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Teaching Hospital Update - October 24-28, 2011

Email Alert
October 28, 2011
By C. Elizabeth O'Keeffe*

Employer-Sponsored Health Insurance: Trending . . . Down?

The news came as a shock: Wal-Mart, the nation's largest private employer, would not offer healthcare benefits to new part-time employees, the company said last Friday. Only 16% of employers offer health insurance to part-timers, according to the Kaiser Family Foundation's most recent Employer Health Benefits Survey. The number increases to 42% among large employers. Wal-Mart has provided health insurance for part-time workers since 1996, said company spokesman Greg Rossiter.

"There's been a really striking decline in [employer-based] coverage for these part-time workers," said Sara Collins, vice president for the Affordable Health Insurance Program at the Commonwealth Fund, a Massachusetts-based nonprofit group. The healthcare law that Congress passed last year is unlikely to change that. While part-time workers will have access to new, subsidized coverage on the individual market, the Obama Administration's signature legislative achievement provides little incentive for employers to cover workers who are not full-time staff.

During the healthcare debate, Wal-Mart came out as an early supporter of an employer mandate to require that companies provide insurance for their workers. The retailer partnered with the Service Employees International Union to write a June 2009 letter to the White House on the issue. "We are for shared responsibility," they wrote. "Not every business can make the same contribution, but everyone must make some contribution. We are for an employer mandate which is fair and broad in its coverage." The Affordable Care Act that Congress passed in 2010 does include such a provision. It requires large employers with more than fifty workers to provide health insurance. If an employer does not, it is subject to a fine of $2,000 for each worker.

The law, however, is largely silent on the subject of part-time workers, and there are no penalties for not offering them coverage. That makes the divide between full time and part time a key distinction for the healthcare law, and one the Obama Administration is fine-tuning. The law defines a "part-time employee" as one who works fewer than thirty hours a week. But that definition has raised concerns about how to treat employees who do not have regular work schedules, with hours potentially varying from month to month.

The Internal Revenue Service (IRS) is working on further guidance. Without it, "employees might move in and out of employer coverage as frequently as monthly, which would be undesirable, both from the employee's and employer's perspective," IRS said in a notice released last May, requesting public comment on the issue.

For those who do not receive employer-sponsored insurance, the health law creates new options. Beginning in 2014, new marketplaces called health exchanges will serve as a more organized and easier way to buy health insurance. Anyone who earns less than four times the federal poverty level, about $43,320 for an individual, will be eligible for tax credits to subsidize the purchase of insurance. "Assuming this is all up and running in 2014, the exchanges will be there, there won't be preexisting conditions and there will be new subsidies," said Paul Fronstin, director of the health research and education program at the Employee Benefits Research Institute.

Part-time workers "will have something they don't have. You could argue they don't really need their employers anymore."

Sarah Kliff, Healthcare Coverage Still Eludes Some Part-Time Workers, The Washington Post (Oct. 22, 2011).

United States Supreme Court Hyperlinks to Healthcare Filings

The U.S. Supreme Court, reacting to the widespread interest in the new cases testing the constitutionality of the federal healthcare law, now provides a page on its website where all of the filings before the Court will appear.

It will be updated as the six cases already filed develop further. As of now, there is no scheduled date for the Court to begin considering which, if any, of the petitions it will review. The posting of such filings on the Court's own site is rare, but not unprecedented.

Kathleen Arberg, the Court's public information officer, said in response to questions that the posting was done on the initiative of the Court Clerk's Office. "Similar postings have occurred before in cases that generated heightened public interest," Arberg said. She mentioned, in particular, the massive test case (twelve separate appeals) in 2003, involving the constitutionality of major provisions of a 2002 federal campaign finance regulation law (McConnell v. Federal Election Commission was the lead case), and the historic fight in 2000 over the presidency that the Court decided in Bush v. Gore. The Court's website also contains filings in "Original" cases--those in which the Court itself acts as the originating Court, under specific grants of authority in the Constitution (typically, legal disputes between two or more states).

Lyle Denniston, Court Links to Filings, SCOTUS Blog (Oct. 21, 2011).

How to Measure Quality and Care Coordination for Medical Homes?

