Speaking at WHA’s September 30 Public Policy Council meeting, State Budget Director David Reimer shared the Doyle Administration’s views on the state budget, particularly Medical Assistance funding and health care reform. Reimer said Governor Doyle is committed to identifying methods of increasing access to health care for the uninsured, improving the MA program, and lowering costs and improving quality for private payers. But, he warned many factors, including fluctuation in state tax revenues and less than estimated federal aid, could make Wisconsin’s budget situation a priority in the short term. Reimer said the size of the MA, BadgerCare and SeniorCare budget, its unpredictability and its volatility drives a majority of other budget decisions.

"If you think about Wisconsin as a corporation, its core businesses would be education and health," Reimer said, pointing to the fact that more than half of the state’s annual $24 billion budget is allocated to these two services. "For schools, we can predict the amount of funding needed and limit the state’s commitment if deemed appropriate; we can’t do those things with health care."

Reimer said predicting how many low-income residents will need government-sponsored health care is not as straightforward as predicting the number of disabled and elderly in need of MA services.

"Stagnant incomes, increasing health care costs, and declining availability of employer-sponsored plans means there’s no light at the end of the tunnel as far as increased enrollment," he explained.

Reimer said Governor Doyle’s goal was to meet these increased needs without limiting eligibility, eliminating benefits, or cutting provider reimbursement. According to Reimer, this was done by increasing cost sharing by enrollees.

"This approach really distinguished Wisconsin from other states," Reimer said. "Even in the face of the $3.2 billion deficit, we did not make any structural changes to MA, BadgerCare or SeniorCare."

Reimer defended the Governor’s proposal to fund these programs with, among other things, $200 million from the Patients Compensation Fund and cuts to Graduate Medical Education (GME). He argued that using $200 million from the PCF to fund MA would not jeopardize Wisconsin’s favorable medical malpractice environment, especially since the proposal required the state to backfill any PCF shortfall. (See September 12 Valued Voice for more information on the Administration’s position.)

He said while the Governor supports GME, he decided preserving the structure of core programs was a priority in all instances, even when it meant cutting programs he favors. "The Governor does not have any philosophical objection to GME - in fact, he would like to preserve it," Reimer said. "He had to make these difficult cuts in order to balance the budget and preserve key programs."

Reimer called Wisconsin’s health care market dysfunctional, arguing that it does not promote high quality or low cost. He said requiring employees to pay more for their insurance will not address increasing health care costs as long as employers aren’t making decisions based on quality.

"If Wisconsin can figure out a new system for buying health care coverage, reducing the number of uninsured or underinsured, and increasing quality all while reducing costs, it will be an extremely powerful marketing tool as the state strives to attract new businesses and workers," he said. "It’s key to the state’s economic development plans."

Reimer said because aging baby boomers in need of health care services and school-aged children will outnumber wage earners beginning just ten years from now, Wisconsin’s ability to generate more economic activity, attract venture capital and become a magnet for college graduates is crucial. According to Reimer, without this growth, Wisconsin will not be able to finance needed health care and educational services in the very near future.

Reimer pointed to recently approved laws requiring the establishment of a prescription drug purchasing pool and the tiering of state employee health plans based on cost and quality as first steps toward controlling health care costs. Reimer said the state is self-insuring for employee prescription drug benefits, using a benefit manager and preferred drug list to control prices. If the purchasing pool is successful, he said the Administration hopes to extend it to the private sector.

Under the tiering plan, the Department of Employee Trust Funds placed health plans in one of three tiers based upon the plan’s per-person, per-month risk adjusted cost and its adherence to Health Plan Employer Data and Information Set (HEDIS) and Leapfrog Group standards. Employees choosing plans in lower tiers will pay a higher percentage of the monthly premium.

WHA President Steve Brenton said the tiering is only as reliable as the methodology used to evaluate cost and quality, adding that the quality information available will change and increase tremendously over the next few years.

"Still, this is a radical departure from some of the soundbite solutions of some of the others in the state," Brenton said. "I commend you on using this approach."

Reimer said the risk assessment methodology will be reviewed and possibly adjusted each year, and encouraged WHA to provide input.

Reimer pointed out that once the tiering was completed, health plans were given the opportunity to reduce costs and move into higher tiers. He said decreased costs were fueled by discounts from providers. Some council members expressed concerns about additional cost shifting resulting from artificially pushing prices down with the tiering program.

"Right now you’ve just got a system that beats down the price of providers and cost shifts to private payers," said Council Chair Mary Starmann-Harrison, regional president/CEO, SSM Health Care.

"At some point, there will be no one to cost shift to and the whole system will explode," said Dennis Pope, vice president, public relations, Mayo Health System.

