November 18, 2011
Volume 55, Issue 44

Economic Impact, Medicaid, Insurance Reforms Top Issues at WHA Public Policy Meeting
"Innovative growth is coming out of hospitals...that moves the economy forward."

Professor Steve Deller, an economist with the University of Wisconsin-Extension, studies the Wisconsin economic climate from every perspective and on November 15 he shared his insights with WHA Public Policy Council members at their meeting in Madison.

Deller, lead author of "Healthy Hospitals. Healthy Communities: The Economic Impact of Wisconsin’s Hospitals," illustrated for Council members how Wisconsin hospitals provided relatively stable employment in an economy that has been rocked with uncertainty.

"The impact of the recession has been less severe than you would see in manufacturing or construction. Hospitals tend to be relatively stable because people still become ill and they require hospitalization," according to Deller. "That doesn’t mean they are not experiencing fiscal stress themselves. People are not working, they can’t pay their bills, and hospitals are absorbing these costs."

In addition to being major employers, hospitals are credited with helping move Wisconsin toward a "new economy" built on innovation.

"Hospitals are on the cutting edge. They find new, innovative ways of doing things by using the latest technology and new processes," Deller said. "Even a small, rural hospital is doing that kind of work. A lot of engines that are driving innovative growth in Wisconsin are coming out of hospitals. As you introduce new technology, you are training your employees how to use it or bringing new talent into our state. That moves the economy forward."

Deller encouraged hospitals to create their own economic impact report using the calculator developed by Matt Cures at UW-Extension (see The local hospital economic impact report is a useful advocacy tool, not just in the State Capitol, but it also starts a conversation in the local community about economic and community development.

"You use the economic impact as the (starter) and it evolves to a broader conversation of the role of the hospital in the local community," according to Deller. "When I speak in communities about economic development, it is critical to have everyone at the table—the elected officials, the Chamber, and in most communities, the hospital because it is one of the biggest employers, and it should be an active participant in the conversation."

The Committee also heard from special guest Dan Schwartzer, Deputy Commissioner at the Office of the Commissioner of Insurance (OCI) who spoke on how Wisconsin was approaching implementing the Patient Protection and Affordable Care Act (PPACA). Schwartzer discussed and reviewed the charge of the Office of Free Market Health Care formed by Governor Walker and tasked with the mission of researching and developing what Wisconsin would need to do to implement elements of PPACA. For the Walker Administration, Schwartzer said, that meant in the most market-oriented way possible. In particular, Schwartzer noted the study done by Gorman Actuarial and MIT economist Dr. Jonathan Gruber on how PPACA would impact Wisconsin.

Schwartzer also discussed state legislation related to PPACA, including Assembly Bill (AB) 210, which has passed the Assembly but remains stalled in the Senate. He described AB 210 not as a proposal that crafts new policy, but instead as a bill that updates state statutes to comply with PPACA and allow Wisconsin to maintain regulatory authority over certain aspects of the insurance market.

Schwartzer also discussed the timelines necessary for states to follow for exchange-related efforts as well as ongoing communication with the federal Department of Health and Human Services on necessary benchmarks and potential exchange functionality. If states don’t take the necessary steps and demonstrate the ability to implement their own exchange, the federal government takes over that responsibility.

Medicaid Reform: DHS Submits Waiver to CMS, Continues to Look for Savings

WHA Executive Vice President Eric Borgerding said the Legislature’s Joint Committee on Finance approved the Department of Health Services (DHS) request to submit a request for a waiver to the Centers for Medicare and Medicaid Services (CMS) to make changes to the Medicaid program.

DHS released its reform package September 30 that contained 39 proposals for Medicaid program changes (see 10/14/11 article in The Valued Voice at The CMS approval of the waiver is essential if DHS is to be successful in filling a $225 million hole in the Medicaid budget. The waiver will allow DHS to make changes to eligibility, enrollment, expansion of the Benchmark Plan, and implement medical home models.

