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On Increasing Price Transparency in Medicine

Posted on September 23, 2009 by Dr. David Edward Marcinko MBA MEd CMP™

About NewChoiceHealth.com

By Staff Reporters

NewChoiceHealth, Inc. is an online comparison shopping marketplace built to provide healthcare consumers a way to save money. With NewChoiceHealth.com, consumers can easily locate medical facilities and compare medical procedure costs for services like MRIs, CT scans, mammograms, and more. Patients may shop nationwide, or right in their own local market from over 20,000 medical facilities for over 400 of the most commonly performed medical procedures.

Employer Portal

The site also features an employer portal to combat the rapidly escalating costs of healthcare. A Medical Cost Action Plan (mCAP) is reported to deliver an independent, unbiased, measurable plan which segments employer’s medical cost consumption categories into measurable Consumer Healthcare Efficiency Indices (CHEI) to deliver an actionable plan that reduces healthcare costs.

The Founder

CEO and Founder Brad Myers is a medical cost expert with 24 years of broad experience and extensive knowledge in medical cost informatics, healthcare insurance, managed care, clinical laboratory, and health and life insurance. His website message to ME-P readers, and others, is “shop & save!”

Assessment

Employee passion drives price transparency to healthcare consumers through the web site www.NewChoiceHealth.com Give it a click, for more information, and tell us what you think!

Conclusion

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Filed under: Accounting, Ethics, Health Economics, Health Insurance, Healthcare Finance, Information Technology, Managed Care | Tagged: Brad Myers, Consumer Healthcare Efficiency Indices, CT scans, healthcare price transparency, Medical Cost Action Plan, medical price transparency, MRIs, www.NewChoiceHealth.com | 4 Comments »

Understanding the Medicare Prospective Payment System

Posted on September 17, 2009 by Dr. David Edward Marcinko MBA MEd CMP™

Origins of Diagnostic Related Groups

By Dr. David Edward Marcinko; MBA, CMP™

[Editor-in-Chief]

The Medicare Prospective Payment System (PPS) was introduced by the federal government in October, 1 1983, as a way to change hospital behavior through financial incentives that encourage more cost-efficient management of medical care. Under PPS, hospitals are paid a pre-determined rate for each Medicare admission. Each patient was classified into a diagnosis-related group (DRG) on the basis of clinical information. Except for certain patients with exceptionally high costs (“outliers”), the hospital is paid a flat rate for the DRG, regardless of the actual services provided.

Enter the DRGs

Each Medicare patient is classified into a DRG according to information from the medical record that appears on the bill:

principal diagnosis (why the patient was admitted);
complications and co-morbidities (other secondary diagnoses);
surgical procedures;
age and patient gender; and
discharge disposition (routine, transferred, or expired).

Medical Records Documentation

Diagnoses and procedures must be documented by the attending physician in the patient’s medical record. They are then coded by hospital personnel using ICD-9-CM nomenclature. This is a numerical coding scheme of over 13,000 diagnoses and more than 5,000 procedures. The coding process is extremely important since it essentially determines what DRG will be assigned for a patient. Coding an incorrect principal diagnosis or failing to code a significant secondary diagnosis can dramatically affect reimbursement.

DRG Categories

Originally, there were more than 490 DRG categories defined by the Centers for Medicare and Medicaid Services (CMS, formerly known as the Health Care Financing Administration [HCFA]). Each category was designed to be “clinically coherent.” In other words, all patients assigned to a DRG are deemed to have a similar clinical condition. The PPS is based on paying the average cost for treating patients in the same DRG. Each year CMS makes technical adjustments to the DRG classification system that incorporates new technologies (e.g., laparoscopic procedures) and refines its use as a payment methodology. CMS also initiates changes to the ICD-9-CM coding scheme. The DRG assignment process is computerized in a program called the “grouper” that is used by hospitals and fiscal intermediaries. It was last significantly updated by CMS in 2006.

Assessment

Each year CMS also assigns a relative weight to each DRG. These weights indicate the relative costs for treating patients during the prior year. The national average charge for each DRG is compared to the overall average. This ratio is published annually in the Federal Register for each DRG. A DRG with a weight of 2.0000, for example, means that charges were historically twice the average; a DRG with a weight of 0.5000 was half the average; and so on.

Conclusion

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Speaker: If you need a moderator or speaker for an upcoming event, Dr. David E. Marcinko; MBA – Publisher-in-Chief of the Medical Executive-Post – is available for seminar or speaking engagements. Contact: MarcinkoAdvisors@msn.com

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Filed under: Health Economics, Health Insurance, Healthcare Finance, Practice Management | Tagged: Centers for Medicare and Medicaid Services, CMS, david marcinko, diagnosis-related group, DRG, HCFA, ICD-10-CM, ICD-9-CM, medicare, Medicare Prospective Payment System, PPS | 7 Comments »

The Largest Purchaser of Domestic Healthcare?

Posted on September 14, 2009 by Dr. David Edward Marcinko MBA MEd CMP™

It’s the Government – Silly

By Ann Miller; RN, MHA

[Executive Director]

By far, our federal government is the largest purchaser of healthcare services, according to Robert James Cimasi MHA, AVA, CMP™ of Health Capital Consultants, in St. Louis, MO; and many others.

Obama Care

Although the government faces immense pressure to control healthcare costs, especially during the current HR 3200-3400 debates, it also faces pressure to expend additional funds in order to achieve its ostensible primary mission in its involvement in healthcare, i.e., to expand and improve public health.

Federal Payment Schemes

In many ways the government has led the way for cost control through its development of resource-based reimbursement, prospective payment systems, budget limitations and other payment schemes. However, its conflicting goals have led it to approach these controls in a hesitant and piecemeal manner rather than effecting bold, comprehensive reforms.

Consider, for example, the lack of government intervention in the face of mounting pressure to remove some of the barriers preventing a reduction in US pharmaceutical costs.

Assessment

Today, most experts agree that Uncle Sam pays for at least 51% of domestic healthcare when Medicare, Medicaid, SHIPS, the VA, Indian and Prison Healthcare Systems are considered. In fact, according to our Publisher-in-Chief, Dr. David Edward Marcinko; MBA:

‘We already have a single payer health system in this country, but most folks just don’t realize it.”

Conclusion

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OUR OTHER PRINT BOOKS AND RELATED INFORMATION SOURCES:

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PRACTICES: www.BusinessofMedicalPractice.com
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CLINICS: http://www.crcpress.com/product/isbn/9781439879900
BLOG: www.MedicalExecutivePost.com
FINANCE: Financial Planning for Physicians and Advisors
INSURANCE: Risk Management and Insurance Strategies for Physicians and Advisors

Filed under: Drugs and Pharma, Health Economics, Managed Care, Military Medicine, Op-Editorials | Tagged: david marcinko, healthcare reform, HR 3200, HR 3400, Indian Health Services, Managed Care, Medicaid, medicare, Obama care, Prison Healthcare, prospective payment systems, resource-based reimbursement, robert james cimasi, SHIPs, VA System | 7 Comments »

On Regional Extension Centers [RECs]

Posted on September 2, 2009 by Dr. David Edward Marcinko MBA MEd CMP™

Another New Governmental Machination?

[By Staff Reporters]

A Regional (health information) Extension Center [REC] is similar to a Health Information Organization [HIO] that brings together healthcare stakeholders within a defined geographic area and governs Health Information Exchange [HIE] among them for the purpose of improving health and care in that community.

Fundamental to this definition is the meaning of Health Information Exchange and Health Information Organization. A Health Information Organization (HIO) is an organization that oversees and governs the exchange of health-related information among organizations according to nationally recognized standards.

Thus, the goal of an REC is to act as a local support organization to help doctors install electronic health records and use them to achieve improved quality, efficiency, and continuity of care.

Past and Present

The RECs are based on the example of agricultural extension offices, established over 100 years ago by Congress, which offered rural outreach and educational services across the country.

Today, the HITECH Act amends Title XXX of the Public Health Service Act by adding Section 3012, Health Information Technology Implementation Assistance. This section provides supportive services for the rest of the HITECH Act. Section 3012 (a) establishes the Health Information Technology Extension Program (Extension Program). The Extension Program provides grants for the establishment of Health Information Technology

Assessment

Link: Regional Extension Center

Link: http://www.chhs.ca.gov/initiatives/HealthInfoEx/Documents/SUMMIT%20DOCUMENTS/RECSummitSlides_FinalDraft-7-15.pdf

Link: HIT Extension Program – Regional Centers Cooperative Agreement Program

Conclusion

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HOSPITALS: http://www.crcpress.com/product/isbn/9781466558731
CLINICS: http://www.crcpress.com/product/isbn/9781439879900
ADVISORS: www.CertifiedMedicalPlanner.org
BLOG: www.MedicalExecutivePost.com
FINANCE:Financial Planning for Physicians and Advisors
INSURANCE:Risk Management and Insurance Strategies for Physicians and Advisors

Filed under: Breaking News, Career Development, Health Economics, Information Technology | Tagged: health information exchange, Health Information Organization, health information technology, Health Information Technology Extension Program, HIE, HIO, HIT, HITECH Act, HR 3200, Information Technology, Public Health Service Act, REC, Regional Extension Center, RHIO, Title XXX | 2 Comments »

Superannuation Demographics for Financial Advisors

Posted on August 25, 2009 by Dr. David Edward Marcinko MBA MEd CMP™

www.CertifiedMedicalPlanner.org

“Live Long and Prosper”

By Dr. David Edward Marcinko; MBA, CMP™

By Thomas A. Muldowney; MSFS, CLU, CFP®, CMP™

By Hope Rachel Hetico; RN, MHA, CMP™

The words of Mr. Spock!

Recently, during my promotional speaking tour for the summer of 2009, I had the occasion to visit a few nursing and related homes for the elderly, sick, infirmed and aged. This harkened warm thoughts back to my time at Temple University in Philadelphia, PA as a young medical student. So, as a health economist and former certified financial planner, I recruited some folks and did some research on the domestic aging population to refresh my understanding of the facts and figures; especially in light of the current healthcare reform political debates [DEM].

Just the Facts

According to the U.S. Bureau of the Census, there were almost 49 million people in the United States who were over age 60 in 2001. There are approximately 4 million people over the age of 85 living in the US and there are over 60,000 people older than age 100 estimated as of July 1st 2004. For every100 middle aged persons in the United States there are at present about 114 persons over the age of 65. This statistic will change as we move forward through time. In the year 2025, there will be about 253 people over age 65 for every 100 middle-aged people.

Enter the Baby Boomers

Beginning on January 1, 2006 at midnight and every 12 seconds thereafter for fifteen years, a baby boomer will have a birthday and cross over the age threshold of age 60. In the next 30 years, the 60+ age group will more than double, becoming 25% of the total population, and will have to be supported by a proportionately smaller workforce. Research published in June 2005 by AARP (based on data from 2002) estimates that: ‘‘In 2002, roughly $140 billion was spent on nursing home and home health care, with 24% of these costs being paid out of pocket” (O’Brien and Elias, 2004).

Aging Boomers

As the baby boom generation ages, the care needs will expand precipitously. Add to this, scientific and technological improvements in healthcare. These very same people will need more expensive healthcare and more expensive custodial care, and they will need it for an even longer period of time. Who will pay for this expanded need is not so clear. What is clear is that it will take money and lots of it to make these payments.

Money Preservation Variables

There are only three variables associated with the accumulation or preservation of money: ‘‘time, money and rate of return.’’ Time is reduced to the following two questions ‘‘How long until I will need my money?’’ and ‘‘How long will I live?’’ an uncertainty to be sure. Rate of return is either a function of the financial markets or the successful maintenance of a Long Term Care Insurance [LTCI] plan. Because of the volatility in the financial markets, the ‘‘money’’ question is equally as uncertain. In order to accumulate sufficient assets; an aging physician must ’tradeoff’ many other alternatives such as ’lifestyle.’

Assessment

What is certain is this—financial planning is important. More important is the implementation.

Conclusion

OUR OTHER PRINT BOOKS AND RELATED INFORMATION SOURCES:

PRACTICES: www.BusinessofMedicalPractice.com
HOSPITALS: http://www.crcpress.com/product/isbn/9781466558731
CLINICS: http://www.crcpress.com/product/isbn/9781439879900
ADVISORS: www.CertifiedMedicalPlanner.org
FINANCE: Financial Planning for Physicians and Advisors
INSURANCE: Risk Management and Insurance Strategies for Physicians and Advisors
Dictionary of Health Economics and Finance
Dictionary of Health Information Technology and Security
Dictionary of Health Insurance and Managed Care

Filed under: Ethics, Financial Planning, Health Economics, Insurance Matters, Research & Development, Retirement and Benefits, Touring with Marcinko | Tagged: AARP, baby boomers, Bureau of the Census, CLU, custodial care, david marcinko, hope hetico, insurance, long term care insurance, LTCI, nursing homes, Thomas A. Muldowney | 2 Comments »

ME-P Healthcare Reform Survey?

Posted on August 18, 2009 by Dr. David Edward Marcinko MBA MEd CMP™

Off-Road Touring with Dr. Marcinko [Part V]

By Dr. David Edward Marcinko; MBA, CMP™

[Publisher-in-Chief]

About Marquette, Michigan

As our ME-P readers are aware, Marquette Michigan has a population of 20,714, and is the UP’s largest community. In addition to being a population center, it serves as the regional center for education, health care, and outdoor recreation. This regional draw is particularly evident due to Northern Michigan University and Marquette General Hospital [MGH]. Naturally, during my recent tour there, I was able to visit both small and large medical practices, clinics and hospitals. Everywhere, the topic of conversation was the Obama Administration’s vision of domestic healthcare reform. And so, after unofficially asking local residents on their feelings in the matter, we are pleased to offer this survey to all readers and subscribers to our Medical-Executive Post.

About Off Road with Dr. Marcinko

These sporadic off-road segments will continue through-out my 2009 summer promotional tour. On the one hand, formal attendance at several engagements was a bit sparse because of the death of several recent celebrities and entertainer types. On the other hand, local book stores and sponsors noted a spike in our CD and book sales, as well as interest in our online www.CertifiedMedicalPlanner.com program and premier quarterly guide: Healthcare Organizations [Journal of Financial Management Strategies] www.HealthcareFinancials.com

Part IV: https://healthcarefinancials.wordpress.com/2009/08/13/off-road-touring-with-dr-marcinko-part-iv/

Speaker: If you need a moderator or speaker for an upcoming event, Dr. David E. Marcinko; MBA – Publisher-in-Chief of the Executive-Post – is available for seminar or speaking engagements. Contact: MarcinkoAdvisors@msn.com

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Healthcare Organizations: www.HealthcareFinancials.com

Health Administration Terms: www.HealthDictionarySeries.com

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Filed under: Drugs and Pharma, Health Economics, Health Insurance, Information Technology, Managed Care, Professional Liability, Quality Initiatives, Surveys and Voting, Voting Polls | Tagged: CDHCP, consumer directed healthcare plans, EHRs, electronc medical records, EMRs, healthcare reform, HSAs, malpratice tort reform, medical records, MSAs, national health care, obama, pharmaceutical pricing, single payer, socialized medicine | 1 Comment »

Health Plan Management Navigator

Posted on August 16, 2009 by Dr. David Edward Marcinko MBA MEd CMP™

August 2009 Edition

By Douglas B. Sherlock; CFA, MBA

Linked below is the August 2009 edition of Plan Management Navigator. In this month’s edition, we update readers on the results for the Blue Cross Blue Shield universe, and provide product breakouts, summary functional area breakouts as well as expense trends. Cost increases are lower this year than last, though higher if product mix is considered. Twenty-two Blue Cross Blue Shield Plans serving 31.3 million members participated in this year’s benchmarking study. Growth in Information Systems and Medical Management costs explained more than 40% of the total increase.

Link: Navigator August 09

Sherlock Expense Evaluation Report

This analysis is based on materials from our Sherlock Expense Evaluation Report (SEER) for Blue Cross Blue Shield Plans. Additional information about SEER is available at http://www.sherlockco.com/seer.shtml or by contacting us.

Assessment

In coming weeks, Plan Management Navigator will summarize other results of this year’s performance benchmarking studies. We expect to publish Medicare and Medicaid editions in late August or early September. Independent / Provider-Sponsored plan results were published two weeks ago in Plan Management Navigator and the associated presentation and transcript are found at http://www.sherlockco.com/

Conclusion

And so, your thoughts and comments on this Medical Executive-Post are appreciated. Tell us what you think. Feel free to review our top-left column, and top-right sidebar materials, links, URLs and related websites, too. Then, be sure to subscribe to the ME-P. It is fast, free and secure.

