Posts Tagged ‘Arizona’

Large Arizona Healthcare System Taking a Close Look at New Reimbursement Models

Wednesday, January 26th, 2011

Arizona’s second largest healthcare system – Banner Health, which employs 28,000 – is struggling to save jobs in the face of up to $100 million in 2011 cuts to reimbursement from the Arizona Health Care Cost Containment System (AHCCCS), the state’s Medicaid program.

This is the opinion of Peter S. Fine, FACHE, President and CEO of Banner Health in a recent op-ed piece in the Arizona Republic. According to Fine, “Arizona’s elected officials continue to struggle with a massive state budget deficit that is primarily made up of healthcare, education and corrections.  I do not envy their job as there are no pain-free options.  Our objective will be to stay ahead of further possible cuts to AHCCCS by the state Legislature and subsequent reductions in reimbursements from AHCCCS to deal with these cuts.”

Fine notes that non-profit hospitals must act when reimbursements are cut or threatened – whether the reductions come from government or private payers.  “In challenging economic times, healthcare organizations that place themselves into a weakened position as a result of inaction, tepid actions or even actions that come too late to make a difference, are organizations in which job security is at great risk,” Fine wrote.

Banner Health is in discussions with private insurers to create new care and reimbursement models.  Typically, these are collaborative efforts where reimbursement is shared by hospitals, doctors and other providers.  The goal is to cut costs by reducing hospital admissions through prevention or cutting hospital re-admissions by better patient management.  “This model is called an Accountable Care Organization (ACO), and it incentivizes insurers, hospitals, physicians and other healthcare providers to work more collaboratively to ensure a higher quality of care at a reduced cost.  Doubtless, there will be those who will decry ACOs as a by-product of healthcare reform and therefore unworthy of consideration.  However, ACOs and similar collaborative models are moving forward whether healthcare reform is implemented or not.”

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Arizona Halts Medicaid Funding for Some Transplant Surgeries

Friday, December 17th, 2010

The State of Arizona – facing soaring enrollments and shrinking revenues – has eliminated Medicaid coverage for some transplants of the heart, liver, lungs, pancreas and bone marrow.  Because these treatments are usually considered to be life saving, the consequences for Medicaid patients in Arizona requiring transplantation are grim.  The cut, which impacts approximately 100 Arizonans, is a clear demonstration of the fiscal pressure that states are facing.

“It’s a real sign of the times,” said Alan Weil, executive director of the National Academy for State Health Policy.  “And I think this is a precursor to a much larger number of states having this discussion.”  These policy implications are all the more striking, given the partisan framing of the healthcare debate.  Republican arguments against the Patient Protection and Affordable Care Act frequently focus on the specter of healthcare rationing and even the so-called death panels.  Democrats counter with the argument that – because 50 million Americans currently lack coverage – healthcare is already being rationed.

Diane Rowland, director of the Kaiser Commission on Medicaid and the Uninsured, said that Arizona’s move “is a classic example of making decisions based not on medical need but based on a budget.  It results, potentially, in denial of care to individuals in a life-or-death situation.”  Dr. Robert Gaston, president-elect of the American Society of Transplantation, agrees, noting that “It seems inappropriate that life-saving care has the potential to be withheld based solely on budgetary issues and the bureaucratic determination of relative benefits.”

Earlier this year, Arizona became the only state to almost eliminate its Children’s Health Insurance Program, which would have impacted 47,000 children from lower-income families.  State legislators reversed this decision before the effective date, but only after concluding that the state might lose billions of dollars in matching money from the federal government

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Mayo Clinic Saying “No” to Medicare Patients

Tuesday, January 26th, 2010

Low reimbursements make Mayo Clinic turn away Medicare recipients. A Glendale, AZ, family clinic operated by the non-profit Mayo Clinic is no longer accepting Medicare patients, saying government payments are too low.  The more than 3,000 Medicare-eligible patients who use the facility will be forced to pay cash or find a physician at another location.  The decision, which doesn’t impact other Mayo facilities in Arizona, Minnesota and Florida, is a two-year pilot project, according to spokesman Michael Yardley.

Mayo’s move may lead additional family physicians to drop Medicare patients, according to Lori Heim, president of the National Association of Family Physicians.  “Many physicians have said, ‘I simply cannot afford to keep taking care of Medicare patients,’” Heim said.  “If you truly know your business costs and you are losing money, it doesn’t make sense to do more of it.”

Mayo’s Yardley defended his organization, noting that “We firmly believe that Medicare needs to be reformed.  It has been true for many years that Medicare payments no longer reflect the increasing cost of providing services for patients.”  Nationally, physicians were reimbursed approximately 20 percent less for treating Medicare patients vs. privately insured patients in 2007.  That payment gap has not changed over the last 10 years, says a report from the Medicare Payment Advisory Commission, a group that advises Congress on Medicare.  At the end of 2008, approximately 45 million Americans were covered by Medicare, according to statistics from the Centers for Medicare & Medicaid Services.  Although 92 percent of family physicians participate in Medicare, just 73 percent are accepting new patients under the program.

Medicare patients who opt to stay with their physician at Mayo’s Glendale clinic will pay $1,500 annually for a physical and three additional visits.  Additionally, they will pay a $250 annual administrative fee.

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