Wednesday, January 31, 2007

New Chairman


In a surprise move to some, the Board of Trustees elected a new Chairman for 2007. He is one of the newly appointed Board members and not one of the existing members on the board.

The newly elected Chairman is Jerrol Miles who was voted in by a majority of the members. with a 5:4 split.
He gave a wonderful acceptance speech and spoke of his qualifications and long tenure on many other boards as well as in the banking industry. He has served on the Hospital Foundation Board and has dealt with many healthcare entities over his years of service.
The other candidate who received votes for the Chair position was Ms. Mame Garner who is currently beginning her 4th year on the Board. She along with Mr. David Atkins will both be up for reappointment at the end of this year.
Mr. Don Gibbons was voted in as vice-chairman, Mrs. Kay Garry as secretary, and Mr. Keith Megraw recieved the other elected position.
We wish all of our newly elected members a good and productive year.

Tuesday, January 30, 2007

Premiums slow




Health insurance premiums have seen a steady decline in growth over the past few years, but why it is occurring is summarized in Modern Healthcare Online.

The insurance industry loves to take credit for this and as stated in the article,

America's Health Insurance Plans immediately issued a news release attributing the slowdown to its members' "cutting-edge" cost-control efforts, such as tiered prescription-drug formularies, pay-for-performance initiatives, and disease-management and prevention programs.

"Our community has reinvented cost-containment strategies and is deploying a new generation of tools and techniques to stretch healthcare dollars and mitigate the burden of rising medical costs," AHIP President and Chief Executive Officer Karen Ignagni said in the news release.

But as always, there is the rest of the story.

Providers argue that large insurers, many emboldened by a spate of recent megamergers, have been able to ease up on premiums predominantly because they've been clamping down even more on reimbursements. "These `savings' are coming off the backs of providers," said Martin Wasserman, executive director of the Maryland State Medical Society.

"Insurers are using their market dominance to hold hospitals hostage," added Gary Gaube, president and CEO of 150-bed Landmark Medical Center in Woonsocket, R.I

The real impetus for the slower rise in premiums is probably related more to the demands of frustrated employers who are choosing to drop insurers altogether because of the double digit rises year after year while watching the insurers post huge profits.

"Employers are putting pressure on insurers to demonstrate their ability to hold down costs, and clearly a lot of that is being driven through tougher negotiations with providers," said Henry Loubet, chief strategy officer for insurance broker Keenan & Associates and former CEO of UnitedHealth Group's Western operations.

It used to be that large Hospital entities would throw their weight around and force insurers to cough up more money. But according to some recent data, the power is shifting back to the insurers.

This really rings hollow with many physician providers when we see large insurers, including many of the nation's not-for-profit Blues plans posting record profits, boosting their reserves and paying executives hefty salaries and perks. An example is the Rhode Island Blues that holds $326 million in reserves and is expected to post $60 million to $70 million in operating profits this year.

Physicians are legally restricted from collective bargaining and therefore cannot do what the hospitals and insurers have continually done. Therefore, we become the easiest target for the financial cuts along with the patients who also have limited voice.

As WCA President Bill Mooney said, "Here we have hospitals and doctors who are in real trouble, and then we have the paper-pushers walking away with carloads of money and not wanting to help the industry where they make all that money. There's something very wrong with this picture."

Monday, January 29, 2007

The New Year


We begin this week in anticipation of the first Board meeting of the year with the addition of the newest members. This will take place Tuesday night.

We are excited and hopeful that we will see some real and substantial changes as we proceed into 2007.

Recently, eleven members of the active Medical Staff invited the four newest Board Members out to dinner. It was very enjoyable and casual and allowed each of us the opportunity to get to know each of them and offer our services for consultation when issues arise.

The stated goals of meeting were:
1.) To build a relationship with Board members
2.) Educate members on issues and problems
3.) Improve quality of care
4.) Help ensure success of FMHHS

To this end, the meeting was a great first start and we look forward to doing this again. There was lots of open discussion on a variety of topics and the Board members asked some very good challenging questions.

