Survey shows most rural doctors in Southern Kentucky aren’t ready for electronic health records; grant will help them switch

A recent survey found that 63 percent of rural health providers in Southern Kentucky have not installed electronic health records software, so more than 280 of the small and rural doctor practices surveyed could face financial penalties from Medicaid and Medicare if they do not install it by 2015. Federal grant money will help them make the switch.

Many rural Kentucky providers are near retirement and are deciding between making the necessary investment of capital and personnel that is required to make the switch to electronic records or to just close their practice, according to a release from Kentucky Highlands Investment Corp., which led the effort to get the grant

Decisions to close practices and to avoid using electronic health records could be problematic to rural areas in Kentucky, since the state already has doctor shortages, especially in rural areas. If the state expands the Medicaid program under federal health reform, the number of insured patients could increase much more than the number of physicians in Southern Kentucky, an area where many people are uninsured.

“Large hospitals in the region such as ARH, Baptist Regional and others have successfully installed this software, and they are using the system with quality results,” Richard Murch, an IT consultant who specializes in electronic health records and is working on the project, said in teh release. But he said the process is complicated and requires extra staff and resources that are sometimes difficult to find in the area.

The U.S. Department of Agriculture has funded a project called Stronger Economies Together to improve the biomedical and life-science practices in the region. SET plans to provide resources and training to help providers and health systems make a successful switch to electronic health records, which the release said could create about 100 jobs over the next few years.

The survey showed 73 percent of doctors’ practices have asked for help transferring to and using electronic records. “SET reviewed industry sector research to determine health care and health related businesses as the fastest growing business segment of our rural economy,” said Jerry Rickett, president and CEO of Kentucky Highlands. For more information about SET and its partner programs, click here.

Death rates for heart and pneumonia patients at critical-access hospitals are rising nationally, study finds

Death rates are rising at rural critical-access hospitals for Medicare patients who have heart attacks, heart failure and pneumonia, according to a study published in the Journal of the American Medical Association.

Hospitals designated as critical-access get slightly higher Medicsare and Medicaid reimbursements in exchange for limiting their size, procedures and patient stays. In 2002, they had a death rate of 12.8 percent for such ailments, under the 13 percent rate at other hospitals. But from 2002 to 2010, mortality rates at critical-access hospitals increased 0.1 percent each year, to 13.3 percent, while the rates at other hospitals fell 0.2 percent each year, to 11.4 percent.

There are 1,331 hospitals in the critical access program, Jordan Rau reports for USA Today. "Congress started the critical access program in 1997 to stave off hospital closures in places where patients had no good alternative because the next hospital was at least 35 miles away by regular roads or 15 miles by secondary roads. To qualify hospitals need 25 or fewer beds."
 
The authors of the study "suggested that the hospitals' care may suffer because they don't have the latest sophisticated technology or specialists to treat the increasingly elderly and frail rural populations," Rau reports. "Since hospitals are not required to submit performance evaluations to Medicare, the government may not realize that facilities could need additional assistance in caring for sicker patients."

Brock Slabach of the National Rural Health Association told Rau that the statistics don't always tell the complete story and that "The association's own research has found that rural hospitals do better in patient satisfaction surveys than do urban hospitals," Rau writes.

Kentucky hospitals gave $1.96 billion to communities in 2011, including $576.7 million cover of Medicare, Medicaid shortfalls

In 2011, despite economic and financial obstacles, Kentucky hospitals' estimated value of benefits to their communities up 17 percent from the year before, to $1.96 billion. So says the Kentucky Hospital Associated 2011 Community Benefits Report, compiled by the Kentucky Hospital Association with data submitted by hospitals. (Chart gives a breakdown of hospitals' total community benefits and services expenditures in 2011.)

Kentucky hospitals say they absorbed $576.7 million in 2011 shortfalls from Medicaid and Medicare, which cover 19 and 55 percent of Kentucky hospital patients; those losses were 26 percent larger than 2010, and may nearly double under federal health reform, to an estimated $852 million by 2019.

Bridging gaps created by Medicaid and Medicare underpayment is only one example of how the 131 Kentucky hospitals demonstrate their commitment to local communities by investing in community needs, the report says. In addition to covering government shortfalls, community benefits include providing charity care, forgiving bad debt and supporting medical research.