"We don’t know yet if CMS will approve all or parts of the waiver," Borgerding said. "What we do believe is this will have national implications."

WHA has supported the reform approach as opposed to across-the-board cuts to enrollment or provider payments. WHA’s guiding principles for Medicaid include maintaining coverage for vulnerable populations encouraging employer-sponsored coverage and reducing cost shifting. However, Borgerding said WHA has concerns about certain aspects of the waiver proposal including standards used to determine Medicaid eligibility and an emergency room co-payment of $100 for benchmark plan enrollees (200,000+ people) not admitted to the hospital.

DHS is attempting to shrink the demand side of Medicaid with co-pays and care coordination in an effort to change behavior patterns, but Borgerding cautioned that it could be a failed experiment if it just shifts costs.

"Hospitals have no control over who comes to the ER, and whether or not they are there for a true emergency," Borgerding said. "Federal law requires hospitals to care for anyone presenting in an ER – regardless of their ability to pay. The data shows that co-pays, which may work in non-hospital settings, go largely uncollected in the ER. The new $100 ER co-pay then becomes nothing more than another multi-million dollar cost-shift to employers and employees in the private sector without better care management in the Medicaid program."

DHS has indicated it intends to work with all parties involved to curb unnecessary ER usage, an effort WHA will participate in and strongly supports.

2011-2012 Legislative Session Updates

WHA staff provided the Council with an update on several proposed pieces of legislation, including the biennial Workers’ Compensation bill (see October 14, 2011 edition of The Valued Voice at Staff summarized WHA efforts to advance a proposal to streamline hospital regulations (see October 21, 2011, edition of The Valued Voice at and provided a status update on the "Apology Bill" (see also October 21, 2011, edition of The Valued Voice), which has passed the Assembly, but remains stalled in the Senate.

Staff updated the Council with the most recent news coming out of Washington, DC related to the federal deficit and super committee action. Within the last week, both Republicans and Democrats have offered up plans to save $1.2 and $2.3 trillion, respectively. However, the sides cannot agree on where deficit reduction should come from, leaving the negotiations at a stalemate moving into the last week before the November 23 deadline for super committee action.

Staff also provided an update on WHA’s ongoing aggressive legislative and grassroots campaign to date, which has netted over 2,000 contacts to Congress via several HEAT alerts, dozens of letters to the editor in papers statewide, trips to Washington, DC to meet with Congress, and a Congressional Dear Colleague letter along with other elements.

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Supreme Court to Hear Health Care Reform Case

The U.S. Supreme Court has agreed to review a case brought by Florida and 25 other states, including Wisconsin, challenging the Patient Protections and Affordable Care Act (PPACA). In the case, the 11th Circuit Court of Appeals ruled PPACA’s individual mandate unconstitutional, but said the provision could be severed from the rest of the law, which should be left intact.

The Supreme Court will review the individual mandate and its severability, PPACA’s Medicaid expansion, and whether the Anti-Injunction Act bars federal lawsuits against the individual mandate before the provision takes effect. The Court scheduled oral arguments for March 2012. The arguments will include two hours on the constitutionality of the individual mandate, 90 minutes on the issue of severability, one hour on the Anti-Injunction Act, and one hour on the constitutionality of the Medicaid expansion. The case briefs are available on the Court’s website at:

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CEOs Take to Local Papers to Express Concerns on Federal Deficit Cuts

As the "super committee" continues its effort to come up with at least $1.2 trillion in federal deficit savings, several proposals being vetted would impact small, rural hospitals known as Critical Access Hospitals (CAHs). Over the past few weeks, newspaper articles, editorials and letters to the editors have run in papers across the state. We wanted to make sure you saw a few excerpts of what they were saying in their opinion editorials and letters to the editor…

Article: Panel Targets Rural Hospitals for Budget Cuts
Leaders from Wisconsin hospitals, including Ministry Eagle River Memorial Hospital, descended on Washington, D.C. last Friday seeking support for rural-critical access hospitals (CAH) threatened by Medicaid and Medicare cuts…Sheila Clough, president of Ministry Howard Young Health Care, was among the local hospital leaders on Capitol Hill… "The message to our legislators was we really need to support critical-access hospitals," said Clough. "If Congress does not give that support, it will impact access to health care in rural communities."
Article ran in the Vilas County News-Review on November 11, 2011.