It is refreshing to have Board members willing to tackle some very challenging problems.

Friday, January 26, 2007

Giving her a hand


Patrons of exotic dance establishments are reported to always be looking for ways to ingratiate themselves with favorite entertainers in hopes the dancers will sometimes grant these patrons some level of access to their real lives.

In New Brunswick, N.J., a doctor has pleaded not guilty to stealing a hand from a New Jersey medical school cadaver and giving it to an exotic dancer.

The dancer evidently had a penchant for body parts other than typically highlighted at the establishment. The physician is a 2005 graduate of the University of Medicine and Dentistry of New Jersey and was charged Monday after voluntarily returning from Los Angeles where he is in an Emergency Medicine residency program.

The hand was found in a jar of formaldehyde in her bedroom along with six human skulls.

The discovery was made when police were called on a report of the roommate being suicidal. The dancer pleaded not guilty to unlawful disposal of human remains. The hand was evidently taken in 2002 according to the school and the investigation is ongoing.

The charge against the physician carries up to 10 years in prison.

It is sad how the psychopathology of both fetishes and addictions ruin so many lives.

Thursday, January 25, 2007

What to pay for?

Some states including Utah are considering mandating Insurance companies to cover gastric bypass surgery for morbidly obese residents.

The Utah legislature will consider a bill in the session that begins Jan. 15. It is being raised because a 386-pound man named Jeff Haaga urged his local state representative, Steve Mascaro, to sponsor the bill.

He reported his physician told him he would die if he doesn’t lose weight, but there is not much information about what the patient has tried or has been advised.

The patient believes the insurance company would save money by paying for the $17,975 surgery rather than covering all the care for health problems related to his obesity. These could include heart attacks, strokes, knee and hip replacements, and diabetes management.

What this patient doesn’t understand is that from the Insurance perspective, they know that on average, companies only stay with the same insurer for 2-3 years. Therefore, the insurance company would not be saving these dollars in the long run because the patient will likely be covered under another plan. It is to their financial benefit to deny services knowing many times the complications will occur when the patient is under another insurance plan.

Maryland and Indiana already mandate payment for the surgery.

The mandate is a concern for all insurance companies. Many offer it as an option that companies can choose as part of their benefit programs. But a mandate would then cause premiums to rise and many companies may not be able to afford any policies for their employees.

These types of issues get to the heart of the problem. What is considered basic medical care?

What should be covered and what should be an “add-on”?

Wednesday, January 24, 2007

Cumberland Dam Health


Recent reports about the Dam at Cumberland Lake certainly have stirred my interest as an avid boater. I was aware of some concerns, but certainly not that the Corp of Engineers placed the dam as one of the top 6 in the country for possible catastrophic failure. This is compared with 700 other dams the Corps manages.

Corps fears dam in Ky. might fail

The corps announced that it would lower the lake's pool level by 10 feet to decrease pressure on the 240-foot-high dam, which is in Southern Kentucky's Russell County. The corps has begun working to correct a problem of water seepage through the dam's foundation.

The lake would remain at the new level -- 680 feet -- for at least a year and perhaps as long as seven years, a corps official said. That's 43 feet below the normal summer pool of 723 feet. The move will leave up to 90 percent of the lake's boat ramps out of the water and raise the lake's temperature, which could have a catastrophic effect on fishing for trout and other cold-water fish, state officials said.

The financial impact on all the surrounding counties will be devastating. The striper fishing and trout fishing may be irreparably damaged by this change. I know many people with property, houseboats etc. who regularly recreate at Lake Cumberland, and it will certainly be much more difficult to do all of these activities.

Anyone who has visited Cumberland Dam can certainly understand the impact of what a catastrophic failure would do to the communities downstream. The tremendous amount of water held in Lake Cumberland would flood and destroy communities well into the Nashville area.

