Dozens of health care organizations and anti-smoking advocates joined Governor Doyle on January 24 as he unveiled a new statewide anti-smoking initiative at a press conference held at the Governor’s Executive Residence in Madison. Flanked by representatives from SmokeFree Wisconsin, the Wisconsin Cancer Society and cancer survivors, Doyle announced he will introduce a $1.25 cigarette tax increase in the state budget he will propose in mid-February. The funds generated from the cigarette tax will be designated to pay for tobacco-related illness.

"Wisconsin hospitals join with SmokeFree Wisconsin, the Wisconsin Cancer Society, and many others in support of a cigarette tax increase," said WHA President Steve Brenton. "Reducing smoking related-illnesses by raising the cigarette tax makes fiscal sense for Wisconsin’s Medicaid program, and health sense for Wisconsin citizens."

Doyle’s anti-smoking initiative also includes a statewide smoking ban and a commitment to refinance the state’s tobacco settlement bonds. Refinanced bonds will bring in a lump sum of $600 million, which Doyle says would be used as a type of endowment to generate $30 million in annual interest. That interest will be used to fund anti-smoking efforts. The statewide smoking ban will be introduced as separate legislation.

"This is a comprehensive approach to improve the health of our citizens," said former WHA Chair Mary Starmann-Harrison, president, SSM Health Care–Wisconsin. "Chronic illnesses, many of which are caused by smoking, result in hundreds of millions in avoidable health care costs every year. These initiatives will save lives and reduce the cost of health care."

Increasing the price of cigarettes is seen as one of the most effective ways to reduce and prevent smoking. By increasing the tax by $1.25, it is projected over 42,000 Wisconsin adults will quit smoking; over 84,000 kids in Wisconsin will never start; and nearly 12,000 smoking-affected births will be avoided. Estimates also show just how much smoking-related illnesses impact Wisconsin health care. Approximately $2.02 billion of Wisconsin’s health care expenditures are caused by tobacco use, and of that, over $480 million is directly related to taxpayer-funded Medicaid costs.

In addressing how this money would be used, Doyle said the following: "The taxpayers of Wisconsin [are] now paying $500 million in smoking-related illnesses through Medicaid…If the tobacco tax is passed at the level I proposed it, that money will go towards the treatment of smoking-related illnesses. The result of doing that is we will have additional money in the Medicaid fund that can help with our Badger Care Plus initiatives, which are directed at cutting the uninsured rate in this state by more than half and getting all our children insured."

Conservative estimates project that the $1.25 increase will raise over $252 million in new state revenue. When used to fund programs like Medicaid, the $252 million will also draw down federal matching dollars, which would catapult the total to upwards of $630 million annually.

Wisconsin hospitals already see dismal Medicaid reimbursements. On average, they receive 49 cents for every dollar it costs to provide care to a Medicaid patient. As a result, in 2006, Wisconsin hospitals were forced to shift over $600 million in unpaid Medicaid costs to others, further inflating the price of health insurance. Due to the direct linkage between Medicaid costs and smoking-related illness, the Wisconsin Hospital Association has been working in partnership with a large coalition of organizations including SmokeFree Wisconsin and the American Cancer Society in support of the cigarette tax.

MN Legislature Introduces Statewide Smoking Ban
Right on the heels of Governor Doyle’s own announcement to propose a statewide smoking ban, the Minnesota Legislature officially introduced legislation to do just that. The bi-partisan legislation is believed to have a strong chance at passage.  Under the proposal, smoking would be prohibited in bars, restaurants and other public areas, and would unify an otherwise patchwork set of local bans and ordinances across the state of Minnesota. Exemptions include Indian casinos, hotel rooms and tobacco shops. Sixteen other states have similar bans.     - Source: Star Tribune

This week Governor Doyle announced his budget will include $30 million in grant money and tax breaks to increase the use of electronic medical records in Wisconsin. Doyle’s initiative builds on the recommendations released last month by the Governor’s eHealth Care Quality and Patient Safety Board, on which various WHA staff and members have served.

