April 20, 2007
Volume 51, Issue 16
Wisconsin Continues to Lead on Public Reporting
New efforts aimed at aligning reporting efforts
In his report to the WHA Board on April 19, WHA President Steve Brenton said Wisconsin continues to "lead the pack" on private sector public reporting initiatives. "We are proud of the fact that we have total statewide member commitment to publicly report to CheckPoint and PricePoint," he said.
Brenton outlined the WHA public reporting initiatives, CheckPoint and PricePoint. PricePoint has, according to Brenton, become the "voluntary tool of choice" for reporting inpatient and outpatient charges, utilization, and charity care data for state hospital associations across the nation. He said he expects the total number of states that use PricePoint to reach about 16 by the end of 2007.
The Wisconsin Collaborative for Healthcare Quality (WCHQ) members are mostly large hospitals, health systems and medical groups. WCHQ’s focus is on collecting and reporting measures related to physicians. WHA and the Wisconsin Medical Society both serve on the WCHQ Board.
A newcomer to Wisconsin is WHIO – the Wisconsin Health Information Organization. Started in 2006, WHIO was created by state statute and replaces the highly unsuccessful physician office visit data program. WHA and Wisconsin Medical Society are board members, along with state and payer representatives. WHIO expects to develop a data repository by 2007, with a focus on reporting episodes of care, and an overall goal of measuring and improving efficiency.
Brenton said WHA’s priorities related to measurement and reporting are:
He also said WHA is committed to aligning reporting efforts with these organizations to:
"Our goal is to integrate the activities of all four organizations," Brenton said. He told the Board members that this year the WHA Quality Showcase would include WCHQ, Medical Society, and WHIO as co-sponsors, the start of a collaboration that will grow over time. Efforts will continue to drive consumers to the quality portal, www.wisconsinhealthreports.org, so they get a better understanding of the magnitude of public reporting efforts taking place in Wisconsin and access all the information that is available to the public to assist them in making health care decisions for themselves and for their families.
Advocacy Report
WHA Senior Vice President Eric Borgerding provided a status report on advocacy activities at the State Capitol. The hospital tax continues to be at the center of the action. Borgerding said now that we know more about the tax, "we understand that it is not just a ‘spreadsheet issue.’ There are fundamental flaws in the structure of the hospital tax," according to Borgerding. Borgerding and Brenton both reiterated the Board and WHA member’s determination to "stay the course" in opposing the hospital tax.
"We continue to oppose a tax because it sets a bad precedent, the money is available from the tobacco tax to fund the new health initiatives, and current federal law and regulations were ignored in the development of this proposal," Brenton said. "Wisconsin isn’t going to get the waivers it needs to make this tax plan work," he said.
Borgerding said he believes, "The Governor wants to deliver payment improvements he has proposed, but there is one big string attached—at least one-third of the hospital tax revenue must be used to pay for unrelated state spending. We don’t think that’s fair, especially for our patients who will ultimately be paying the tax."
The Governor’s budget has several positive proposals WHA supports, including a $1.25 increase in cigarette tax, coverage expansions for the uninsured, dental access improvements and e-health grants. However, the budget would also transfer $873 million in existing Medicaid revenue to the general fund to support other state spending. The budget would also take $174 million from the Injured Patients and Family Compensation Fund, in addition to one-third of the hospital tax, to backfill the transfer out of Medicaid.
Borgerding noted that many who support increasing the tobacco tax are disappointed that the revenue it generates will be used to backfill the transfer of dollars out of Medicaid. "According to the Legislative Fiscal Bureau, all the revenue from the tobacco tax increase is being used to simply replace a portion of $873 million that’s being taken out of Medicaid," Borgerding said. "That money could be used to expand coverage to the uninsured and a host of other positive health care investments. When you step back and look at how the budget is put together, it’s clear that a hospital tax and IPFCF raid are not necessary—the dollars are already there."
Borgerding encouraged hospitals to continue to dialogue with their legislators throughout the budget debate, which is expected to stretch into the fall.