Tuesday, January 23, 2007

JCAHO retirement

It appears that the JCAHO has certainly done well in the past few years. According to Modern Healthcare Modern Healthcare Online, they paid their retiring CEO (a physician) almost 1.2 million dollars in 2005. They are calling him the 2 million dollar man. Some excerpts are:

The impending retirement of Joint Commission on Accreditation of Healthcare Organizations President Dennis O’Leary boosted his 2005 total payout by almost $1.2 million, according to a federal tax form filed last week by the group.

But it was the expected retirement of O’Leary at the end of next year that prompted the need to recognize the value of previously reported deferred compensation payments, which pushed his total compensation and benefits to $1,972,598 in 2005 from $875,231 in 2004, according to Rodgers.

It appears that deferred compensation is getting more and more attention with all areas of healthcare CEO’s.

The article went on to say that the majority of the revenue generated by JCAHO is from the fees charged to the facilities it is surveying.

That’s a lot of money to spend for someone to come to your organization and find every deficiency.

As many have mentioned in previous postings, there are certain public perceptions about Floyd Memorial no longer being JCAHO credentialed.

Monday, January 22, 2007

Another startling study

Here is another one of those studies that you really wonder who funded it.

In a recent edition of the Journal of the American Medical Association they came up with the following startling conclusions that Men tend to live longer if:


  • During their middle-years (average age: 54) they avoid certain unhealthy behaviors
    such as “smoking,
    being overweight,
    excessive drinking
    and hypertension”
    while attempting to remain “physically robust in midlife.


One writer in Modern Healthcare stated that this came from their "Department of Obvious Conclusions" and “This is consistent with theories of aging that suggest that better-built organisms last longer.”

Friday, January 19, 2007

Law of heredity


Many parents out there would agree there are few things more challenging than being a parent.

There are also few things more rewarding.

Since children do not come with an instruction book, we are poorly prepared for the task.

You will always find some helpful comments and here are a few.

• The law of heredity states that all undesirable traits come from the other parent
• You don't need a remote control for your television; if you have children, the chances of controlling anything are already remote.
• If you don't want your children to know what you are saying, pretend you are talking to them.
• More ominous than the sound of an approaching riot is the sound of children suddenly quiet.
• A quote from Ralph Waldo Emerson; “There never was a child so lovely but his mother was not glad to see him asleep."
• If your wife doesn't treat you as she should, be thankful

Thursday, January 18, 2007

Fulfillment

Medical economics published a recent article on fulfillment in Medical Practices. Exclusive Survey: Is your practice fulfilling? - We asked doctors whether the complexities of modern practice life were undermining their effectiveness and their satisfaction. - Medical Economics


The article points out numerous trends and observances:
Nearly 1/3 stated they were no more than somewhat effective with their patients.
More older doctors gave themselves higher effective scores
Primary care physicians were less likely to rate their performance as “very effective”
The higher the effectiveness rating, the higher the satisfaction
Thirty three percent of primary care respondents said they would choose another specialty.
.

With this much formal education, time, training, and expense, it makes you wonder how other career choices would rate on a similar survey

Wednesday, January 17, 2007

Top 3 Challenges

Nearly every major healthcare publication is reporting on the recent survey that polled CEO’s around the country. The results revealed that doctors ranked No. 2 on hospital chief executive officers’ list of most significant challenges for 2006.

This result ousted the nation’s chronic shortage of healthcare workers from CEOs’ top three concerns for the first time in the American College of Healthcare Executives’ fifth annual poll.

This should not come as any surprise to anyone who has followed this blog for the past 2 years. I have repeatedly stated that the relationship challenges between hospitals and physicians are significant and there needs to be a paradigm shift.

Financial challenges ranked as the top concern for CEOs surveyed despite the industry’s record revenue of $544.7 billion and $28.9 billion aggregate profit in 2005.

Thomas Dolan who is the president of the American College of Healthcare Execs said that “hospitals and physicians both face financial pressures and will need to find new types of joint ventures to offset their respective risks and financial losses.”

Doctors’ incomes haven’t fared as well as other professionals in recent years, he said. Dolan cited a June report by the Center for Studying Health System Change that found physicians’ inflation-adjusted income fell 7% between 1995 and 2003. Meanwhile, U.S. professional and technical workers’ real income rose 7%, according to federal labor data.