Reimer disagreed, saying state employees are not a large enough portion of the insured population to have such an effect, but also stated that the private sector may at some point be allowed into the plan. Starmann-Harrison said in order to successfully control health care costs in the long term, the state must have a strategy to address utilization as well. Brenton and Meriter Hospital Vice President of Planning Fred McGee agreed, arguing that health plans should be allowed to provide different co-pay options and design creative benefit packages.

"The fundamental flaw with the state’s program is mandating a single design," said Brenton. "By imposing a mandatory benefit package, the state is disrupting a real opportunity to address the cost issue, while at the same time ignoring the utilization side of the cost equation."

Reimer responded with concern about the ability to design co-pays and other pricing incentives that discourage inappropriate utilization, but not appropriate utilization and encouraged council members to share their ideas with him. He said the administration is supportive of cost sharing of premiums as well as co-pays.

"We have more provider lead health plans in this state than most and some of the best in the country," continued Brenton. "Who better to design appropriate incentives for appropriate utilization?"

The House and Senate on September 30 approved a six-month extension of the increased Medicare base payment rate for hospitals in rural and other urban areas. The temporary increase, originally passed in February, will continue to make the base rate for rural and other urban hospitals equal to that for hospitals located in large urban areas. The current provision expired at midnight September 30, the end of the fiscal year.

Equalizing the standard amount is a key building block in our federal advocacy agenda to fight for more adequacy and equity in Medicare and Medicaid payments. This six-month extension will bring more than $8 million in additional Medicare payments into Wisconsin hospitals.

The six-month extension, in addition to protecting those payments for rural and other urban hospitals, also will allow time for efforts to convince Medicare prescription drug bill conferees to permanently fix this inequity, among our other issues, in their final bill.

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I would love to see the impasse broken because of the provider provisions, especially since it helps hospitals in rural areas. It would be a tremendous help to providers because it deals with reimbursement and physician rate cuts, two issues that are long overdue. Separating the issues could prove difficult, as a lot of senior citizen groups want them attached because they believe if provider reimbursement is not attached, the prescription drug bill won’t pass on its own. The prescription drug bill is being held up because in rural areas there are not a lot of options in private insurance plans that make the prescription drug plan feasible. The argument is that in rural areas where they do not have access to private plans, there should be a Medicare fall back provision so they can receive their prescription drugs through the traditional Medicare program. Others say it is the premium support portion causing the roadblock. It is difficult to predict how it will be reconciled. President Bush may have to weigh in on the issue and lend direction to the conference negotiations so we have final agreement at the end of the day. It is critically important to do the prescription drug portion right the first time. It constitutes the largest expansion of entitlement spending in the last 40 years. Unless there is cost containment, it would become very expensive, very fast.

We need to deal with the inadequacies of the current Medicare system and work with the prescription drug industry on cost measures so it is not a runaway train when we provide this benefit to our senior citizens.

The biggest concern is that of rising health care costs for businesses, large and small, and for family farmers. They are very concerned about where this road is leading, and they cite the problem of rising health insurance premiums. That is what I hear most—not quality issues—it is the affordability of health care and that is where we are going to have to be creative.

To address this issue, I introduced a health insurance plan for small business and family farmers modeled after the federal health insurance plan. In my proposal, these businesses would be allowed to enter a purchasing pool and with this combined negotiating power, choose from a menu of plans that makes sense for them in their situation, while keeping premium costs in check. Included in this plan are premium support payments for those businesses with fewer than 50 employees, which would include farmers. It fits into the budget resolution, costing $50 billion over 10 years. Conservative estimates are that it would provide coverage for an additional 17 million Americans who currently are uninsured while saving 15-20% on premium costs.

It is incumbent upon us to focus on lowering health care costs. One thing we could do is deal with the Medicare reimbursement shortfalls and reduce cost shifting to private plans and payers. I am working hard on the provider piece to improve reimbursement for Wisconsin providers. Some providers have taken time to educate the general public on the causes of health care cost increases, and they explain cost shifting that occurs due to inadequate Medicare reimbursement. In addition, a large component of the increase in costs is prescription drugs. There are a variety of proposals that would help curtail costs, like generic competition and allowing the federal government to negotiate price with the pharmaceutical industry, as the Veterans Administration is currently doing. Unfortunately, the Medicare Reform Bill actually has language in it that specifically prohibits any price negotiations with pharmaceutical companies. The Secretary of HHS should have the ability to negotiate prices so as a means to control Medicare entitlement spending.