Task Force on Access and Coverage
Leo Brideau, chair of the WHA Task Force on Access and Coverage, reported that the AHA health reform proposal was discussed at length at the last meeting of the Task Force. He said AHA is moving away from general principles to more specificity, leading to a lot of dialogue on their proposal. At the state level, WHA subsidized a Lewin analysis of the Wisconsin Health Plan that will be released at an event on April 25-26. Brenton cautioned that the proposal "keeps shifting," which could throw the analysis off.
Brideau said the Task Force developed a set of principles that WHA will use in analyzing the myriad of proposals that are being introduced across the state. It was suggested by a Board member that WHA develop a set of talking points that would summarize each health reform proposal that is being debated publicly that can be used by hospitals when they are asked to comment on a specific plan.
WHA has been working with Wisconsin Manufacturers and Commerce, Wisconsin Medical Society, and the Wisconsin Association of Health Plans on a new Healthier Choices proposal. First released in 2004, Healthier Choices takes factors into account that are often not taken into consideration in other health reform proposals, such as utilization.
AHA Washington Meeting
Brenton said 25 WHA members will head to Washington DC in May to participate in the AHA Annual Meeting. He said plans are in place to meet with all members of the Wisconsin Congressional Delegation to deliver the message that Wisconsin is providing information that consumers can use when they are making choices about their health care. Congress continues to be interested in issues related to the tax-exempt status of hospitals, Brenton said. Brenton emphasized the importance of keeping the data that WHA has collected related to hospital community benefits at the forefront of any discussion about this subject.
Advocacy Day Registrations Top 400!Registrations for WHA’s Advocacy Day 2007 have topped the 400 mark again this year and there are still 10 days left to register your hospital employees, trustees and volunteers. Be sure not to miss this premier event slated for May 1 in Madison at the Monona Terrace Convention Center. Hundreds of attendees will also use what they have learned throughout the day on important hospital health care issues to meet that afternoon with their legislators.
Get the pulse of the nation and the state from morning keynote speaker Kellyanne Conway, a nationally known pollster and commentator, who will provide attendees with the lay of the land on American public opinion on issues like health care, "security," entrepreneurship and much more. Key legislative leaders—Senate Majority Leader Judy Robson (D-Beloit), Assembly Speaker Michael Huebsch (R-West Salem), Senate Health Committee Chair Jon Erpenbach (D-Middleton), and Assembly Health Committee Chair Leah Vukmir (R-Wauwatosa)—will round out the morning sessions with a bipartisan panel discussion on health care.
At the luncheon, be prepared to hear from Wisconsin’s Attorney General J.B. Van Hollen on his priorities as AG and areas where cooperation and partnership are occurring. After his presentation you’ll learn who will win WHA’s coveted "Health Care Advocate Award," presented every year to one outstanding legislator, and the "All Star Grassroots Advocate Award," presented to one stellar hospital for grassroots advocacy.
To help prepare you for your legislative meetings in the afternoon, nationally known grassroots guru Amy Showalter of The Showalter Group will provide you with training and insight on effectively communicating with your legislators. She will build on WHA’s issues briefing on proposals in the state budget.
If you haven’t sent your registration in yet, it’s not too late. Join with hospital administrators, nurse leaders, employees, trustees and volunteers from across Wisconsin on May 1 for this grassroots event. To register, log on to www.wha.org/education/pdf/2007advocacyday.pdf or contact Sherry Rabuck at WHA, at 608-274-1820 or email srabuck@wha.org. You may also fax your registrations to 608-274-8554.
As with all of WHA’s Advocacy Days, WHA strongly encourages attendees to put their training into action by meeting with their legislators in the afternoon of May 1. Please contact WHA’s Angela Miloszewicz at 608-268-1801 as soon as possible to inquire about scheduling your legislative meeting.
Wisconsin Hospitals Political Action Campaign Sets New Record in 2006The Wisconsin Hospitals Political Action Campaign raised $187,000 in 2006, exceeding its goal by $2,000. Mary Starmann-Harrison, chair of the PAC committee, said she does not expect anything less than that kind of success in 2007 when she announced the new goal of $195,000 this week.