Partnering with physicians is the surest way to maintain a successful hospital. Operating costs, Medicaid reimbursement and bad debt continue to be the three most troublesome financial challenges and hospitals and physicians need a collaborative effort to survive.

Tuesday, January 16, 2007

Glimmers and Bashing

On a recent posting, a commenter stated “Enough with all this boring blogs, lets get back to Bashing Floyd Memorial Hospital. Lets bring back the "Glimmer Of Hope" as a Part II blog. Its much more interesting.”

I see several issues with this response.

First, we have to get out of the mindset of relating the Hospital to the current Administrative leadership. Bryant Hanson (CEO) and Floyd Memorial Hospital and Health Services are two very distinct entities. For some reason, many people cannot separate them and refer to them as one in the same.

The employees on the front line and in the trenches make Floyd Memorial. They are the heart and soul of the institution and continue to try and overcome the tremendous challenges placed upon them by this administration.

The problems and concerns related to Floyd have not been related to employees. The “bashing” as it was stated has mainly concerned the decisions made by the current leadership including the Board.

Our hospital will rise to the challenges placed before it by this leadership and will eventually overcome some of the decisions that have been made.

The glimmer of hope many of us feel is the fact that this administration is on its way out as recently validated by the CFO “resigning”. If the 2007 financial situation continues to decline, we will see other changes being made.

Then we can look forward to bringing our Hospital back to its admired and trusted status.

Monday, January 15, 2007

Better performance

A recent report by the MGMA (Medical Group Management Association) defined some benchmarking standards that demonstrated what makes some medical practices perform better than others.

The key points were:



  • The first benchmark in successful practices is they employ productive physicians. The data showed better-performing practices perform more procedures and take steps to ensure productivity.

  • They offer profitable ancillary services. The better-performing practices readily adopt new services and technologies and acquired new information technology and billing systems.

  • They hire enough support staff and the ratio to physicians is higher in the better-performing practices.

  • They get the money they are owed and are much better at accounts receivables management. They do a better job of collecting co-pays and deductibles at the time of the visit.

  • They spend more and have higher operating costs, but overall make more money in the long run.


The bottom line is that the better-performing practices demonstrate a commitment to patient satisfaction, benchmarking their practices, maintain strong effective leadership and are not afraid to invest time and money on improvement for the ultimate goal of success.

Friday, January 12, 2007

Tiger's Yacht

Ever since the golfer Greg Norman got his big yacht, people around the world have marveled at how big it is.

Well, Tiger Woods has earned a lot more money playing golf than Greg Norman, and he invested it in all the right places so he too could have a yacht.

Recently, Tiger sold his old one, and withdrew some of his money and bought a new yacht. He had it decked out to his specifications, with all the things he wanted on a yacht. He secretly did all of this until the yacht was ready to set sail.

A photographer on assignment to photograph sea turtles in the ocean happened upon the yacht during its initial shakedown cruise, and got the first photo of his new yacht.




This was sent by a friend and thought it appropriate for all my golfing friends

Thursday, January 11, 2007

Winter crunch

Diversion issues continue to hamper all the local hospitals and are anticipated to worsen as the weather changes and the winter illnesses arrive.

RSV (respiratory syncytial virus), Rotavirus, and influenza are all anticipated to increase in frequency as is the normal pattern this time of year.

These will burden the understaffed beds currently available. Floyd has implemented a diversion plan we hope will help, but it certainly will not solve the shortage of beds.

Floyd has elected to convert some of the private rooms back into semi-private rooms to help with the crunch. This probably won’t help the public relation and patient satisfaction results, but it will help physicians treat more patients more effectively.

This move is opposite the stated goals and public comments made last year when the new addition was built but certainly validates the comments of many physicians and others who criticized the expansion without significantly increasing the bed numbers.

But for now, we are able to care for more patients and limit the amount of diversion days and times. That will be good for everyone.

