Payers & Providers – Issue of April 22, 2010

8/9/2019 Payers & Providers Issue of April 22, 2010

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As Universal Health Services Inc. battles tokeep two of its hospitals in RiversideCounty open after state and federal officialsclaimed they are endangering patients,

compliance issues are delaying its openingof a new hospital northeast of Los Angeles.CDPH announced on April 15 it would

move to rescind UHS license to operateSouthwest Healthcare System. That consistsof two properties:122-bed RanchoSprings MedicalCenter in Murrietaand 96-bed InlandValley MedicalCenter in Wildomar.CDPH officials citedpersistent problems

involving infectioncontrol, nursinglevels and failures tomaintain appropriatehumidity levels in itsoperating rooms.Federal regulatorsalso took the rarestep last week of moving to strip Southwestof its participation in the Medicare andMedi-Cal programs, effective June 1. UHSsaid it would appeal the CDPH move, andcould reach a settlement with the Centers

for Medicare and Medicaid Services toretain its funding.

Meanwhile, Palmdale RegionalMedical Center has sat all but finished

since the fall of 2009, but remainsunopened. It is the biggest constructionproject ever undertaken by UHS, a for-profit operator based in King of Prussia,Penn. The facili ty, perched on a prime

spot of real estate onthe southern edge ofthe Antelope Valley, isto open with 127beds, with plans toexpand to 240. Theproject is expected tocost around $400million.

But PalmdaleRegionals buildershave had to grapplewith leaky windows,buggy firesuppression systemsand other issues,according to the

Office of Statewide Health Planning andDevelopment, which must certify thehospital as being safe to occupy. AfterOSHPDs approval, its operating systems

Universals California Woes MountNew Palmdale Hospital Having Compliance Issues

California Edition

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Payers & Providers

must be inspected and certified by theCalifornia Department of Public Health(CDPH). Only then may it open for

business.OSHPD spokesman David Byrnesinitially issued a statement earlier thisweek that there is no opening date forthe hospital anytime soon. He laterrevised that to say Palmdale Regionalcould receive certification from his agencysometime next month echoing a timelinesuggested by an official with LancasterCommunity Hospital, another UHSproperty nearby whose management teamwill take over Palmdale Community onceit opens.

However, Byrnes issued another

statement late Wednesday afternoonsaying that there are numerous itemsremaining to be completed, some smalland some large.

According to Byrnes, some 160windows have had to be replaced due toleaks; the fire-control system is notfunctioning properly; and the hospitalscontractor has yet to address issuesinvolving water chlorination and theinstallation of other equipment.

Both CDPH spokesman RalphMontano and UHS spokeswomanMaryAnn Ninnes say that the difficulties at

Southwest will not affect PalmdaleRegional. But for more than a year, CDPHhas refused to license a completedexpansion at Rancho Springs until itaddresses operational deficiencies theagency says go back as far as 2007.

In turn, Southwest has taken aparticularly combative stance with theagency. It has denied the allegations

Page 2

CDPH has made in its administrativepenalties, claiming that patients were nevein danger. It also blamed the penalties in

part on CDPHs refusal to license theRancho Springs expansion, which includesa neonatal unit, additional operatingrooms, and a much larger emergencydepartment.

Southwest is also very disappointedthat CDPH chose to issue these penalties inlight of the extraordinary efforts Southwesthas made to correct any compliance issuesand the cooperative relationship developedwith CDPH in that endeavor, the statemenconcluded.

Southwests response surprised SteveRivkin, a hospital crisis communications

consultant in Glen Rock, N.J.The basic tenets of good crisis

communications is to deal with the issue ahand, take action, demonstrate there is aplan, attack the problem and indicate it isbeing worked on, and work on it ascandidly as possible, Rivkin said, althoughhe added that Southwest has the right torefute any charges made against it.

At least one industry observer believesthat the troubles at Southwest have broughheightened attention to Palmdale RegionalMedical Center.

Im sure theyre going to look more

closely, said Steven T. Valentine, presidenofThe Camden Group, a hospital andmedical group consulting firm in ElSegundo, and member of the Payers &Providers editorial board. Anytime youhave an operator with serious licensingissues regarding another facility, theregulators are going to want to make surethose issues do not repeat themselves.

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In Brief

Childrens Hospital ofOakland Restructures

Attempting to cut a projected $26million decit for the current year,

Childrens Hospital of Oakland has cut17 jobs and will develop additionalbusiness opportunities.