WHA President Steve Brenton said it was not just the monetary success of the 2006 campaign that was impressive, but the fact that there were more than 100 new participants—a 20 percent increase. "That speaks well to the efforts we have made to encourage our members to have a voice in government. Their voluntary participation helps shape the Wisconsin health care agenda," Brenton said.
The Wisconsin Hospitals PAC has made steady progress since 2002 in increasing participation. The 2006 achievements continue a six-year upward trend in contributions and participation. Six years ago, Wisconsin Hospitals PAC contributions totaled just $60,000.
The Wisconsin Hospitals PAC and Conduit will soon kick-off its 2007 campaign, and Starmann-Harrison is confident the $195,000 goal can be met. "We saw a 20 percent increase in the number of participants in the PAC last year. Based on that, I am confident we can reach our goal," she added.
Proposed Medicare Rule for FFY 2008 Includes Changes to the DRG Classification SystemThe Centers for Medicare and Medicaid Services (CMS) has proposed changes to the Diagnosis Related Groups (DRGs) for Federal Fiscal Year (FFY) 2008 that would restructure the classification system through the addition of "major complication and comorbidity" DRGs. Although the rule includes a 3.3 percent marketbasket update, the standard rate would only increase by 0.9 percent due to a proposed 2.4 percent reduction intended to compensate for anticipated case mix increases resulting from improved coding as hospitals adapt to the new DRGs. In addition, the proposal would decrease capital payments for urban facilities. The changes are part of the Medicare proposed inpatient rule for FFY 2008 that is scheduled to be published in the May 3 Federal Register.
The proposed DRGs, referred to as the Medicare-Severity DRGs (MS-DRGs), would increase the number of DRGs from 538 in the current system to 745. The current Medicare DRGs include 115 DRGs that split based on the presence or absence of a complication or comorbidity (CC). CCs are conditions that require increased resource use and therefore receive higher payment. The MS-DRGs retain the basic logic of the current system but add an additional level by designating certain diagnoses as major CCs. As a result, the proposed MS-DRGs include 152 DRGs that divide into three subgroups (major CC, CC, and non-CC) and another 106 DRGs that divide into two subgroups. According CMS’ analysis, this provides a more accurate match between cost and payments.
In FFY 2007 CMS began a three-year transition to a revised DRG weight calculation methodology. Prior to FFY 2007, weights were calculated based on average charges. In 2007, CMS implemented a new methodology that used national cost-to-charge ratios to estimate average costs for the weight calculation. CMS is not proposing any methodological changes to the weight calculation for FFY 2008 and has continued the transition by calculating the MS-DRG weights based on 67 percent cost and 33 percent charges.
The change from a charge-based weight calculation to a cost-based methodology increased reimbursement for less complex cases and for medical cases, which tended to benefit smaller hospitals and rural hospitals. According to CMS, the proposed MS-DRGs will have an opposite affect by increasing average payments to urban hospitals and to teaching hospitals that tend to treat more severely ill patients.
Other significant provisions of the proposed rule include:
Marketbasket factor: Even though CMS is proposing a full marketbasket update of 3.3 percent for FFY 2008, the standard rate will only increase by 0.9 percent due to a proposed 2.4 percent reduction to account for improved documentation and coding. CMS is concerned that the adoption of the MS-DRGs will create increased aggregate levels of payments as a result of improved coding. WHA will object to this attempt to decrease rates for anticipated behavioral changes prior to implementation of the system. In addition, a 2.0 percentage point reduction would be applied to hospitals that do not submit quality data as required by the Deficit Reduction Act of 1995 (DRA).
Quality Measures: Hospitals will be required to report 27 measures in order to receive the full marketbasket update in FFY 2008, compared to 21 measures in FFY 2007. The six additional measures, which were adopted in the calendar year 2007 Outpatient PPS final rule, include three surgical care improvement measures, two mortality measures, and the Hospital Consumer Assessment of Healthcare Providers and Systems (HCAHPS) patient survey.