Wednesday, January 10, 2007

Newest Appointees

Recently, our County Commissioners made the final Board of Trustees appointments to Floyd Memorial Hospital and Health Services. They replaced the current Chairman of the Board by not reappointing him to a third term and they replaced Darrel Mills who became our new Sheriff in January. We wish Darrell success in his new job.

The two newest appointees are in addition to the two they added in December for 1 year terms. The four new members are:

Dr. Guy Wall Professor of Education at Indiana University Southeast on a 1 year term.
http://homepages.ius.edu/GWALL/

Mr. Jerrol Miles on a 1 year term.

Dr. Stuart Eldridge (Pediatrician) on a 4 year term.

Mr. Don Gibbons on a 4 year term.

These four will join the existing five that includes Ms. Mame Garner, Von Marshall, Kay Garry, David Atkins and Keith Megraw( http://www.healthinsurancebydesign.com/ )

The Medical Staff is very hopeful that the newest members will keep an open mind to the current situation and not shy away from challenging some current ideas and practices.

With the “resignation” of the CFO, many are hopeful that this may be the stimulus for some necessary changes to enhance and secure the future of FMHHS.

Tuesday, January 09, 2007

Socialized Medicine shortages

Socialized medicine may help some people get basic medical care, but it is not the answer to our Healthcare problems in the United States.

Physicians per 100,000 people in the US averages about 275-300 with a range from a low of 170 in Idaho to more than 440 in Massachusetts. In Britain, they have 166 doctors per 100,000 of the population, while France and Germany have more than 300 doctors per 100,000. Most other areas in Europe have much, much lower numbers and places like Ghana has just 9 physicians per 100,000 of the population.

Recent articles from the BBC and other European publications continue to demonstrate that socialized medicine does not meet the needs or expectations of patients or physicians.

Here are a few recent articles defining how the medical and dental care in Europe is declining and how more physicians and dentists are going into private practice with a fee for service payment system. This is basically becoming a two-tiered system. Those who can afford care can choose who and what they want and those who cannot afford care either do not receive it or are on a very long waiting list.

BBC NEWS UK England Doctor shortage hits waiting list plan

NHS dentist shortage is exposed News This is London

http://www.dailymail.co.uk/pages/live/articles/health/healthmain.html?in_article_id=416187&in_page_id=1774#StartComments

We have the capability to do better than this. We just need some innovative ideas, progressive thinkers, paradigm shifts, and a different mindset in our politicians.

Monday, January 08, 2007

Newest compensation numbers



Since we have recently been recieving more comments about salaries among physicians, I am showing the newest released average salaries of other types of healthcare workers.

This should put into perspective some of the comments made and the disdain some readers seem to have toward physicians.

These are the latest figures on average hospital based employee salaries. All of these have consistently shown increases. Physicians salaries on the average have decreased by 7% or more based on the most recent Medical Economics figures.





All areas of healthcare have seen increases in compensation and the perks that go with working at a large institution like hospitals also add to the appeal of these jobs.

Every one of these salaries is far above the average american wage as has been stated.



Are these salaries outrageous?

Do they represent fair compensation?

Does the educational requirements needed to attain these positions meet the readers expectations or should we have government regulate all of these wages?

Friday, January 05, 2007

Exploiting nurses.


A restaurant in Phoenix has caused some controversy for exploiting health care workers (particularly nurses).http://www.heartattackgrill.com/

Several national organizations as well as the local nurses are outraged the restaurant is making money by appealing primarily to male fantasies.

Their menu has items like single bypass burger up to quadruple bypass burgers and flatliner fries.

The grill owner refers to the complainers as being “prudes”, “cranks” and “lunatics”.

The attorney generals office did force the owner to stop using the word nurse at his restaurant, but the website still shows it quite plainly. There is now a disclaimer regarding the word nurse.

Our employees receive the highest base pay in the industry and we have insurance programs available for both full and part-time employees. Rather than paying the lowest possible wages that we can get away with, we pay them the highest possible wages that we can get away with. Our Nurses* work hard and deserve to be rewarded by sharing in our success.