Vilas County News-Review Editorial: Critical Care Access Program Essential To Hospital Here
The federal government has a monumental task at hand as a committee tries to cut $1.2 trillion from its annual budget, but Eagle River and surrounding communities would be severely impacted if Congress votes to end the Critical Care Access designation…Ministry Eagle River Memorial Hospital has survived to see its 50th anniversary because of that designation, which allowed struggling rural hospitals to qualify for full Medicare reimbursement. Four out of every five patients seen at our hospital are on Medicare. Anything less than 100% reimbursement will mean losses that the hospital can’t sustain, and it will once again be faced with closing its doors.
Editorial ran in the Vilas County News-Review on November 11, 2011.

Letter to Editor: Proposal Hurts County Hospitals
We all place a high value on being able to access health care close to home. Not only do Indianhead Medical Center (IMC) and Spooner Health System (SHS) provide top-notch care, but are economic engines that keep our local economy vibrant. That is why we are concerned with proposals being discussed in Washington, DC that threaten rural hospitals…Rural hospitals are some of the largest local employers in many areas and provide family sustaining wages that are, on average, higher than other industries. Together IMC and SHS employ over 200 people. These employees in turn support local businesses through their purchases…We are proud to serve as the CEO’s of the respective hospitals and desire to see our hospitals continue to thrive and provide great care to our patients. To do so, we as a community must stand together against these cuts. Please remind our Members of Congress to continue their strong support for rural hospitals by opposing proposals that hurt critical care in our communities. 
Paul Naglosky, CEO, Indianhead Medical Center (Shell Lake) & Mike Schafer, CEO, Spooner Health System in the Spooner Advocate

Letter to Editor: Keep Rural Hospitals Working
As President of Ministry Good Samaritan Health Center, I may be a bit biased when I say we are fortunate to have a hospital in Merrill. I believe this with all of my heart… We constantly are working to improve and maintain our quality and customer service. But now smaller, rural hospitals are coming under attack. The designation "Critical Access Hospitals" allows some costs to be reimbursed by Medicare. This reimbursement is what allows the hospital to remain financially viable…I recently learned that there are proposals at the federal level to decrease the reimbursement to Critical Access Hospitals—and more alarmingly, a proposal to remove the Critical Access Hospital designation from hospitals that are within 10 miles, or possibly 15 to 20 miles, of another hospital. At least eight Critical Access Hospitals in Wisconsin would lose their designation under this rule and perhaps not be able to remain open. Ministry Good Samaritan could be affected if the proposal is changed to include hospitals 15 to 20 miles from another.
Kris McGarigle, President, Ministry Good Samaritan Health Center in the Wausau Daily Herald

Letter to Editor: Federal Proposals Hurt Hospitals
Health care provided by local professionals is something we all value, and Essentia Health-St. Mary’s Hospital of Superior is proud to provide care to our local community…The Congressional "super committee" is crafting proposals to find over a trillion dollars in deficit savings—and many of those proposals are targeted directly at hospitals. The proposals currently being considered in DC include a variety of payment reductions or other policy changes under the existing Medicaid and Medicare programs, all of which negatively impact hospitals’ ability to best serve their communities and patients. Despite declining reimbursements, Essentia Health-St. Mary’s Hospital of Superior continues to focus on the delivery of high quality, cost-effective care—we are proud to serve our community in this way. Congressman Duffy and other members of our Wisconsin delegation have long been strong supporters of rural health care, and we thank them for this support. We encourage our delegation to stand with us in opposition to Congressional proposals that negatively impact Essentia Health-St. Mary’s Hospital of Superior’s ability to care for our community.
Mary Shaw, Administrator, Essentia Health – St. Mary’s Hospital of Superior in the Superior Telegram.