In 2011, the reports says, Kentucky hospitals financed $451 million in charity care, which means they cared for the sick and injured even if those patients could not afford care.

In Glasgow, T.J. Sampson Community Hospital and Dr. Bharat Mody (left), a general surgeon, have teamed up to fulfill the unmet health care needs of low-income, working, uninsured or under-insured adults of Barren County through a charity program called Community Medical Care. The program provides assistance with basic coverage for those who qualify, in addition to helping cover the cost of medications, glasses or hearing aids.

In 2011, Kentucky hospitals absorbed $426.5 million in bad debts, losses due to patient non-payment that often occur in hospital emergency rooms. Dennis Manners, who had a $500,000 medical bill and sometimes visited the ER 25 times a month, is one patient out of the total 22 percent of University of Louisville patients who cannot afford care and often cannot even afford their $15 co-pay. Highlighting its efforts to give back to the community, the reports says U of L developed a new treatment plan for Manners, which included sending him to a treatment center outside of Cincinnati.

Many health-improvement services in Kentucky communities, such as health fairs, screening programs, immunization clinics, health needs assessments and community planning, are financed by Kentucky hospitals. According to the report, $43.7 million was spent by these hospitals on such outreach programs that serve all ages and a number of special needs populations. For example, Northern Kentucky's St. Elizabeth Healthcare is fighting against cardiovascular disease, diabetes and stroke with its Cardiovascular Mobile Health Unit that brings vascular services to the community for easy access, screenings, risk appraisals and education.

Hospitals also spend a lot of money, an estimated $127.5 million in 2011, to ensure health professionals are properly educated -- a great need in Kentucky, where 59 of the 120 counties are designated as health professional shortage areas. One effort, the Rural Physician Leadership Program on the campus of St. Claire Regional Medical Center in Morehead, addresses this shortage by training physicians to serve in rural areas of Kentucky and the nation.

Other community benefits include subsidized health services, estimated at $32.3 million, to support programs like Highlands Regional Medical Center's Highlands Center for Autism in Prestonsburg (left). The center is the first of its type in the state and was created in 2009 to address autism in Kentucky, which is estimated by the Center for Disease Control to be diagnosed in one out of every 88 children, says the report. Each child at the Highlands center has a customized treatments plan involving psychologists, educators, behavior analysts, speech pathologists, pediatricians and neurologists, who collaborate to help children with autism reach their full potential.

The annual KHA report reminds people what hospitals do for the state and provides education about ongoing efforts. A more recognizable contribution is that Kentucky hospitals had a combined spending of $6.4 billion in 2011 on staff salaries, purchases or supplies and services that create a‘ripple effect” in the overall economy to generate state businesses, jobs, and tax revenue. The reports says St. Joseph Mount Sterling, for example, provided 213 jobs and generated about $12 million in annual local payroll in 2011. Kentucky hospitals' compensation comprises 5.8 percent of all wages and salaries in the state.

The reports says hospitals are more important than ever to the overall economic health of Kentucky communities. This is the fourth year for the report, generated by the voluntary KHA survey and other data sources, including the annual survey by the American Hospital Association; Kentucky Hospital Statistics, 2013; and Kentucky Hospitals’ Economic Importance to Their Communities, 2011. The KHA report covers community benefit expenditures made in 2011, which is the most recent year for which statewide data is available.

Commission says drastic changes to doctor pay and cuts to wasteful services can fix Medicare problem without tax hikes

A national advisory panel says “drastic changes” in how Medicare reimburses doctors and other providers are needed to shore up Medicare's finances, improve patient outcomes and rein in health care costs, and there is no need to seek more taxpayer money.

Medicare needs $138 billion over the next decade to avoid steep cuts in physician pay, and avoiding those cuts has become an annual scramble in Congress known as "the doc fix."  A panel dominated by internal-medicine specialists, The National Commission on Physician Payment Reform, has concluded that reduction of wasteful medical services can help solve the problem and "our nation cannot control runaway medical spending without fundamentally changing how physicians are paid," it says in its report.