We are making these changes nowto ensure we are scally sound andable to carry out our mission toprovide the highest quality pediatriccare to all children said ChiefExecutive Ofcer Bertram Lubin, M.D.Lubin took over the 178-bed facilitylast August.

In addition to cutting staff, some ofthe hospitals outpatient services willbe outsourced to community clinics.Additional sources of funding are alsobeing sought from the state and federalgovernments.

The restructuring Lubin announcedthis week is expected to shave $10million off its projected 2010 decit.

Childrens Hospital has lost $80million over the past four years.Hospital ofcials attributed the lossesto the poor economy and low levels ofreimbursement for patient care,

Blue Shield LaunchesSocial Consciousness

Site

Blue Shield of California haslaunched a new website stressing

the social contributions made bythe San Francisco-based insurer.

The website, at https://www.blueshieldca.com/bsc/aboutbsc/social-responsibility/index.jhtml?WT.mc_id=otc-mem-responsibility-287, discusses BlueShields use of diverse suppliers, itsefforts to use green buildingmethods for its facilities, and itscommitment to healthcare reform.It also includes a link to the Blue

UHS (Continued from Page One)

A new survey of California voters over theage of 40 by the UCLA Center for HealthPolicy Research and the SCAN Foundationhas found that only a fraction have long-term care insurance, and less than half areprepared for the cost of such care as theyage.

Two-thirds of the 1,200 voters polled saythey worry about long-term care costs.

However, only 15% had any long-term careinsurance.

Fifty-eight percent say they are unpreparto pay for long-term care if they could nolonger care for themselves. A third of thosesurveyed say they cannot afford even a singlemonth of in-home care.

Continued on Page 3

NEWS

Continued on Next Page

Poll: Long-Term Care Worries Seen

States Voters Say They Cannot Pay For Services
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Although California Insurance CommissionerSteve Poizner is running well behind in hisbid to become the states next governor, hisagency is way ahead on a potential insurancescam.

Poizners ofce issued a statement earlierthis week warning of individuals who aregoing door-to-door, using high-pressure salestactics to convince people to buy potentiallybogus insurance coverage. Such offers wouldbe coupled to high-pressure sales tactics,including claims that purchasing insurance is

mandatory, and that actitious limitedenrollment period exists.

The provision requiring purchase ofinsurance coverage in lieu of a nancialpenalty does not go into effect until 2014.

Scam artists will use any opportunity toexploit consumers, and the passage of the newfederal health care legislation is noexception, Poizner said in a statement. Iurge Californians shopping for healthinsurance to be wary of agents, brokers oranyone pressuring them to purchase a policy,and to call the Department of Insuranceimmediately if illegal behavior is suspected.

Page 3Payers & Providers

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NEWS

In Brief

Shield of California Foundation, itscharitable arm.

As a not-for-profit, mission-driven health plan, we care aboutthe communities we serve andbelieve that a healthy Californiastarts with socially responsiblebusiness practices, said Blue

Shield Chief Executive OfficerBruce Bodaken. That's why we'vemade corporate citizenship apriority and have taken steps toalign our business processes withour community, environmental andpublic policy efforts.

Plans Agree toImplement AgeExpansion Early

Most of the nations health planshave agreed to extend coverage tochildren under the age of 26immediately.

The rule, enacted as part ofnational healthcare reform lastmonth, was not scheduled to gointo effect until Sept. 23. But thedelay was expected to causeseveral hundred thousand youngAmericans to lose coverage,particularly as they graduated fromcollege later this spring and movedout of their parents homes.

By proactively making thischange now, Blue Cross and BlueShield Plans are working toenhance and preserve coverage foras many Americans as possible,said Scott P. Serota, chiefexecutive officer of the Blue Crossand Blue Shield Association, whichrepresents 39 plans nationwide.

BCBS members include SanFrancisco-based Blue Shield ofCalifornia and Blue Cross ofCalifornia, whose parent company,WellPoint, Inc., is based inIndianapolis.

According to the U.S. Department ofHealth and Human Services, at least 70% ofAmericans over the age of 65 will need long-term care services at some time in their lives.In California, the average nursing home costs$6,000 a month.

As for potential solutions, 66% say thatproviding affordable care options in thecommunity should be a high priority forelected ofcials. Although there was somedivision on this issue along political lines,

50% of Republicans and 76% of Democratssay more affordable options should bepresented.