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Medical Risk Management: http://www.jbpub.com/catalog/9780763733421

Healthcare Organizations: www.HealthcareFinancials.com

Health Administration Terms: www.HealthDictionarySeries.com

Physician Advisors: www.CertifiedMedicalPlanner.com

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Sponsors Welcomed

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Filed under: Accounting, Breaking News, Career Development, Health Economics, Health Insurance, Healthcare Finance, Information Technology, Managed Care, Monthly Reports, Op-Editorials, Research & Development, Sponsors | Tagged: Blue Cross, Blue Shield, Douglas B. Sherlock, health costs, Health Plan Management Navigator, medical cost accounting, medical management, Sherlock Company, Sherlock Expense Evaluation Report | 1 Comment »

Dictionary of Health Insurance and Managed Care

Posted on August 8, 2009 by Dr. David Edward Marcinko MBA MEd CMP™

ADVERTISEMENT

Whither the Dictionary of Health Insurance and Managed Care?

A simple query that demands a cogent answer!

Why do we need the Dictionary of Health Insurance and Managed Care, and, why do payers, providers, benefits managers, consultants, and consumers need a credible and unbiased source of explanations for their health insurance needs and managed care products?

The Answer is Clear!

Health care is the most rapidly changing domestic industry. The revolution occurring in health insurance and managed care delivery is particularly fast. Some might even suggest these machinations were malignant, as many industry segments, professionals, and patients suffer because of them. And so, because knowledge is power in times of great flux, codified information protects all people from physical, as well as economic harm.

We appreciate the support of our sponsors. So, click-on on the links and review all dictionary products.

Link: http://healthdictionaryseries.com/TechnologySecurity.aspx

Link: http://www.findbookprices.com/author/Hope_Hetico

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Sponsors Welcomed

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Filed under: Book Reviews, Career Development, Health Economics, Health Insurance, Health Law & Policy, Healthcare Finance, iMBA, Inc., Managed Care, Practice Management, Recommended Books, Sponsors | Tagged: CPAs, david marcinko, doctors, financial advisors, health information technology, Health Insurance, healthare reform, HIT, hope hetico, INSURANCE COMPANIES, IT, Managed Care, MEDICAL PROVIDERS, nurses, obama, patients, PAYERS, physicians, www.healthdictionaryseries.com | 1 Comment »

Medical Inventory Management Methodologies

Posted on August 7, 2009 by Dr. David Edward Marcinko MBA MEd CMP™

Understanding Traditional Costing Methods

By David J. Piasecki, with
Hope Rachel Hetico; RN MHA, CMP™

A good inventory management system offers opportunities for improved efficiency in any healthcare organization. The following traditional methods of inventory cost accounting and management are useful when one is calculating the cost of supplies (as opposed to medical items for resale and DME).

a. LIFO

The last-in first-out (LIFO) inventory costing method means the last items purchased are the first to be used (at least for cost calculations if the inventory consists of identical units). In times of rising prices, a lower total cost inventory is produced with a higher cost of goods sold. The last items purchased are most often the most expensive, and used first for the calculation. This happens because LIFO increases an expense (cost of goods sold) and decreases taxable income. Given the same revenue, higher expenses mean less profit. Deflation has the opposite effect.

b. FIFO

The first-in first-out (FIFO) inventory costing method means the first items purchased are the first to be used (at least for cost calculations if the inventory consists of identical units). In times of rising prices, a higher total cost inventory is produced with a lower cost of goods sold. This happens because FIFO decreases an expense (cost of goods sold) and increases taxable income. Deflation has the opposite effect.

Note: Any switch from FIFO to LIFO does not change reality, and although a decrease in reported incomes occurs, it does not increase cash outflows. However, for a taxable healthcare entity, after-tax net cash flow does increase.

c. Specific Identification

Specific identification is used for larger pieces of equipment, as it traces actual costs to an identifiable unit of product and is usually applied with an identification tag, serial plate, or radio frequency identification device (RFID) scanner. It does not involve flow-of-cost analysis. It does, however, permit the manipulation of income because healthcare entities state their cost of goods sold, and ending inventory, at the actual cost of specific units sold.

d. Average Cost

Average costing calculates ending inventory using a weighted average unit cost. When prices are rising, cost of good sold is less than under LIFO, but more than that under FIFO, and hence income manipulation is also possible.

e. Just-in-time Management

Although technically not a costing technique, JIT inventory management means that inventory supplies like DME are delivered as soon as needed by the healthcare organization, the prescribing doctor, or the patient. In JIT, inventory is “pulled” through the flow process. This is contrasted to the “push” approach used by conventional IM. In the push system, DME is already on-site, with little regard to when it is actually needed. In the JIT “pull” system, the overriding concern is to keep a minimum cost inventory, so that means having a system in which inventory is obtained on an as-needed basis.

The key elements of JIT consist of six parts:

1. a few dependable vendors or suppliers willing to ship with little advance notice;

2. total sharing of demand information throughout the supply chain;

3. more frequent orders;

4. smaller size of individual orders;

5. improved physical plant (hospital or clinic) layout to reduce travel flow distance; and

6. use of a total quality control system to reduce flawed medical products.

Using the JIT method, inventory is delivered when needed, rather than in advance, saving handling and storage costs. The healthcare entity never needs to stockpile inventory, and cash flow is enhanced. JIT is further characterized as follows:

little or no work orders;
little or no tracing of materials;
fewer inventory accounts or accounts payables;
reduction or elimination of work-in-progress or handling activities; and
no tracing of overhead and direct labor costs

JIT requires a dependable working relationship with suppliers and the precise calculation of inventory needs, especially for the following:

sterile surgical packs;
gastro-intestinal and gastro-urinary instrumentation;
orthopedic and OB-GYN inventory;
invasive heart and lung equipment;
radio isotopes and trace radiographic materials; and
equipment for almost all pre-schedule medical interventions and procedures.

Assessment

This means that, when JIT inventory monitoring is used, healthcare managers are better prepared with the proper inputs to control and reduce inventory, including when dramatic bursts or declines occur. This means a more rapid and higher cash flow balance, rather than inventory balance. Each of these traditional methods of inventory cost accounting is adequate for most healthcare facilities, but as inventory orders and costs continue to increase, economic order quantity [EOQ] costing may be the most effective means of accounting for inventory in DME-intensive organizations.

Conclusion

And so, your thoughts and comments on this Medical Executive-Post are appreciated. Can you think of any other inventory management technologies? Tell us what you think. Feel free to review our top-left column, and top-right sidebar materials, links, URLs and related websites, too. Then, be sure to subscribe to the ME-P. It is fast, free and secure.

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Sponsors Welcomed

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Link: https://healthcarefinancials.wordpress.com/2007/11/11/advertise

***

Filed under: Accounting, CMP Program, Health Economics, iMBA, Inc., Practice Management, Taxation | Tagged: acerage cost accounting, cost accounting, David Piasecki, DME, durable medical equipment, economic order quantity costing, EOQ, FIFO, GI, hope hetico, inventory management, JIT, just in time costing, just in time management, LIFO, managerial acounting, ob-gyn, RFID scanner, specific identification, www.certifiedmedicalplanner.com, www.healthcarefinancials.com, www.medicalbusinessadvisors.com | 2 Comments »

About HealthSpottr.com

Posted on August 6, 2009 by Dr. David Edward Marcinko MBA MEd CMP™

Leading Minds, Leading Change, Leading Healthcare

By Staff Reporters

As a newly launched collaborative website, www.HealthSpottr.com believes in the future of healthcare. According to the site, it exists to showcase emerging innovations and the new faces of leadership who will bring this future to you. Co-founders Carleen Hawn and Lawrence Leisure believe that the powers of technology, design, and business model and care delivery-innovation can transform healthcare. Mostly, they opine that the passion which drove doctors into medicine, engineers into technology, artists into design, and entrepreneurs into business; can be leveraged to bring this future to us all.

Inauguration

In its inaugural issue, HealthSpottr debuted something special: a list of the 100 most creative and influential innovators working in healthcare today. Since the future of healthcare is coming; they highlighted some of the people who will deliver it to you.

Assessment

In a few days HealthSpottr will debut a Weekly Digest, a regular brief on new technology, a business model, a new therapy or scientific discovery with the potential to shift the healthcare economy; so stay tuned!

Channel Surfing?

Have you visited other websites of interest to ME-P subscribers? If you find one that facilitates like-minded idea exchange, and links our community together, please let us know!

Conclusion

And so, your thoughts and comments on this Medical Executive-Post, and HealthSpottr are appreciated. Give them a click and tell us what you think? And, feel free to review our top-left column, and top-right sidebar materials, links, URLs and related websites, too. Then, be sure to subscribe to the ME-P. It is fast, free and secure.

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Physician Financial Planning: http://www.jbpub.com/catalog/0763745790

Medical Risk Management: http://www.jbpub.com/catalog/9780763733421

Healthcare Organizations: www.HealthcareFinancials.com

Health Administration Terms: www.HealthDictionarySeries.com

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Sponsors Welcomed

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Filed under: Alerts Sign-Up, Breaking News, Experts Invited, Health Economics, Information Technology, Media Mentions and PR, Nominations Sought, Research & Development | Tagged: 100 healthcare innovators, Carleen Hawn, Health Economics, healthcare business, healthcare technology, HealthSpottr, Lawrence Leisure | 1 Comment »

About MeaningfulUse.org

Posted on July 23, 2009 by Dr. David Edward Marcinko MBA MEd CMP™

A Dedicated Terminology Website

By Staff Reporters

Understanding and defining the new era of healthcare information technology in America.

The ARRA and HITECH concept of “meaningful use” for e-MRs is nebulous and ill defined. This new website is intended to be a collaborative destination site in order to promote the national dialogue and education around the term, “meaningful use”, by providing the HIT community a single-central location to access resources, influence and discuss the definition of “meaningful use” and learn how to take advantage of the HITECH stimulus funds.

Assessment

According to the site, registration for the www.MeaningfulUse.org discussion board is only used for the purpose of posting and will not be used for any marketing purposes. The site is supported by the Association of Medical Directors of Information Systems (AMDIS) and sponsored by Compuware Corporation.

Conclusion

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FINANCE:Financial Planning for Physicians and Advisors
INSURANCE:Risk Management and Insurance Strategies for Physicians and Advisors

Filed under: Breaking News, Career Development, Glossary Terms, Health Economics, Information Technology | Tagged: AMDIS, ARRA, Association of Medical Directors of Information Systems, CCHIT, Compuware Corporation., economic stimulus funds, HIT, HITECH, IT, Mark Leavitt, meaningful use, www.healthcarefinancials.com, www.healthdictionaryseries.com, www.MeaningfulUse.org | 13 Comments »

Off-Road Touring with Dr. Marcinko [Part I]

Posted on July 20, 2009 by Dr. David Edward Marcinko MBA MEd CMP™

“Using-Up” Health Insurance

By Dr. David Edward Marcinko; MBA, CMP™

[Publisher-in-Chief]

Dateline: June 18-19th, 2009

I flew into Marquette Michigan last night on a puddle jumper from Chicago, Illinois. Marquette will be the home base on my current book promotion and public/private speaking tour. This second leg of our trip, from Atlanta, was delayed for mechanical reasons. So, rather than follow directions from American Airlines regarding new arrangements, and rushing to wait in a long line of humanity for a new boarding pass on a much later flight, I simply called the travel assistance number on my cell phone. We were re-routed by computer from American, to a Delta Airlines flight, that caused no additional time lag as we later learned the other passengers boarded their American flight three hours late. Many of the elderly and slower moving folks even missed connecting flights which necessitated overnight hotel stays, in some cases.

THINK: outside the box independently, and don’t follow directions mindlessly.

About Marquette, Michigan

The City of Marquette is located in the central region of Michigan’s Upper Peninsula. With a population of 20,714, it is the UP’s largest community. In addition to being a population center, it serves as the regional center for education, health care, recreation, and retail. This regional draw is particularly evident due to Northern Michigan University and Marquette General Hospital, both of which are located in the City of Marquette. Of course, I visited both.

Quality Healthcare for the Upper Peninsula

So, the next morning I called some friends who suggested we head over to the Marquette Upper Peninsula Healthcare Network System, on Washington Street, for an unplanned and unofficial stop on our current “signing and opining” tour. It seemed very busy for a Friday morning; so we gathered some colleagues and ambled over to Viering’s Restaurant where we discussed the local economy, current state of the healthcare industry and the Obama Administration’s ideas for healthcare reform. When I expressed my surprise at the number of patients in the clinic waiting room areas, I was informed that an unexpected corporate layoff resulted in patients “wanting to use their health insurance, before being RIFed [Reduced-in-Force].” Now, as a doctor, and insurance agent, I find this attitude both very strange; yet not uncommon.

“Using-Up” Health Insurance

I can honestly say that after more than three-decades in the business, I have never heard a single soon-to-be unemployed client say,” I need to use up my life insurance”, or “auto insurance”, or “homeowner’s insurance”, etc. So, what gives with health insurance?

Health Insurance IS Different

Insurance of all types is sold to economically protect against catastrophic events like pre-mature death, auto accidents, or home destruction. But life insurance doesn’t pay for non-lethal issues; auto insurance doesn’t pay for new tires, tune-ups or oil changes; and home owner’s insurance doesn’t pay for regular upkeep and maintenance, etc. So, why do some patients believe that health insurance necessarily needs to be used-up? Were they not healthy before the lay-off announcement; or did they suddenly become ill, thereafter? What do you think? Is this just a local phenomenon, or would it be [is it] pandemic in any community given the same or similar circumstances?

Assessment

For me, this scenario clearly demonstrates two things. First, that Health Insurance is thought of as a personal right and/or corporate fringe-benefit; rather than true financial indemnification. Second, it demonstrates the ability of patients to think ahead; unlike the airline customers on my initial trip here. So, if patients can be forward thinking about their health insurance needs, why don’t they think ahead about their personal health care needs? Why don’t more of us exercise regularly, watch our blood pressure and weight, and/or avoid drugs, alcohol and promiscuous sex, etc. If we can monitor and pay for routine auto and home maintenance ourselves; why not our routine health needs? Isn’t good health our most important personal asset? Aren’t we worth it? Do we really want to abrogate our very lives to others? Do we want to concede our responsibilities to a third party, ie, a national [single-payer] governmental controlled healthcare? Those patients wanting to “use their health insurance”, before unemployment, certainly seem to think so.

About Off Road with Dr. Marcinko

These sporadic off-road segments will continue through-out my 2009 summer promotional tour. On the one hand, formal attendance at several engagements was initially a bit sparse because of the death of several recent celebrities and entertainer types. On the other hand, local book stores and sponsors noted a spike in our CD and book sales, as well as interest in our online www.CertifiedMedicalPlanner.com program and premier quarterly guide: Healthcare Organizations [Journal of Financial Management Strategies] www.HealthcareFinancials.com

Conclusion

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Health Administration Terms: www.HealthDictionarySeries.com

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Filed under: Health Economics, Health Insurance, iMBA, Inc., Marketing & Advertising, Media Mentions and PR, Op-Editorials, Sponsors, Touring with Marcinko | Tagged: American Airlines, auto insurance, certified medical planner, CMP, david marcinko, Delta Airlines, doctor, Health Insurance, healthcare, healthcare reform, insurance agent, marquette general hospital, marquette MI, Marquette Upper Peninsula Healthcare System, Michigan, Northern Michigan University, obama, RIF, Upper Peninsula, Viering’s Restaurant, www.certifiedmedicalplanner.com | 1 Comment »

Medicare Scam Alert Notice

Posted on July 17, 2009 by Dr. David Edward Marcinko MBA MEd CMP™

Fearing Medicare Payment Gaps

By Staff Reporters

June 18, 2009

The Centers for Medicare and Medicaid Services (CMS) issued the following “Scam Alert Notice”

“CMS has become aware of a scam where perpetrators are sending faxes to physician offices posing as the Medicare carrier or Medicare Administrative Contractor (MAC). The fax instructs physician staff to respond to a questionnaire to provide an account information update within 48 hours in order to prevent a gap in Medicare payments. The fax may have the CMS logo and/or the contractor logo to enhance the appearance of authenticity.”

Medicare Contractors

Furthermore, CMS said that “Medicare FFS providers, including physicians, non-physician practitioners, should be wary of this type of request. If you receive a request for information in the manner described above, please check with your contractor before submitting any information. Medicare providers should only send information to a Medicare contractor using the address found in the download section of the CMS.gov website” found at:

Link: http://www.cms.hhs.gov/MLNGenInfo/

Link: http://www.cms.hhs.gov/MedicareProviderSupEnroll.