Source: Henry J. Kaiser Family Foundation and Congressional
Budget Office, Budget and Economic Outlook, January 2011

The U.S. spends nearly $3 trillion a year on health care, and that level of spending is unsustainable. The report says that as a proportion of the federal budget, the cost of Medicare has risen from 3.5 percent in 1975 to 15.1 percent in 2010 in 2010). In 2020, it is projected to consume 17 percent, or 4 percent of the U.S. gross domestic product.

Recognizing the way that physicians are paid contributes substantially to the high cost of health care, The Society of General Internal Medicine convened the commission in March 2012 to make recommendations for payment reform. According to the report, some of the factors that drive up health care expenditures are:

• Fee-for-service reimbursement
• Consolidation in the health-care industry
• Reliance on technology and expensive care
• Reliance on a high proportion of specialists
• Paying more for the same service or procedure when done in a hospital setting as opposed to an outpatient setting
• A disproportionate percentage of health care spending directed to a small number of people who are very sick and costly to treat
• High administrative costs
• Fear of malpractice lawsuits
• Fraud and abuse

The commission says increased taxes are not needed to fix the Medicare problem, and the Medicaid shortfall could be entirely found by reducing overuse of services within Medicare. See the chart to the right for a breakdown of those excess medical costs.

The commission developed 12 recommendations to reduce health costs, calling for drastic changes to the current fee-for-service payment system and a five-year transition to a physician payment system that rewards quality and value-based care and not the volume of care.

The 12 recommendations were based on the principles that payment reform should improve care quality and efficiency, encourage care for the medically disadvantaged, reduce marginal and ineffective services, increase transparency to the public and should reward patient-centered comprehensive care. (Click here to see those recommendations)

Fiscal-cliff deal revives program that helps rural hospitals dependent on Medicare; 200 in nation, 10 in Kentucky

Even though most of the hospital industry wasn't happy with the fiscal-cliff deal that will only pay half the $30 billion needed to avoid a 27 percent Medicare fee cut for doctors, the deal gave about 200 rural hospitals, including 10 in Kentucky, reason to celebrate. It extends a program that pays hospitals up to several millions of dollars a year because they have fewer than 100 beds, are located in rural areas and have a high percentage of Medicare patients, Phil Galewitz of Kaiser Health News reports.

The Medicare Dependent Hospital Program was created in 1990 and is one of several payment programs designed to help small, rural hospitals deal with financial challenges that larger hospitals don't face. The program is based on the idea that "some rural hospitals have such a high percentage of Medicare patients they are unable to get enough money from higher paying privately insured patients to make up for the lower government reimbursements," health lawyer Eric Zimmerman told Galewitz.

The program has come under scrutiny. Congress allowed it to expire in September 2012, but two senators from New York and Iowa made sure $100 million for the program made it into the budget deal. The Medicare Payment Advisory Commission said hospitals in the program will receive about 25 percent higher reimbursements as a result of the funding. (Read more)

The Kentucky hospitals in the program are Clinton County Hospital, Fleming County Hospital, Harrison Memorial Hospital, Jewish Hospital Shelbyville, Logan Memorial Hospital, Monroe County Medical Center, Parkway Regional Hospital in Fulton, Rockcastle Regional Hospital, Taylor Regional Hospital and Westlake Regional Hospital in Columbia. The Appalachian Regional Hospital in Williamson, W.Va., is also considered a Kentucky hospital in the program.

Health care decisions by and for Medicare patients differ widely by place; Lexington big in back surgery, low in mastectomy

All medicine involves decisions and, according to a new series of nine reports published by the Dartmouth Atlas Project, those decisions differ drastically by location for Medicare patients. In the East South Central region -- Kentucky, Tennessee, Alabama and Mississippi), the variation between how things are diagnosed and treated can change when one crosses county lines.

An example, with numbers but without explanation: The total knee replacement rate in Harlan is 3.3 per 1,000 Medicare beneficaries; in Bardstown, it's 13.8. As the report goes on to note: "If you have heart disease and live in Huntsville, Ala., you are half as likely to undergo balloon angioplasty than if you live in Hattiesburg, Miss., and twice as likely to undergo back surgery if you live in Lexington, Ky." The greatest variation in the region was seen in mastectomy, ranging from a low of 0.3 percent per 1,000 female Medicare beneficiaries in Lexington to 2.1 per 1,000 in Tupelo, Miss.

