8 May 2012

Midwest Edition
Calendar
June 6-7
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Hospital Collections Firm Under Fire

Minnesota AG Sues Chicago-Based Accretive
Chicago-based hospital collections rm Accretive Health has come under scrutiny by both state and federal reguators because of its debt collection practices. Accretive was recently sued by Minnesota Attorney General Lori Swanson for the collections practices it undertook on behalf of Minneapolis-based hospital operator Fairview Health Services. Swansons ofce claimed Accretive may have violated state and federal consumer protection laws by trying to collect fees from patients as they were trying to seek treatment at Fairviews emergency rooms. Swanson has also alleged that the company used forceful tactics and condential medical records in its collection efforts. In a prepared statement, Fairview said this has been an incredibly difcult experience for our entire organization. Our focus has always been on delivering high quality care and treating patients with dignity and respect. Since the initial investigation in Minnesota, Illinois Attorney General Lisa Madigan has announced that she will be examining Accretives business practices. Congress has also requested a list of the companys clients to assess its compliance with federal emergency room access and collection laws. Because of the investigation in Minnesota, Fairview has terminated its contract with Accretive and returned its collection efforts in-house. The statement said that the organization is diligent in adhering to laws applicable to collections, including the Emergency Medical Treatment and Active Labor Act. On top of EMTALA, hospitals are required to comply with local laws and requirements. Since 2005, Minnesotas hospitals have had an agreement with the state attorney general that is broader in scope than federal collection laws, said Wendy Burt, vice president of communications and public relations for the Minnesota Hospital Association. Burt said each hospital is bound by the agreement; if they use the services of a collection agency, the hospital is responsible for overseeing the organizations practices. Illinois law specically deals with hospitals collection practices. The Hospital Uninsured Patient Discount Act outlines the practices hospitals can use in terms of notifying patients of charity care and nancial aid. The Patient Protection and Affordable Care Act also created guidelines that limit the collection practices of nonprot hospitals. The
Continued on Next Page

June 11-13

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June 26-27

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WEBINAR
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Thursday, May 24, 2012

Noon, CDT

HOSPITAL DISTRICTS: MAPPING THE FUTURE

Please join Michael A. Dowell, partner, Hinshaw & Culbertson, Walter Kopp, president, Medical Management Services, Inc. and Cleo E. Burtley, manager, The Camden Group, to discuss the future of hospital district management. More Info @:

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NEWS
Accretive (Continued from Page One)
law mandates that hospitals perform a community health assessment every three years and have a written nancial assistance policy that is well-publicized. Nonprots cant bill unreasonable amounts for emergency or medically necessary treatment, nor can they take overly aggressive collection actions with patients who may be eligible for nancial assistance. Though there are clear collections guidelines in place in many states, a handful of hospitals across the country have been exposed for overly aggressive collection practices. A recent investigation by the Charlotte Observer found that two providers in North Carolina, Carolinas HealthCare and Wilkes Regional Medical Center, have led more than 12,000 lawsuits against patients over a ve-year period. Many of the patients sued

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In Brief
KFF Projects $1.3 Billion In Insurance Rebates
The Kaiser Family Foundation has estimated that consumers and businesses will receive about $1.3 billion in rebates later this year from health insurers that spent more on administrative expenses than permitted under the Patient Protection and Affordable Care Act. The large group market is expected to reap the most money: $541 million. The individual market will receive $426 million, and the small group market will receive $377 million. Altogether, about 31% of those consumers who purchased individual policies will receive a rebate, followed by 28% of the small group market and 19% of the large group market. Texas is expected to rebate the largest amount, $186 million, followed by Florida, at $148 million. In the Midwest, Michigan is expected to receive the largest rebate, $14.6 million, followed by Illinois and at $8 million and Ohio at $7.8 million. This study shows that asking insurance companies to put more of their premium dollar towards patient care rather than administration and profits is not only popular but also effective," said KFF President and CEO Drew Altman. There are tangible benefits for consumers and employers.

had relatively low incomes and the paper found that some would have qualied for charity care. Part of the problem is that hospital collections are becoming more complex as patients bar more responsibility for their own healthcare costs, Burt said. More have HSAs and high deductible plans and hospitals have to try where possible to obtain plans for payment when a patient is admitted when its not an emergency, she said. According to the American Hospital Association, hospitals provided $39.9 billion in uncompensated care in 2010, the most recent date for which numbers are available. Billing shouldnt get in the way of patient care, Burt said. She added the challenge is nding a balance that respects patients while reducing uncompensated care.