Hospital acquired conditions: Hospitals are required to begin reporting on secondary diagnoses that are present on the admission to the hospital beginning on October 1, 2007. By October 1, 2007, CMS must select at least two conditions that are: (1) high cost or high volume or both; (2) assigned to a higher paying DRG when present as a secondary diagnosis; and (3) reasonably preventable through application of evidence-based guidelines. In FFY 2009, cases with these conditions would
not be assigned to a higher paying DRG unless they are present on admission. The proposed rule lists six conditions that CMS is considering for this policy.
Capital Related Costs: CMS is proposing to provide the full capital update of 0.8 percent for rural hospitals and no capital update for urban hospitals in FYY 2008. In addition, CMS is proposing to eliminate the 3.0 percent large urban add-on for capital. The CMS proposal is based on an analysis showing that capital margins have grown for urban hospitals since 1998. Under the CMS proposal, the 2.4 percent reduction for anticipated coding improvements due to the adoption of the new MS-DRGs, will also apply to the capital rates.
Indirect Medical Education (IME): The IME adjustment would increase from 5.35 percent for every 10 percent increase in the resident-to-bed ratio to 5.5 percent as mandated by the Medicare Prescription Drug, Improvement, and Modernization Act of 2003 (MMA). In addition, CMS is proposing to exclude time spent by residents on vacation or sick leave from the calculation of full time equivalents for IME and Direct Medical Education (DME) payment purposes. CMS will continue to allow hospitals to count time spent by residents in orientation activities.
Outliers: CMS proposes to decrease the outlier threshold from $24,485 in FFY 2007 to $23,015. The decrease of the threshold is a result of the proposed implementation of the MS-DRGs.
A display copy of the rule is available at www.cms.hhs.gov/AcuteInpatientPPS/IPPS/list.asp#TopOfPage, click on "Show only items whose Year is 2008" and refer to CMS-1533-P. Please note that the display copy is double-spaced and over 1,000 pages long.
CMS has also posted fact sheets on the proposed rule at www.cms.hhs.gov/apps/media/fact_sheets.asp.
WHA will provide additional information about the proposed rule in the coming weeks.
President’s Column: Medicaid Myths and FactsLegislators and the general public hear a lot about costs associated with Wisconsin’s Medicaid program. But the real facts surrounding Medicaid—Wisconsin’s program providing health care services for our most vulnerable populations—are widely misunderstood.
Last week, this column began exploring common "myths" about Wisconsin’s Medicaid program. Here are two more "myths" and actual "facts" using current data.
MYTH: Health care provider rates go up every year under Medicaid.
FACT: The Governor and Wisconsin Legislature set Medicaid provider payments. Most of those rates have remained stagnant, or in the case of hospitals, have actually been cut, this in spite of increased costs incurred by hospitals to provide inpatient and outpatient services to Medicaid patients. Without inflationary increases, the gap between payment and the cost of providing care has grown larger each year.
MYTH: Underpaying hospitals for Medicaid patients saves taxpayer dollars.
FACT: Wisconsin hospitals have no choice but to shift Medicaid losses to commercial payers—a hidden health care tax. As a result, Wisconsin businesses and families end up with higher insurance premiums.
While hospital payments are being cut, new Medicaid programs are being created or expanded.
Steve Brenton
President
CMS released this week its long awaited revised Medicare Conditions of Participation interpretive guidelines concerning informed decision-making and informed consent in hospitals. The following guidelines have been revised:
The initial reaction to the document has been positive, but the review continues. A copy of the CMS memo to state survey agency directors and the revised interpretive guidelines are available on the WHA Web site at www.wha.org on the Legal and Regulatory page.
Community Benefits: Stories From Our Hospitals – ThedaCare Physicians Raise $10,000 for Anatomy ClassThanks to ThedaCare Physicians–Shawano, students at Shawano Community High School will soon have the opportunity to enroll in a dual-credit anatomy and physiology class, earning both high school and college credits. ThedaCare Physicians presented a check for $10,000 to help fund the new class at the April 2, 2007 meeting of the Shawano-Gresham Board of Education.