The point, researchers say, is that providers and patients need to work together to determine care. The report looked at rates for early-stage breast cancer, stable angina, low back pain, arthritis of the knee or hip, carotid artery disease, gallstones, enlarged prostate, and early-stage prostate cancer. Read the report here.

Northern Kentucky included in Medicaid's pilot program to increase data about quality of health care

The Health Improvement Collaborative of Greater Cincinnati, which includes much of Northern Kentucky, is included as one of three regions to participate in a program designed to bolster availability of information about doctors, hospitals and health care providers, the federal Centers for Medicare & Medicaid Services has announced. According to the Robert Wood Johnson Foundation, the new program will match private data with Medicare claims data to create comprehensive reports on provider performance.  The other two organizations selected are Kansas City Quality Improvement Consortium and the Oregon Health Care Quality Corporation.

The program will place quality markers on those receiving Medicare claims data. For example, they must show that they can manage and process consumer-focused data, can prevent breaches of protected health information and that they are working with private insurers in order to produce comprehensive reports on provider performance. The program is also intended to protect patient privacy, enforcing strong penalties if Medicare data is misued.
(Read more)

Lame-duck Congress could cut funding for critical access hospitals; more than two dozen in Kentucky

Critical access hospitals, which in most states are rural facilities with fewer than 25 beds, may be under attack in the lame-duck session of Congress, former national rural-health director Wayne Myers writes for the Daily Yonder. President Obama's "budget proposes to revoke CAH status and special payments for any such hospital within 10 miles of another hospital, and to cut the extra 1 percent payment for all of the critical access hospitals," Myers writes. (Census Bureau map of CAH locations)

This would "have enormous consequences," Myers writes. "Of the hospitals that lose CAH designation probably most will close or merge with another hospital. I've seen no estimates of numbers. There are more than a few congressional budget hawks in both parties who would like to eliminate the special payments to Critical Access Hospitals entirely. If these small hospitals dodge the bullet during the lame duck session, they'll continue to be targets in the next Congress. If they are successful in reducing payments to CAHs, the net effect will be to move health care capacity and jobs from smaller to larger towns."

The issue is complex. Rural areas have less political clout than ever, because of declining population, and many rural people use urban hospitals over CAHs, even for ordinary care. "Those who do use CAHs say their experience there is just as good as that in urban hospitals, even if the quality of care isn't as good as in larger facilities," Myers writes. "Elderly patients stay at CAHs because they know the nurses and doctors and their families live close by."

Issues for CAHs arise out of how Medicare payments are made to them, Myers writes. "A long list of arcane, special funding arrangements has accumulated to try to fit small rural hospitals into a Medicare payment system designed for large city hospitals." The largest program is the "Disproportionate Share Program," or DISH, which gives $15 billion a year to states to hand out to CAHs. The program is being phased out between 2014 and 2020, along with several other programs, as part of the Patient Protection and Affordable Care Act. (Read more)

Here are the seven factors driving health care cost increases

Escalating health care costs are everybody's problem and no one entity's fault. Julie Appleby at Kaiser Health News reports that the United States spends about18 percent of its gross domestic product -- or about $2.6 trillion a year -- on health care costs. So what's making that figure rise? A Bipartisan Policy Center study took on the task of finding out and came up with it believes are seven major factors:

1. Paying our doctors, hospitals and other medical providers in ways that reward doing more, rather than being efficient. Even insurers like Medicare pay on a fee-for-service system. New efforts in the federal health law look to change that.
2. Growing older, sicker and fatter as a nation.Medicare is set to grow by an average of 1.6 million people annually. With two-thirds of adults are either overweight or obese, lots of additional medical spending looms.
3. Wanting the latest drugs, technologies, services and procedures. Prices for newer treatments are often higher than for the products they replace.
4. Employers and employees get tax breaks on health insurance, and it costs employees little to seek care. Appleby writes, "The majority of people with insurance get it through their jobs. The amount employers pay toward coverage is tax deductible for the firm and tax exempt to the worker, thus encouraging more expensive health plans with richer benefits, the report says. How that coverage is designed also plays a role: Low deductibles or small office co-payments can encourage overuse of care, the report says. Increasingly, however, employers are moving toward high-deductible coverage as a way to slow premium growth and require workers to pay more toward the cost of care."
5. Not having enough information to make decisions on which medical care is best for us.
6. Hospitals increasingly gain market share through consolidation and demand higher prices.
7. Legal issues complicate efforts to slow spending. Doctors sometimes prescribe tests or treatment out of fear of facing a lawsuit, the report says. Fraudulent billing is another concern. The report notes that laws sometimes limit the ability of medical professionals to do work for which they are trained but that more highly paid doctors must do. (Read more)

To read the entire Bipartisan Policy Center report here.