My committee worked hard to address the nursing shortage crisis, in particular. We passed the Nurse Reinvestment Act and provided scholarships to students entering nursing. We made similar provisions for other occupations that are in high demand, making a special effort to ensure that an adequate number of these trained health care professionals practice in rural areas. The higher education bill is about access and financial aid to those who enter a career in medicine. I hope we can get it properly funded. With massive federal deficits that grow deeper each day, the funding situation is getting worse. However, in spite of this, we need to give priority in investing in our future, which includes properly funding health care education and training.

This is an excellent idea—providers, on a volunteer basis, establishing criteria on which quality is measured in all hospitals in Wisconsin is a very positive development. The more educated and informed consumers and purchasers are, the better off we all are. Many people have no idea of how much their treatment costs, and they become frustrated when they ask for details about the cost, and they can’t get that information. Consumers need to be cost conscious so their expectations are not off the scale. We see them make medically unnecessary visits to the emergency room, which drives up the cost of health care. It is my hope that federal government will look at Wisconsin as model for establishing a nation wide quality initiative.

Health care is the #1 issue; it is the 800-pound gorilla in Washington. It is a complex subject and one that is terribly important as we face an aging population and watch 80 million baby boomers enter retirement over the next few years. We must be able to pay for the marvelous advances that are made every day in treatment and technology.

I truly believe that Wisconsin’s pairing of state-of-the-art technology with highly trained, well-educated nurses, doctors, and other medical workers makes us a national leader in health care. We are so lucky to live in a state with such a high quality of care, and I am doing all I can in Congress to further improve health care in our country and our state.

WHA Distinguished Service Award:
Tom Miller, III, Vice President, Myrtle Werth Hospital, Menomonie

WHA Trustee Awards:
Mike Boss, Sauk Prairie Memorial Hospital board of directors
Mike Murry, Wheaton Franciscan Services board of directors

W-ONE Nurse Leader of the Year:
Gerri Staffileno, Director of Patient Services, Columbia St. Mary’s, Milwaukee

ACHE Young Healthcare Executive:
Linda Smith, Aurora BayCare Medical Center, Green Bay

Global Vision Community Partnership Awards:
Waukesha Hispanic Health Initiative
IMPACT Child Development Screening Program
Infinite Boundaries

Partners of WHA Best of the Best Award:
Craig Kantos, CEO, Riverside Medical Center, Waupaca

Partners of WHA WAVE Awards (Wisconsin Awards for Volunteer Excellence)
Category: Community Service Program
Program: "Employee Assistance Program Fund"
Organization: Auxiliary of Riverside Medical Center, Waupaca

Category: In-service Hospital Volunteer Program
Program: "Adopt a Flowerbed"
Organization: Fort Atkinson Memorial Health Services Auxiliary

Category: Fundraising Program
Program: "Annual Charity Ball"
Organization: St. Joseph’s Hospital Auxiliary, Chippewa Falls

Category: Community Outreach and/or Collaboration Program
Program: "T.A.T.U. (Teens Against Tobacco Use)"
Organization: Partners of Black River Memorial Hospital, Black River Falls

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Here are a few excerpts from my President’s Report, presented last week (September 25) at WHA’s House of Delegates meeting.

• WHA Chair Jerry Worrick’s special sense of humor, irreverence and friendship have been refreshing attributes that are recognized and cherished by WHA staff and by the Association’s board.

• WHA must aspire to be an organization that is described by its members and those it relates to as proactive, accountable and effective. The sum of those adjectives will assure value.

Key current and future association "must dos" include:

• Allying with key stakeholders to fashion a private sector health reform agenda that focuses on enabling consumerism, expanding access and coverage (especially for small groups), and demonstrating accountability for providers and for patients.

• Implementing the quality initiative (CheckPoint) and health claims privatization projects…both high profile accountability vehicles.

• Addressing the health care workforce agenda—an agenda that includes the state’s future physician workforce as well as the chronic health care professions shortage.

• Advancing public program payment equity and adequacy issues by focusing on the growing cost shifting problem and its impact on insurance premiums.

• WHA’s greatest assets are found within its highly professional and engaged staff and its committed and active membership.

• Issues emerging from the 2003 WHA annual meeting theme, "The Rise of Consumerism in Health Care" present an astounding opportunity for Wisconsin’s hospitals and health systems to demonstrate a commitment to accountability and connect with our patients and our communities through thoughtful programming and meaningful initiatives.

Members not in attendance at last Thursday afternoon’s roundtable discussion missed a fascinating and thoughtful discussion on issues associated with health care costs, consumer-driven health care, the necessary emergence of value purchasing, and the need for comparable quality, safety and cost information. Special thanks to a fine group of panelists, including:

• Ford Titus, CEO/President, ProHealth Care, Inc.