Conclusion

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Medical Risk Management: http://www.jbpub.com/catalog/9780763733421

Healthcare Organizations: www.HealthcareFinancials.com

Health Administration Terms: www.HealthDictionarySeries.com

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Filed under: Alerts Sign-Up, Breaking News, Career Development, Health Economics, Health Insurance, Health Law & Policy, Healthcare Finance, Research & Development | Tagged: CMS, CMS Scam Alert Notice, FFS, MAC, MC, medicare, Medicare Administrative Contractor, Medicare FFS, medicare paymenhjt gaps, Medicare Scam Alerts | Leave a comment »

Health Plan Management Navigator

Posted on July 15, 2009 by Dr. David Edward Marcinko MBA MEd CMP™

July 2009 Edition

By Douglas B. Sherlock; CFA, MBA

Attached below, find the July 2009 Edition of Plan Management Navigator. In this month’s edition, we summarize the results of Independent / Provider-Sponsored Healthcare Plans. The 16 plans collectively serve 5.7 million members and are leaders in their communities.

Link: Navigator_07-09

Conclusion

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Medical Risk Management: http://www.jbpub.com/catalog/9780763733421

Healthcare Organizations: www.HealthcareFinancials.com

Health Administration Terms: www.HealthDictionarySeries.com

Physician Advisors: www.CertifiedMedicalPlanner.com

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Sponsors Welcomed

And, credible sponsors and like-minded advertisers are always welcomed.

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Filed under: Health Economics, Health Insurance, Healthcare Finance, Managed Care, Monthly Reports, Research & Development | Tagged: douglas sherlock, Health Insurance, health plan, healthcare plans, managed care plans, Plan Management Navigator, Sherlock Company | 1 Comment »

Boosting Medical Practice Goodwill Value

Posted on July 10, 2009 by Dr. David Edward Marcinko MBA MEd CMP™

Goodwill Hunting

What’s your Office Really Worth?

[By Dr. David E. Marcinko; MBA]

There are several measures a physician can take to increase the value of medical practice goodwill, which in turn will make the practice more desirable, and profitable, when selling or taking on a partner.

These are listed below for your consideration:

Keep good financial records. Know your capital purchases, and have your balance sheet, statement of cash flow and net income statement up to date.
Continually monitor key financial ratios, such as profitability, creditors, long-term debt management and medical equity value-added.
Have adequate practice insurance, including property liability coverage, plus have workers’ compensation for staff and life and disability insurance on the key doctors.
Build a brand identity for the practice rather than an individual brand identity for you as a physician. This helps in developing a business that others could assume and operate.
Have a practice continuation plan that stipulates how the practice will be sold or continued in the event of a physician’s death or disability. Specify who will buy the practice and for how much. And specify whether the purchase will include land, buildings, inventory, licenses and goodwill. Have a covenant that specifies the procedures to follow when a physician leaves the practice.
Have strong relationships with everyone who does business with your practice, including supply vendors as well as referring doctors and fellow physicians.
Be organized when it comes time to present the supporting information. Don’t accept the first valuation given. Numbers can be changed, if you can present substantive reasons.

MORE: AMA News Interviews Dr. Marcinko

Conclusion

And so, your thoughts and comments on this Medical Executive-Post are appreciated. How have you reacted to the recent declines in both medical practice [business] and personal [doctor] goodwill?

Tell us what you think? Feel free to review our top-left column, and top-right sidebar materials, links, URLs and related websites, too. Then, be sure to subscribe to the ME-P. It is fast, free and secure.

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Sponsors Welcomed

And, credible sponsors and like-minded advertisers are always welcomed.

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Filed under: Career Development, Glossary Terms, Health Economics, iMBA, Inc., Practice Management, Practice Worth, Research & Development | Tagged: accounting value, book value, business goodwill, david marcinko, goodwill, goodwill valuation, medical practice value, personal goodwill, practice appraisal, Practice Worth | 1 Comment »

Essay of Atul Gawande MD in the New Yorker

Posted on July 9, 2009 by Dr. David Edward Marcinko MBA MEd CMP™

The McAllen Redux

We urge all ME-P subscribers and followers to read Atul Gawande’s piece in the New Yorker that appeared as an essay on McAllen, Texas – the little Texas town with the dubious honor of being one of the most expensive health care markets in the country, today.

Link: http://www.newyorker.com/reporting/2009/06/01/090601fa_fact_gawande?currentPage=all

As Dr. Gawande noted, in 2006, Medicare spent about $15,000 per enrollee there – close to twice the national average, and three thousand dollars more per person than McAllen’s per capita income of $12,000.

Commentary

Then, take at look at the comment by OMB Director Peter R. Orszag, posted on Thursday, June 4th, 2009 at 10:50 am; entitled the McAllen Redux

http://www.whitehouse.gov/omb/blog/09/06/04/McAllenRedux/

Assessment

Who says bloggers, and citizen journalists, get no respect?

Conclusion

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Filed under: Alerts Sign-Up, Breaking News, Health Economics, Health Insurance, Health Law & Policy, Healthcare Finance, Media Mentions and PR, Practice Management, Quality Initiatives | Tagged: Atul Gawabde, CMS, Health Insurance, McAllen Redux, McAllen Texas, medicare, New Yorker, OMB, Peter R. Orszag | 6 Comments »

Concierge Medicine and the “Zombie” Medical Practices

Posted on July 7, 2009 by Dr. David Edward Marcinko MBA MEd CMP™

Continued Growth of Boutique Medical Practices Today

[By Dr. David Edward Marcinko; MBA CMP™]

The boutique, or direct reimbursement, or cash based medicine, or concierge medical practice business model requires an annual fee for personalized treatment that includes amenities far beyond those offered in the typical practice, or suggested by physician medical unions. Patients pay annual out-of-pocket fees for top tier service, but also use traditional health insurance to cover allowable expenses, such as inpatient hospital stays, outpatient diagnostics and care, and basic tests and physician exams. Typical annual fees can range from $1,500 to $ 5,000 per patient, to family fees that top $25,000 a year, or more. The concept, initially developed for busy corporate executives, has now made its way to others desiring such service.

A Higher Level of Care

Medical providers get to provide a much higher level of care and get to know their patients as they enjoy the incentive to spend appropriate time with them, and over time, get to know them within their unique social/cultural context as well (hence the house calls become important). Patients enjoy the access, the attentiveness, and are willing to spend cash to have the type of unhurried, contemplative time with physicians that is required to develop a trusted relationship and deliver high quality care. The financial remuneration potential is compelling as well.

Now, let us compare and contrast various parameters of traditional medical practice [third party reimbursement] with the same parameters of so-called “new-wave” concierge medicine. Then, let the next-generation of doctors decide.

Current Traditional Model

patients seen at 15-20 min increments
2,000 – 3,000 patients
Paperwork, administrative burdens, frustrations, and lack coordinated care
Impersonal experience (long waits, un-intelligible interactions with health care system)
Average Salary = $150,000-250,000

Concierge Practice Model Potential

direct relationship with patients
300-500 patients
$1,500 – $3,000 access/retainer fee
Reduced overhead, positive interactions, care coordination and increased quality
Personalized experience (reduced headaches and paperwork with transparent pricing)
24/7 access, same day appointments with multiple other amenities
Average Salary = $100,000 – $500,000

Enter the Franchisors

Concierge medical practices can be developed organically, or use a franchise business model [personal communication, Suzanne R. Dewey, Forté Partners, LLC, Williamstown, MA]. Examples of franchisors include:

Elite Health: http://elitehealth.com
Health Advocate: http://healthadvocate.com National organization with over 4,300 client relationships.
MD2 International: http://www.md2.com/home.php
MDVIP: http://www.mdvip.com
ModernMed: http://www.modernmed.com

Opponents and Pessimists

There have been plenty of opponents, within medicine and outside, to the idea of concierge practices almost from the first day. For example,

”The state of Washington’s insurance commissioner attacked the concept of practices offering all the primary care patients needed for a prepaid fee or retainer, arguing that such practices amounted to the business of underwriting health insurance. He said that the practices would have to meet all the regulatory requirements for such an insurance business, including establishing capital reserves and maintaining loss reserves for the payment of claims. It didn’t work, and besides, few concierge practices offer free traditional medical care once retainers are paid–most concierge physician’s bill insurance plans for all the services covered under their patients’ coverage. The Medicare folks chimed in and managed to drive one physician out of business, arguing that he had tried to charge Medicare patients an extra $600 a year for services already covered by Medicare, hence he was guilty of illegal “balance billing.” Rather than fight Medicare over the issue, the doctor gave up and closed his practice. [C. Davis, “Big Problems for Medicare and Concierge Medicine,” Sierra Sacramento Valley Medicine, 55:3, May/June, 2004 (www.ssvms.org)]”

Attacking ME?

Objections to concierge medicine focus on both its causes and its effects, and some critics have even attack me, personally. For example, just look what “they” said in the online journal: “Health Care Strategic Management.”

”Many critics argue that concierge medicine merely reflects physician greed and unconcern over the needs of the community. Indeed, a recent book by David Marcinko, Business of Medical Practice [Advanced Profit Maximization Techniques for Savvy Doctors], includes a chapter on “The Case for Concierge Medicine” (Ch. 24) as one of the ways ‘savvy’ physicians can maximize their profit, as if that is what medicine is all about. While the image of physicians may retain some Marcus Welby elements of their rushing to the hospital or a patient’s home in the middle of the night, most physicians would rather stay home and leave the job to someone else, it is argued”.

Nicht Schadenfreude

Just think! My mother always feared I’d be a no-body. Good publicity – bad publicity – just spell the name correctly. Schadenfreude may be defined as a “largely unanticipated delight in the suffering of another which is cognized as trivial “ and I take no delight in the slow collapse of traditional medical practice models; or the economic, professional or personal pain of colleagues. But, I also often tell my critics – and clients – that although it’s awfully nice to be altruistic; I am always mindful of the competitive business adage: “no margin-no mission.” And, in as much as this attack was written in July 2005, I can only wonder if I was prescient, or just lucky? With all due respect, I believe it was the former, rather than the later. Why so? Well, just consider how fast www.ChoiceMed.com is growing. This stuff is not rocket-science.

www.MedicalBusinessAdvisors.com

About Concierge Choice Physicians

Concierge Choice Physicians: http://choice.md is a national organization offering a hybrid business model. Physicians divide their practice between a traditional practice and a retainer practice. The retainer practice is limited to approximately 150 patients. A typical concierge practitioner may have 300-500 patients, while the norm for a traditionalist is about 2,000-3,000 patients.

Assessment – Whither the “Zombies”

I, also ruefully wonder how many “zombie” medical practices [practitioners] are out there? You know the kind – a medical practice with neither a good/bad balance sheet. One with only subsistence level operating performance; a practice that is not growing organically or thru merger activity. It is just barely existing as the doctor-in-charge slowly, agonizingly, milks it to death; or retires, whichever comes first.

Conclusion

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Filed under: Career Development, CMP Program, Ethics, Health Economics, Health Insurance, Health Law & Policy, Healthcare Finance, Practice Management, Professional Liability, Research & Development, Risk Management, Sponsors | Tagged: boutique medical practice, Business Medical Practice, c Davis, cash based medicine, choice.md, ChoiceMed, concierge medicine, david marcinko, direct reimbursement medicine, elite health, health advocate, Health Care Strategic Management, MD2 International, MDVIP, ModernMed, zombie medical practices | 11 Comments »

Understanding the Need for Onsite Practice Management Visits

Posted on June 25, 2009 by Dr. David Edward Marcinko MBA MEd CMP™

Interview Information also Important

By Dr. David E. Marcinko and Staff Reporters

SPONSOR: http://www.CertifiedMedicalPlanner.org

According to Robert James Cimasi MHA, ASA, AVA, CMP™ of Health Capital Consultants, LLC, in St. Louis, MO, the following types of information specific to medical practices should be gathered by the financial executive, financial advisor or healthcare consultant when performing a practice enhancement engagement, or especially, an economic valuation and appraisal. This information may be obtained through an interview, questionnaire, or preferably a site visit:

Background Information: Include such information as the number of years the entity has operated at its current location and in the community, as well as the office hours.
Building Description: Include the location (urban/suburban), proximity to hospitals and other medical facilities, and its size, construction, electrical and computer wiring, age, access to parking, and so on.
Office Description: Approximate acquisition details and price, as well as ownership or lease details should be included. The square footage and number of rooms, and a description of different office areas should be outlined, including, where applicable: medical equipment, including all diagnostic imaging and major medical equipment; pharmacy, laboratory, examination rooms, waiting rooms, and other areas.
Management Information Systems: Document types of hardware and software and the cost, age, and suitability of all components, including their management functions, reporting capabilities, and integration between programs.
History of the Entity: Give the date founded and by whom, the number of full-time equivalent (FTE) physicians in practice by year, the physicians who have joined and left the entity, the dates they practiced at the entity, and their relationship and practice arrangement with the entity.
Staff Description: Include the number and types of non-physician positions as well as the tenure and salary of all current employees.
Competitive Analysis: Include details of hospital programs impacting practice, growth or decline in the volume of business and the reasons, association with other physicians, competitive strengths and threats, the number and volume of procedures performed, any change in the number and volume, and the corresponding fees.
Patient Base Information: Encompass income distribution and percentages from different payors, the number of new patients and total patients seen per week, the age mix of patients, the number of hours spent in patient care per week, and the number of surgeries performed.
Managed Care Environment: Details the terms and conditions of all managed care contracts including discounts and withholds, the impact on referral patterns and revenues, willingness to participate in risk sharing contracts and capitation, and the entity’s managed care reporting capabilities.
Hospital Privileges and Facilities: List all hospital privileges held by physician members of the medical practice and the requirements for acquiring privileges at the different local hospitals.
Credit Policy and Collections: Include practice policies for billing and payment, use of collection agencies, acceptance of assignments, other sources of revenues, and an aged breakdown of accounts receivable.
Financial Management: Include cash management procedures and protections, credit lines and interest, controls to improve payment of accounts payable, late payment frequency, formal or informal financial planning methods, and budgeting processes.
Operational Assessment: Include governance structure for the entity, detailing responsibilities and procedures for performance, conflicts, recruitment, outcomes measures, case management, reimbursement; income, continuing medical education (CME), credentialing, and utilization review.

Assessment

http://www.CertifiedMedicalPlanner.org

The financial advisor must also allow for discussion of overall relationships with physicians in the community, practice concerns, and needs.

Conclusion

And so, your thoughts and comments on this Medical Executive-Post are appreciated. Have you ever had such an onsite visit? Was it by a fiduciary financial advisor or medical management consultant; or other? What was the outcome? Feel free to review our top-left column, and top-right sidebar materials, links, URLs and related websites, too. Then, be sure to subscribe to the ME-P. It is fast, free and secure.

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Filed under: Career Development, CMP Program, Health Economics, Healthcare Finance, Managed Care, Practice Management, Practice Worth | Tagged: certified medical planner, CMP, financial advisor, financial consultant, healthcare consultant, medical consultant, medical management, medical onsite visit, medical practice appraisal, medical practice management, medical practice valuation, Robert Cimasi, www.certifiedmedicalplanner.com | 1 Comment »

On Growing Tensions in Healthcare Services Markets

Posted on June 21, 2009 by Dr. David Edward Marcinko MBA MEd CMP™

Stressors Affecting all Stakeholders

[By Robert James Cimsai; MHA, AVA, ASA, CMP™]

http://www.HealthCapital.com

The changes in reimbursement for Medicare services through the introduction of prospective payment systems and physician reimbursement cuts for professional services, as well as the increased focus on patient quality and transparency initiatives and health 2.0 collaboration have forced healthcare providers to look for more efficient ways to provide services, as well as additional sources of revenue and margin-producing business.

Additionally, with the rise of corporate healthcare provider networks and health systems, together with rising healthcare costs, competition among providers has become prevalent in the healthcare industry.

Assessment

Strict control of reimbursement costs from payers and consistent decreases in physician professional component fee reimbursement yields; reduction in traditional hospital inpatient use; and higher costs of capital have all contributed to the trend of physician investment in outpatient (and inpatient) specialty provider enterprises [ASCs, specialty hospitals and clinics, etc] , which often compete with general acute care community hospital providers.

Conclusion

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Filed under: Career Development, Health Economics, Health Insurance, Health Law & Policy, Healthcare Finance, Practice Management | Tagged: health 2.0, health 2.0 collaboration, healthcare competition, HMO, IPA, Managed Care, MC, medicare, next generation healthcare, participatory medicine, PPO, PPS, prospective payment system, Robert Cimasi, www.healthcarefinancials.com | 6 Comments »

Capital Sources for Hospitals

Posted on June 10, 2009 by Dr. David Edward Marcinko MBA MEd CMP™

Understanding the Liquidity Crunch -with- Publisher’s Interview

By Calvin W. Weise; MBA, CMA, CPA

www.HealthcareFinancials.com

Hospital are struggling in the current financial crisis, and like most of us, liquidity is scarce. In general, hospitals have three sources of capital: equity from earnings, equity from donations, and long-term debt.