One of Humana's plans to get 5% more in Medicare payouts under bonus plan that rewards proof of preventive care

The Courier-Journal reports that Louisville-based Humana Inc. will get 5 percent more in Medicare payments and the highest rating for one of its health plans under a government program that is likely improving care for the elderly, according to an analysis. The program provides bonus payments to insurers that limit "how many members are readmitted to the hospital after a discharge, increasing the amount of preventive care and getting acceptable ratings on patient satisfaction surveys, among other criteria," according to the report. Separate analyses by the consulting firm Avalere Health LLC and the nonprofit Commonwealth Fund conclude that the bonus system, created by the 2010 Patient Protection and Affordable Care Act, is working. It has since been modified by the Obama administration to allow for bigger payments to more plans.

Kaiser study estimates how changing Medicare to a premium-support plan like Ryan's would cost differently by state and region

A Kaiser Family Foundation study has looked into what Medicare beneficiaries might pay under a "premium support" system that relies on competitive bidding, like the one proposed by House Budget Committee Chairman and Republican vice-presidential candidate Paul Ryan. Presidential nominee Mitt Romney has also supported a premium-support system, which allows beneficiaries to choose among competing plans.

Under such plans, if subscribers choose to enroll in a more costly plan, for whatever reason, they would pay the additional premiums. This differs from the current Medicare system, explains Kaiser, "in which beneficiaries generally pay the same Medicare premium regardless of where they live, whether they choose traditional Medicare or a private plan, or whether they live in a high-cost or low-cost area." Assuming full implementation of such a premium support system, and assuming current plan preferences among beneficiaries, the Kaiser study "estimates that:

• Nearly six in 10 Medicare beneficiaries nationally could face higher premiums, assuming current plan preferences, including more than half of the beneficiaries enrolled in traditional Medicare and almost nine in 10 Medicare Advantage. Even if as many as a fourth of all beneficiaries moved into a low-cost plan offered in their area, more than a third of all beneficiaries would still face higher premiums.
• Premiums for traditional Medicare would vary widely based on geography, with no increase for beneficiaries living in Alaska, Delaware, Hawaii, Wyoming, or Washington, D.C., but an average increase of at least $100 per month in California, Florida, Michigan, Nevada, New Jersey and New York. Such variations would exist even within a state, with traditional Medicare premiums remaining unchanged in California's San Francisco and Sacramento counties and rising by more than $200 per month in Los Angeles and Orange counties.
• At least nine in 10 Medicare beneficiaries in Connecticut, Florida, Massachusetts and New Jersey would face higher premiums to keep their current benefits.

"This analysis does not attempt to model all aspects of any specific premium-support proposal, which would require more details than are currently available and assumptions about shifts in demographics, spending, and enrollment," Kaiser says. "The analysis also differs from Chairman Ryan's most recent proposal by assuming full implementation in 2010 (rather than a phased-in implementation starting in 2023) and by not exempting everyone who is at least 55 years old now." (Read more) To read the full report, go here.

Home-health agency for Madison, Estill and Powell counties says it has to cut staff because of issues with Medicaid and Medicare

Declining reimbursements from Medicaid and Medicare are behind the Madison County Health Department's layoff of seven home-health employees last week. Director Nancy Crew said the cuts should not mean a reduction in care but that cuts were being made because "we've done all we can do without involuntary layoffs," Bill Robinson of the Richmond Register reports. The department's MEPCO subsidiary, which has offered home-health services in Madison, Estill and Powell counties since 1974, has been under financial pressure for two years despite cutting costs and not filling eight now-vacant positions. It had a deficit last year of $610,000.