Patient-centered medical homes offer accessible, coordinated, comprehensive care focused on patients' needs. One of the primary activities of the medical home is care coordination, which involves sharing test results with patients and all of their providers, ensuring patients have follow-up appointments, and much more. Effective care coordination results in better outcomes, reduced waste and duplication, and higher patient satisfaction. Through a care team that includes not only the primary care provider, but also nurses, medical assistants, and other office staff, medical homes are responsible for coordinating care with patients, among providers within a practice, and with providers in other settings. To understand if patients' needs are being met, routine performance measurement and reporting about the effectiveness and quality of care coordination are critical.

In a guide released last Friday by the Patient-Centered Primary Care Collaborative, a chapter by Commonwealth Fund staff outlines seven key strategies to help health systems effectively measure care coordination as a routine part of medical home activities.

The seven strategies are:

  1. Work with a broad stakeholder group to reach consensus on measures;
  2. Clarify purpose of measurement: quality improvement, accountability, evaluation;
  3. Use standardized measures;
  4. Incorporate patient feedback in assessing quality of care coordination;
  5. Develop a tracking system that facilitates ongoing monitoring of performance;
  6. Build and nurture relationships with providers outside of your medical home--the "medical neighborhood"--to facilitate data sharing, monitoring, and improvement; and
  7. Use the data to improve care coordination. Share results at the practice and care-team levels.

Improving care coordination within and among healthcare settings is a critical step to achieving high performance in the U.S. healthcare system. And obtaining information about care coordination performance can help identify weaknesses, stimulate improvement, and track progress. Practice systems that enable routine data collection, standardization of measures, involvement of patients and staff, and systematic processes to respond to poor performance will bring us one step closer to achieving better-coordinated, higher-value care for all patients.

Melinda Abrams, M.S., and Karen Crow, Promoting the Integration and Coordination of Safety-Net Healthcare Providers Under Healthcare Reform: Key Issues, The Commonwealth Fund (Oct. 21, 2011).

The Quiet Healthcare Revolution

CareMore, a company based in Cerritos, CA, serving more than 50,000 Medicare Advantage patients, through its unique approach to caring for the elderly, is routinely achieving patient outcomes that other providers can only dream about: a hospitalization rate 24% below average; hospital stays 38% shorter; an amputation rate among diabetics 60% lower than average. Perhaps most remarkable of all, these improved outcomes have come without increased total cost. Though they may seem expensive, CareMore's "upstream" interventions--the wireless scales, free rides to medical appointments, etc.--save money in the long run by preventing vastly more costly "downstream" outcomes such as hospitalizations and surgeries. As a result, CareMore's overall member costs are actually 18% below the industry average.

At first, CareMore accepted patients of all ages, but in 1997 the company's founders restructured the company around the original concept, focusing on the elderly and eventually accepting payment exclusively from the Medicare Advantage program. Rather than paying for services rendered (the traditional fee-for-service model), Medicare Advantage pays CareMore an annual per-patient fee, adjusted according to each client's risk profile. This system, by replacing the distorted incentives of the fee-for-service economic model, allows CareMore to be rewarded for innovative, results-oriented care. In particular, it enables the company to build specialized programs for its highest-risk patients, who generally suffer more--and run up astronomical costs--under traditional fee-for-service plans.

An early discovery was that CareMore's elderly patients failed to show up for as many as one-third of their doctor appointments. As one of the initial partners at CareMore and now a senior physician with the company explains, "About one in three of the elderly people we were taking care of were home by themselves. They'd outlived their family resources, they couldn't drive, and their kids lived out of town. So when they got sick, they ended up calling 911. And when it came to routine doctor visits, they sometimes just couldn't make it at all."

The problem of "noncompliance" isn't limited to missed appointments, either. Patients, especially elderly ones, also leave prescriptions unfilled, medicines untaken, exercise-and-diet regimens unfollowed, and symptoms unnoticed and unreported. Healthcare professionals often grumble about noncompliance, but given the myriad demands on their time, they generally can do very little about it. At CareMore, by contrast, the founder decided, "noncompliance is our problem, not the patient's." So the company began adding more nonmedical services to its routine care in order to improve compliance rates--for example, sending healthcare professionals to its patients' homes to make sure they had scales to keep tabs on their weight, to look for loose throw rugs that might cause falls, and to provide "talking pill boxes" that remind patients to take their medicine with preset alarms. Each of these innovations led to a small improvement in patient wellness and a corresponding improvement in the economics of providing care.