Equity from Earnings

Earnings generate cash, and a portion of that cash is available to fund capital investments. Besides funding capital investments, cash generated from earnings is used to fund working capital. As operations grow, more working capital is required to fund the difference between the operating receivables and operating payables since days of revenue in receivables tend to be a good deal higher than days of expense in payables. Additionally, cash on hand should increase as operations grow so that days of cash remain constant or increase. Once working capital has been adequately funded, any remaining cash generated from earnings is available to invest in capital.

Donations

Most not-for-profit hospitals engage in active fundraising to generate donations. Donations are a good source of capital in certain markets. Often, fundraising initiatives are less useful than they appear due to the costs expended in the fundraising activities. It is important to ensure that all the costs incurred in fundraising activities are properly attributed.

Long-Term Debt

Borrowing long-term debt has been an important source of capital for hospitals and will continue to be. Debt is particularly attractive due to the low cost associated with borrowing on a tax-exempt basis. Long-term debt, borrowed on a tax-exempt basis, is probably the lowest cost form of capital available to hospitals. Tax-exempt borrowing is fairly complex due to the tax regulations affecting it. Because of its complexity, the costs associated with these transactions are quite high, making it less practical for small borrowings.

Assessment

Tax-exempt borrowing transactions require many lawyers and high-priced investment bankers. Credit rating agencies and credit enhancers are also typically involved. Accessing the tax-exempt markets requires a good bit of sophistication and expertise. Despite these requirements, this capital is highly attractive to hospitals and should be used whenever possible.

Interview

Read: Dr. David Edward Marcinko’s recent interview on the current status of hospitals.

Link [unedited version]: https://healthcarefinancials.wordpress.com/2009/04/01/medical-news-of-arkansas-interviews-dr-marcinko/?preview=true&preview_id=9094&preview_nonce=d9039cf076

Link [edited version]: http://www.arkansasmedicalnews.com/news.php?viewStory=738

Conclusion

And so, your thoughts and comments on this Medical Executive-Post are appreciated. What is the financial status of your hospital, today? How has the cash flow crisis affected it; and your practice? Feel free to review our top-left column, and top-right sidebar materials, links, URLs and related websites, too. Then, be sure to subscribe to the ME-P. It is fast, free and secure.

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Dictionary of Health Economics and Finance

Posted on June 8, 2009 by Dr. David Edward Marcinko MBA MEd CMP™

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Whither the Dictionary of Health Economics and Finance?

A simple query that demands a cogent answer!

Medical professionals are struggling to maintain adequate income levels. While some specialties are flourishing, others like primary care barely moved forward, not even incrementally keeping up with inflation. In the words of Atul Gawande, MD, a former surgical resident at Brigham and Women’s Hospital in Boston, and one of the best young medical writers in America,

“Doctors quickly learn that how much they make has little to do with how good they are. It largely depends on how they handle the business side of their practice”.

Therefore, the ability to decipher the alphabet soup of medical economics (i.e., OPHCOO, ALOS, DRG, RBRVS, behavioral health, acuity, etc), and understand those financial terms coming from clinical medicine (i.e., call premium, cost benefit ratios, IGARCH, AACPD, IBNR ABCM, internal rate of return, accounts receivable days outstanding, etc.) is vital for survival. Until we have a common language however, medical professionals cannot possess a shared vision, nor can we communicate successfully to create healthcare entities that provide quality care to patients and reasonable profits to medical practitioners.

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Why Coding Professionals?

Posted on June 7, 2009 by Dr. David Edward Marcinko MBA MEd CMP™

More on the NPI, the AAPC, Censorship and Quality Health Care

By Darrell K. Pruitt; DDS

For those who have been following me recently on Twitter (Proots), you know that unlike me, John Hamm has not yet been kicked off of DrBicuspid, and is awaiting a response from Dr. David J. Pettigrew – a dental coding expert with 14 years of experience as Chief Dental Officer for BCBS of New Jersey. I can only shadow the conversation because, as I said, I was kicked off.

Through John Hamm, I sent word to Dr. Pettigrew that he should just shut up and not enter into a discussion about the NPI number. Pettigrew told Johnhamm that I should come onto the DrBicuspid forum and say that in front of everyone. Of course, I am unable to do that because as shameful as it is to my family, I am still banned from posting anything on DrBicuspid.

For real-time developments concerning Dr. Pettigrew’s public defense of the NPI number, it would be better to follow that chunk of drama on Twitter or DrBicuspid. I’ve got other things cooking here. Can you smell it yet?

As you can see, sports fans, I have had Internet contact with a new class of fat, slow-moving healthcare IT stakeholders, and I haven’t been building long-term relationships fortified by good will – if you know what I mean. 14 years of employment at BCBS of New Jersey fails to impress me much.

American Academy of Professional Coders

Those who have studied alphanumeric science have a national organization called the American Academy of Professional Coders [AAPC] which represents business consultants in a growing healthcare niche. Most are employed by providers who are too busy actually performing healthcare to play games with insurance companies for the money owed them. Like SEO professionals who know gimmicks to increase a client’s page rank in relation to competitors, or perhaps a bolus of bad news from a special bastard, professional coders maximize providers’ profits by keeping on top of the ever-changing hoops involved in paying doctors almost all that is owed them following a shorter than average delay.

ICD-10 is Coming

Learning coding is job security these days because in a few years the mandated ICD-10 codes will force even dental offices to hire IT staff, which also cuts down on the nation’s unemployment. I’ve taken a peek at the ICD-10, and it makes the ICD-9 look like simple algebra. I’d stick with well-trained coding professionals. They’ll cost more but you do want to approach making a profit, don’t you?

Of Censorship

I submitted the following stinker to be posted on the AAPC Website. To their credit, it was posted almost immediately. That could be a good sign … OOPS! Several minutes later it went back under moderation. I think someone is having problems with it. You’ll have to read it to understand why. It’s tricky to let go of, yet if it remains posted, it looks like a concession. Some poor slob in the AAPC is in a bad position. I hope you are enjoying this as much as I am.

-Darrell

“A recent change to Medicare policy made by the Centers for Medicare & Medicaid Services (CMS) helps ensure claims processing isn’t delayed when the only missing information on the CMS-1490S form is the provider or supplier’s National Provider Identifier (NPI).

CMS Transmittal 1747, Change Request 6434, issued May 22, notifies A/B Medicare Administrative Contractors (MAC) and carriers of editorial changes to Medicare policy in Pub. 100-04, Medicare Claims Processing Manual, chapter 1 regarding the monitoring of claims submission violations and the handling of incomplete or invalid claims.

In either case, as stated in the transmittal, “If the beneficiary furnishes all other information but fails to supply the provider or supplier’s NPI, the contractor shall not return the claim but rather look up the provider or supplier’s NPI using the NPI registry.”

http://www.aapc.com/news/index.php/2009/06/missing-npi-no-reason-to-deny-says-cms/

“How does an NPI number improve patient care?”

By D. Kellus Pruitt DDS – posted on AAPC Website, 6.4.09

I see that nobody from the American Academy of Professional Coders has yet attempted to answer my question. Some visitors to the AAPC Website who have followed the comments to the article “Missing NPI Won’t Delay Processing – CMS” (no byline) may think the lack of an answer is odd – that is if they happen to notice. The novice professional coder who still does not know much about HIPAA could easily assume that since the article itself is almost a week old, the lack of a response to my question is nothing more than the natural fading of interest. At some point, people logically move on to newer posts and other parts of their lives.

But I know a secret.

Based on nothing more than glaring silence from anonymous officials of AAPC, I know that my question of whether the NPI number improves care did not go unnoticed by a few knowledgeable and sharp individuals. They know enough not to touch a transparently trick question. The answer of course is:

The NPI number does nothing to improve patient care (Gasp!)

There’s more. Five years ago informatics experts (coders), promised that the ten digit identification number for providers will speed payments lightning fast. When is the last time you heard that fib? I cannot fault abundant optimism, AAPC, but by now you are surely aware that physicians have had to wait for a year or more for payment because of foul-ups at NPPES. Some have had to take out loans to pay the salaries of coding professionals and other new IT members of their staffs.

Improving Healthcare?

And as far as “improving” patient care? That would be worse than a fib. That would be called a harmful lie that upsets me in a very personal way. I know where it is documented that dental patients have been forced to leave dentists they preferred simply because one-third of the dentists in Texas do not have NPI numbers. BCBSTX requires that their clients only see dentists who have the numbers. Otherwise, the client has to pay their dental bill in full and BCBSTX isn’t even obligated to refund the employer the insurance premium. Yet BCBSTX sales reps tell these employers that their employees can see any Texas dentist they choose.

I’m sorry. Sometimes I ramble.

To keep it fair, I will ask if there is anyone who would like to point out the benefits of the NPI number. Your AAPC members and many others, including enthusiastic newbie coders, are interested in hearing from leaders of the organization. Many careers are built upon the complexities caused by digitalization and informatics. I don’t blame you for the complications. After all, you don’t make the rules – you just get along with them really well. It’s like our unavoidably complicated tax code and accountants. Accountants call themselves professionals. So why the hell shouldn’t you?

The Medical Executive-Post

Let me say that I am grateful that you believe enough in transparency that this comment remains posted. It wouldn’t surprise me if someone briefly considered deleting it until they discovered that it will be on the PennWell forum and probably on the Medical Executive-Post anyway. And of course, we can all see that you chose the honorable thing to do.

NPI Fallacy

The NPI fallacy reminds me of a scene in the Mike Judge movie “Idiocracy,” when a character 500 years in the future named Frito is asked why fields are fruitlessly irrigated with a politically-correct brand of green colored sports drink instead of water. Frito, who got his law degree from Costco, doesn’t even have to suffer minimal thought before he quickly repeats what he’s heard so many times, “’Cause it’s got ‘lectrolytes.”

Grnerod finds it incredible that I don’t have an NPI number. “How on earth are you billing and getting paid without an NPI?”

I told him (?) that I don’t work if I don’t get paid. Call me an old school radical.

Conclusion

And so, your thoughts and comments on this Medical Executive-Post are appreciated. What are your feelings on the NPI situation? Does it really improve health care, or not? Feel free to review our top-left column, and top-right sidebar materials, links, URLs and related websites, too. Then, be sure to subscribe to the ME-P. It is fast, free and secure.

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Filed under: Glossary Terms, Health Economics, Health Insurance, Information Technology, Op-Editorials, Practice Worth | Tagged: A/B Medicare Administrative Contractors (MAC), AAPC, ADA, AMA, American Academy of Professional Coders, BCBS New Jersey, BCBS New York, CMS, CMS Transmittal 1747 Change Request 6434, CMS-1490S, CPT codes, Darrell Pruitt, david marcinko, Dr. David J. Pettigrew, DrBicuspid, ICD-10, ICD-9, John Hamm, medical billers, medical coders, Medicare Claims Processing Manual, National Provider Identifier, NPI, NPI Number, Proots, Pub. 100-04 | Leave a comment »

The Power of “ME Inc” for Physicians

Posted on June 3, 2009 by Dr. David Edward Marcinko MBA MEd CMP™

Embracing a New Competitive Practice Culture

By Dr. David Edward Marcinko; MBA, CMP™

[Publisher-in-Chief]

There are more than 900,000 physicians in the United States. Yet, the brutal supply/demand/demographic calculus of the matter is that there are just too many aging patients chasing too few doctors. Compensation and reimbursement is plummeting as Uncle Sam becomes the payer-of-choice for more than 52% of us. And, the government as payer will likely increase with the Obama Administration. So, going forward, it is not difficult to imagine the following four rules for a new-wave competitive medical care culture for all physicians.

[A] Rule No. 1

Forget about large office suites, surgery centers, fancy equipment and the bricks and mortar that comprised traditional medical practices. One doctor with a great idea, good bedside manner or competitive advantage, can outfox a slew of CPAs, while still serving the public and making money. It’s a unit-of-one healthcare economy where “ME Inc.”, is the standard and physicians must maneuver for advantages that boost their standing and credibility among patients and payers. Examples include patient satisfaction surveys, the rise of evidence-based medicine; outcomes research analysis, concierge medicine, direct reimbursement payment plans, and economic credentialing; etc.

[B] Rule No. 2

Challenge conventional wisdom, think outside the traditional payer box, recapture your dreams and ambitions, disregard conventional gurus and work harder – and smarter – than you have ever worked before. Remember the old saying, “if everyone is thinking alike, then nobody is thinking”. Do insurance panel members think rationally or react irrationally?

However, you should realize the power of networking, vertical integration and the establishment of virtual medical practices, which come together to treat a patient, and then disband when a successful outcome achieved. Job security in this structure is achieved with successful outcomes, and perhaps not necessarily a degree in the near future. Medical futurists even presume the establishment of virtual medical schools and hospitals, where students and doctors learn and practice their art on cyber-entities that look and feel like real patients, but are generated electronically through the wonders of virtual reality units.

www.HealthcareFinancials.com

[C] Rule No 3

Differentiate yourself among your medical peers. Do or learn something new and unknown by your competitors. Market your accomplishments and let the world know. Be a non-conformist. The conformity of health insurance plans are an operational standard and a straitjacket on creativity. Doctors should create and innovate, not blindly follow entrenched medical society leaders into oblivion. Seek, and practice, health 2.0 collaboration with all stakeholders.

[D] Rule No 4

Realize that the present situation is not necessarily the future. Attempt to see the future and discern your place in it. Master the art of the quick change and fast but informed decision making. Do what you love, disregard what you don’t, and let the fates have their way with you. Then, decide for yourself if health plans adhere to any of the above rules?

Assessment

Regardless of the future de facto business model of the learned profession of medicine, current practice models are no longer the structure of choice. Rather, a more laissez-faire and highly competitive business model should be pursued. Physicians have been slow to accept this philosophy. Remember, as a physician, if you merely want a static job with promised security, pledged retirement benefits, limited goals and structured regulations; join a health plan panel and become their laborer.

However, if you desire more, such as the possibility of a dynamic career, the unlimited security of your brainpower, non-defined retirement contributions, infinite potential with rules you can create along the way; incorporate the power of ME, Inc., in everything you do. Remain a competitive professional and be a physician ... Get fly!

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About Timely Medical Alternatives; Inc

Posted on May 30, 2009 by Dr. David Edward Marcinko MBA MEd CMP™

Understanding Canadian Health System Alternatives

By Staff Reporters

In 2003, Timely Medical Alternatives Inc. was formed to help Canadians, on long medical waiting lists, to take personal responsibility for their own medical care and “Leave the queue” [the national healthcare system waiting-list].

Urgent Need

According to their website, the need for private medical services is thriving in Canada. The mission of Timely Medical Alternatives [TMA] is to accommodate Canadian’s needs for private medical services by providing them with options, referrals to hospitals, clinics and diagnostic imaging facilities.

Link: http://www.timelymedical.ca

Assessment

Timely Medical Alternatives, a PPO, says it is able to expedite most types of private medical services from diagnostics to virtually all types of surgery, including procedures not available within the Canadian healthcare system. Wait times for clients are measured in days rather than in months or years.

Link: www.HealthDictionarySeries.com

Sicko Alternative

The movie documentary Sicko was directed by Michael Moore in 2007. It compared the highly profitable American health care industry to other nations, and HMO horror stories

Link: www.michaelmoore.com

Conclusion

And so, your thoughts and comments on this Medical Executive-Post are appreciated. Please compare and contrast TMA to “Sicko”, our current domestic health system, and the Obama administration’s vision of national healthcare for the US; and opine .Feel free to review our top-left column, and top-right sidebar materials, links, URLs and related websites, too. Then, be sure to subscribe to the ME-P. It is fast, free and secure.

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Beware the Faux Medical Journals

Posted on May 26, 2009 by Dr. David Edward Marcinko MBA MEd CMP™

When is a “Journal” … not a Journal?

By Dr. David Edward Marcinko; MBA, CMP™

Publisher-in-Chief

Allow me to begin this post by making the unusual disclosure that I was the Editor-in-Chief of a print guide in healthcare finance and economics [aka periodical or journal].

Formally, the title was: Healthcare Organizations [Financial Management Strategies]. At 2 volumes, and more than 1,200 pages, it was quite a job to update it quarterly. And, with more than two dozen contributing authors, it was a labor of love indeed. Alas … no more!