Study Links Low Co-Pays To ER Use

Consumers May Be Becoming More Cost Conscious
The relatively low out-of-pocket cost to visit a hospital emergency room may be driving overutilization of that resource compared to primary care, according to a new study. Based on research conducted by the Boston-based HighRoads and the Corporate Executive Board, the average co-payment for an emergency room visit is $76. The study correlates that to two of the 10 most common conditions for ER visits: Toothaches and sprains. The study also found that there is a minimal out-of-pocket differential between urgent care and primary care ($32 versus $17), which may also be driving more urgent care visits because they keep longer hours than the ofces of primary care physicians. The interesting data on co-pays show employees are basically acting as price sensitive consumers and going for what they perceive as the best value and convenience for the price, said CEB Senior Director Ania Krasniewska. However, it also sounds a warning that some visits to ER and urgent care facilities should, in fact, be handled at the more cost-effective primary care level. Not only does this affect cost to the employee in the end, but in large quantities, this signicantly affects the cost to the organization. The study also found that health plans charge relatively mild co-payments for cancer treatment visits and for primary care for dependent children.

Growth In Medigap Policies Continues

The number of Medicare supplement insurance policies being sold in the U.S.has grown considerably in the past year,

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Drug-Addicted Newborns On Rise

Michigan Study Cites a Number of Troubling Factors
The number of newborns addicted to opiate drugs have skyrocketed in the U.S. over the past decade, according to a new report by researchers at the University of Michigan. The study estimated that more than 13,500 children were born with what is known as neonatal abstinence syndrome essentially symptoms of drug withdrawal in 2009. Thats compared to about 5,000 back in 2000. The studys authors speculated that the widespread prescriptions of painkillers among adults has driven up the incidences of addicted newborns. The number of expectant mothers on such drugs have increased vefold. Black market demand for such drugs has also soared, primarily in poor and rural areas. "Recently, the Centers for Disease Control and Prevention released a report which found that over the last decade sales for opiate pain relievers like OxyContin and Vicodin have quadrupled," said Stephen W. Patrick, M.D., fellow in the University of Michigan's Division of Neonatal Perinatal Medicine. Although our study was not able to distinguish the exact opiate used during pregnancy, we do know that the overall use of this class of drugs grew by ve-fold over the last decade and this appears to correspond with much higher rates of withdrawal in their infants." Meanwhile, the cost of treating such newborns has leaped 35%, from $39,400 in 2000 to $53,400 in 2000. Nearly 80% of newborns treated for the syndrome were covered by the Medicaid program. Citing the fact that such infants often require much more medically complex care after their births than other children, the studys authors suggested increased public health measures to cut the number of addicted newborns. Too often our health system reacts to problems! instead, we must address opiate use as a public health issue. To do this, we must limit opiate pain reliever use through healthcare provider education and statewide systems that watch for abuses, like people going to multiple doctors to get opiate prescriptions," Patrick said. The studys ndings were published in the most recent issue of the Journal of the American Medical Association.

In Brief
according to a new report by Mark Farrah Associates. Mark Farrah reported that sales of the supplemental policies grew 7.5% in 2011 compared to 2010, while the total number of people enrolled in such policies grew an overall 1.9%, reaching enrollment of 9.9 million last year. Altogether, Medigap insurers collected $21.4 billion in premiums from policyholders and processed more than $17 billion in claims. Plan F coverage is the most popular option for consumers, purchased by 47% of those seeking Medigap coverage last year. Plan N, which was introduced in June 2010, has sold about 265,000 policies to date. More data about the Mark Farah survey is available at www.markfarrah.com

Coury Named New President of Ohio Health Care Association

The chief operating ofcer of Generations HealthCare Management in Berea, Ohio has been named president of the Ohio Health Care Association. In addition to his executive position, Michael Coury has served for nine years on the board of the Ohio Board of Examiners of Nursing Home Administrators. The association represents about 700 long-term care and skilled nursing facility operators, which is home to about 1.7 million Ohioans. "My commitment to you over the next year is to continue our effort to stop the erosion of resources which make a difference to those 1.7 million lives," Coury said during his inaugural speech. "My request of you is to continue to provide the quality, efcient, and innovative services we are known for."

