ED overcrowding

David Harlow

Tom Mayo posted a couple of stories on his Health Law Blog this week (here and here) about emergency departments and their varying approaches to reducing waiting times ("boot in the butt" vs. triaging noncritical patients more appropriately). 

While many hospitals have developed systems to triage noncritical care patients into an urgent, but not critical, care settings, there has been little done to address the root causes of ED overcrowding. 

A couple of years ago, a Health Affairs article noted that for some California hospitals, the solution to the problem was to build additional ED capacity.  More recently, another Health Affairs article pointed out that, despite general perceptions, inappropriate ED utilization is not concentrated in facilities serving uninsured and ethnic and cultural minority populations. 

Update:  Further detail from the article on ED utilization may be found on Peter Lucash’s Physician Business Blog.

So what are the real root causes and how can they be addressed?  A couple of thoughts:

First, the "boot in the butt" leading to the "boot in the butt" described on Tom Mayo’s blawg may be a relatively new JCAHO standard, effective as of January 1, 2005, which requires that:

The leaders develop and implement plans to identify and mitigate impediments to efficient patient flow throughout the hospital.

The rationale for this standard:

Managing the flow of patients through their care is essential to the prevention of patient crowding, a problem that can lead to lapses in patient safety and quality of care. The Emergency Department is particularly vulnerable to experiencing negative effects of inefficiency in the management of this process. For this reason, while Emergency Departments have little control over the volume and type of patient arrivals and most hospitals have lost the “surge capacity” that existed at one time to manage the elastic nature of emergency admissions, other opportunities for improvement do exist. Improved management of processes can ensure the wise use of limited resources and thereby reduce the risk to patients of negative outcomes from delays in the delivery of care, treatment, or services.

Well, that doesn’t explain the origins of the problem, but it may help explain hospitals’ growing interest in solving the problem.

Second, a few years ago, an interesting study came out in Academic Emergency Medicine, based on a study of ambulance diversion in Massachusetts.  My memory is that the authors found that the key contributing factor to diversions was uneven scheduling of elective surgeries during the course of the week, to suit the scheduling convenience of surgeons and patients.  If hospital beds (esp. ICU beds with post-surgical patients) were all full, then EDs had to go on diversion because the hospitals would not be able to admit a patient arriving by ambulance.

It’s a difficult problem, and one that all hospitals need to gear up for as summer comes to an end and flu season is not far behind.

In Massachusetts universal health care skirmishes, Moore wants more; calls DHCFP thresholds for employer contributions inadequate

David Harlow

The Boston Globe reports that State Senator Richard Moore finds the DHCFP draft regulations wanting.

Under the proposed rules, companies would be exempt from a $295-per-employee annual assessment if at least one-quarter of their workers sign up for a company-sponsored health plan. Those that don’t meet that standard could still avoid the assessment if they contribute a minimum of 33 percent to individual health insurance premiums. The assessment applies only to companies with at least 11 employees.

Moore, Democrat of Uxbridge, said the median premium contribution by companies that now provide insurance to their employees is about 75 percent of the total cost.

"An employer who’s not contributing 50 percent isn’t doing their fair share," he said. "We opted not to spell out what ‘fair share’ is in the law and give the administration some flexibility. But they’re pushing the envelope."

Final rules are due out August 29.  Per the Globe, Moore may move to legislate his point of view in a technical correction bill due out soon.  He submitted his views in written comments to DHCFP, reproduced at Health Care For All’s A Healthy Blog (a terrific resource on this issue), but seems to have little confidence that DHCFP will see things his way.

IRS guidance on HSA contributions should promote HSA use with HDHPs

David Harlow

The IRS recently finalized its latest guidance on health savings accounts (HSAs), effective January 1, 2007.  (Additional IRS guidance on HSAs may be found here.)  Employers now have clear guideposts for funding voluntary employer contributions to HSAs, including contributions made through cafeteria plans.  The IRS noted in its explanation of these regulations:

Numerous commentators requested guidance on the exception to the comparability rules for employer contributions made through a section 125 cafeteria plan. In response to these comments, the final regulations . . . provide that employer contributions to employees’ HSAs are made through the cafeteria plan if under the written cafeteria plan, the employees have the right to elect to receive cash or other taxable benefits in lieu of all or a portion of an HSA contribution (i.e., all or a portion of the HSA contributions are available as pretax salary reduction amounts), regardless of whether an employee actually elects to contribute any amount to the HSA by salary reduction. The final regulations also provide several examples that illustrate the application of the cafeteria plan exception to the comparability rules.