Varying Levels of Credibility

Now, we doctors know that medical journals are not all alike. There are different levels of “credibility.” Some are peer-reviewed, others not. Some are trade magazines. Frankly, some “real” journals are better, and more respected than others. Some entrenched journals are in decline, while other emerging journals are leading-edge in the health 2.0 space. Still others, like the formerly esteemed Journal of the American Medical Association [JAMA], have been accused of outright censorship.

Link: https://healthcarefinancials.wordpress.com/2009/04/02/is-jama-censoring-physician-dissent/

Adventures

Of course, doctors also know that pharmaceutical companies routinely offer us reprints of articles from medical journals that are favorable to their products. But, news of a Merck-sponsored publication for doctors in Australia has come to light in a personal injury lawsuit over Vioxx. It raised more than a few eyebrows in international medical publishing circles. It may have even crossed the line of journalistic, not to mention medical, ethics.

Read: Merck Paid for Medical ‘Journal’ Without Disclosure; by Natasha Singer, May 13, 2009.

Link: http://www.nytimes.com/2009/05/14/business/14vioxxside.html?_r=1&adxnnl=1&adxnnlx=1242313549-xaAEwW4MCd7pJh9OdgWdUQ

Mis-Adverntures

Tracy Staton wrote more about these mis-adventures in a story, dated May 14, 2009, in FiercePharma.

Analysis and Apology

Analysis in the Pipeline: http://seekingalpha.com/article/136942-merck-and-elsevier-cross-the-line-in-joint-medical-journal?source=yahoo

Libology Mea Culpa: http://www.libology.com/blog/tag/excerpta-medica

Assessment

Perhaps; Merck ought to read our Medical-Executive Post on health journalists?

Link: https://healthcarefinancials.wordpress.com/2009/03/17/battered-health-journalists

Or, our Medical-Executive Post on medical experts, reporters and journalists?

Link: https://healthcarefinancials.wordpress.com/2009/03/09/healthcare-experts-versus-health-journalists

Conclusion

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Economic Facts your Dentist Doesn’t Want You to Know

Posted on May 25, 2009 by Dr. David Edward Marcinko MBA MEd CMP™

Some Office Visit Schedules Linked to Insurance Payment

By D. Kellus Pruitt; DDS

http://thebulletin.us/articles/2009/05/21/herb_denenberg/doc4a15404e56e5f308210565.txt

Here is the link to an article written by Herb Denenberg titled: “Some Facts Your Dentist Doesn’t Want You to Know”. In it, he shared with his readers some information about dentistry that is hard to find. I submitted the following comment.

Dear Herb Denenberg,

Yours was a great article, and as a dentist with 27 years in a comfortable practice and 32 years in an expensive marriage, I find your cost-saving points oh so painfully accurate. Nevertheless, I must honestly agree that not only can some patients safely go a year or more between check-ups (ouch!), but many don’t need bitewing x-rays every year either (Good thing neither my patients nor my wife read the stuff I write).

Of BiteWing X-Rays

Readers who are hopefully from places other than the east side of Fort Worth can easily understand that the more treatment and x-rays I recommend, the more money I make. I must honestly add that my devoted and trusting dental patients, like most Fort Worth dentists’ patients, are reliably willing to accept my recommendations for these kinds of procedures without questioning the need. Let me put it this way: Annual bitewings are an easy $56 sale, mostly because fee-for-service insurance pays for them at 100% anyway. (If an angry dentist should ask who told you that, it wasn’t me). That is why it should not be taken lightly my approval of the advice about dentistry published in the book “1,001 Things They Won’t Tell You.” And; they won’t, sometimes.

Ethics and EBD

True to ethics I learned at the University of Texas dental school, in San Antonio (UTHSC), in the last six months, my hygienists and I have been determining which patients are safe to go a year and a half without routine bitewing x-rays. They are commonly taken every year simply because it has always been that way, and that interval was adopted as the minimum time most insurers allow. As readers can see, not a hint of Evidence-Based Dentistry [EBD] was involved in that determination. It was just a 1950’s guess.

Extended Prophylactic Schedules

This week we found four candidates in our practice for extended schedules. Our honesty will save these patients (their insurance companies) money by eliminating unnecessary care. And I really, really hate saving insurance companies money, on principle alone.

In My Defense

In my defense of continuing to maintain a large number of my patients on 6 month prophys and 12 month x-rays – and with the hope of restraining local dentists from throwing rocks through my windows – let me say up front that most people still need the old-school schedule in order to prevent disease. And, a few of the more fragile cases need x-rays and cleanings even more often than insurance allows.

Assessment

My patients and I are fortunate that I can freely charge the prices I deem necessary in order to put my patients’ interests above my wife’s. Let’s face it. Ethics are invisible to dental patients and they are not free. Ethics are a precious courtesy that dentists who accept managed care insurance find themselves forced to eliminate because contracts prevent them from raising fees as the market demands. Managed care dentistry is dentistry by the lowest bidder with no quality control. I only wish that someone would have pointed out that chunk of information in the book. Now, I’d better have my wife go ahead and start my car in the morning when she grabs the paper.

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Filed under: "Doctors Only", Career Development, Ethics, Health Economics, Health Insurance, Managed Care, Practice Management | Tagged: ADA, bite wing X-rays, cavities, Darrell Pruitt, DDS, dental visits, DMD, EBD, evidence based dentistry, Herb Denenberg, UTHSC | 7 Comments »

Health Care Costs and the Domestic Budget

Posted on May 19, 2009 by Dr. David Edward Marcinko MBA MEd CMP™

The Real Budget Defecit

[By Staff Reporters]

The Obama Administration has made comprehensive health insurance, and health care, reform a priority.

The goal is to transform the domestic health-care system so that it improves efficiencies, increases value and provides care for all citizens.

Current Situation

Recently, two important facts that all ME-P readers know, were re-confirmed:

Health-care costs are the key to the nation’s economic future.
The medical community agrees that great efficiencies are possible in how it is practiced.

Variations

It is well known that health-care costs vary across significant regions of the country, as well as hospitals and doctors within a region – even for patients with a same/similar diagnosis. This must end, according to the Director of the White House Office of Management and Budget [OMB]. Director Peter R. Orszag explained in a WSJ interview below, that practice variation is unnecessary and wasteful, and that evidence-based-medical practices and comparative-effectiveness-research is a good idea for all healthcare stakeholders.

The Baucus-Grassley Policy Options for Expanding Healthcare Coverage report is also included for your review and commentary.

Two New Reports

Wall Street Journal on May 15, 2009.

1. Link http://online.wsj.com/article/SB124234365947221489.html

2. Link: http://finance.senate.gov/press/Bpress/2009press/prb051109.pdf

Assessment

Once accomplished, it is hope that the nation will be on a sustainable fiscal path that builds a new foundation for our economy for generations to come.

Conclusion

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Filed under: Health Economics, Health Insurance, Healthcare Finance, Research & Development | Tagged: Baucus-Grassley Health policy, comparative effectiveness research, EBM, evidence based medicine, GDP, healthcare costs, healthcare reform, healthcare transformation, medical variations, Obama healthcare reform, Peter Orszag | 7 Comments »

Predicting the Next Domestic Economic Implosion

Posted on May 17, 2009 by Dr. David Edward Marcinko MBA MEd CMP™

Emerging Financial Doomsday Scenarios

By Dr. David Edward Marcinko; MBA, CMP™

Publisher-in-Chief

Recently, I was pondering the extreme instability that we are facing in this country today, in the two professional sectors in which I work, live and enjoy: [1] health economics and finance; and [2] medicine and medical practice management. In other words; from healthcare and Wall Street reform, to the housing mess and rising unemployment rates; these are challenging and at least, changing times.

The Question

And so, any cogent thinker may reasonably ask: where will the next domestic financial blow-up be? And, what economic doomsday scenario do you predict; and how will it affect the healthcare industrial complex?

The Choices

Commercial mortgage debt foreclosures because they have lagged the home mortgage fiasco, but may be deeper, wider and larger than ever imagined.
Life insurance and annuity companies since these entities have watched their investment portfolios sink and their variable annuity business models implode. Moreover, annuity benefits are being cut, premiums are rising and transparency is increasing.
Health insurance and healthcare reform since the country can not afford the Obama Administration’s current deficit spending and medical initiatives that will spark long term inflation.
Wall Street, the SEC, FINRA, Financial Planner’s Board of Standards, broker-dealers, etc., as the public demands increased competency, fiduciary accountability and transparency in their dealings within a client-focused culture.

Assessment

Of course, our astute ME-P readers may have other ideas that are certainly welcomed; especially from our informed CPA, CFA, CMP™ and FA readers. Physicians, CEOs, CFOs, nurses, politicians, economists and all ME-P readers and subscribers may opine, as well.

Conclusion

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Physician [Fee] Schedule Augmentation

Posted on May 14, 2009 by Dr. David Edward Marcinko MBA MEd CMP™

Organizing and Analyzing Financial Data

[By Christy Clodwick; MHA]

After all medical practice management data has been gathered, organize it onto a spreadsheet or chart. This analysis report will help to determine the codes and/or health plans that should be targeted for process improvement.

Focus … Focus … Focus

The focus should be on the highest volume and dollar value codes. Does this mean patients with unusual conditions or low dollar value codes are not treated? Hopefully it will not; but it will push this process forward and the practice will see the greatest benefit from these categories. When you review the report and find that a fee is being paid at a much lower rate, this would be indicative of a necessary negotiation with the payer for an increase for that procedure. Most health plans are committed to preventing disease. Maybe, but they are still actually aimed at treating diseases; not preventing them. If this is true of many payers then they should be willing to provide the incentives for those services to be carried out. You will find that some payers’ fee schedules are very much out of line with a percentage of Medicare payments, therefore the practice administrator should focus on those payers and bring evidence of the inadequacies to their attention.

The Specialists

Specialists are, for the most part, paid at a higher rate than primary care physicians not usually for the same service! And, with GPs as gatekeepers, the specialty doc incomes may have actually decreased in some instances, while the GPs may have increased. There was a time when Medicare had two conversion factors, and this was the result. This inequity could also be used as a tool for better reimbursement rates.

Finalizing the Fee and Revenue Analysis

When the final preparations of the fee analysis have been completed, it is time to react to the results of the findings. There are several options to choose from when it has been determined that a health plans fee schedule is not in tune with the practice’s financial growth. The practice should act on these results as soon as they are discovered, to avoid the loss of any more revenue.

No longer Accepting Health Plans

During the analysis phase, you may determine that a health plan’s payment levels are extremely low. You will have to determine whether the plan is worth negotiating or the practice administrator should consider dropping out of the plan altogether at the end of the contract period. It will have to be carefully determined by the local market. If the practice is in a highly competitive market, this process should not be considered as first choice. However, if the market is very slim, the health care purchaser will be responsible for complaining to the health insurance plan provider that there is simply not enough physician coverage for their employees for the area. This could be a very effective way to force a negotiation with the health care company. If this were the case, the area would have less managed care and more MC/MD.

Not Accepting New Patients from Low Paying Health Plans

One option would be to not accept any more patients from the health plan that is reimbursing the practice with low rates. Although this may initially lower your patient count, over time the practice will benefit from new patients with health plans that have a better reimbursement policy. Include snapshot of what the final analysis or report should look like and the details of what it should include. This can be used in any specialty to assist in putting together the individual practice analysis to achieve the same results. But is it noble or ethical? What about any willing provider laws?

The Future for Health Care Reimbursement

The health care purchasers who pay most of the bills, such as employers and the government, will soon be challenging the annual increase and the overall cost of health care. The cost increases of the hospital and pharmacy sectors of healthcare are far higher than that of the physician. However, the pressure for cost containment is being felt across the board. This will eventually depress future reimbursement for all healthcare providers. In the future it will be hard for practices to keep up with the demands of labor, malpractice and supply cost increase. All medical providers need to plan for this future paradigm. To offset this trend, physicians will need to get the most out of the work that they are doing today as well as look to new revenue generating procedures for their practice that will be cheaper and more convenient to the patient.

Process Improvement

The biggest benefits will come from continually improving the process of the daily operations of the practice, as well as ensuring accurate diagnostic coding. This will enable a practice to keep up with charge capturing through the explanation of benefits (EOB) when the charge has been processed and paid by the health insurance provider. When this process identifies that there is room for negotiation, the provider should proceed for a better reimbursement rate. If the provider is in a dominant market, the payers will be more likely to issue sweeping fee increases and so can you give me an example of this ever happening? By completing a Practice Fee Analysis, any practice should be able to use this tool to demonstrate the inequities and negotiate a better reimbursement rate for the practice.

Assessment

The first step in the negotiation process would be to contact a representative of the health insurance company that is in question. If you can produce compelling evidence to the representative, the negotiation process should be the next meeting. These folks may be fired if they do what you suggest, too frequently. Continually updating the practice fee schedule will help the practice stay on top of the contracts that it practices under. Practices that present a well-documented argument may (almost never) be rewarded with positive payer response. Again, proper planning will make for great future performance in any health care practice.

Conclusion

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HOSPITALS: http://www.crcpress.com/product/isbn/9781466558731
CLINICS: http://www.crcpress.com/product/isbn/9781439879900
ADVISORS: www.CertifiedMedicalPlanner.org
BLOG: www.MedicalExecutivePost.com
FINANCE:Financial Planning for Physicians and Advisors
INSURANCE:Risk Management and Insurance Strategies for Physicians and Advisors

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On HIT Cost Savings

Posted on May 14, 2009 by Dr. David Edward Marcinko MBA MEd CMP™

Real or Imagined Solutions

According to David M. Cutler, of the Center for American Progress Fund [CAPF] on May 11, 2009, health care will be the major challenge to the federal budget in coming decades. Rising health costs will account for nearly all of the expected increase in government spending relative to gross domestic product [GDP].

Healthcare Costs and GDP

Health care currently accounts for 16 percent of domestic GDP, and that share is forecast to nearly double in the next quarter century. Spending money on health care is not bad, but wasting money is very bad.

Link: http://www.americanprogressaction.org/issues/2009/05/health_modernization.htmlHIT

HIT to the Rescue

But, $600 billion might be saved over the next ten years, and $9 trillion saved over the next 25 years, if HIT initiatives are used; says the CAPF.

Assessment

Estimates suggest that a third or more of medical spending—perhaps $700 billion per year—is not known to be worth the cost. Wasting hundreds of billions of dollars on inefficient health care is a luxury the country cannot afford.

Conclusion

And so, your thoughts and comments on this Medical Executive-Post are appreciated? Feel free to review our top-left column, and top-right sidebar materials, links, URLs and related websites, too. Then, be sure to subscribe to the ME-P. It is fast, free and secure.

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Filed under: Career Development, Health Economics, iMBA, Inc., Information Technology, Practice Management | Tagged: CAPF, Center American Progress Fund, David Cutler, federal budget, GDP, health costs, health technology, healthcare economics, HIT, medical spending | 3 Comments »

Healthcare Projections and the US Budget 2007-09

Posted on April 26, 2009 by Dr. David Edward Marcinko MBA MEd CMP™

Issues and Challenges for Obama Administration Reform

By Staff Reporters

Read the complete testimony and statement of Peter R. Orzag, OMB Director, to the US Senate, dated June 21, 2007.

For more information:

Congressional Budget Office

Second and D Streets; SW

Washington, DC 20515

Link: 06-21-healthcarereform

Assessment

Now, almost two years later, and with the new Obama Administration, has your opinion changed on the potential of healthcare reform; why or why not?

Conclusion

And so, your thoughts and comments on this Medical Executive-Post are appreciated?

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Healthcare Organizations: www.HealthcareFinancials.com

Health Administration Terms: www.HealthDictionarySeries.com

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Filed under: Career Development, Health Economics, Health Insurance, Health Law & Policy, Healthcare Finance, Managed Care | Tagged: COngressional Budget Office, healthcare reform, Obama Administration, OMB, OMB Director, Orzag testimony on health reform, Peter Orzag, US Senate | Leave a comment »

Sherlock Expense Evaluation Report [SEER]

Posted on April 24, 2009 by Dr. David Edward Marcinko MBA MEd CMP™

ADVERTISEMENT

Plan Management Navigator

By Marco Georeno

Ph: 215-628-2289

Please find attached the April 2009 edition of Plan Management Navigator. In it we provide an update on the timing of the Blue Cross Blue Shield universe and the Independent / Provider-Sponsored editions of the Sherlock Expense Evaluation Report (SEER). In addition, we expect to circulate the benchmarking surveys for the Medicaid and Medicare universes on or about June 1st, for completion by July 20^th, 2009.

Benchmarking Studies

If you are interested in participating in our benchmarking studies please contact us as soon as possible. Additional information about SEER is available at www.sherlockco.com/seer.shtml or by contacting Doug Sherlock (sherlock@sherlockco.com).