Letter to Editor: Federal Proposal Could Adversely Affect Rural Communities
Since 1904 Stoughton Hospital has proudly provided health care to Stoughton and surrounding communities. Those of us who work at Stoughton Hospital are your family, friends and neighbors; we are invested in the communities we serve. We hope you have grown accustomed to the award-winning care we provide…Today our federal government is proposing legislation that would cut payments to rural hospitals…These proposed cuts will seriously affect Stoughton Hospital and the communities we serve, potentially reducing the services and other community benefits we provide…
Terry Brenny, President & CEO, Stoughton Hospital in the Stoughton Courier Hub

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President’s Column: Not So "Super"

In less than one week the Joint Deficit Reduction Committee (aka - the Super Committee) must deliver a deficit reduction deal to Congress that, through a combination of revenue increases and spending cuts, reduces the federal budget deficit (currently at $15 trillion and climbing) by at least $1.2 trillion over the next ten years.

Failure to accomplish this task—or failure by Congress to pass the bill by Christmas—will automatically trigger spending cuts including a two percent payment cut to all Medicare providers beginning in 2013.

The prospects for significant new provider payment cuts is significant and all but certain. And incredible as it may sound, Medicare providers may actually be better off with the two percent cut (from a program that pays hospitals and doctors less than 80 cents on the dollar) than from the Super Committee’s plan. For example, Democrat members of the committee reportedly have offered up provider payment cuts that are twice as high as the two percent cuts included in the automatic trigger.

The fact that Wisconsin hospitals are already on the hook for $2.6 billion in payment reductions over the next year to pay for PPACA coverage expansions in 2014 seems to be unimportant for many lawmakers and for an Administration that extracted the cuts as part of a larger "deal" less than two years ago. That fact alone promises an almost flat line Medicare payment glide path (no inflation updates) over the next decade. Additional cuts will mean negative annual updates for PPS hospitals. CAH reductions are also very much in play.

The truth is that we have two publicly-financed health care programs that are unsustainable. The easy way out for lawmakers is to again "slash and burn" provider payments in order to artificially "balance" the budget, thus kicking the can down the road for another year or two. The alternative is a massive systemic "reform" of the programs, including serious discussion of the Premium Support approach that Congressman Ryan and Presidential candidate Romney have recently championed.

But the prospects of working hard to accomplish anything more than minimizing the "slash and burn" of fee-for-service price fixing in the near term are negligible. So "minimizing" the damage is what we’ll work hard to least for now. Opportunity may present itself post November 2012.

Steve Brenton

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Wisconsin Hospitals Community Benefits: Tobacco Use and Exposure

Tobacco use is the single most preventable cause of disease and death in Wisconsin. More people die of tobacco-related disease than alcohol, cocaine, heroin, homicide, suicide, motor vehicle accidents and HIV/AIDS combined. Wisconsin hospitals offer a variety of education and smoking cessation classes to help people kick the habit. In addition, all Wisconsin hospitals are tobacco free, campus wide, to signal their support of creating an environment that promotes wellness.

Freedom from Smoking program

Residents of Green Bay and surrounding counties can find help for their smoking addiction at the Freedom from Smoking program offered at Aurora BayCare Medical Center. The program was established in 1999 and is an eight week session that prepares participants to quit smoking. It is a fee based on the ability to pay program. The instructors are trained and certified by the American Cancer Society and American Lung Association.

Bill Charles of New Franken, Wis. decided that after 20 years of smoking he was going to join the Freedom from Smoking program. This was not the first time he attempted to quit – he had tried 15 times before, but he always relapsed. Bill noted, "I was smoking at least one pack a day, and two packs if on vacation or when I was out with friends. I was an aggressive smoker. I refused to go into a restaurant that did not offer a designated area for smokers."

