BLOG Medicine

Peanuts and Popcorn and Arthroscopic Surgery?

A recent Boston Globe article reported that the New England Patriots, Massachusetts General Hospital, and Brigham And Women's Hospital have partnered in a new sports medicine clinic in Foxborough, part of the Patriot Place complex the Kraft family is building around Gillette Stadium.

The plan has been generally well-received, but isn't sitting well with everyone.  Some community hospitals view the partnership as yet another attempt by Boston's academic medical centers to strip the highest paying services, such as MRIs and outpatient surgical procedures, out of local hospitals.

The Foxborough facility completes a competitive horseshoe around the greater Boston area by Partners HealthCare, the parent company of Mass General and Brigham, that will draw patients from as far south as Rhode Island.  The facility will be approximately half the size of a small community hospital, but provide care in some of the most lucrative specialties.  It will have four operating rooms and a collection of advanced imaging machines.  Up to 30 primary and specialty care physicians will work at the facility.

Similarly, Tufts-New England Medical Center plans to build a suburban facility on a yet-to-be-chosen site; it's been reviewing sites in Waltham and Westwood.  Beth Israel Deaconess Medical Center and New England Baptist Hospital are establishing satellite orthopaedics services at Beth Israel Deaconess Hospital-Needham.  Cardiac care, orthopaedics, and oncology services are common "halo" services.  It would be surprising if similar satellite services for cardiac care and oncology aren't already in the works.

Academic medical centers/tertiary care facilities creating feeder networks of community hospitals and outpatient surgery centers through ownership or affiliation isn't a new healthcare business strategy.  University Hospitals of Cleveland and the Cleveland Clinic began utilizing a similar strategy in the late 80s and early 1990s, more or less successfully.  Subsequently, some surrounding community hospitals merged with each other or shut down, decreasing access and increasing healthcare costs.  The Boston market should expect similar fallout.

Patient outcomes, however, should be the factor determining the success of this continuing trend.  If patients gain access to higher quality care, yielding improved outcomes, then the Foxborough facility is a successful community benefit.  If not, then the move is strictly a financial one meant to leech the few remaining dollars available to community hospitals whose mission to provide access to high quality, low cost care will suffer as a consequence.■

U.S. Hospitals Cost Uninsured More

Uninsured patients on average are billed 2 1/2 times more than what the insured are billed through health plans according to a recent study authored by Gerard F. Anderson, director of the center for hospital finance and management at Johns Hopkins University's school of public health.  The study, appearing in the May/June 2007 issue of the journal Health Affairs, has been condemned by the American Hospital Association (AHA), which represents the nation's 5,000 or so hospitals, as out-of-date and methodologically flawed.

Anderson has been throwing around condemnations of his own, stating that "hospitals shouldn't be charging three times Medicare rates, especially from poor people who are uninsured," according to the 8 May 2007 Los Angeles Times.  In California, a law that has only recently gone into effect requires hospitals to offer discounts to uninsured patients who earn as much as 350% of the federal poverty income level, about $70,000 for a family of four.

In 2006, the AHA outlined voluntary guidelines (that include an allowance for discounts to uninsured patients) intended to strengthen a hospital's relationship with its community and to reassure patients, regardless of their ability to pay, of hospitals' commitment to caring.  More than 4,290 hospitals, nationwide, have confirmed their commitment to the AHA's Hospital Billing and Collection Practices: Statement of Principles and Guidelines.

A healthcare researcher such as Anderson knows the relationship (and difference) between, a hospital's cost of care, chargemaster, negotiated price, billed amount, charge amount, and reimbursement.  Anderson's erroneous assertion that hospitals are charging patients different amounts based on ability to pay is both reckless and unnecessarily provocative -- questionable patient advocate and evidently shoddy scholar, Anderson's approach is way off target and helps no one, except perhaps himself.■

NIH Funding Flat

National Institutes of Health (NIH) funding nationwide doubled from 1998 to 2003 but has since remained flat, lagging behind the inflation rate.  Boston's teaching hospitals collectively receive $1.4 billion annually in federal grants, more than any other group of healthcare institutions in the country according to the Conference of Boston Teaching Hospitals, an organization representing 14 institutions and the city's three medical schools that lobbies government on healthcare spending and regulations, economic study.

The report also quantifies the huge contributions to the local economy of the teaching hospitals and the medical schools run by Boston University, Harvard University, and Tufts University.  The hospitals account for $24.3 billion in economic activity annually and the direct and indirect employment of more than 150,000 people in the Boston area.

Also, see NIH in the Post-Doubling Era: Realities and Strategies by Elias A. Zerbouni in the November 2006 issue of Science.■

Patients Negotiate for Health Care

Facilitated by the number of such companies and the ease with which they can accessed, patients are increasingly taking advantage of web-based personal claims adjusters who review doctor and hospital bills and will negotiate on patients' behalf to get a better price.

The Centers for Medicare and Medicaid Services expects health care spending in the United States to more than double to over $4 trillion a year, a fifth of the gross domestic product, over the next decade and overall out-of-pocket expenses for consumers are expected to rise more than 5 percent every year.

Currently, more than 12 percent of working-age adults have out-of-pocket medical costs greater than 5 percent of their annual household income, according to the Center for Studying Health System Change, a Washington research group.  As a result, patients are becoming more comfortable discussing price during their doctor visit and, although pricing is increasingly available to consumers, it's the out-of-pocket expense they're really interested in.

With out-of-pocket expenses for hospital patients expected to increase 9.1 percent in 2007, alone, expect to see use of this type of web-based service increase.■