Tuesday Tidbits

Notwithstanding the fact that federal courts blocked two health insurer mega-mergers, hospitals system mega-mergers continue apace according to Modern Healthcare

Hospitals saw a year’s worth of mega-mergers in the first quarter, four in all, as big systems looked to partners to conserve capital, manage populations, tie up referrals and find efficiencies.  The trend that gave rise to the large health system deals through March is more likely to accelerate than not, said Anu Singh, managing director at healthcare financial advisory firm Kaufman Hall.  Hospital companies want regional, if not national, reach, to be attractive to patients and insurers, Singh said.

 Cost curve up.

Medcity News has an encouraging article about a new primary care provider in Chicago called Oak Street Health that treats Medicare Advantage patients usually in lower income neighborhoods.

The company’s first center opened in the Edgewater neighborhood of Chicago in 2013. Today Oak Street has 20 centers in Chicago and Rockford in Illinois; Detroit, as well as Indianapolis, Fort Wayne, Hammond, and Gary in Indiana. It has 800 employees, including physicians, nurse practitioners, and clinical informatics specialists. In sum, all of its clinics see about 28,000 patients annually.
The company’s model of care focuses on the Medicare patient population, typically in low-income neighborhoods. Their physicians oversee fewer patients (about 500, compared to between 2,000 and 2,500, according to Pykosz) and spend more time with each patient (about 30 minutes) than the average physician (who sees patients for about 13 to 16 min).
“We’re a fully value-based practice,” Myers said in an interview. “We have a unique way to invest in preventive care in a way that keeps people healthy.”
That unique approach involves looking at patients’ lives beyond their particular malady. And that’s the raison d’être for the community centers, regular events for patients, and remote monitoring services. There’s also a van service for patients who can’t make it to an Oak Street facility on their own. Oak Street’s Medicare counselors can assist patients who have questions about their insurance coverage.  * * * According to NEJM Catalyst, thecompany has reduced the hospitalization rate of managed care patients by more than 40 percent.

Speaking of hospitalization, a study in Health Affairs points out that the ACA’s program to reduce unnecessary hospital readmissions via financial penalties isn’t working properly.

The penalty burden was greater in hospitals that were urban, major teaching, large, or for-profit and that treated larger shares of Medicare or socioeconomically disadvantaged patients. Surprisingly, hospitals treating greater proportions of medically complex Medicare patients had a lower cumulative penalty burden compared to those treating fewer proportions of these patients. Lastly, we found that hospitals with high baseline penalties in the first year continued to receive significantly higher penalties in subsequent years. For many hospitals, the HRRP leads to persistent penalization and limited capacity to reduce penalty burden. Alternative structures might avoid persistent penalization, while still motivating reductions in hospital readmissions.

 Ya think?