In 2006, Todd Stiede, principal of Shawano Community High School, and Rex Wachtel, a guidance counselor at the school, began to explore a way to help the many students who find themselves on waiting lists to get into college nursing programs. They approached Dr. Richard Hess, superintendent of the Shawano-Gresham School District, and the high school’s anatomy and physiology teacher, Angela Kowalewski, with an idea that would allow high school students to earn college credits.
"We had noticed that a lot of students come back to the Shawano area after college to work as nurses and CNAs (certified nursing assistants)," Kowalewski said. "As we learned about their experiences, we found out that many of them were frustrated by long waiting periods to enter nursing programs. Having college credits under their belts when they graduate from high school would help them get a boost on the credits they need, and hopefully allow them to get into nursing programs more quickly."
The group’s idea of offering a dual credit class, however, would cost the school district almost $27,000 – more than was in the budget. Dr. Hess approached Kathy Qualheim, MD, of ThedaCare Physicians–Shawano, about helping launch the class. She responded by enlisting the help of her fellow ThedaCare physicians, including retired cardiologist John Mielke, MD. Together, they raised $5,000 to help purchase the materials required to start the class. ThedaCare’s corporate office matched the gift.
"We are very grateful to ThedaCare," said Dr. Hess. "Dr. Qualheim really stepped forward. She’s always been a great friend of our school district. Without help from her and all the other physicians at ThedaCare, this class would never have happened. It’s a plus for our community and a plus for our students and their futures."
Since many students enroll in nursing classes at Northeast Wisconsin Technical College (NWTC), Kowalewski sought college-level status for the class there. Students who complete the high school class with a C grade or better will automatically receive college credit at NWTC. Those credits will transfer to other colleges and technical schools, including schools in the University of Wisconsin system and private universities.
In order to teach the class at the college level, Kowalewski had to earn adjunct professor status at NWTC, which she did last summer. She completed additional studies, and also took NWTC’s anatomy and physiology class.
"It was important to see how the class is actually taught," she said.
Dr. Qualheim, along with Dr. Mielke, organized an action plan to help the school raise money and called on fellow physicians in ThedaCare’s Shawano office to contribute. They also helped Kowalewski campaign for donations from other local organizations and individuals.
"This is our community, and these are our kids," said Dr. Qualheim. "The more young people we can interest in healthcare careers, the better for the future of care in our area."
In addition to the ThedaCare contribution and the funds budgeted by the school district, grant applications are in process. The start-up funds will be used to purchase specimens and models of body parts.
The high school will offer a trial run of the new class this fall for about 15 students. Although nearly 150 students take anatomy and physiology classes each year at the high school, the dual-credit class will strive for a small student-to-teacher ratio.
Dr. Qualheim has volunteered to present during some class periods next year, as have Tod Lewis, MD, and Michael Williams, MD, also of ThedaCare Physicians–Shawano. Kowalewski hopes to draw on the expertise of other physicians as the class develops.
ThedaCare Physicians–Shawano is the largest multi-specialty physician practice in the region. It began as a physician practice more than 40 years ago, and has been affiliated with ThedaCare for almost 15 years. It employs nearly 170 people, including 17 physicians, at locations in Shawano, Clintonville and Tigerton. More than 20,000 active patients in ten counties make more than 80,000 visits to ThedaCare Physicians–Shawano annually.
ThedaCare™ (www.thedacare.org) is a community health system consisting of Appleton Medical Center, Theda Clark Medical Center, New London Family Medical Center, Riverside Medical Center in Waupaca, ThedaCare Physicians, Ingenuity First, and other health care services. ThedaCare is the largest employer in Northeast Wisconsin with nearly 5,300 employees.
For more information, media may contact Megan Wilcox (megan.wilcox@thedacare.org), public relations specialist for ThedaCare, at 920-830-5847, or John Gillespie, manager of ThedaCare public and government relations, at john.gillespie@thedacare.org, or (920) 830-5846.
Submit hospital community benefit stories to Mary Kay Grasmick, editor, mgrasmick@wha.org or call 608-274-1820.