Bill felt that everyone in the class had similar problems. "It really meant a lot to me to have Margie Reichwald, Freedom from Smoking instructor at Aurora BayCare Medical Center, who went through the experience and understood how difficult it was for the group to quit," said Bill.

The class was broken into two sections. The first section was focused on how to prepare to quit. The participants gathered information, made a plan, and tracked what was most desirable in order to give up the smoking habit.

The second part of the class was learning how to cope and live after quitting. "If you smoked for years, and that cigarette has always been there for you during hard times, it is like losing a friend," said Bill. The class also covered a grief process. "In my class, everyone wrote a letter to their cigarette. We told it why and how we plan to quit. It truly worked for me, as I reflected back when I started smoking at 19 years old. I thought I was invincible and bulletproof."

The class taught participants how to prevent weight gain and minimize stress through breathing exercises. They developed a fitness routine with planned rewards. "You can’t leave any room for error. You cannot allow any excuses to creep back in because you are surrounded by other smokers who will know," said Bill.

By the end of 2009, Bill was smoke free and signed up for a marathon. The marathon not only helped him with his physical health, but he was able to manage and prevent weight gain. Bill was offered a part-time facilitator position with the Freedom from Smoking program because Margie was so impressed with his determination and overall accomplishments. Bill proudly accepted the facilitator position at Aurora BayCare Medical Center.

In addition to exercising, Bill joined Yoga class to aid in relaxation. Bill noted, "I went through a life- changing experience. Because of smoking, I was not able to smell pizza, and after 20 years I forget how amazing pizza smells. My cholesterol was always bad and I did not eat healthy. Now my lifestyle has changed. I was able to run two marathons and my life has improved because I am now smoke-free. I think it is the best experience that ever happened to me. I am now able to support so many people through the Freedom from Smoking program and hopefully help them get their life back, as I did with mine."

Aurora BayCare Medical Center, Green Bay

Teaching the harm of tobacco use

Thirty-two high school students from Black River Falls, Melrose-Mindoro, and Alma Center-Humbird-Merrillan School Districts participated in the Teens Against Tobacco Use (T.A.T.U.) Program. The Partners of Black River Memorial Hospital sponsor this program along with involvement from the Jackson County Public Health Department, Jackson County Schools, WIC, and Together for Jackson County Kids.

T.A.T.U. is a national program developed by the American Lung Association, the American Heart Association and the American Cancer Society. The program trains high school students to teach elementary students about the harmful effects of tobacco use. In Jackson County, the teens present lessons with follow-up materials to all fourth-grade students in the school districts of Black River Falls, Alma Center-Humbird-Merrillan, and Melrose-Mindoro.

Training sessions for the high school students were conducted at their schools in September. Instructors included public health nurse Kristi Hanson and Partners: Patsy Elrod, Darlene Neisner and Joan Ferrario.

The teens learned about the many dangerous chemicals in cigarette smoke, the negative health effects of tobacco use, and the powerful influence of tobacco advertising. Teens learned how to do demonstrations using pig lungs. Two pig lungs, one healthy and another treated to represent the black lung of a pack-a-day smoker, show the effects of smoking on the human lung. The training also stressed the powerful influence that teenage youth have as role models with elementary students. The teens worked together to develop a short summary of their plan.

The T.A.T.U. teens made presentations to fourth-grade students in October. The teens used the pig lungs and many other visual aids in their presentations. They gave classroom teachers a letter about the program to send home to parents, a cost-of-smoking math lesson and information about the Smoke Free/Anti-Tobacco Poster Contest for the fourth-grade students. Four winning posters will be placed on billboards in the Black River Falls area during the month of January, 2011.

T.A.T.U. is one of the health education programs sponsored by Partners of Black River Memorial Hospital and funded in part through a grant from the Lunda Charitable Trust.

Black River Memorial Hospital, Black River Falls

Submit community benefit stories to Mary Kay Grasmick, editor, at

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