• Mark Moody, Administrator of Health Care Financing, DHFS

• Chuck Shabino, MD, Chief Medical Officer, Community Health Care, Inc.

• Tim Size, Executive Director, Rural Wisconsin Health Cooperative

• Mary Starmann-Harrison, Regional President, SSM Healthcare of Wisconsin

• John Torinus, President, Serigraph, Inc.

Steve Brenton, President

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This year’s expanded agenda includes national perspectives on the state of health care quality, as well as recognition of statewide initiatives, through both the traditional project showcase and through select breakout presentations.

Kenneth W. Kizer, MD, MPH, president and CEO of the National Quality Forum, keynotes the Forum with a look at the history of health care quality assurance in the U.S., as well as recent trends and forces driving the current quality improvement imperative. Dr. Kizer will also discuss the genesis and maturation of the National Quality Forum, reviewing its work relating to the further evolution of health care quality improvement in our country.

Other general session presentations will focus on the consumer’s perspective of health care in the U.S., working with a computerized physician order entry system, engaging physicians in quality improvement, and a presentation by representatives of the Baldrige Award winning SSM Health Care.

Finally, a special pre-conference seminar focused on the concept of customer service as a component of quality initiatives will be offered from 9 to 12 on October 27. Register now for this pre-conference event, as space is limited.

The full conference brochure with registration information is included in this week’s packet and is available on the web site at www.wha.org. Don’t forget to ask for the WHA room block (group #7119) at The Plaza when making your reservation. The special room rate has been extended, but only until October 10.

For more information on the program content, contact Jennifer Frank at 608-274-1820 or email jfrank@wha.org. For registration questions, contact Bridget Gifford at 608-274-1820 or email bgifford@wha.org.

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On September 23, 2003, the American Hospital Association sent a notice to its member hospitals concerning the new accreditation process being implemented by the Joint Commission on Accreditation of Healthcare Organizations ("JCAHO"). The new process, "Shared Visions-New Pathways," which will be implemented in January 2004, includes a periodic performance review ("PPR") which is a new form of evaluation that is conducted by the hospital organization at the mid-point between triennial surveys and focuses on patient safety and quality of care issues.

The new PPR presents certain legal issues for Wisconsin hospitals involving the potential discoverability of and access to the PPR materials by private litigants and state regulators. In response to a number of similar legal concerns raised by counsel throughout the country, JCAHO is offering two alternative options to the standard PPR requirement. To retain JCAHO accreditation, a hospital must participate in the standard PPR process or one of the options.

Before determining whether your hospital will utilize the standard process or one of the options, it is important to consider the legal implications for each. For a discussion of some of the issues presented by the standard PPR and the options see General Memo 8-03 in this week’s packet from WHA’s Laura Leitch and Matthew Stanford.

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WHA’s 2003 Conference for Health Care Executive and Administrative Assistants will be held November 6-7 at the Great Wolf Lodge in Wisconsin Dells. The conference opens with an optional networking reception and dinner on Thursday evening, and continues with a full day of education on Friday.

This year’s agenda includes a look at generational diversity in the workplace and how best to deal with it; a federal and state legislative update on issues affecting Wisconsin hospitals; and an inspirational session entitled "Unleash Your Potential: How to Bring the Best of Yourself to Your Life and Your Work." The cost to attend both the dinner and the education sessions is $250 per person. A special team rate of $225 per person and education conference only rates are also available.

A block of hotel rooms is being held for attendees at the Great Wolf Lodge at a special rate of $129 for Thursday, November 6. Additionally, a limited number of rooms are being held at a special rate of $179 for both Friday and Saturday nights. The room rates include up to four people and four waterpark passes. Make your reservations now, as the WHA room block and special rates will only be available until October 24.

A brochure and registration form are included in this week’s packet. You can also find program and registration information on WHA’s web site at www.wha.org . For program content questions, contact Jennifer Frank at 608-274-1820 or email jfrank@wha.org . For registration questions, contact Bridget Gifford at 608-274-1820 or email bgifford@wha.org .

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On November 5, WHA is offering "Improving Your Reimbursement Contracts," a one-day seminar taught by reimbursement contract expert Maria K. Todd, PhD, based upon a recommendation by WHA’s Workgroup on Payment Issues of the Council on Finance and Payment.

Recently, the workgroup recommended formal education as one vehicle to assist hospitals in dealing with a variety of payment issues, including silent PPOs, non-standard coding requirements, accountability of third party administrators (TPA), and payment delays from self-insured plans and others utilizing TPAs. This is an important seminar for all business office managers, reimbursement managers, contract specialists, chief financial officers, and others charged with managed care contract evaluation and negotiation to attend.