"I want to be the first Governor in the nation to announce we have a fully integrated electronic medical records system," Doyle said during his press conference at Dean Health Care Systems in Madison.

Doyle indicated the challenge in doing so will be to have technologies in place that allow all systems to communicate quickly about patients, while at the same time ensure patient confidentiality. However, he said he did not believe the state should prescribe what that system should look like, but rather, allow health care providers to determine the system that will work best to reach interoperability.

"Hospitals and health care systems across the state have a keen interest in realizing interoperability, and have already invested millions of dollars to do so," said WHA President Steve Brenton.

Under Doyle’s proposal, $20 million in grants will be available for non-profit organizations and $10 million will be used to fund tax breaks for for-profit entities. Governor Doyle would partially fund his proposal through money from the Patients Compensation Fund (PCF). Indicating Wisconsin spends $6 billion on "inappropriate, redundant or unnecessary care," Doyle said he sees this as a good use of PCF dollars.

In a statement to the press, Brenton expressed support for the plan because electronic medical records have the potential to increase both the efficiency and safety of patient care.

"Electronic medical records allow accurate medical information to be accessible to health care professionals no matter where the patient is treated," said Brenton. "Unfortunately, this technology is very expensive both in terms of initial investment and training costs."

"We applaud Governor Doyle’s proposal to provide funding to health care providers. This aspect of his plan is especially important in rural areas to ensure that they are not locked out of the statewide implementation plan because of finances," Brenton said.

Hospitals are at ground zero when it comes to treating patients who are battling diseases caused by smoking or exposure to second-hand smoke. Since hospitals are dedicated to improving the health status of the communities they serve, they also strive to help people live healthier, safer lives. One way hospitals visibly demonstrate that commitment is by prohibiting the use of tobacco products on their campuses.

The WHA Board recommended late in 2006 that all Wisconsin hospitals become tobacco-free campus wide by the end of November 2007. Wisconsin is moving closer to that goal with 93 hospitals (73 percent) now reporting that they are tobacco-free campus wide, with another 26 hospitals in line to join that list by the end of 2007.

Lezli Redmond is director of outreach programs at the University of Wisconsin Center for Tobacco Research and Intervention (CTRI). CTRI is nationally recognized for its leadership in reducing the burden of illness and death from tobacco use. Part of the UW School of Medicine and Public Health, CTRI research programs strive to improve tobacco dependence treatment and help people quit. Redmond said CTRI has been working directly with Wisconsin hospitals to help them prepare their employees, visitors, and patients for tobacco-free initiatives.

"Initially, when hospitals started working towards tobacco-free campuses, they thought of the patients first, which is natural. However, what they realized was that they could be more successful treating their patients for tobacco addiction if they also helped their employees quit," according to Redmond. "Now, in preparation for going tobacco-free, many integrate a tobacco cessation program for patients and employees into their tobacco-free campus initiatives," Redmond added.

Redmond said CTRI has seen a rapid increase in the number of hospitals that are tobacco-free campus wide, or moving towards that goal. WHA President Steve Brenton said Wisconsin is fortunate to have the nationally respected CTRI "in our backyard to offer assistance to hospitals are they move towards that even loftier goal of helping their communities become tobacco-free."

Wisconsin hospitals that are now tobacco-free campus wide include:

Agnesian HealthCare/St. Agnes Hospital, Fond du Lac

Amery Regional Medical Center, Amery

Appleton Medical Center, Appleton

Aspirus Wausau Hospital, Wausau

Aurora BayCare Medical Center, Green Bay

Aurora Mem. Hosp. of Burlington, Burlington

Aurora Lakeland Medical Center, Elkhorn

Aurora Med. Ctr. of Manitowoc Co., Inc., Two Rivers

Aurora Medical Center, Hartford

Aurora Medical Center, Oshkosh

Aurora Medical Center-Kenosha, Kenosha

Aurora Psychiatric Hospital, Inc., Wauwatosa

Aurora Sheboygan Memorial Medical Center, Sheboygan

Aurora Sinai Medical Center, Inc., Milwaukee

Baldwin Area Medical Center, Baldwin

Barron Medical Center—Mayo Health System, Barron

Beaver Dam Community Hospitals, Inc., Beaver Dam

Berlin Memorial Hospital, Berlin

Black River Memorial Hospital, Black River Falls

Bloomer Medical Center, Bloomer

Bond Health Center, Oconto

Boscobel Area Health Care, Boscobel

Children’s Hospital of Wisconsin-Fox Valley, Neenah

Children’s Hospital of Wisconsin-Kenosha, Kenosha

Columbia St. Mary’s, Inc.-Columbia Campus, Milwaukee

Columbia St. Mary’s, Inc.-Milwaukee Campus, Milwaukee

Columbia St. Mary’s, Inc.-Ozaukee Campus, Mequon

Sacred Heart Rehabilitation Institute, Milwaukee

Community Memorial Hospital, Menomonee Falls

Divine Savior Healthcare, Portage

Door County Memorial Hospital, Sturgeon Bay

Eagle River Memorial Hospital, Eagle River

Elmbrook Memorial Hospital, Brookfield

Flambeau Hospital, Park Falls

Franciscan Skemp Healthcare, Arcadia

Franciscan Skemp Healthcare, La Crosse

Franciscan Skemp Healthcare, Sparta

Good Samaritan Health Center, Merrill

Grant Regional Health Center, Lancaster

Holy Family Memorial, Inc., Manitowoc

Howard Young Medical Center, Woodruff

Hudson Hospital, Hudson

Kindred Hospital Milwaukee, Greenfield

Ladd Memorial Hospital, Osceola

Lakeview Medical Center, Rice Lake

Langlade Memorial Hospital, Antigo

Luther Hospital, Eau Claire

Memorial Health Center, Medford

Mercy Health System Corporation, Janesville

Mercy Medical Center, Oshkosh

Mercy Walworth Hospital and Medical Center, Lake Geneva

Mile Bluff Medical Center, Mauston

Moundview Memorial Hospital & Clinics, Friendship

New London Family Medical Center, New London

Oconomowoc Memorial Hospital, Oconomowoc

Orthopaedic Hospital of Wisconsin, Glendale

Osseo Medical Center, Osseo

Our Lady of Victory Hospital, Stanley

Prairie du Chien Memorial Hospital, Prairie du Chien

Red Cedar Medical Center, Menomonie

Reedsburg Area Medical Center, Reedsburg

River Falls Area Hospital, River Falls

Riverside Medical Center, Waupaca

Riverview Hospital Association, Wisconsin Rapids

Sacred Heart Hospital, Eau Claire

Sacred Heart-St. Mary’s Hosps., Tomahawk

Sacred Heart-St. Mary’s Hosps., Rhinelander

Saint Clare’s Hospital, Weston

Saint Michael’s Hospital, Stevens Point

Sauk Prairie Memorial Hospital, Prairie du Sac

Southwest Health Center, Platteville

St. Clare Hospital & Health Services, Baraboo

St. Croix Regional Medical Center, St. Croix Falls

St. Elizabeth Hospital, Appleton

St. Joseph’s Hospital, Chippewa Falls

St. Mary’s Hospital, Madison

St. Nicholas Hospital, Sheboygan

Stoughton Hospital Association, Stoughton

SynergyHealth St. Joseph’s Hospital, West Bend

The Monroe Clinic, Monroe

The Wisconsin Heart Hospital, Wauwatosa

Theda Clark Medical Center, Neenah

Tri-County Memorial Hospital, Whitehall

Vernon Memorial Healthcare, Viroqua

Watertown Memorial Hospital, Watertown

Waukesha Memorial Hospital, Waukesha

Waupun Memorial Hospital, Waupun

West Allis Memorial Hospital, West Allis

Westfields Hospital, New Richmond

Wheaton Franciscan Healthcare-All Saints, Racine

Wheaton Franciscan Healthcare-St. Francis, Milwaukee

Wheaton Franciscan Healthcare-St. Joseph, Milwaukee

One year ago, New Jersey Governor Jon Corzine introduced a budget bill that included a $430 million hospital tax. New Jersey hospitals were not consulted or even provided a "heads up" about the tax initiative, which Governor Corzine’s staff described as a "good deal" for them. While some of the tax monies were envisioned to be matched with federal Medicaid dollars and returned to hospitals…much of the hospital tax revenue windfall was destined to be used to fund New Jersey’s state budget. New Jersey hospitals vehemently opposed the hospital tax, calling it a "sick tax," and ultimately won legislative support to reject the initiative.