You shouldnt have to go broke to gethelp, said Steven P. Wallace, associatedirector of the UCLA Center for Health PolicyResearch. Yet that is what our public policycurrently requires in order to get any publichelp with in-home or nursing home care areference to being eligible for the Medi-Calprogram.

Long-Term Care (Continued from Page Two)

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DOI Warns On Reform-Based ScamDespite Lack of Complaints, Poizner Urges Caution

The warning seems to be prophylactic innature: DOI spokesman Darrel Ng has twicconrmed with Payers & Providers this mothat the DOI has not received any signicacomplaints about such a scam. The DOIreceives about 300,000 insurance-relatedcomplaints each year.

We got some warnings from the(National Association of InsuranceCommissioners) about this, and we wantedlet some of the groups with whom we havepipelines particularly those who work wit

the elderly know about it, Ng said.Ng added that issuing a statement abosuch a scam that has yet to materialize isreasonable. If we really wanted to publicizthis, we would have held a press conferencwith cameras, he said.

Ng said the press release is not politicamotivated. Poizner, who is seeking theRepublican nomination for this yearsgubernatorial race, is running more than 40percentage points behind former eBay ChieExecutive Ofcer Meg Whitman.
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I concluded last weeks article by statingthat hospitals can increase their patientflow and efficiency by as much as 50% byemploying the lean method, thebreakthrough in manufacturing thatresolutely focused Japanese automakerson workflow issues, permitting them toleapfrog over the Big 3 in just a fewdecades.

Obviously, hospitals are serviceproviders and not large-scalemanufacturers. Nonetheless,they share one critical goal:

moving people and materialthrough predeterminedspaces within a specificperiod of time.

Given the vast pressureson the healthcare industry tocut costs, this is an obviousopportunity for providers.

How can the leanmethod work for hospitals?Case studies always serve asclear examples. Since 2006,a team consisting of myselfand colleagues from the University of

Southern Californias Viterbi School ofEngineering have focused on workflowreconfiguration for more than a dozensafety net hospitals in California.

Each hospital had similar flowpatterns for surgical patients essentially a line from admitting, throughtwo pre-operative rooms, the operatingroom, and recovery. Yet such progressionsincluded up to 25 separate steps. Everypatients transit through surgery had thepotential to be delayed if their surgeon,anesthesiologist or nurse was unavailable,or paperwork or supplies could not be

located.In the case of one Los Angeles hospital,the surgical suites were only beingutilized 60% of the time. That doesntsound terrible, until you consider that ORtime costs a hospital more than $3,000 anhour. It meant that the hospital had thepotential to capture an additional$780,000 per year per OR. With sevenORs, that is about $5.5 million annually.That figure is based only on an eight-hour,five-day workweek.

There were also ongoingcommunications issues due to the layout the surgical floor, in particular, the chargenurses office was located at a distance frthe ORs and the whiteboard the nervecenter of any surgical area. This delayedcommunications with the staff. And turnoof a surgical suite often took 40 minutes about twice as long as other hospitals. Thwould balloon to an hour if a surgeon walater. All of this contributed to delays and

extra costs.Such problems are not

isolated to this particularinstitution. The issuespresented in this case mayresolved through a variety simple methods. Surveyingwhere delays occur; usingwalkie-talkies or in-housecellular phones to improvecommunications; ensuringsupplies are available andnearby; and charging the Ocirculating nurses with theof pulling the next patien

into surgery can all lead to dramatic

improvements in performance. The drastic measure would simply berelocating the charge nursesworkstation so they may witness theworkflow in real time.Although these are all relatively

straightforward changes, they can be diffito achieve. Staffs are already overworked not always receptive to disruptions in thework routines. Yet medical staffs must idewhere cuts can be made and wherecollaborative working procedures will savtime. We all want quality healthcare - bumust also expect lean, efficient service.

OPINION

Clearing Healthcares Clutter: Part IReconfiguring a Single Surgery Unit Can Save Million

By

DavidBelson,

Ph.D.

David Belson is an industrial engineering

professor at the University of Southern

California and a healthcare manageme

consultant. He may be reached by e-ma

at [email protected].

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Op-ed submissions of up to 600 words a

welcomed. Please e-mail proposals to

[email protected], or ca

(877) 248-2360, ext. 3.


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Payers & Providers – Issue of April 22, 2010

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