Only about 15 percent of MEPCO's revenue comes from private insurance, said David Reed, the health department's financial director. That leaves MEPCO with a disproportionate number of Medicaid patients at a time when those re-reimbursements often are denied by managed-care companies, Reed said. Challenging those denials is a complicated process, sometimes requiring going to court to recover costs. The problem is not all with Medicaid. MEPCO’s Medicare reimbursements began a steep decline from nearly $3.24 million in 2008 to $2.55 million in 2012.  (Read more)

Government says health-reform law to save average Kentuckian with Medicare coverage $5,000 through 2022

The U.S. Department of Health and Human Services says the Patient Protection and Affordable Care Act will likely save the average person with traditional Medicare coverage $5,000 from 2010 to 2022, and people with Medicare who have high prescription drug costs will save more than $18,000 over the same period, based on the agency's estimates.

The department also announced that seniors and people with disabilities in Kentucky have already saved $85.5 million on prescription drugs since the law was enacted. Nationwide, the report states that over 5.5 million people have saved nearly $4.5 billion on prescription drugs since the law was enacted. This includes $195 million in savings on prescriptions for diabetes, over $140 million on drugs to lower cholesterol and blood pressure, and $75 million on cancer drugs so far this year.

CNN's fact-checking of 'Medicare's impending bankruptcy' shows the program is not likely to go under soon, or ever

That giant whooshing sound you just heard may have been the sound of millions of baby boomers letting out of sigh of relief. That's because CNN.com did some much needed fact checking on the often-cited and often-fretted about claim of Medicare’s “impending” bankruptcy. What they found is was startling -- and in a good way, for a change.

Trudy Lieberman, writing in the Columbia Journalism Review, notes that the Democrats used the B word at their convention, claiming that if Republicans repealed the Affordable Care Act and thus its efforts to prolong the Medicare Hospital Trust Fund, "Medicare could go broke in 2016.” Republicans, when asked to respond to the charge, promptly B-worded back, saying “Medicare will go bankrupt in 2024." Lieberman reports that CNN then "did some old-fashioned reporting, read some financial reports, and found sources that could really give the financial skinny on Medicare. And it didn’t go for that 'mostly true' or 'partly misleading' stuff that some other fact checking pieces resort to, which can confuse readers more than it enlightens them.

"First, CNN reported, as CJR has urged news outlets to do, that only one part of Medicare is in potential trouble—the Hospital Trust Fund, which is financed by payroll taxes. The other parts of Medicare, including Part B, which finances doctor visits, lab tests, and outpatient services, 'are adequately financed for now,' Medicare trustees have said. Jonathan Oberlander, a health policy expert at the University of North Carolina, told CNN that repealing the health reform law “would in fact worsen Medicare’s financial condition,” but even so, he added, “Medicare is not going bankrupt. Medicare would still have most of the necessary funds to pay those expenses and other parts of the program would be unaffected. Medicare won’t go bankrupt in the literal sense in 2016 or 2024 or 2064 -- or ever.

The Centers for Medicare and Medicaid Services noted this year, "In practice, Congress has never allowed a Medicare trust fund to exhaust its assets." (Read more)

Medicare is a hot topic on the presidential campaign trail; federal agency says reform has saved seniors money

Republican presidential candidate Mitt Romney and running
mate Paul Ryan talk health care in New Hampshire. Photo
by Aram Boghosian for The Boston Globe.

The federal health reform law continues to be a major point of contention in the presidential campaign. Yesterday, Republican vice presidential candidate Paul Ryan said, "Medicare should not be a piggybank for Obamacare," while at a rally in New Hampshire yesterday and blasted President Obama "for using $716 billion in savings from Medicare and applying it to his health care law," reports Matt Viser for The Boston Globe.

Most of that amount was taken from reductions to Medicare Advantage, a category of Medicare plans that are run by private insurance companies. The idea behind the program "was that competition among the private insurers would reduce costs," reports Politifact.com, a Tampa Bay Times project that fact-checks statements on public policy. "But in recent years the plans have actually cost more than traditional Medicare. So the health-care law scales back the payments to private insurers."

Ryan has proposed his own fix, a voucher program for Medicare, which Obama sharply criticized Saturday: "Now you think they'd avoid talking about Medicare, considering both of them have proposed to voucherize the Medicare system," he said. "They want seniors to get a voucher to buy their own insurance, which would force seniors to pay an additional $6,400 for their health care."

