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Teaching Hospital Update - August 20-24, 2012


Email Alert

August 24, 2012

By Sarah Kitchell*

Moody's: Nonprofit Hospitals Show Growth in Revenue in 2011; Changes Looming

Modern Healthcare (8/23) reported that Moody's Investors Service released a recent report showing that revenue for nonprofit hospitals increased 5.3% in fiscal year 2011. The article pointed out that this growth was fueled by such factors as physician hiring and incentive payments received by hospitals from programs promoting health information technology, but that continued revenue growth is unlikely in coming years due to "expected Medicare and Medicaid cuts and lower payments form insurers for hospitalized patients." The Moody's report also indicated that, after deferring spending on capital projects for the previous two years, hospitals and health systems have increased spending in this area in the past year. (Note: Registration is required to access this article.)

Hospitals Lay Off Employees to Cut Costs, Prepare for Reform

Fierce Healthcare (8/23) reported that hospitals in Illinois, Maryland, and Tennessee have recently announced the firing of hundreds of employeesand another hospital in New Jersey is considering laying off seventy nursesall in an effort to cut costs, anticipate reductions in Medicare reimbursement, and prepare for "state challenges to expanding Medicaid benefits under federal healthcare reform." The article also noted that Bureau of Labor Statistics data show that the number of "mass layoffs" (i.e., fifty or more people laid off at the same place on the same day) at hospitals has "more than doubled month to month in May and June."

Deaths of Forty-One Mice in Harvard Research Lab Brings USDA Citation

The Boston Globe (8/24) reported that Harvard University was cited August 21 by the U.S. Department of Agriculture (USDA) for a violation of the U.S. Animal Welfare Act. The citation was issued in connection with forty-one rodent deaths due to dehydration resulting from a system failure in April. The article noted that the enforcement action by the USDA "does not carry a fine or other penalty," however. A USDA spokesperson remarked that the Animal Welfare Act normally "does not cover typical laboratory mice," but that the species that died in the incident were wildi.e., "not specifically bred for research"and therefore fell under the protection of the Act.

Study: Changes to Cath Lab Protocol and Culture Can Reduce Radiation Exposure

MedPage Today (8/21) reported on a recent study which found that changes to the Mayo Clinic's cardiac catheterization laboratory (cath lab) policies and procedures cut the "mean radiation exposure for patients by 40%" over three years and also likely reduced radiation scatter to cath lab staff accordingly. Researchers noted that physician's expectations during this single-center study also changed, "from a desire for excellent image quality to a desire for low radiation dose and acceptance of clinically adequate image quality." While researchers indicated that patient radiation exposure for cath lab procedures is "below the level that is known to be associated with elevated cancer risk," they noted that it was important to consider that "low levels of radiation have a proportionate risk" to patients.

Minnesota State Court: Hospital's Medical Staff has No Standing to Sue (8/20) reported on a recent opinion from a Minnesota court, Medical Staff of Avera Marshall Regional Medical Center et al. v. Avera Marshall Regional Medical Center, which concluded that the medical staff of a hospital is "not an independent legal authority with the capacity to sue or be sued" because "[t]he medical staff would not exist but for the medical center." The outstanding issues of the case, however, include whether the bylaws can be "considered a contract between doctors and medical centers and if hospital administrators can unilaterally repeal those rules." While the medical staff is no longer a part of the case after the court's ruling, two individual physicians are still plaintiffs.

*We would like to thank Sarah Kitchell, Esquire (McDermott Will & Emery LLP, Boston, MA), for providing this week's update.

 AHLA Teaching Hospital Updates are intended to provide quick summaries of cutting-edge issues of interest to teaching hospitals and their counsel. Additional information and more in-depth coverage on these topics may be available from AHLA Health Lawyers Weekly and appropriate AHLA Practice Groups.

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