Rumors in Madison suggest that some may be interested in pursuing a major hospital tax as an option to raise revenue for the 2007-09 biennial budget. While we have yet to see any specific proposals, this much is known:

• Taxing sick hospital patients to raise revenue to underwrite a structural Medicaid budget deficit – or – generate new revenues to finance other state budget priorities is a terrible precedent. While approximately 20 states have hospital taxes, in almost every case those taxes are fully directed to fund hospital payment improvements. We doubt that would be the case here.
• The total lack of fairness in taxing a provider group that has not had a payment increase in almost a decade while absorbing tens of millions of dollars in payment cuts over the past four years is not debatable.
• The federal government is clamping down on provider tax schemes via proposed regulations and state plan amendment approval interpretations. CMS auditors are demanding that tax schemes identify provider "losers." In other words, they want to make these initiatives difficult for providers to support. This has become a big issue in Illinois. Connecticut and Utah repealed their hospital taxes because of this issue.
• The inevitability that the tax will result in hospital "winners" and hospital "losers" makes this financial scheme untenable for a trade association. This may not be of concern to some folks at the Capitol, but it has become a major issue for Wisconsin’s nursing home associations who agreed to a provider tax over one decade ago.
• A hospital tax will touch off a bipartisan political firestorm in the state capitol that could put many legislators in a horrible situation of creating winners and losers across the state and even within their own districts.
• Hospital leaders who reluctantly supported provider taxes in other states observe that the legislators, state agency officials and governor’s staff they negotiated with in "year one" are largely absent from the scene within three or four years. The disappearance of institutional memory associated with the original provider tax agreements undermines the original commitment over time. The general consensus is that "it will never be better than it was in year one." Promises made become promises that are forgotten.
• A small sampling of the comments/advice we have received from states that enacted a hospital tax:

• "It’s a terrible tax."
• "Beat this back. Once you get a tax, it’s very, very hard for the state to give it up."
• "The losers have been the (rural) hospitals that do very little Medicaid business."
• "Here, it’s called ‘Mediscam’."
• "We have aggressively opposed ‘sick taxes.’"

• Once a provider organization has agreed to a tax, their success of fostering support for new state matching revenues in the future from any source other than their own tax are doomed. The experience of Wisconsin nursing homes proves this point.
• Inevitably, a tax will be passed on to those who, through no choice or fault of their own, find themselves in need of hospital care. Indeed, a "sick tax."

WHA staff is actively working to keep a hospital tax out of the 2007-09 budget. Stay tuned.

Steve Brenton
President

Last year, 100 percent of Wisconsin’s hospitals completed the online community benefits survey. The data collected in the survey was used to create the first-ever Wisconsin hospital community benefit public report. On February 28, WHA will offer an advanced training course for those who have responsibility for completing the WHA online survey. While all hospitals completed the survey in 2006, many continue to have questions about what can be counted, how to assign dollar values to non-material contributions, and how the WHA survey can be integrated in the processes they may have already set up to collect this data.

Marlene Hulteen, a recognized expert in the field of community benefit collection and reporting, and Laura Schmidt, assistant director of health care surveys at the Michigan Hospital Association, will lead this seminar.

The seminar will be held February 28 at the Kalahari Report in Wisconsin Dells. The registration fee is $75. Any hospital employee involved in collecting benefit data or completing the WHA survey is encouraged to attend.

The brochure is included in this week’s packet and is also available at www.wha.org.

For information on program content, contact Mandy Ayers, mayers@wha.org, or call 608-274-1820. For registration information, contact Lisa Geishirt, lgeishirt@wha.org, 608-274-1820.

