before          status of the nation's estimated 12      legal immigrant children to the State
deciding to visit a health clinic here    million illegal immigrants boils,        Children's Health Insurance
that is open Thursday nights so           another battle is simmering over         Program was blocked in the Senate
migrant farmworkers don't miss a          what — if any — benefits they            last year. Instead, lawmakers added
day working in the fields.                deserve while they're here. Some of      language to ensure that illegal
                                          the most heated arguments on the         immigrants were excluded.
As an illegal, uninsured immigrant,       issue focus on health care. So far,
Perez has had problems in the past        immigrants are losing:                   "The phrase 'illegal immigrant' is
— not only with his health, but with                                               just radioactive at the moment,"
navigating the U.S. health care           •In Texas, where the state               says Leighton Ku, a health analyst
maze. In Michigan, there was no           comptroller estimates illegal            at the liberal Center on Budget and
interpreter at his local health clinic,   immigrants cost hospitals $1.3           Policy Priorities. "Efforts to provide
the bills had to be paid in               billion in 2006, the University of       additional benefits for the
installments, and co-workers              Texas Medical Branch in Galveston        undocumented would be essentially
warned that a visit to a doctor could     is considering denying cancer care       perceived as adding fuel to the fire."
lead to deportation. In North             to such immigrants.
Carolina, he's found a health care                                                 Illegal immigrants can get
home at Tiffany Revels' weekly            •State legislatures across the           emergency care through Medicaid,
clinic — providing he can hitch a         country are seeking to limit the         the federal-state program for the
ride there.                               costs to taxpayers of illegal            poor and people with disabilities.
                                          immigration, including health care       But they can't get non-emergency
"The biggest concern is getting sick,     benefits. In May, Oklahoma               care unless they pay. They are
because you don't have anyone             lawmakers restricted illegal             ineligible for most other public
here," Perez says after Revels, a         immigrants from receiving most           benefits.
family nurse practitioner at the          public benefits; other states, such as
federally funded clinic, prescribes       Nebraska, are seeking to follow suit.    Data on health care costs for illegal
two antibiotics and Pepto-Bismol          A bill introduced in Indiana this        immigrants are sketchy because
tablets for his bacterial gastritis.      month would make hospitals report        hospitals and community health
"You are here by yourself."               how much they spend on illegal           centers don't ask about patients'
                                          immigrants.                              legal status. In California, a 2004
                                                                                   study by the Federation for
American Immigration Reform put        amount of work that they have to         prenatal care, as well as injuries and
the state's annual cost at $1.4        do."                                     chronic disease complications.
billion. Similar studies in Colorado
and Minnesota in 2005 came up          A potent political issue                 At the state and local level, illegal
with much smaller estimates: $31                                                immigrants already cost more in
million and $17 million,               Opponents of illegal immigration         public services such as education
respectively.                          see health care as a benefit that        and health care than they pay in
                                       illegal immigrants don't deserve —       taxes, the Congressional Budget
One thing is clear: Undocumented       and that taxpayers can't afford.         Office reported recently. Illegal
immigrants are driving up the                                                   immigrants make up less than 5% of
number of people without health        In a special election to fill the seat   the cost in most states, but closer to
insurance. The Pew Hispanic Center     of the late Rep. Paul Gillmor, R-        10% in some California counties. In
estimates that 59% of the nation's     Ohio, last month, the National           2000, counties along the Mexican
illegal immigrants are uninsured,      Republican Congressional                 border lost more than $800 million
compared with 25% of legal             Committee attacked Democrat              in health care services for which
immigrants and 14% of U.S.             Robin Weirauch for backing               they were not paid; about 25% of
citizens. Illegal immigrants           universal health insurance because       that went to care for illegal
represent about 15% of the nation's    it could extend taxpayer-funded          immigrants, according to a report by
47 million uninsured people — and      health care to illegal immigrants.       the United States/Mexico Border
about 30% of the increase since        She lost the race.                       Counties Coalition.
1980.
                                       Steven Camarota of the                   Some states, including New York,
"If you want to do something that      conservative Center for Immigration      Illinois and Washington, as well as
will have a meaningful impact on       Studies says offering non-               several California counties, cover
the problem of the uninsured, then     emergency Medicaid to illegal            illegal immigrant children with state
you must talk about undocumented       immigrants would be more                 tax dollars. "Kids are the more
immigrants," says James Smith, a       expensive than leaving them              sympathetic group, and they're less
senior economist at the RAND           uninsured and in need of occasional      costly," says Sonal Ambegaokar of
Corp.                                  hospital care. In those cases,           the National Immigration Law
                                       hospitals lose money, and taxpayers      Center, an advocacy group for low-
Because most illegal immigrants are    pick up the tab.                         income immigrants.
relatively young and healthy, they
generally don't need as much health    "Either you enforce the law and          Since 2003, California's San Mateo
care treatment as U.S. citizens,       don't have so many illegals, or you      County has used local tax dollars as
studies show. But while they           shut up about the cost," he says.        well as money from hospitals and
account for less than 2% of national                                            non-profit groups to provide health
medical spending, their growing        While state governments, Congress,       insurance to all low-income
presence is a problem in places such   the Bush administration and              children, regardless of immigration
as eastern North Carolina, one of      presidential candidates wrestle with     status. "These children are in our
the nation's poorest areas.            how to provide health coverage to        schools. They're part of our
                                       uninsured Americans, illegal             community," says Beverly Thames,
Statewide, illegal immigrants          immigrants rely on a patchwork of        spokeswoman for the county health
accounted for one in four new          federally funded community health        department. "It's just important that
residents from 1990 to 2004,           centers, which charge little for basic   they have access to health care."
according to a University of North     services and don't seek proof of
Carolina study. The state ranks        citizenship. For medicine, they          San Francisco goes further, adding
ninth in the nation for illegal        often rely on free prescription          adults at local expense. Some cities,
immigrants with more than 300,000,     samples or over-the-counter drugs.       including New York, encourage
according to the Pew Hispanic                                                   illegal immigrants to use public
Center.                                From 2001 to 2004, spending for          services such as health clinics
                                       emergency Medicaid for illegal           without risking deportation.
