I just read a great piece in Becker's Hospital Review, “10 Key Trends for Hospitals in 2011,” which focused on hospital subject matter experts’ predictions for the new year. Their observations are relevant not only if you’re in the acute care sector of the field, but also serve as useful guideposts for any organization in the health care field.  

The ‘top ten’ trends this group is expecting include:

1. Lower reimbursements
2. Recovery audit contractors (RACs) gather momentum
3. More uncompensated care
4. Political gridlock
5. Uncertain fate of healthcare reform
6. Anticipated ACO rules may open the floodgates
7. Greater focus on experimentation
8. States will further cut Medicaid spending
9. Healthcare IT payments start
10. More hospital consolidation likely

I think these will prove to be trends that all management teams will need to factor into their planning scenarios. So make sure that your team – and your plan – is ready for the new year.

In a recent speech, Kentucky Republican Senate Candidate Rand Paul said that Medicaid is “intergenerational welfare.” His stated rationale was that coverage has spread beyond those “truly in need” and citing the fact that 800,000 people out of Kentucky’s approximately 4.314 million citizens (18.5%) were on Medicaid. Given Kentucky’s Medicaid eligibility requirement—$13,671 in annual household income for family of 4 (62% of the federal poverty level)—I would say that has more to do with the income distribution in Kentucky.

I find Dr. Rand’s comments a bit hypocritical. This is coming from a candidate who is an ophthalmologist (an ophthalmologist who invented his own board certification, no less) and has 50% of his income coming from Medicaid and Medicare. This is the candidate who said in an interview on October 3, 2010 that he would cut Medicare benefits and raise the retirement age for Social Security in order to keep the full Bush-era tax cuts. So while depending on your perspective, I suppose you could consider this to be intergenerational welfare; I would maintain that it is, in fact, intergenerational war.

On December 31, 2009, the federal Department of Health and Human Services (HHS) released an interim final rule (IFR) with definitions for certified electronic health record (EHR) technology that will meet the Stage 1 “meaningful use” requirements the Medicare and Medicaid EHR Incentive Programs. Eligible professionals and hospitals must use certified EHR technology to qualify for the financial incentives described in the American Recovery and Reinvestment Act of 2009 (ARRA). HHS will adopt the IFR’s initial set of certification criteria on February 12, 2010.

Once the IFR came out, the behavioral health and human services space was abuzz discussing what was missing, what was unclear, how meaningful ‘meaningful use’ could be—you name it. The other day I came across a great feature written by John Halamka, MD, the Chief Information Officer of Beth Israel Deaconess Medical Center and Chief Information Officer at Harvard Medical School. While teaching a health care information technology (HIT) class at Harvard, he asked his class to read his EHR implementation project and then to “develop a list of barriers to EHR implementation.” The result? Ten major barriers to successfully deploying EHRs:

10.  Usability—products are hard to use and not well engineered for clinician workflow.

9.  Politics/naysayers—every organization has a powerful clinician or administrator who is convinced that EHRs will cause harm, disruption, and budget disasters.

8.  Fear of lost productivity—clinicians are concerned they will lose 25% of their productivity for 3 months after implementation. Administrators are worried that the clinicians are right.

7.  Computer Illiteracy/training—many clinicians are not comfortable with technology. They are often reluctant to attend training sessions.

6.  Interoperability—applications do not seamlessly exchange data for coordination of care, performance reporting, and public health.

5.  Privacy—there is significant local variation in privacy policy and consent management strategies

4.  Infrastructure/IT reliability—many IT departments cannot provide reliable computing and storage support, leading to EHR downtime.

3.  Vendor product selection/suitability—it's hard to know what product to choose, particularly for specialists who have unique workflow needs

2.  Cost—the stimulus money does not flow until meaningful use is achieved. Who will pay in the meantime?
1.  People—it's hard to get sponsorship from senior leaders, find clinician champions, and hire the trained workers to get the EHR rollout done. (this was the #1 concern by far)

They say health care is recession-proof. But, that's not exactly the case. The health and human services sector has proven to be both recession-resistant and a recession laggard. And—if U.S. governors are right—the start of the ‘recession’ in the health and human service sector will begin on July 1, 2011. The fiscal year that begins in July will be “the most difficult to date,” according to a survey of 45 states released at the winter meeting of the National Governors Association.

States must find a cumulative $18.8 billion to balance their budgets in remaining months of the current fiscal year, and in fiscal 2011, an estimated $53.6 billion in shortfalls awaits, according to the survey. For governors, Medicaid is one of the top budget issues. Medicaid spending for fiscal year 2009 was $335 billion, an increase of 7.8 percent over the previous year. Enrollment increased 5.4 percent in fiscal year 2009 and will grow 6.6 percent in fiscal 2010. Additionally, 3.3 million more people were enrolled in Medicaid in June 2009 compared to the previous year—the largest one-year increase to date.