Efforts to replicate the CareMore model should gain new momentum following the company's August acquisition by WellPoint, which operates Blue Cross and Blue Shield plans across the country. WellPoint serves thirty-four million members in its affiliated health plans and another thirty-five million through subsidiaries. "CareMore was a perfect strategic fit with the direction in which we're moving our company," said the chief executive officer of WellPoint. "We have been focused on delivering greater healthcare value, and finding ways to put the patient in the center of the system
. . . That's the entire focus of the CareMore model."

Tom Main and Adrian Slywotzky, The Quiet Healthcare Revolution, The Atlantic (Oct. 25, 2011).

IRS Gearing Up to Handle Tax Implications of Healthcare Reform

The Internal Revenue Service (IRS) is gearing up to handle the complex tax provisions of the healthcare reform law and has made significant progress so far in planning for the law's implementation, according to a new government report.

The Patient Protection and Affordable Care Act (ACA) took effect in March 2010 and contained $438 billion in revenue provisions in the form of new taxes and fees. At least forty-two of ACA provisions add to or amend the Tax Code, and at least eight require IRS to build new processes that do not exist in current tax administration.

These provisions provide incentives and tax breaks to individuals and small businesses to offset their healthcare expenses. They also impose penalties, administered through the Tax Code, for individuals and businesses that do not obtain health coverage for themselves or their employees. Other provisions raise revenue to help pay for the overall cost of health insurance reform.

In a new report, the Treasury Inspector General for Tax Administration (TIGTA) conducted an audit to assess the IRS Modernization and Information Technology Services (MITS) organization's planning efforts in implementing the law. TIGTA auditors found that, early on, the MITS organization realized the vastness of the information technology work required by ACA.

In an effort to meet this challenge, the MITS organization created, staffed, and received funding for a new office called the Associate Chief Information Officer Affordable Care Act Program Management Office (PMO). In addition, the MITS organization obtained approval of the Program Management Office's charter and prepared a governance plan. The PMO is responsible for ensuring the proper implementation of information technology changes for the healthcare reform law.

"The new ACA provisions represent the largest set of tax law changes in twenty years," said the TIGTA inspector general in a statement. "I commend the IRS for its successful creation of a plan to implement them." TIGTA recommended that MITS ensure that the PMO governance plan is updated to include escalation procedures to timely address unresolved issues and critical decisions. IRS management agreed with TIGTA's recommendation and plans to update the governance plan.

Michael Cohn, IRS Readies for Healthcare Reform Changes, Accounting Today (Oct. 24, 2011).

Gas Pump Handles, ATMs Among Dirtiest, Germ-Ridden Surfaces

What do gas pump handles, ATM buttons, mailbox handles, and escalator rails have in common in the United States? As the flu season approaches, you may wish make a note of this: they are amongst the most germ-ridden and dirtiest surfaces that Americans touch every day, according to tests carried out recently in six major U.S. cities recently. The results of the tests were announced to the press on Tuesday.

As part of its Healthy Workplace Project, the hygiene products and services company Kimberly-Clark Professional, had trained hygienists go round swabbing frequently touched surfaces in high traffic locations in Atlanta, Chicago, Dallas, Los Angeles, Miami, and Philadelphia.

Using a Hygiena System SURE II ATP Meter, the hygienists swabbed and analyzed a total of 350 surfaces. The meter tests for levels of Adenosine Triphosphate (ATP). ATP is commonly used in food hygiene as a quick measure of cleaning quality for surfaces. Used for transporting chemical energy between cells, ATP is present in all animal, vegetable, bacteria, yeast, and mold cells, and its presence indicates contamination by any of these.

If you touch a surface with an ATP reading of 300 or higher, you are thought to be at a high risk of getting sick from a transmitted illness, according to a press statement from Kimberly-Clark Professional.

The tests revealed that the following surfaces had ATP counts of 300 or more:

  • 71% of gas pump handles;
  • 68% of mailbox handles;
  • 43% of escalator rails;
  • 41% of ATM buttons;
  • 40% of parking meters and kiosks;
  • 35% of crosswalk buttons; and
  • 35% of vending machine buttons.

A professor of Microbiology at the University of Arizona said these tests show how important it is to keep hands and surfaces clean: people don't realize how many germs they are exposed to as they go to and from work every day and touch things like gas pump handles and escalator rails.

More information on the The Healthy Workplace Project is available online.

Catherine Paddock, PhD, Gas Pump Handles, ATMs Among Dirtiest, Germ-Ridden Surfaces, Medical News Today (Oct. 26, 2011).

*We would like to thank C. Elizabeth O'Keeffe, Esquire (The University of Mississippi Medical Center, Jackson, MS), 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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