Other issues addressed include an exception for employees covered collective bargaining agreements, guidance on health screenings and wellness programs, and rules on tracking down former employees for purposes of maintaining comparability of contributions.

The expectation is that these guidelines will promote the propagation of high deductible health plans (HDHPs) in conjunction with HSAs, now that there is greater clarity on the comparability rules, and therefore less risk of incurring a 35% penalty for doing something noncomparable. 

However, some employers remain dubious and have not — and will not — shift to HDHPs, reasoning that employees will balk at the limited provider panels associated with HDHPs and really will not relish the opportunity to write checks paying for health care services out of their HSAs. 

At the same time, there are various "HSA improvement" legislative initiatives in play (supported by the banking industry, which has an interest in greater acceptance of HSAs) that would allow for contributions to pre-existing plans — like flexible spending accounts — to be rolled over into HSAs without penalty.

Even though 2007 health plan decisions have already been locked in by some employers, it stands to reason that the number of people covered by HDHPs and HSAs will increase dramatically in the coming year or so.

It may be only a matter of time before employers and employees grow more comfortable with this new paradigm.

Massachusetts DHCFP releases proposed nursing facility rates based on new state budget

David Harlow

DHCFP issued its SFY 2007 Medicaid nursing facility rate plan on August 11.  The aggregate increase is about $30 million, or 2%.  Facility-specific rate information and the proposed regs are available here.  The proposed regs also change the annual cost report due date to March 1.  Comments will be accepted through October 2.

Should we let the federales run Medicaid in the states?

David Harlow

Tommy Thompson’s latest crusade involves trying to get the feds to run Medicaid’s programs for the elderly (rather than just share in the funding), and let the states focus on services to younger populations.  He’s been touting this plan lately, at the National Governors Association annual meeting, and through the media.  He says now he’s always thought this would be a good idea — more efficient to have one central operation vs. 50 local operations — though some folks believe that his current client list might have at least something to do with his support for this notion.  (Original articles here and here; Washington Post free registration required.) 

So far the discussion of his plan seems to be short on details. 

Remember: this is a guy who (a) sold Medicare Part D by assuring Congress that it would cost no more than $400 billion over 10 years and then saw his subordinates investigated over the details of what did they know (about the fact that the estimate was way off) and when did they know it and (b) announced he would have an RFID tag implanted after a joining the board of a corporation in that line of business. 

Now, while I believe that in the future each of us may have a chip implanted with all sorts of useful information (though we might need to carry explanations of why we’re setting off overly-sensitive security devices, as some other RFID pioneers and even patients receiving radioactive isotopes have experienced), I am still wary of suggestions that the health care system can save money by federalizing some of its financing processes.

Specialty hospital report submitted to Congress; calls for DRG tweaks, disclosure, enforcement

HHS announced on August 8 a strategic and implementing plan to address issues regarding physician investment in specialty hospitals (i.e., hospitals exclusively or primarily engaged in caring for cardiac, orthopedic or surgical patients).  The final report and accompanying press release detail the survey results collected (since a significant number of specialty hospitals did not provide answers to key questions about physician ownership, information on ownership is likely somewhat skewed).  Not surprisingly, physician-owned specialty hospitals provide less in the way of emergency services, charity care and Medicaid volume than their acute care counterparts.  The proposed solution to the issue is the panacea du jour around CMS: make DRG payments more accurately reflect the cost of providing care, and the skewed incentives leading to development of specialty hospitals (or nonhospital ASCs and imaging services and, in past years, hospital-based SNFs, etc., etc.) will no longer be operative.  And so the balloon gets pushed in on one side and will no doubt bulge outwards, soon, somewhere on the other side.