If you haven't started your management strategy for this time of economic freefall, now is the time. For starters, employ a three-prong recession management strategy consisting of short-term cash management, business development, and preparing for the post-recession marketplace.

For more, check out:

• Prepare for the Emerging Post-Recession Marketplace: Five Management Best Practices for Organizational Sustainability
• Anticipating Emerging Post-Recession Market Models: Consumer & Payer Demands for Behavioral Health & Social Services

The health care reform bill tug-of-war currently happening between the House and Senate is too much for many of us to keep up with. I took interest with an article in Slate by Christopher Beam that includes a hit-list of those health care reform issues that still need to be ‘hammered out’ in the final bill. His six issues include:

• The exchanges—while the House bill would create a national exchange, the Senate bill would create a series of state-based exchanges. There’s no happy medium. It is either state or national.
• The mandates—what will be the real penalty for not buying health insurance? The House bill would charge a 2.5% tax on all income above the filing threshold ($9,000/individuals or $19,000 for couples), while the Senate bill would impose a flat penalty, which itself fails to acknowledge the wide variance in American income levels and their ability to pay up. The employer mandate is a big one as well; will employers pay an 8% tax on total wages or levy a $750 fine per employee? Who will be eligible for exemptions?
• Medicaid expansion and subsidies—the House bill would make Medicaid available to individuals earning up to 150% of the poverty level, while Senate bill would expand it 133%. The differences are in the subsidies, in that the House bill provides far more support for families at or below 300%, while the Senate bill seems to focus more on middle income families between 300% and 400%.
• CHIP—key questions posed by Beam: “Does Congress really want to end the Children’s Health Insurance Program and push kids into exchanges and Medicaid, as the House bill would do? Or does it want to extend CHIP until 2015, as the Senate bill would do?
• Narrowing the ‘donut hole’—the gap in Medicare coverage known as the ‘donut hole’ is addressed far more in the House bill, which phases it out altogether by 2019 by ‘filling’ it with money from the pharma industry. The Senate bill would only close the gap halfway (and only temporarily).
• Paying for it—the House would levy a 5.4% surtax on individual income above $500,000 while the Senate would tax plans that cost more than $8,500 for individual and $23,000 for a family; Senate would also tax indoor tanning services (yes, seriously).

As our eyes dart back and forth between this legislative ‘volley,’ I will be interested to see how flexible the House and Senate are on certain issues—and which issues they refuse to compromise on.

We're on the eve of the implementation of behavioral health parity legislation. Medicare has released the procedures for implementation of parity for their beneficiaries—see “Medicare Claims Processing Transmittal 1843: Outpatient Mental Health Treatment Limitation.” The regulations for the Paul Wellstone and Pete Domenici Mental Health Parity and Addiction Equity Act will be released in January of 2009, “Wellstone Act Mental Health Parity Effective Date Delayed Until 2010.”

But the various pieces of parity legislation will only be as meaningful to consumers as their implementation. To that end, there is a great piece in the December 2, 2009 issue of Medical News Today, “Lessons From the Implementation of Mental Health Parity in California.” Coauthors Margo L. Rosenbach, Ph.D., Timothy K. Lake, Ph.D.; Susan R. Williams, M.P.P., also affiliated with the Mathematica Policy Institute, and Jeffrey A. Buck, Ph.D., offer three pieces of advice from their research:

• The need for increased oversight of health plans—monitoring health plan performance related to access and quality, in addition to monitoring coverage and costs;
• The need to look at the breadth of diagnoses covered by health plans; and
• The need to ensure consumer awareness of parity—mounting a campaign to education consumers about their insurance benefits.
  

Three points we should all put on our 2010 new year's resolutions!

Don't miss the great piece "Recent Changes in Medicaid Policy and Their Possible Effects on Mental Health Services” by Jeffrey A. Buck, Ph.D., Center for Mental Health Services, Substance Abuse and Mental Health Services Administration, in the November issue of Psychiatric Services. If you were one of the few remaining people in the field who didn't think that Medicaid funding has come to indelibly change public mental health systems—and will continue to do so—this is a great synthesis of the current and future market effects.

On the system side, Dr. Buck identified the following Medicaid-driven system effects that have already occurred:

• A larger role for state Medicaid authorities in state mental health services and a corresponding decline in the role of mental health authorities;


• Service delivery privatization via Medicaid managed care arrangements which privatize many functions previously provided by public entities


• Increased funding for community-based mental health care


• Increased difficulty in using Medicaid funds for areas not clearly defined within the program;


• Increased accountability of individual service providers via the Medicaid Integrity Program


• Movement away from incentivizing psychiatric institutionalization
  

Dr. Buck also looks ahead to future policy changes. A few are ‘more of the same’—an increase in the role of Medicaid authorities and the growth of community-based services, with continued promotion of deinstitutionalization. In addition, he points to two other developments that are on the horizon. The first is increasing convergence of mental health policy with those that are the norm in primary care. The second is more meaningful consumer participation in treatment plan participation and choice of professionals and provider organizations.