Cardinal Reports Quarterly Earnings

Modest Revenue Growth, Acquisitions Fuel Rise
Cardinal Health, the Ohio-based pharmaceutical and medical equipment supplier and distributor, reported signicantly improved earnings on modest revenue growth for the third quarter of scal 2012. Cardinal reported net income of $333.4 million for the quarter ending March 31, up 36% from the year-ago quarter. Revenue was $26.9 billion, up 3% from the $26 billion reported during the third quarter of 2011. The bump in net income was attribiuted mostly to writeoffs pertaining to recent acquisitions, as well as modest gains from the sales of assets. Cardinals acquisition of P$ Health was reduced in fair value in a way that boosted the companys bottom line by $55 million during the quarter. Cardinals pharmaceutical division, by far the companys largest, reported a 9% increase in prot, to $446 million from $411 million during the third quarter of scal 2011. Although the protability of Cardinals much smaller medical segment dropped 17%, to $89 million for the quarter compared to $108 million during the year-ago quarter, revenue was up 8%, reaching $2.4 billion. Our Medical segment fundamentals showed continued momentum, but as anticipated, prot was negatively impacted by the cost of commodity inputs, said Cardinal Chief Executive Ofcer George Barrett. However, we see the year over year impact of this dynamic subsiding in the fourth quarter of scal 2012 and into scal 2013." Cardinal revised its earnings forecasts for the remainder of 2012 to between $3.15 and $3.20 a share. Just prior to releasing its earnings report, Cardinal announced it had bumped its annual divided from 21.5 cents a share to just under 24 cents per share.

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Payers & Providers

OPINION

Page 4

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The Dangers Of Depending On EMRs

Sloppy Inputting Has Potential of Endangering Patients
In our rush to establish a national electronic When EMR developers and their hospital medical record (EMR) system, powerful silos of administration customers purchase software independent EMR systems have sprung up capable of spewing forth completely useless and nationwide. While most systems are being potentially lethal information about our patients developed responsibly many have been that is then transmitted far and wide, (not to developed without an objective eye toward mention to local direct caregivers) doctors have quality and the potential harm they may be an obligation to speak up. causing our patients. These kinds of documentation Since 2005 the medical device problems are the EMR's Achilles' heel. industry in which I work has had But beyond this, EMR software updates widely publicized instances of are routinely deployed without realpatient deaths splashed all over the world, real-life testing. And yet, like New York Times from debrillator patients with a debrillator who die malfunctions that resulted in a just outside the hospital before a root cause a few patient deaths. The backlash of a debrillator defect can be in response to these deaths was discovered, I acknowledge that it is signicant: device registries were incredibly difcult to prove that the developed, software improvements death of an individual was caused by to devices created, and legal fees an EMR software problem. By and damages were paid to patients So how will we measure problems with Westby G. Fisher, EMRs? It seems industry representatives and their families on the path to improvement. In addition, we also would rather not address these M.D. learned about the limits of concerns. We should ask ourselves, is corporate responsibility for these deaths thanks anyone thinking about this? to legal precedent established by the Reigel vs. Right now, the prevailing belief is that the Medtronic case. electronic medical record might be one of the This week I received a medical record from a most important medical devices doctors have at large academic medical center that has one of our disposal to care for patients. I tend to agree. these new pioneering EMR systems But it's potential to do harm is also enormous if it manufactured by $13 billion-dollar company is not used responsibly and accurately. After all, Cerner Corp. I have never personally used as the above example shows, the potential to Cerner's system, but I am a doctor who introduce unintended yet potentially lethal errors received a note composed on Cerner's system into patient care is huge. More importantly, since and what I saw was one of the better examples nearly every person in the United States will soon of how EMR's are contributing to have their medical data housed within these misinformation and confusion when health care systems, the number of people that could be is delivered. adversely affected by them is much larger than I received a copy of an internal medicine what we've seen with our recent debrillator consult that was performed on a patient at this malfunctions. outside hospital. I was terried at what the Perhaps, like the ICD registry, we should try to system had listed as the patient's medications: develop an EMR registry of adverse patient outcomes caused by these software systems. That I saw multitudes of medications listed more way, every independent EMR company can learn than once; drugs of similar classes from the other's mistakes. Because, like other (antihistamines, beta blockers) on the same list; man-made medical devices, EMR's are not perfect warfarin without a dose included; and what either. seems to be outpatient meds mixed with inpatient meds. Honestly, I really had no idea Westby G. Fisher, M.D., is a cardiologist at North what medications are actually being taken from Shore University Health System in Evanston, Ill. this list. This article is adopted from his blog. What the heck have we created? Certainly, any capable physician who cares for patients would Op-ed submissions of up to 600 words are describe this medication list as worthless. So welcomed. Please e-mail proposals to why is it in there? editor@payersandproviders.com

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