In an ongoing effort to assist hospitals and health systems that are attempting to comply with Section 6032 of the Deficit Reduction Act of 2005 ("Section 6032"), WHA has released three new documents that can be used as part of an implementation plan.

The documents include: (1) a step-by-step implementation plan; (2) a model notice to contractors and agents of an entity’s DRA 6032 policies; and (3) a cover letter to contractors and agents to be used with the notice. WHA previously released a model policy for DRA 6032 compliance. Lori Wink, Hall Render Killian Health & Lyman, P.S.C., and Laura Leitch, WHA general counsel, prepared the documents for use by WHA members. All of the DRA 6032 documents are available on the WHA Web site at www.wha.org under Legal and Regulatory.

WHA has provided copies of the model documents to the Wisconsin Medicaid Program. WHA will continue to monitor information from both CMS and the Wisconsin Medicaid Program and provide more information when guidance is available.

This week, Rep. Leah Vukmir (R-Wauwatos) visited with Columbia St. Mary’s Hospital staff, including CEO Leo Brideau, to discuss various health care issues of importance.

As chair of the Assembly Committee on Health & Health Care Reform, Rep. Vukmir will play a key role in analyzing and refining reform proposals in the Legislature.

Rep. Vukmir is well suited to serve as Health Committee chair, as she is a pediatric nurse practitioner and has direct experience working in various health care facilities in the metro-Milwaukee area. Columbia St. Mary’s and WHA look forward to working collaboratively with her.

A Proposed Decision has been released in response to a petition filed by the Wisconsin Society of Anesthesiologists (WSA) in which WSA asked the Medical Examining Board to decide whether the administration of anesthesia by a certified registered nurse anesthetist (CRNA) must be performed under the supervision of a physician.

In his Proposed Decision, the Administrative Law Judge states that, "A CRNA who is certified as an Advanced Practice Nurse Prescriber ("APNP") and who administers anesthesia is lawfully practicing within the scope of a certificate granted to practice professional nursing[.] … A CRNA who is not certified as an APNP and who administers anesthesia is not practicing within the scope of a certificate as an APNP. … A CRNA who is not an APNP may administer anesthesia only under the supervision of a physician[.]"

The Petition in this case was filed in July 2005 after Governor Doyle requested an "opt-out" from the federal Medicare Condition of Participation that requires physician supervision of Certified CRNAs (see June 26, 2005 edition of The Valued Voice). CMS rules permit governors to opt out of the physician supervision requirement for health care providers in their state only: (1) After the governor consults with the state’s medical and nursing examining boards about issues related to access to and the quality of anesthesia services in the state; (2) If the governor attests that state law permits CRNAs to administer anesthesia without physician supervision; and (3) If the governor concludes that it is in the best interest of the state to opt out of the current physician supervision requirement. In his letter to CMS, Governor Doyle requested the opt-out, stating that the three requirements had been met in Wisconsin.

Any objections to the Proposed Decision must be filed with the Medical Examining Board by February 6, 2007. A copy of the Proposed Decision is available on the WHA Web site under Legal and Regulatory.

Faced with their own budgetary challenges, Wisconsin municipalities have increasingly sought to limit eligibility for property tax exemptions in order to increase tax revenues. Nonprofit hospitals in the state have become a target, as more assessors seek to characterize hospital property as outpatient physician "clinics" that do not qualify for exemption. A trial court judge in central Wisconsin has recently rejected one assessor’s attempt to tax hospital property under that approach.

The case involves Our Lady of Victory Hospital, Inc., a nonprofit hospital located in Stanley. Victory moved its hospital operations to a new facility in 2003. The new facility consisted of two buildings: a main building that included its inpatient wing as well as certain diagnostic and support functions; and an annex that housed hospital administration, a dialysis center, cardiac and other rehabilitation therapy programs, billing, medical records transcription and storage, and other administrative functions. The annex also included physician offices and exam rooms for an affiliated medical clinic.