The seminar is scheduled for Wednesday, November 5, at the Kalahari Resort in Wisconsin Dells, and is co-sponsored by the Wisconsin Chapter of HFMA and the Rural Wisconsin Health Cooperative. The registration fee is $200 per person. A program and registration information can be found on the Web site at www.wha.org . On-line registration is available for this seminar on WHA’s Web site.

For more information on program content, contact Jennifer Frank at 608-274-1820 or email jfrank@wha.org . For registration questions, contact Bridget Gifford at 608-274-1820 or email bgifford@wha.org .

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Learn about the final rule changes and interpretations for the EMTALA (Emergency Medical Treatment and Labor Act) regulations at the October 29 seminar sponsored by WHA. The seminar will be presented by Ralph Topinka, vice president and general counsel of Mercy Health System Corporation in Janesville, and Tom Shorter, attorney with Quarles & Brady.

The seminar will be held from 9:30 to 11 at the Crowne Plaza in Madison. The cost is $75 per person.

As this is a very important topic for WHA members, if you are interested in the program, but cannot attend in-person, send an email regarding your interest to Jennifer Frank at jfrank@wha.org . WHA wants to be sure everyone interested can take advantage of this offering and is pursuing alternative options for getting this information out to all our members.

You can find program and registration information and can register on-line for this seminar on WHA’s web site at www.wha.org . For program content questions, contact Jennifer Frank at 608-274-1820 or email jfrank@wha.org . For registration questions, contact Bridget Gifford at 608-274-1820 or email bgifford@wha.org .

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"Safety Through Action: Uniting Patients, Providers and Purchasers for Safe Health Care" is the theme of the 5th Annual Wisconsin Patient Safety Forum to be held November 12 and 13, 2003. All health care stakeholders interested in improving the safety of the health care system are encouraged to attend.

Presenters include Lucian Leape, MD, whose advocacy for a "systems" perspective regarding medical errors is revolutionizing health care; Peter Buerhaus, PhD, RN, whose research points out important connections between nursing care and patient safety; and Helene Nelson, Secretary of Health and Family Services, who is also co-founder of the Center for Patient Partnerships at UW-Madison.

The conference is produced by the Wisconsin Patient Safety Institute, a unique statewide consortium of health care organizations, practitioners, payers and advocates committed to making Wisconsin the safest place for health care. The conference is made possible in part by generous educational grants and in-kind contributions from Wisconsin Hospital Association, PIC Wisconsin, AstraZeneca, Wisconsin Medical Society, Wisconsin Nurses Association, Pharmacy Society of Wisconsin, Medical College of Wisconsin, and American Society for Quality.

Visit WPSI’s web site at www.wpsi.org for conference details or to register.

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AHRQ announces the fourth event in its series of five free Web-assisted audio conference calls on bioterrorism and health system preparedness.  The fourth call is scheduled for Tuesday, October 21, from 2 to 3:30 p.m., Eastern Time.  It will focus on "The Role of Information/Communication Technology and Monitoring/Surveillance Systems in Bioterrorism Preparedness."   These 90-minute audio conferences are designed to share the latest health services research findings, promising practices, and other important information with State and local health officials and key health systems decision makers.

Visit http://hsrnet.net/ahrq-ulp/bioterrorism/ to see the agenda and sign up for Event #4.

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After an unprecedented tenure of 34 years as president of Community Memorial Hospital (1969-2000) and Community Health Care Services (1988-2003), Robert Drisner announced his retirement effective December 31, 2003. Community Health Care Services is the parent company of the hospital.

Under his leadership, Community Memorial Hospital grew from a 61-bed facility to a 237-bed acute care hospital with 1,400 employees. What began as a small hospital located on what was then 34 acres on the outskirts of Menomonee Falls became a regional medical center under Drisner’s leadership.

"Bob took a small community hospital and had a vision for a major medical campus," said Clarence Dittmar, former board chairman. "When he encouraged the Board to look at a new project or go in a different direction, we knew he already saw the positive impact we could make by providing health services in that geographic area or with that new technology. He had the vision, but he let us think it was our idea."

"What began as a learning experience became much more," said Drisner. "I thought I’d help Community Memorial get established, instead I fell in love with the community and the vision we put together for our hospital."

Drisner has also been a leader at the national and state level in the health care profession. He served on the Board of Directors of the American Hospital Association, 1992-95, as well as chairman of its regional policy board, 1989-95. He has served on the Wisconsin Hospital Association board for many years, including chairman in 1983. He also served on the Council of Regents of the American College of Healthcare Executives from 1985 to 1991.