The element of sex appeal is prevalent at the grill, and we believe that our Nurses* are as socially acceptable as the all-American cheerleader. Our "famous" Nurses* are an important part of the Heart Attack Grill experience. We hire women who best fit the classic image of a loving and understanding confidant. Claims (by PC Nazis) that we exploit beautiful women are as ridiculous as saying the NBA exploits men who are tall and athletic. Our Nurses* have the equal right to use their female sex appeal and natural charm to earn a living as do actresses and super models. We applaud the women's rights movement because it guarantees that women have the right to choose their own careers. It should be known that women occupy the majority of management positions at the Heart Attack Grill.

Taste Worth Dying For® is more than just a slogan, it's the core of a philosophy which understands that life is short so one should "Eat, Drink, and be Merry!"


*The use of the word "Nurse" above is only intended as a parody. None of the women pictured on our website actually have any medical training, nor do they attempt to provide any real medical services. It should be made clear that the Heart Attack Grill and its employees do NOT offer any therapeutic treatments (aside from laughter) whatsoever



The question is whether this is objectionable, in poor taste, or just freedom of speech and expression?

Thursday, January 04, 2007

Not-for-profit perks

Senator Chuck Grassley who most know to be very critical of our current healthcare environment recently released his latest findings on a survey about charity care and community benefits provided by not-for-profit hospital systems.

One of the results related to the survey deals with the perks offered to CEO’s of these non-profit systems. Country Club dues being paid has come into question. A couple of the comments were as follows:

• American Hospital Association spokesman Richard Wade said hospitals began reimbursing administrators for country club dues decades ago because administrators were often the hospitals' chief fundraisers. "In some cases hospitals have dispensed with those practices and in others they have not.” Wade said.

• North Mississippi Vice President and General Counsel Bruce Toppin said when he moved to Tupelo 10 years ago there weren't many restaurants. "In a small town like Tupelo, country clubs are places for social interactions and places to eat. We brought the issue of country-club dues to our compliance committee and said while it wasn't illegal, it didn't look right. The people we were paying for could afford it," Toppin said. "So we stopped doing it at the beginning of the year."


In this ever-increasing struggle to meet financial goals, Boards need to go back and reassess why some of these perks continue. Using the rationale that it has always been done that way, or everyone is doing it will not continue to hold water. Grassley stated “it is especially troubling that executive after executive is having country club dues paid for by nonprofit hospitals."

Senator Grassley plans to begin scrutinizing the many other perks in nonprofit hospitals such as expense accounts, cars, clothing allowances, donations, and the salary packeages of the executives.

Wednesday, January 03, 2007

Vehicle inspections end in Clark, Floyd Counties

Here is a memo sent out from the Governor's office related to emissions testing. This is a lot of money that will be saved for the State. We just hope the savings leads to something worthwhile. I wonder if there has been any significant health benefits for the cost of this program over the years.?

INDIANAPOLIS (January 2, 2007) - The vehicle inspection and maintenance program in Clark and Floyd counties ended on December 31. As first announced in May, Governor Mitch Daniels said the testing program, Clean Air Car Check, is no longer needed to maintain compliance with the health-based federal ozone air quality standards for the two counties.

"Any day we can return a dollar in lower taxes or a little bit more freedom to Hoosiers is a good day. Vehicle inspections may once have made sense, but there was no longer any good reason for government to impose any burden of cost or lost time on the people of Clark and Floyd counties. I only wish Jim Bottorff could have been here to join us in this announcement," said Daniels.

Vehicles registered in Clark and Floyd counties account for only a small percent of the total vehicle traffic in the metropolitan area and have a minimal impact on local air quality. The testing station in Floyd County closed in November, and the Clark County station closed at the end of the year.

"Hoosiers have invested heavily in clean air and proved it through more than a decade of clean fuels and vehicle testing," said Thomas W. Easterly, Indiana Department of Environmental Management commissioner. "It's time to liberate the economy of Clark and Floyd counties from unneeded testing and restraints."