For hospitals, "the burden of the      immigrants rose by 28% in North
uninsured immigrant is huge," says     Carolina, said a March 2007 article      Direct federal aid has been minimal,
Jeff Spade, vice president of the      in the Journal of the American           but in 2003, Congress appropriated
North Carolina Hospital                Medical Association. Researchers         $1 billion over four years for
Association. "It's exploded the        cited increases in childbirth and        hospitals and other health care
                                                                                providers that serve illegal
immigrants. More than 15,000             pain of illness or injury, so they live    with the Mexican Consulate to
providers have registered for            with their afflictions rather than         arrange transportation back to their
payments, according to the Centers       seeking help until their health            native countries. If that can't be
for Medicare and Medicaid                problems become critical. That             arranged, the patients remain in the
Services.                                makes things worse — for them, for         hospital for weeks or months.
                                         hospitals that eventually treat them,
The sweeping overhauls of the            and for taxpayers who ultimately           "It's a real Catch-22," says Sharon
nation's health care system proposed     foot the bill.                             Coulter James, senior vice president
by Democrats Hillary Rodham                                                         at the University of North Carolina
Clinton, Barack Obama and John           "They're scared to see the doctors,"       Hospitals. "We would never put that
Edwards would not provide                says Genaro Diaz,a legal resident          patient out on the street in an unsafe
coverage for illegal immigrants.         who, at 59, is a father figure to          environment. But there are patients
"Because the issue is so politically     many of the mostly male                    who need those beds."
hot, people are staying away from        farmworkers here. "They think
it," says Cecilia Munoz, senior vice     they'll send them back to Mexico."         In an effort to help local health
president at the National Council of                                                officials better understand the
La Raza, the nation's largest            Now, at least some are coming to           immigrants who are inundating their
Hispanic advocacy group. Only            community health centers, part of a        area, the University of North
Dennis Kucinich of Ohio, a               national matrix of more than 4,000         Carolina's Center for International
Democratic long shot, proposes           federally funded health centers that       Understanding sponsors week-long
covering them.                           have sprung up throughout the              immersion programs in Mexico.
                                         country during the past 40 years. In       Janet Hadar, director of clinical care
That's likely to mean little change in   2006, those centers served 6 million       management for UNC Hospitals,
undocumented immigrants' health          uninsured patients, a 50% increase         recently returned from a trip that
care status, already the worst in the    since 2001.                                exposed her to residents' unsanitary
nation. Even among children, 53%                                                    living conditions. "It made me much
are uninsured, according to Jeffrey      At Goshen Medical Center, nursing          more sympathetic to this
Passel of the Pew Hispanic Center.       assistant Jessica Roberts recalls a        population," she says.
That compares with 9% of U.S.            woman who arrived more than eight
citizens' children.                      months pregnant with her eighth            Revels went on the same trip. Now,
                                         child — for her first prenatal visit.      she's back treating ailments large
In North Carolina's rural Duplin         "A lot of Hispanic patients are            and small: skin rashes and
County, more than one in four            scared of coming to the doctor's           hypertension, infections and
people are uninsured. The area's job     office because of who they're going        nosebleeds. Most patients pay $6
growth is in low-wage agribusiness       to meet," she says, referring to their     per visit and $6 per prescription.
— "plucking chickens and gutting         fear of deportation.
hogs," says Greg Bounds, chief                                                      Slowly, she's building a steady
executive officer of Goshen              At Duplin General Hospital, the            clientele. Ignacio Hernandez
Medical Center, the area's largest       challenge is staying afloat. Because       complained recently of recurrent
group of community health centers.       so many patients are seniors on            eye pain after being struck by a
Businesses need the influx of illegal    Medicare, low-income residents on          sweet potato in the fields.
immigrants to take hard-to-fill jobs,    Medicaid or uninsured people who           Guadalupe Cortez came for his
but hospitals lose money when the        can't pay their bills, it's difficult to   monthly diabetes check and
workers need emergency care.             turn a profit. "We're living off           emerged with a bag of insulin
                                         reserves," CEO Harvey Case says.           samples. Without the clinic, "I don't
Until recently, most illegal                                                        know what I'd do," he says.
immigrants here had one health care      The University of North Carolina's
strategy. "They just weren't getting     four hospitals are seeing an increase      On some nights in 2006, "we would
care before," Bounds says. "They         in the number of undocumented              only see eight patients," Revels says
were just suffering and dying."          immigrants who need care for major         between treating farmworkers'
                                         illnesses or injuries. Because they        ailments. More recently, "I have not
'Scared to see the doctors'              only qualify for Medicaid on an            had one slow night."
                                         emergency basis, their funding often
For many illegal immigrants, the         runs out before they're able to leave.
fear of deportation outweighs the        Hospital officials sometimes work

				
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