Best Practices for the Healthcare Enterprise

We also endeavor to provide an enterprise view of best practice. Best practice is typically considered to be the most efficient way of achieving a desired outcome. We believe that the best way of determining the best practice in its most practical application is to start with an overall objective and weigh all particular practices in light of how they contribute to that overall objective.

In that vein, over the next several months, Sherlock Company will be offering web conferences focused on best practices. The first conference will address activities within Customer Services, as well as activities or effects in other functional areas. This web conference will be held on Wednesday May 20th at 2:30 PM, Eastern Time. The costs will be $225. Participation is free of charge to health plans participating in our 2009 benchmarking studies. If you are interested in participating, please email Erin Sawchuk (erinsawchuk@sherlockco.com) or call at 215-628-2289.

Assessment

This edition of Navigator also discusses the latest private health plan Dashboard results for the trailing three months ended January 31, 2009.

Link: navigator

Sincerely,
Sherlock Company

Marco Georeno – Analyst
mgeoreno@sherlockco.com

Fax: 215-542-0690

Conclusion

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Healthcare Organizations: www.HealthcareFinancials.com

Health Administration Terms: www.HealthDictionarySeries.com

Physician Advisors: www.CertifiedMedicalPlanner.com

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Alternative Design Options for a Public Health Plan

Posted on April 23, 2009 by Dr. David Edward Marcinko MBA MEd CMP™

New Lewin Group Report Examines Potential Impact

[By Staff Reporters]

April 6, 2009

FALLS CHURCH, VA – The Lewin Group released a report titled “The Cost and Coverage Impacts of a Public Plan: Alternative Design Options.” The report examines potential impacts that a “public health plan” might have in competing for enrollment with the private insurance industry.

Healthcare Reform

As ME-P readers are aware, a public plan is currently being considered in a number of health reform proposals being considered by President Obama and the US Congress. This analysis enhances prior work done by The Lewin Group of the major party presidential candidate’s health reform proposals, during the 2008 campaign, as well as more recent analyses of the Congressional plans now being considered. The report estimates the impact on cost and coverage based on different levels of eligibility and reimbursement rates.

Key Findings Review

According to The Health Care Blog writer Robert Laszewski, key study findings include:

If Medicare payment levels are used in the public plan, premiums would be up to 30 percent less than premiums for comparable private coverage. On average, the monthly premium in the public plan for a typical benefits package would be $761 per family compared with an average of $970 per family in the private market for the same coverage.
If as the President proposed, eligibility is limited to only small employers, individuals and the self-employed, public plan enrollment would reach 42.9 million people. The number of people with private coverage would fall by 32.0 million people. If private payer reimbursement levels are used by the public plan, enrollment would be lower, with only 10.4 million people switching to the public plan from private insurance.
If the public plan is opened to all employers as proposed by former Senators Clinton and Edwards, at Medicare payment levels we estimate that about 131.2 million people would enroll in the public plan. The number of people with private health insurance would decline by 119.1 million people. This would be a two-thirds reduction in the number of people with private coverage (currently 170 million people). Here again, if the higher private payer levels are used, enrollment in private insurance would decline by only 12.5 million people.
Assuming Medicare reimbursement rates and eligibility for all individuals and employers, provider net income would decline under this public plan proposal, even after accounting for reduced uncompensated care and increased utilization for the newly insured. Net hospital revenues would fall by $36 billion (4.6 percent), and physician net income would fall by $33 billion (6.8 percent). If eligibility is restricted to individuals and small firms, net hospital revenues would actually increase by $11.3 billion due to the increase in newly insured individuals. But net physician incomes would decline by $3.0 billion.

Assessment

Full report: lewin-report

Conclusion

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Become a Published Print Author with Us

Posted on April 22, 2009 by Dr. David Edward Marcinko MBA MEd CMP™

The Business of Medical Practice [3^rd Edition]

By Hope Rachel Hetico RN, MHA, CMP™

[Managing Editor]

Dear Colleagues,

As you may know, we are commencing work on the third edition of our best selling book: The Business of Medical Practice

TOC 1st: http://www.amazon.com/Business-Medical-Practice-Maximizing-Doctors/dp/0826113117/ref=sr_1_8?ie=UTF8&s=books&qid=1231111232&sr=1-8

TOC 2nd: http://www.springerpub.com/prod.aspx?prod_id=23759

Invitation to Contribute

Accordingly, we would be honored for you to consider contributing a new or revised chapter, in your area of expertise, for a low-effort but high-yield contribution. Our goal is to help physician colleagues and management executives benefit from nationally known experts, as an essential platform for their success in the healthcare 2.0 business industry. Many topics are still available: [health accounting and costing; law, policy and administration; Medicare fraud and abuse; coding and insurance; HIT, grid and cloud computing; finance and economics, competitive models, collaboration and leadership, etc].

Support Always Available

Editorial support is available, and you would enjoy increasing subject-matter notoriety, exposure and public relations in an erudite and credible fashion. As a reader, or preferably a subscriber to the ME-P, your synergy in this space may be ideal. Time line for submission of a 5,000-7,500 word chapter is ample, and in a prose writing style that is “wide, not deep.”

A Health 2.0 Initiative

And, be sure to address health 2.0 modernity. Update chapters from the second edition are also available.

Definition: https://healthcarefinancials.wordpress.com/2008/09/12/emerging-healthcare-20-initiatives

Assessment

Please contact me for more details, if interested. A best selling-book is rare; while a third-edition volume even more so. Join us in this project. Regardless, we trust you will remain apostles of our core ME-P vision, “uniting medical mission and financial profit margin”, promoting it whenever possible.

Front Matter Link: frontmatter1advancedbusinessmedicine4

Contact Info:

MarcinkoAdvisors@msn.com

770.448.0769

Conclusion

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BLOG: www.MedicalExecutivePost.com
FINANCE:Financial Planning for Physicians and Advisors
INSURANCE:Risk Management and Insurance Strategies for Physicians and Advisors

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About Certified Medical Planner™

Posted on April 18, 2009 by Dr. David Edward Marcinko MBA MEd CMP™

SPONSOR NOTICE

Top 10 Reasons to Become a

Certified Medical Planner™

1. Expertise: Provide health economics, business and financial advice to physicians.

2. Credibility: Gain health industry recognition and fiduciary clout.

3. Opportunity: Focus on the lucrative and expanding physician advisory niche.

4. Recognition: Join a select group of advisory experts.

5. Distinction: Become quality; rather than product driven.

6. Achievement: 500 hours of financial, health economics and management education.

7. Evidence: Validate deep healthcare industry knowledge.

8. Resource: CMP™ text and hand books, dictionaries, and institutional print journal.

9. Distinction: Set yourself apart with our chartered logo and trade-mark identity.

10. Commitment: Become the “go-to” financial advisor for all medical professionals.

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Defining Comparative Medical Effectiveness

Posted on April 13, 2009 by Dr. David Edward Marcinko MBA MEd CMP™

An Emerging Health Economics Issue

By Staff Reporters

Comparative Medical Effectiveness [CME] is not a new healthcare term or health economics concept. Federal initiatives specifically promoting CME were authorized under the Medicare Modernization Act of 2003, but the genesis took root decades before.

Finally … a Hot Topic

Comparative Medical Effectiveness has recently become a hot topic again throughout the arena of health care stakeholders, due to funding and initiatives advanced by the Obama administration, and the positive and negative reactions drawn by different sectors of stakeholders.

Related to Evidence Based Outcomes

For stakeholders including numerous health care policy organizations, the health plan industry, and various health care provider organizations: public and private promotion of Comparative Medical Effectiveness reviews and processes offer the potential for more evidence-based, outcome-benefit or even cost-benefit driven information to improve the health care decision making for all parties. And, for stakeholders concerned about limiting the role of government and third parties in their level of regulation and control over the direct delivery of specific patient care, Comparative Medical Effectiveness may become a lightening rod due to perceived potential as to how the process and information could ultimately be applied.

Definition of the CBO Report

The Congressional Budget Office Report “Comparative Effectiveness: Issues and Options for an Expanded Federal Role” offers the definition that follows:

“As applied in the health care sector, an analysis of comparative medical effectiveness is simply a rigorous evaluation of the impact of different options that are available for treating a given medical condition for a particular set of patients. Such a study may compare similar treatments, such as competing drugs, or it may analyze very different approaches, such as surgery and drug therapy. The analysis may focus only on the relative medical benefits and risks of each option, or it may also weigh both the costs and the benefits of those options. In some cases, a given treatment may prove to be more effective clinically or more cost-effective for a broad range of patients, but frequently a key issue is determining which specific types of patients would benefit most from it. Related terms include cost–benefit analysis, technology assessment, and evidence-based medicine, although the latter concepts do not ordinarily take costs into account.”

Assessment

For related financial, economics, managed-care, insurance, health information technology and security, and health administrative terms and definitions of modernity, visit: http://www.springerpub.com/Search/marcinko

Conclusion

And so, your thoughts and comments on this Medical Executive-Post are appreciated. How do you define this term, and is its’ very definition evolving?

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Physician Advisors: www.CertifiedMedicalPlanner.org

Filed under: Glossary Terms, Health Economics, Quality Initiatives, Recommended Books, Research & Development | Tagged: CBO, Comparative Medical Effectiveness, COngressional Budget Office, EBM, economics, evidence based dentistry, evidence based medicine, financial, health administration, health information technology, Health Insurance, health plans, healthcare industry, insurance, Managed Care, medical cost-benefits, medical outcomes-benefit, obama, orzag, security | 24 Comments »

More about Healthcare Organizations [Financial Management Strategies]

Posted on April 12, 2009 by Dr. David Edward Marcinko MBA MEd CMP™

Our Print-Journal Preface

By Hope Rachel Hetico; RN, MHA, CMP™

As Managing Editor of a two volume – 1,200 pages – premium quarterly print journal, I am often asked about our Preface.

A Two-Volume Guide

As so, our hope is that Healthcare Organizations: [Financial Management Strategies] will shape the hospital management landscape by following three important principles.

What it is – How it works

1. First, we have assembled a world-class editorial advisory board and independent team of contributors and asked them to draw on their experience in economic thought leadership and managerial decision making in the healthcare industrial complex. Like many readers, each struggles mightily with the decreasing revenues, increasing costs, and high consumer expectations in today’s competitive healthcare marketplace. Yet, their practical experience and applied operating vision is a source of objective information, informed opinion, and crucial information for this manual and its quarterly updates.

2. Second, our writing style allows us to condense a great deal of information into each quarterly issue. We integrate prose, applications and regulatory perspectives with real-world case models, as well as charts, tables, diagrams, sample contracts, and checklists. The result is a comprehensive oeuvre of financial management and operation strategies, vital to all healthcare facility administrators, comptrollers, physician-executives, and consulting business advisors.

3. Third, as editors, we prefer engaged readers who demand compelling content. According to conventional wisdom, printed manuals like this one should be a relic of the past, from an era before instant messaging and high-speed connectivity. Our experience shows just the opposite. Applied healthcare economics and management literature has grown exponentially in the past decade and the plethora of Internet information makes updates that sort through the clutter and provide strategic analysis all the more valuable. Oh, it should provide some personality and wit, too! Don’t forget, beneath the spreadsheets, profit and loss statements, and financial models are patients, colleagues and investors who depend on you.

www.HealthcareFinancials.com

Assessment

Rest assured, Healthcare Organizations: [Financial Management Strategies] will become an important peer-reviewed vehicle for the advancement of working knowledge and the dissemination of research information and best practices in our field. In the years ahead, we trust these principles will enhance utility and add value to your subscription. Most importantly, we hope to increase your return on investment [ROI] in some small increment.

Visit and Order Now

Specialty Technical Publishers

8 – 14th Street

Blaine, WA 98230

1-800-251-0381

orders@stpub.com

http://www.stpub.com/pubs/ho.htm

TOC: http://www.stpub.com/pdfs/toc_ho.pdf

Conclusion

And so, your thoughts and comments on this Medical Executive-Post, complimentary e-companion are appreciated. If you would like to contribute material or suggest topics for a future update, please contact me. Subscribers, have we attained our goals and objectives, as a work-in-progress in this preface statement?

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About: Healthcare Organizations [Financial Management Strategies]

Posted on April 11, 2009 by Dr. David Edward Marcinko MBA MEd CMP™

Our Print Mission Statement

[By Dr. David Edward Marcinko; MBA, CMP™]

Publisher-in-Chief

As Editor-in-Chief of a two volume – 1,200 pages – premium quarterly print journal, I am often asked about our mission statement; or the journal’s raison d’etra.

A Two-Volume Guide

As so, Healthcare Organizations: [Financial Management Strategies], with its quarterly updates, will promote and integrate academic and applied research, and serve as a multi-disciplined communications forum for the dissemination of financial, managerial, business and related economic information to decision makers in hospitals, outpatient centers, clinics, medical practices and all mature and emerging healthcare organizations.

Target Market and Ideal Reader

Healthcare Organizations [Financial Management Strategies] and its quarterly updates should be in the hands of all:

* CFOs, CEOs, COOs, CTOs, VPs and CIOs from every type of hospital and healthcare organization including: public, federal, state, Veteran’s Administration and Indian Health Services hospitals; district, rural, long-term care and community hospitals; specialty, children’s and rehabilitation hospitals; diagnostic imaging centers and laboratories; private, religious-sponsored, and psychiatric institutions.

* Physician Hospital Organizations, Management Services Organizations (MSOs), Independent Practice Associations (IPAs), Group Practices Without Walls (GPWWs), Integrated Delivery Systems (IDSs) and their administrators, comptrollers, cost accountants, budget directors, cash managers, auditors, healthcare attorneys and consultants, and actuaries, and all endowment fund directors, executives, consultants and strategic financial managers.

* Ambulatory care centers, hospices, and outpatient clinics; skilled nursing facilities, integrated networks and group practices; academic medical centers, nurses and physician executives; business school and health administration students, and all economic decision-makers and directors of allopathic, dental, podiatric and osteopathic healthcare organizations.

Assessment

After publication, my suggestion is to read, study and act upon the guide in this way:

1. First, browse through the entire text.

2. Next, slowly read those chapters and sections that are of specific interest to your professional efforts.

3. Then, extrapolate portions that can be implemented in specific strategies helpful to your healthcare setting.

4. Finally, use its’ ME-P updates as a reference manual to return to time and time again; and enjoy!

Conclusion

OUR OTHER PRINT BOOKS AND RELATED INFORMATION SOURCES:

PRACTICES: www.BusinessofMedicalPractice.com
HOSPITALS: http://www.crcpress.com/product/isbn/9781466558731
CLINICS: http://www.crcpress.com/product/isbn/9781439879900
ADVISORS: www.CertifiedMedicalPlanner.org
FINANCE: Financial Planning for Physicians and Advisors
INSURANCE: Risk Management and Insurance Strategies for Physicians and Advisors
Dictionary of Health Economics and Finance
Dictionary of Health Information Technology and Security
Dictionary of Health Insurance and Managed Care

Filed under: Accounting, Book Reviews, Career Development, Drugs and Pharma, Ethics, Experts Invited, Health Economics, Health Insurance, Health Law & Policy, Healthcare Finance, iMBA, Inc., Information Technology, Managed Care, Practice Management, Practice Worth, Professional Liability, Recommended Books, Research & Development, Risk Management, Sponsors | Tagged: administrators, ASCs, CEO, CFO, children’s hospitals, clinics, community hospitals, COO, CXO, david marcinko, diagnostic imaging centers, DO, doctors, DPM, healthcare administration, Healthcare Organizations, hospital management, hospitals, Indian Health Services, laboratories, long term care, MD, medical journals, medical practice management, medical practices, nurse executives, nurses, oasteopaths, OD, office managers, outpatient centers, physicians, physisician executives, podiatrists, practice managers, psychiatric institutions, rehabilitation hospitals, RNs, rural hospitals, specialty hospitals, Veterans Administration | 1 Comment »

Direct Reimbursement [DR] and RiskManagers.Us

Posted on April 6, 2009 by Dr. David Edward Marcinko MBA MEd CMP™

Transparent Dental Benefits versus Confusion

[By Darrell K. Pruitt; DDS]

“If you are not a part of the solution, there is good money to be made prolonging the problem.”

Company slogan- www.riskmanagers.us

Meet Mr. William Rusteberg

Today, I met William Rusteberg on the PennWell forum when he replied to the thread, “Why the long NPI, BCBS-TX?” which I copied below, along with my response which includes a plug for Direct Reimbursement [DR].

http://community.pennwelldentalgroup.com/forum/topics/why-the-long-npi-bcbstx?page=1&commentId=2013420%3AComment%3A26976&x=1#2013420Comment26976

Mr. Rusteberg represents a company called RiskManagers.Us, whose specialty involves the benefits market, yet it is not exactly an insurance company – just like there is no such thing as true dental insurance. RiskManagers.us is a firm that works directly with businesses to identify and develop cost-effective benefits packages – emphasizing transparency and fairness. Now that is refreshing, friends!