The Indiana Department of Environmental Management conducted a hearing in June to accept public comment about the redesignation of Clark and Floyd counties as attainment for ozone. The petition for redesignation has been submitted to the U.S. Environmental Protection Agency with a demonstration that the area will continue to meet the federal ozone air quality standard without the inspection and maintenance program.



Office of the Governor media contact: Jane Jankowski, 317/232-1622,
mailto:jjankowski@gov.in.gov
IDEM media contact: Amy Hartsock, 317/233-4927, mailto:ahartsoc@idem.in.gov



Eric Holcomb
Director, Intergovernmental Affairs
Governor Mitch Daniels
mailto:eholcomb@gov.in.gov

Tuesday, January 02, 2007

Competition or Regulation??

Here is an OP-ED from Modern Healthcare that is worth reading in its entirety. It can be found at the following address: Modern Healthcare Online

Hospitals’ predicament
Will better patient care come from competition or regulation?

By: David Burda, Editor
Story posted: December 11, 2006 - 9:14 am EDT

If you’re on the fence about health planning, two major stories that broke over the past two weeks should shove you into one camp or the other.


On Nov. 28, a legislatively established commission in New York released its report on overhauling the state’s healthcare system. As New York Bureau Chief Cinda Becker reported in our Dec. 4 issue (p. 6), the commission recommended reducing hospital beds in the state by 7%, or about 4,200 beds (including closing nine hospitals) and reducing nursing home beds by 3%, or about 3,000 beds.

The commission’s recommendations are binding unless the state Legislature acts to rescind them in their entirety. The process represents the ultimate form of regulatory health planning. The state of New York will decide which hospitals and nursing homes stay open, which will close and which will be forced to reduce their capacity.

Two days later, on Nov. 30, University General Hospital Systems, a privately owned, for-profit hospital company, announced plans to build 10 physician-owned, acute-care hospitals in select markets across the U.S. in a $1 billion deal with an outfit called Alliance Development Group out of Charlotte, N.C. The prospect of a national chain of physician-owned, general acute-care hospitals is the subject of this issue’s cover story by reporter Jessica Zigmond (p. 6).

The University General announcement represents the ultimate form of competition in healthcare. Unshackled from the recent federal moratorium on physician-owned specialty hospitals and targeting states with little or no health planning laws on the books, University General poses a threat to other hospitals in those markets. That could result in hospital closures and bed reductions—but from competition, not regulation.

Given those polar-opposite scenarios, would you rather be a hospital administrator in New York right now or a hospital administrator in a city where University General intends to open up one of its 10 physician-owned facilities? It’s a real test of your belief in regulation or competition as the option for improving care, controlling costs and expanding access.

Perhaps it depends on your personal situation. If you’re running a hospital in New York that’s on the commission’s hit list, Dallas, Denver or Phoenix don’t sound so bad right now. You’d have a chance to fight for your hospital’s survival and your job.

If you’re running a hospital in New York that was spared only to see a former competitor go down, life is good. But if you’re running a weak sister in a city where University General is holding a ribbon-cutting ceremony with your smiling chief of staff, New York in January may seem like heaven.

As firm believers in the benefits of healthcare competition for patients, you know where Modern Healthcare comes down on this issue. The market should decide which hospitals survive, which ones downsize and which ones close.


Those fates should be determined by value: access to the best possible care for the lowest possible price. And the only way to get there is through competition, not regulation. That’s why we consistently advocated abolishing state certificate-of-need laws.

Millions of dollars will be spent on lawyers, consultants and appeals by hospitals in New York fighting the commission’s recommendations before the first bed is put out of service. That’s millions of dollars that could be plowed back into those hospitals to improve their services and make them more competitive.

And in markets where University General is coming to town, existing hospitals will spend millions to gird themselves for the vigorous competition. New buildings, the latest medical technologies, better information systems, more qualified doctors, more nurses and expanded services. The result will be greater access to better care for patients at competitive prices. No form of healthcare regulation can do that.

Monday, January 01, 2007

2007

I hope everyone has survived 2006 and looking forward to 2007.