Victory requested a property tax exemption for the main hospital building as well as for those portions of the annex that were not used for the physician clinic. The city assessor initially denied any exemption for the annex whatsoever, even for the space that was used exclusively for hospital purposes. Although the assessor subsequently reversed course and allowed a refund for the dialysis space, the assessor maintained that the remainder of the annex was 100 percent taxable. The assessor argued that so long as any part of the building was used in support of a physician clinic, no part of the building (except for the dialysis center) qualified for exemption. The assessor also insisted that no exemption was permitted for "dual-use" space, such as the room in which medical records were stored for both hospital and clinic patients.

In a decision rendered on January 16, 2007, Clark County Circuit Judge Jon Counsell rejected the assessor’s position and granted the exemption requested by the hospital. The court accepted the hospital’s room-by-room proof showing what space was used 100 percent for clinic purposes (for which no exemption was requested), what portion was used 100 percent for non-clinic hospital purposes (for which a 100 percent exemption was requested), and what portion was dual-use space (for which the hospital documented the relative proportions of hospital and clinic use). The court concluded that this dual-use space was reasonably necessary to the functioning of the hospital, and that the hospital had provided a reasonable basis on which to calculate that use.

Attorney David Edquist, von Briesen & Roper, s.c., who represented Victory Hospital, said this case is significant in at least two respects. "First, it rejects the movement among assessors to characterize hospital space as taxable doctor’s offices whenever the space is not part of the hospital’s inpatient facility. Second, it demonstrates the need for hospitals to document their exemption requests with detailed descriptions on the actual use of the space, including a fair allocation of dual-use property," according to Edquist. The Victory Hospital case remains subject to possible appeal by the City of Stanley.

WHA corporate members continue to contribute significant financial support to WHA in 2007. Corporate member support currently amounts to nearly $200,000.

A special thank you goes to The MHA Group, MHA Insurance, and WHA Financial Solutions, who have once again renewed their memberships as Corporate Champions for 2007, each contributing $10,000. In addition, WHA has two new Corporate Champions: C.G. Schmidt, Inc., a complete quality health care construction company offering construction, construction management, design-phase and design-build services in southeastern Wisconsin; and Hall, Render, Killian, Heath & Lyman P.S.C., a full service health law firm with offices in Wisconsin, Indiana, Kentucky and Michigan. Thank you to those two companies who increased their level of membership to Corporate Champion in 2007.

Additionally, in 2007, WHA has nine Corporate Partners, each contributing $5,000. The 2007 Corporate Partners include: A’viands Food & Service Management; The Boldt Company; Dairyland Healthcare Solutions; Delta Physician Placement; Gilbane; Hoffman; Lincoln Financial Group; Midwest Medical Insurance Company (MMIC); and Sodexho Health Care Services. A big thanks to each of these organizations as well.

A list of all current 2007 WHA corporate members is included in this week’s packet. Full company descriptions are included in the 2007 WHA Directory and on the WHA Web site (www.wha.org). In February, WHA will once again publish "Business Connection," a directory of services provided by corporate members distributed directly to a variety of hospital decision-makers.

You will continue to see and hear about these WHA supporters in a variety of ways throughout 2007. Remember to consider these corporate member organizations when you have a need in your hospital, and to pass their information on to other decision-makers in your facility. Additionally, thank them for their support of WHA and health care in Wisconsin when you see them at events such as the Wisconsin Rural Health Conference, the Annual Convention, and the Wisconsin Quality & Safety Forum. Additionally, encourage companies that work with your hospital to consider supporting WHA through corporate membership.

Langlade Memorial Hospital in Antigo makes a direct dollar investment in workforce by supporting local schools with donations. In 2004 and 2005 the hospital contributed $10,000 to Northcentral Technical College to support hiring additional instructional staff. With a new building, the school had the space for additional students but not the clinical faculty to supervise students. The hospital also provides in-kind support to clinical programs of nearly $40,000 in staff time for clinical supervision, preceptorships, and mentors.

Janelle Markgraf, human resources director at Langlade Memorial Hospital, says, "We consider these dollars wise investments in the future workforce here at the hospital. Our staff investment and our contribution enable more workers to complete their education, enter the workforce, and ensure availability of care in this region."

Submit hospital community benefit stories to Mary Kay Grasmick, editor, mgrasmick@wha.org or call 608-274-1820.

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