Defining RiskManagers.Us

Here is how RiskManagers.us describes itself:

“We do not work for an insurance company, we work for you. As an independent brokerage, and consulting firm we can represent any licensed insurance company in Texas, Colorado, Mississippi, Louisiana, Alabama, Illinois & Florida.”

If one visits the Web site’s “Reference Library,” here are some of the topics offered:

· Self Funding – Need a second opinion?

· Texas leads in transparency issues

· Can’t get claim information? HB 2015 May Solve Your Problem

· Medical Stop Loss Through a Captive

· PPO Discounts – Games People Play

· PPO Networks – Shell Game

· Can Hospitals waive Deductibles in Texas?

“What is a NPI number?”

Mr. Rusteberg’s initial question on the PennWell forum simply asked, “What is a NPI number?” Following my explanation, he wrote:

“It seems that many of those in your profession would do well in accepting cash only, or directly working with employer groups who sponsor dental/medical plans on a direct pay basis. We have had good success in doing this for our clients – we have one employer in San Antonio who pays medical care providers directly and quickly – providers like it and the plan pays a fair and reasonable rate, not relying on a PPO network to “re-price” claims. We have done the same on dental plans, eliminating the insurance company, PPO network and paying dental care providers submitted charges directly and quickly. We see little or no trend increases on dental charges using this method. In my view, insurance companies interfere in patient – provider relationships in a financially detrimental way.”

Thanks for your reply.

My Response:

I like you, William;

What you describe sounds like my all-time, personal favorite dental benefits plan. It is called Direct Reimbursement {DR}, and it not only gives the employer the unlimited capability to design a plan which reflects the level of commitment desired by the company, but most importantly, it naturally preserves quality of care by allowing employees unlimited freedom of choice in dentists. And that’s as good as the market gets.

http://www.directreimbursement.com/

In addition, since there are no NPI requirements for DR, employees are also permitted see dentists who decline NPI numbers for ethical reasons. That increases employees’ choice by 50% over BCBS-TX clients, according to recent information provided by the Healthcare IT Transition Group.

http://www.npidentify.com/stats.htm#states

Little Management Needed

Just like the benefits plans you mention, with DR, very little money is spent on management because such policies are so simple and transparent that there is no room for profit-enhancing (wasteful) confusion used by unethical companies like BCBSTX, Aetna, Cigna, UnitedHealth, Delta Dental, United Concordia, and so many other members of the National Association of Dental Plans (NADP).

Assessment

Without transparency and the invisible hand of freedom-of-choice, free-market competition for healthcare dollars disappears as fast as executive bonuses rise. We’ll see where it goes from here. It would sure be swell if a Direct Reimbursement representative takes interest in the conversation; anyone home?

Conclusion

OUR OTHER PRINT BOOKS AND RELATED INFORMATION SOURCES:

DICTIONARIES: http://www.springerpub.com/Search/marcinko
PHYSICIANS: www.MedicalBusinessAdvisors.com
PRACTICES: www.BusinessofMedicalPractice.com
HOSPITALS: http://www.crcpress.com/product/isbn/9781466558731
CLINICS: http://www.crcpress.com/product/isbn/9781439879900
ADVISORS: www.CertifiedMedicalPlanner.org
BLOG: www.MedicalExecutivePost.com
FINANCE:Financial Planning for Physicians and Advisors
INSURANCE:Risk Management and Insurance Strategies for Physicians and Advisors

Filed under: "Doctors Only", Breaking News, Career Development, Ethics, Health Economics, Health Insurance, Managed Care, Op-Editorials, Practice Management | Tagged: ADA, Aetna, BCBS-TX, Cigna, concierge medicine, Darrell Pruitt, david marcinko, delta dental, dental benefits, dental insurance, dentists, direct reimbursement, discount dentistry, doctors, Heal;thcare IT Transition Group, HIPAA, HMO, IPA, managed dental care, MCO, NADP, National Association of Dental Plans, NPI Number, PennWell forum, PPO, private pay healthcare, RiskManagers.Us, self insurance, United Concordia, UnitedHealth, William Rusteberg, www.RiskManagers.Us | 12 Comments »

Hospital Non-Profit Care and Community Benefits

Posted on April 6, 2009 by Dr. David Edward Marcinko MBA MEd CMP™

The IRS Sounds-Off

Staff Reporters

According to the Internal Revenue Service [IRS], a survey of nearly 500 not-for-profit hospitals in 2006 revealed that 9 percent total revenues were dedicated to community benefit. The just finalized 2006 report warned that attempts to set a percentage threshold for determining compliance may have a

“disproportionate impact on hospitals, depending upon their size, where they are located their community benefit mix, and other hospital and community demographics.”

Link: http://greisguide.com/?p=1059

Definition

The current “community benefit” standard was established by the IRS in 1969 in Revenue Ruling 69-545. The standard sets out factors to be considered in measuring community benefit, including: (i) a board made up of a broad base of community members; (ii) an open medical staff; (iii) participation in Medicare and Medicaid; (iv) application of surplus funds toward improving facilities, equipment, patient care, medical training, research, and education; and (v) a full-time emergency room open to all regardless of ability to pay (the emergency room standard applies differently to tax-exempt Long Term and Acute Care Hospitals [LTACH] that do not maintain a full array of emergency department services). Under the current community benefit standard, individual hospitals are given flexibility to determine what services will-best serve their communities.

www.HealthDictionarySeries.com

Assessment

Some pundits suggest that if Congress doesn’t establish new charity care requirements, the IRS should revert to its community benefit standard last in force in 1969.

Interim Report: http://greisguide.com/wp-content/uploads/2009/02/eo_interim_hospital_report_072007.pdf

Conclusion

And so, your thoughts and comments on this Medical Executive-Post are appreciated? Then, subscribe to the ME-P. It is fast, free and secure.

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Healthcare Organizations: www.HealthcareFinancials.com

Health Administration Terms: www.HealthDictionarySeries.com

Physician Advisors: www.CertifiedMedicalPlanner.com

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Filed under: Glossary Terms, Health Economics, Health Insurance, Health Law & Policy, Healthcare Finance, Quality Initiatives | Tagged: community benefit, congress, IRS, LTACH, Medicaid, medicare, non-profit hospitals, not-for-profit hospitals, Revenue Ruling 69-545, www.healthdictionaryseries.com | 8 Comments »

Inspect our 2-Volume Hospital Print Guide [for Free]

Posted on April 5, 2009 by Dr. David Edward Marcinko MBA MEd CMP™

ADVETISEMENT

Evaluate “Healthcare Organizations” [Financial Management Strategies] AND Order Now!

By Dr. David Edward Marcinko; MBA

By Professor Hope Rachel Hetico; RN, MHA

[Editor and Managing Editor]

As healthcare continues to evolve, leaders and executives have the formidable and immediate challenge of creating both short-term and long-term financial strategies. Given that today’s knowledge-base is different from that of even six-months ago, and the need is for solutions to tomorrow’s economic problems, success seems always just beyond your grasp!

Why Subscribe?

But fortunately, you can be ready; Healthcare Organizations: [Financial Management Strategies] is your blueprint for success. To ensure your organization’s competitive edge and perhaps even its survival, you must quickly gain the financial management tools and techniques necessary to lead in the 21st century. What you learn and implement using this Guide enables you to respond proactively to the rapidly changing healthcare environment. Your subscription to Healthcare Organizations: [Financial Management Strategies] not only helps you lead, it brings together healthcare executives and visionary thought leaders to help you develop essential models and successful financial management strategies, going forward.

www.HealthcareFinancials.com

Subscription Support

Specialty Technical Publishers is pleased to provide customer information and support services for Healthcare Organizations: [Financial Management Strategies] by phone, fax, or e-mail. Customer information services hours are between 7 am and 5 pm Pacific Standard Time; or http://www.stpub.com/pubs/custinfo.htm
Testimonials

“This well-organized financial management guide is easy to use and perfect for the healthcare organization, hospital or clinic manager; CFO, CEO, administrator or comptroller; CNO, CMO or physician-executive who is tasked with developing, implementing and extending a comprehensive (and integrated) financial, accounting, health economics and enterprise-wide business management program.”

Operating Room Supervisor

Hospital Administrator

Baltimore, Maryland

Assessment

For today … for tomorrow … for all healthcare organizations … for you! Remember, the Guide is available on a 30-day, risk-free trial. You may contact http://www.STPub.com at (604) 983-3434, fax (604) 983-3445, or e-mail at custinfo@stpub.com to place an order, or ask questions regarding pricing and/or availability. All shipments arrive within 5 to 10 days. Prepayment is required for all international shipments and a courier charge will be added to the subscription price. After hours, we suggest you review the STP website FAQs section for answer to your inquiry: www.stpub.com/pubs/custinfo.htm

Specialty Technical Publishers

8 – 14th Street

Blaine, WA 98230

1-800-251-0381

orders@stpub.com

http://www.stpub.com/pubs/ho.htm

TOC: http://www.stpub.com/pdfs/toc_ho.pdf

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Filed under: "Advisors Only", "Doctors Only", Book Reviews, Breaking News, Career Development, Glossary Terms, Health Economics, Health Insurance, Health Law & Policy, Healthcare Finance, iMBA, Inc., Information Technology, Managed Care, Marketing & Advertising, MAST-HEAD, Media Mentions and PR, Op-Editorials, Practice Management, Professional Liability, Quality Initiatives, Recommended Books, Research & Development, Risk Management | Tagged: CEO, certified medical planner, CFO, clinics medical clinics, CXO, david marcinko, doctors, health dictionary series, healthcare administrators, healthcare managers, Healthcare Organizations: [Financial Management Strategies], hope hetico, hospical, hospital administration, hospital administrator, hospital journal, iMBA, medical business advisors, medical office, medical practice, medical practice management, nurse executive, nurses, ospital guide, physician executive, Specialty Technical Publishers, www.certifiedmedicalplanner.com, www.healthdictionaryseries.com, www.medicalbusinessadvisors.com | Leave a comment »

Opinion Poll on eMRs

Posted on April 4, 2009 by Dr. David Edward Marcinko MBA MEd CMP™

SPONSORED ADVERTISEMENT

www.MedicalBusinessAdvisors.com

Please Vote

Filed under: "Advisors Only", "Doctors Only", Career Development, Health Economics, Health Law & Policy, iMBA, Inc., Information Technology, Managed Care, Practice Management, Research & Development, Sponsors, Surveys and Voting, Voting Polls | Tagged: digital medical records, EHRs, electronic health records, electronic medical recrods, EMRs, health information technolgy, HIPAA, HIT, medical records IT | 3 Comments »

Evaluate our 2-Volume Institutional Print Guide

Posted on April 4, 2009 by Dr. David Edward Marcinko MBA MEd CMP™

Healthcare Organizations [Financial Management Strategies]

ADVERTISEMENT

www.HealthcareFinancials.com

Our 1,200 pages, 2-volume, quarterly institutional print guide Healthcare Organizations [Financial Management Strategies] is available on a 30-day, risk-free trial.

You may contact http://www.STPub.com at (604) 983-3434, fax (604) 983-3445, or e-mail at custinfo@stpub.com to place an order, or ask questions regarding pricing and/or availability.

All shipments arrive within 5 to 10 days. Prepayment is required for all international shipments and a small courier charge will be added to the subscription price.

After hours, we suggest you review the STP website FAQs section for answer to your inquiry: www.stpub.com/pubs/custinfo.htm

Assessment

Review and Ordering Information:

Specialty Technical Publishers

8 – 14th Street

Blaine, WA 98230

1-800-251-0381

orders@stpub.com

http://www.stpub.com/pubs/ho.htm

TOC: http://www.stpub.com/pdfs/toc_ho.pdf

Note: The guide is sponsored by www.MedicalBusinessAdvisors.com with contributions from www.CertifiedMedicalPlanner.com and is edited by ME-P’s Dr. David E. Marcinko and Professor Hope R. Hetico; RN, MHA. Definitions and terms supplied by www.HealthDictionarySeries.com

Conclusion

And so, your thoughts and comments on this Medical Executive-Post are appreciated? Reviews from current journal-guide subscribers are encouraged and appreciated.

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Filed under: "Advisors Only", "Doctors Only", Book Reviews, Career Development, Glossary Terms, Health Economics, Health Insurance, Health Law & Policy, Healthcare Finance, iMBA, Inc., Information Technology, Managed Care, Practice Management, Practice Worth, Professional Liability, Quality Initiatives, Recommended Books, Research & Development, Risk Management, Sponsors | Tagged: accountants, AMA, APMA, ASCs, certified medical planner, clinics, CMS, cost accounting, CPT codes, david marcinko, doctors, halth insurance, health dictionary series, Health Economics, healthcare, healthcare administration, Healthcare Finance, Healthcare Organizations, hope hetico, hospitals, lawyers, medical business advisors, medical care, medical clinics, medical practice management, nurses, nursing homes, physician's practice, Risk Management, Specialty Technical Publishers | Leave a comment »

Future of Health Publishing and Business Journalism

Posted on March 27, 2009 by Dr. David Edward Marcinko MBA MEd CMP™

Good Content and “Fly” Beats the Competition

By Dr. David Edward Marcinko; MBA, CMP™

[Publisher-in-Chief]

Last month, Steve Brawner [Steve Brawner Communications, a free-lance journalist for the Medical Business News, Inc., and the publisher of Medical News of Arkansas] contacted me to talk about hospitals, healthcare economics and the current financial dilemma in medical care. The interview will appear, as a special report, in April

But, after discussing answers to his top ten questions, we at the Institute of Medical Business Advisors, Inc www.MedicalBusinessAdvisors.com posited another interesting query. It was not on any particular subject area of our expertise, but aimed at us as electronic-publishers, reporters and health journalists.

The Future of Journalism

In other words, the question was:

“What do we think is the future business model for health journalism?”

Now, we’ve been mulling this thought over some time now, and our opinion goes something like this:

“We don’t – the old media is collapsing.”

And, while I don’t pity the likes of Chicago billionaire Sam Zell [the so-called “grave-dancer” for his penchant to buy distressed companies on the cheap and revitalize them for profit] – poor Sam – he was a very successful real-estate entrepreneur and the Chairman of Equity Group Investments. He thought this knowledge or luck was transferrable to the publishing industry, it wasn’t.

But, I do feel for distressed print newspapers like the Seattle Post Intelligencer, Chicago Tribune and especially the Baltimore Sun; as a native Balti-moron. I have both a favorite uncle, and older cousin, whose entire careers were spent in the print and ink business, there.

Link: https://healthcarefinancials.wordpress.com/2009/03/09/healthcare-experts-versus-health-journalists/

New Media “Fly”

How has this happened? Well, Google destroyed the advertising model for most media, and blogs and social networks have democratized the commentary / opinion playing field to some greater / lesser extent. Think: Mark Zuckerberg [Facebook] of Harvard, whose parents are both physicians – incidentally Mark’s got “fly” – Zell does not. We got the electrons at the ME-P, but little cash.

The Problem

The problem is that not many “new” media outlets, like the Medical Executive-Post, can afford to take on the interesting part of publishing; which is paying real investigative journalists. Think: The Huffington Post. Something I would love to be able to do; as there’s lots of muck to be raked in health economics, finance, administration, health IT; as well as medically focused financial planning, Wall Street and related personal investing activities for doctors – an integrated oeuvre of topics to say the least.

www.HealthDictionarySeries.com

Our Own Investigative Reporter

About the closest we have to a true investigative reporter is Darrel K. Pruitt; DDS. And, although he is no Bob Woodward or Carl Bernstein; he does occasionally do a good job. Think: William Mark Felt as FBI agent “deep-throat”.

Of course, as regular readers of the ME-P are aware, Darrell broke the dental profession’s [allegedly dufus] conspiracy with CCHIT [allegedly faux], and regularly reports on the folly of eHRs, eDRs, NPIs and eMRs. Think: citizen doctor journalist.

Link: https://healthcarefinancials.wordpress.com/2009/03/02/cchit-is-prejudiced-and-lacks-diversity-%e2%80%93-an-indictment/

Link: https://healthcarefinancials.wordpress.com/2009/03/02/avi-baumstein-and-hipaa-compliancy/

Link: https://healthcarefinancials.wordpress.com/2009/03/04/don%e2%80%99t-rush-ehrs/

Assessment

But, when the ME-P gets financially solid enough to hire others, and put them into the mix of expertise, commentary and free-labor entrepreneur punditry we now have on the site; then there’ll be no need for the current newspapers [at least insofar as our covered topic channels are concerned]. Until then; we don’t know what the answer is, but it, like the economy, doesn’t look good for the print media space.

Link: http://www.shirky.com/weblog/2009/03/newspapers-and-thinking-the-unthinkable

Disclaimer about HealthcareFinancials.com

As Editor-in-Chief of the premium subscription, two volume, 1,200 pages, institutional print-guide Healthcare Organizations [Financial Management Strategies], we prefer engaged readers who demand compelling content; old or new media.

www.HealthcareFinancials.com

According to the conventional wisdom expressed above, this printed guide should be a relic of the past, from an era before instant messaging and high-speed connectivity. But, our experience shows just the opposite. Applied healthcare economics and financial management literature has grown exponentially in the past decade and the plethora of internet information makes updates that sort through the clutter and provide strategic analysis all the more valuable.

Info: http://www.stpub.com/pubs/ho.htm

TOC: http://www.stpub.com/pdfs/toc_ho.pdf

Purchase: Call 1-800-251-0381 or email orders@stpub.com

Conclusion

And so, your thoughts and comments on this Medical Executive-Post are appreciated. What is our best-of-breed business model for print and the internet? Should we charge for our electronic content – and if so – how much? OR, shall it remain an informal and complimentary companion to the $535 annual print guide? Please opine.

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Healthcare Organizations: www.HealthcareFinancials.com

Health Administration Terms: www.HealthDictionarySeries.com

Physician Advisors: www.CertifiedMedicalPlanner.com

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Filed under: Book Reviews, Health Economics, Health Insurance, Healthcare Finance, iMBA, Inc., Managed Care, Media Mentions and PR, Practice Management, Recommended Books, Research & Development | Tagged: Baltimore Sun, Bob Woodward, Carl Bernstein, Chicgo Tribune, Darrell Pruitt, eDRs, EHRs, EMRs, Facebook, health journalist, Healthcare Organizations, hospitals, iMBA, Inc., journalism, Mark Zuckerberg, Medical Business News Inc, medical clinics, Medical News of Arkansas, NPI, Sam Zell, Seattle Post Intelligencier, William Mark Felt | 1 Comment »

Obama on the SGR Physician Payment Formula

Posted on March 27, 2009 by Dr. David Edward Marcinko MBA MEd CMP™

Solo Doctors and and Small Group Practices May Benefit

By Staff Reporters

According to Diana Manos of Healthcare Finance News, on March 23, 2009, small medical group practices and solo and/or independent physicians may benefit most from the recently proposed Obama healthcare budget. In it, President Obama asked Congress for $76.8 billion for the Department of Health and Human Services [DHHS] for fiscal year 2010. Some funding would come from changes to the way healthcare is provided, with a new emphasis on pay-for-performance [P4P] for Medicare providers.

The AMA’s Response

It was reported that, Joseph M. Heyman, MD, chairman of the American Medical Association’s Board of Trustees, said the AMA is pleased with the administration’s proposed new baseline – or projected spending over a period of time – or Medicare physician payment updates.

“Unlike previous budget forecasts, the administration’s new budget baseline recognizes that Congress needs to and will act to avert the serious access crisis that looms as physicians face drastic payment cuts in the coming decade due to the failed Medicare physician payment formula,” he is reported to have said. Furthermore,

“The AMA strongly supports the use of a realistic baseline as a foundation for Congress to move forward with a permanent solution to the flawed SGR physician payment formula, and urges the committee and Congress to ensure that a new Medicare physician payment baseline is adopted in the 2010 Fiscal Year (FY) Budget Resolution.”

Assessment

Under the president’s budget request, Medicare Advantage would be revamped; physicians and hospitals could expect to be paid for performance [P4P] under Medicare; pharmaceutical companies would face steeper competition from generic drug companies and the government would clamp down on inadvertent and fraudulent overpayments under Medicare. The budget also calls for “comprehensive, but fiscally responsible reforms” to the physician payment formula [Sustainable Growth Rate], moving toward rewarding doctors for efficient quality care.

Link: http://www.healthcarefinancenews.com/news/small-physician-practices-can-expect-real-changes-healthcare-under-obama-budget

Conclusion

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Speaker: If you need a moderator or speaker for an upcoming event, Dr. David E. Marcinko; MBA – Publisher-in-Chief of the Medical Executive-Post – is available for seminar or speaking engagements. Contact: MarcinkoAdvisors@msn.com

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Hospitals: http://www.crcpress.com/product/isbn/9781439879900

Physician Advisors: www.CertifiedMedicalPlanner.org

Filed under: Health Economics, Health Insurance, Healthcare Finance | Tagged: AMA, DHHS, HITECH, Joseph M. Heyman, MA, Medicare Advantage, Obama Healthcare, P4P, Pay-for-Performance, SGR, sustainable growth rate | 59 Comments »

Consultants and Hospital Employment Statistics

Posted on March 22, 2009 by Dr. David Edward Marcinko MBA MEd CMP™

Economic Conditions Better than Other Major Industries

By Staff Reporters

According to Richard Pizzi, on March 9th, Healthcare Finance Newsweek reported that employment at US hospitals climbed 0.14 percent in February to a seasonally adjusted 4,719,300 people.

Bureau of Labor Statistics

Responding to just issued BLS data, the number employed was 6,800 more than in January and 131,800 more than in February 2008. Without seasonal adjustments, which remove the effects of fluctuations due to seasonal events, hospitals employed 4,703,700 people in February 2009, 2,200 more than in January and 130,100 more than a year ago.

Impact on Healthcare Consultants

This was good news for financial advisors, insurance agents and accountants; medical management consultants and health economists; HIT suppliers and related DME vendors, etc.

Assessment

The news was not so good in other areas of the American economy, however, as the national unemployment rate rose from 7.6 percent to 8.1 percent. The US economy shed an additional 651,000 jobs in February 2009. But, according to Rachel Pentin-Maki; RN, MHA of www.MedicalBusinessAdvisors.com

“Employment continues to be strong in almost all aspects of the healthcare industrial complex. This includes professionals, technicians, nurses and para-professionals, as well. However, in the long-term, we believe that medicine will not attract the best and brightest young minds in the future. The economic, political and competitive demographics are just not favorable.”

Conclusion

And so, your thoughts and comments on this Medical Executive-Post are appreciated. Is healthcare really a recession proof industry? What about those bright young minds; where will they go for professional careers, instead?

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Filed under: Career Development, Health Economics, iMBA, Inc., Managed Care, Research & Development | Tagged: BLS, healthcare CPAs, healthcare jobs report, hospital employment, medical careers, medical consultants, medical jobs, medical school | Leave a comment »

This Time the Hospital Financial Crisis is Different

Posted on March 19, 2009 by Dr. David Edward Marcinko MBA MEd CMP™

Oh Really … No so Fast!

Submitted by J. Wayne Firebaugh, Jr; CPA, CFP®, CMP™

Dr. Malcolm T. MacEachern, Director of Hospital Activities for the American College of Surgeons, presciently observed that:

… Our hospitals are now involved in the worst financial crisis they have ever experienced. It is absolutely necessary to all of us to put our heads together and try to find some solution. If we are to have effective results we must have concerted and coordinated immediate action. … Repeated adjustments of expenses to income have been made. Never before has there been such a careful analysis of hospital accounting and study of financial policies. It is entirely possible for us to inaugurate improvements in business methods which will lead to greater ways and means of financing hospitals in the future … It is true that all hospitals have already trimmed their sales to better meet the financial conditions of their respective communities. This has been chiefly through economies of administration. There has been more or less universal reduction in personnel and salaries; many economies have been affected. Everything possible has been done to reduce expenditures but this has not been sufficient to bring about immediate relief in the majority of instances. The continuance of the present economic conditions will force hospitals generally to further action. The time has come when this problem must be given even greater thought, both from its community and from its national aspect…

Source: Steinberg, C. Overview of the US Healthcare System; American Hospital Association 2003.

Many hospital CXOs, healthcare administrators and physician executives would agree that Dr. MacEachern accurately describes today’s healthcare funding environment. However, they might be startled to learn that Dr. MacEachern made these observations in 1932! There is the old truism that there is nothing new under the sun.

American Hospital Association Statistics

Healthcare statistics suggested that the financial crisis is much the same today as it was for hospitals during the Great Depression. The American Hospital Association’s (AHA) reported gloomy statistics for hospitals include:

In 2001, 29% of hospitals had negative total margins.
Approximately $101.3 billion of uncompensated care was provided between 1997 and 2001 with an average annual increase of 16% during that time period.
Emergency departments in 62% of all hospitals report operating at, or over, capacity.
Technology costs are soaring as traditional technologies such as X-Ray machines, for $175,000, are being replaced by contemporary technologies such as CAT Scanners at $1 million that are in turn being replaced by CT Functional Imaging with PET Scans costing $2.3 million. Even such a “simple” instrument as a scalpel that costs $20, is being replaced by equipment for electrocautery costing $12,000, that is then being replaced by harmonic scalpels costing $30,000.
Between 2000 and 2002, 33% of hospitals reported increases in liability premiums of more than 100%.
The average age of hospital plants has increased 21% from 7.9 years to 9.6 years in just one decade.
In the four years ending 2002, hospital bond downgrades have outpaced hospital bond upgrades by almost 5 to 1.

Editor’s Assessment

As editor’s of the premium subscription, two volume, 1,200 pages, institutional print-guide Healthcare Organizations [Financial Management Strategies], we prefer engaged readers and contributors like Mr. Firebaugh, who demand and create compelling content like the above. Please review these links for same.

www.HealthcareFinancials.com

Info: http://www.stpub.com/pubs/ho.htm

TOC: http://www.stpub.com/pdfs/toc_ho.pdf

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Conclusion

Always beware the words: “this time it’s different;” as it rarely is. And so, your thoughts and comments on this Medical Executive-Post are appreciated. Please opine and subscribe to the ME-P here; it’s fast, free and secure.

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Filed under: Career Development, Health Economics, Health Insurance, Healthcare Finance, Managed Care, Marketing & Advertising, Media Mentions and PR, Recommended Books | Tagged: AHA, American College Surgeons, American Hospital Association, CAT, CT, david marcinko, financial crisis, hope hetico, hospitals, medical crisis management, MRI, PET, Wayne Firebaugh | 4 Comments »

AHRQ Report on Uninsured Hospitalizations

Posted on March 17, 2009 by Dr. David Edward Marcinko MBA MEd CMP™

Differs from Insured Hospitalizations

By Staff Reporters

According to Tracey Walker, Senior Editor of Healthcare Executive News on March 13, 2009, the number of uninsured hospitalizations increased by 34%, over the last 10-year period, and the number of Medicaid hospitalizations increased by 36%. However, a newt report from the Agency for Healthcare Research and Quality (AHRQ) suggests the number of privately insured hospitalizations remained about the same.

AHRQ Report

According to the report, hospital charges increased for the uninsured faster than for overall hospital charges (76% for compared with 69% for all hospital stays). The average hospital charge for an uninsured stay in 2006 was $19,400 compared to $11,000 in 1997 (after adjusting for inflation). The average length of stay for the uninsured remained the same at about 4 days per hospital visit. Other findings included:

Compared to all hospital stays, uninsured hospitalizations begin in the emergency department much more frequently (60% for the uninsured compared to 44% for all hospital stays).
The number of uninsured hospitalizations for skin infections rose sharply over the 10-year period, increasing from about 28,000 stays in 1997 to about 75,000 stays in 2006. Early appropriate outpatient treatment for skin infections can usually prevent the need for hospitalization.
There was a 36% increase in hospitalizations billed to Medicaid during the 10-year period.

Assessment

According to AHRQ, on average the costs (not charges) to provide hospital care to the uninsured are about $1,500 less expensive ($6,800 vs. $8,400 per hospital stay) than costs for all other hospital stays.

Assessment

Lack of health insurance has serious consequences on individuals and societies. For example, the uninsured may be more likely to delay or forgo necessary medical care until eventual hospitalization makes care much more expensive. And philosophically,

“As spending on Medicaid increases; the number of uninsured hospitalizations ought to decrease proportionally—adjusted for population increases”

So says, Hope Hetico; RN, MHA, CMP™ of www.HealthcareFinancials.com.

“But, this was not the case, and determining exactly why will require more studies.”

Conclusion

And so, your thoughts and comments on this Medical Executive-Post are appreciated. Does a similar inverse relationship hold for public versus private education, housing and transportation?

Why or why not? Some pundits wonder if it is due to private entities having more “skin-in-the game?” Please opine?

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Filed under: Health Economics, Health Insurance, Healthcare Finance, Insurance Matters, Surveys and Voting | Tagged: Agency for Healthcare Research and Quality, AHRQ, Health Insurance, hospital admissions, hospital charges, hospital costs, hospital stays, hospitalizations, insured patients, uninsured patients | 2 Comments »

Frank Gehry, Health Reform and the Cleveland Clinic

Posted on March 11, 2009 by Dr. David Edward Marcinko MBA MEd CMP™

Las Vegas Hospital Uses Celebrity Architecture to Fight Disease?

By Dr. David Edward Marcinko; MBA, CMP™

[Publisher-in-Chief]

According to the Las Vegas Sun Newspaper on March 2, 2009, the Cleveland Clinic is the newest top-tier player in Sin-City with an emerging health care system that will shake up the status quo, supposedly creating a multitude of direct and residual benefits for patients throughout the region.

Lou Ruvo Center for Brain Health

In its role as partner with the Cleveland Clinic’s Lou Ruvo Center for Brain Health, the hospital — ranked fourth best nationally by U.S. News & World Report — is projected to influence medical care in Nevada on the strength of its immense organization. And, it is being designed by, none other than esteemed architect, Frank Gehry.

A Huge Project

And, if you believe numerous websites, the behemoth project will include office towers, a park, a 60-story tower for jewelry trading, a hotel conceived by celebrity chef Charlie Palmer, thousands of apartments and a $360 million performing arts center. Of course, in typically flamboyant Gehry fashion, the highly embellished main facility is said to model curvy metallic shapes and “folds of the brain.” Other nescient drawings of the Ruvo Center show it divided in two sections. Offices and examination rooms will be housed in stacked rectangular blocks set slightly off kilter, like a fortress wall built by children.

The Architect

Gehry used this method to design his world famous Guggenheim Museum in Bilbao, Spain (1997) and his Peter B. Lewis Building for the Weatherhead School of Management at Case Western Reserve University in 2002. His style is well known.

Misplaced Priorities

But, with an estimated 40 million uninsured citizens, one only can wonder if this facility could have been built more cost effectively and/or more utilitarian?

Assessment

Moreover, some Clevelanders are grumbling about the clinic’s involvement in such a glamorous project far away, and imagine that the project will drain local resources just as sun-parched Western states have fantasized about tapping the Great Lakes.

Industry Indignation Index: 70

Conclusion

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Filed under: Ethics, Health Economics, Health Law & Policy, iMBA, Inc., Industry Indignation Index, Op-Editorials, Quality Initiatives | Tagged: Charlie Palmer, Cleveland Clinic, executive physical, executive physical examination, Frank Gehry, Guggenheim Museum, HMO, hospitals, Las Vegas, Lou Ruvo Center, MCO, Medicaid, medicare, Peter B. Lewis Building, Weatherhead School | 10 Comments »

Sherlock Health Plan Management Navigator

Posted on March 6, 2009 by Dr. David Edward Marcinko MBA MEd CMP™

Information System Implications on Health Plans

By Douglas B. Sherlock; MBA, CFA

Messrs. and Mesdames

Attached, please find the February 2009 edition of our Health Plan Management Navigator.
Link: sherlock-company

The Sherlock Expense Evaluation Report

In this month’s edition, we endeavor to better understand the functional area of information systems [IS] and its implications on health plans. Information systems, based on the results from out 2008 Sherlock Expense Evaluation Report (SEER) displayed overall anti-scalability in costs. In order to better comprehend IS and its influence on health plans overall, we performed numerous analyses that looked at relationships between IS and other aspects, such as scalability, variety of product offerings, commitment to ASO products and other functional areas.

Assessment

The results suggest that scale does not appear to play a role in IS costs and that more of a concentration in ASO products seemed to lower IS costs. It also appears that management of information systems, in the context of its support to other functional areas, is an inexact science.

Conclusion

Additional information about SEER is available at www.sherlockco.com/seer.shtml or; by contacting me at: sherlock@sherlockco.com

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Filed under: Breaking News, Health Economics, Health Insurance, Healthcare Finance, Information Technology, Managed Care, Monthly Reports | Tagged: ASO, Douglas B. Sherlock, health information systems, HIT, HMO, Loyola College, MCO, PPA, Sherlock Company, Sherlock Expense Evaluation Report | Leave a comment »

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