Meanwhile, the Centers for Medicare and Medicaid Services released a press release detailing how much the Patient Protection and Affordable Care Act has saved seniors. Kentucky seniors and those with disabilities have saved $78.4 million on prescription drugs since 2010. In 2012, seniors in Kentucky saved an average of $579 because of the Patient Protection and Affordable Care Act. The law covers the prescription drug coverage gap known as the "donut hole."

In the first seven months of 2012, 477,235 Kentuckians with Medicare also got at least one preventive service for free because of a provision in the law, a CMS reports.

"The health care law has saved people with Medicare over $4.1 billion on prescription drugs, and given millions access to cancer screenings, mammograms and other preventive services for free," said Kathleen Sebelius, secretary for the Department of Health and Human Services. "Medicare is stronger thanks to the health care law, saving people money and offering new benefits at no cost to seniors."

Aetna buying Coventry, which manages some Medicaid care

Aetna will buy Coventry Health Care for about $5.6 billion as the third-largest health insurance company poises itself for more Medicare and Medicaid patients under the federal health-care reform law.

Coventry Cares is one of four managed care organizations that supervise care for Kentucky's Medicaid patients. But since being put in place last November, the company reports it has been beleaguered by shortfalls and has threatened to end many contracts with hospitals.

"It's a deal that almost had to happen," said thomas Carroll, a Stifel Nicolaus & Co. analyst in Baltimore. "For Aetna to really compete effectively amongst the other large national managed care companies, they have to do more in terms of gaining market share in the commercial business as well as getting a bigger foothold in Medicare and Medicaid, which are the growth areas in managed care over the next decade."

The health care law "seeks to add as many as 17 million patients under Medicaid, the insurance program for the poor, while individuals states have increasingly turned to insurers to help them manage existing programs at lower costs," reports the Bloomberg News. "Medicare managed-care plans are among the fastest-growing products for health insurers as Americans age." (Read more)

Rural hospital coalition urges Congress to spare Medicare programs that shore up rural health care

A coalition of rural hospitals are lobbying Congress to keep two Medicare programs that the National Rural Health Association says are vital to keep hundreds of smaller hospitals going. The Medicare Dependent Hospital designation and the Low-Volume Hospital Adjuster, which date to the 1980s, help keep low-volume rural hospitals' doors open with the Medicare payment adjustments they provide, according to the NRHA.

Both programs could end Oct. 1 without Congressional action. "Rural facilities do not have the financial background to weather all of these cuts," said Lance Keilers, NRHA president and administrator of Ballinger Memorial Hospital in San Angelo, Tex., told Brendon Nafziger of DOTmed News, an online magazine serving the medical and medical equipment industry.

More than 200 hospitals have the Medicare Dependent designation. To qualify, a hospital must have fewer than 100 beds and Medicare patients must make up 60 percent of its inpatient days or discharges. Low-volume hospitals must be at least 15 miles from another hospital and provide care for fewer than 1,600 Medicare beneficiaries a year. (Read more)

Safety-net hospitals could get hit hardest in Oct. when patient ratings will influence Medicare and Medicaid payments

When hospitals start getting paid based on the perceived quality of care they provide to their Medicare and Medicaid patients, so-called "safety net" hospitals, a last resort for the poor, could be the losers in the equation. That's because a main way of measuring quality will be patient experience ratings, and safety-net hospitals tend to get poorer marks from patients, according ta new study published in the Archives of Internal Medicine.

Since hospitals have had to publicly report their patient experience ratings, the gap between how patients rated these facilities and the scores that other hospitals got widened. "We found that [safety-net hospitals] performed more poorly than other hospitals on nearly every measure of patient experience and that gaps in performance were sizeable and persistent over time," the authors write.

When the Centers for Medicare and Medicaid Services agency starts using the scores to hand out bonuses and penalties, safety-net hospitals could be at a disadvantage, especially since penalties could mean a 2 percent cut on regular Medicare payments. Starting in October, patient experience scores will determine 30 percent of a facility's bonus. "The hospitals that perform best will gain money, while those that lag in scores and improvement over time will end up with less," reports Jordan Rau for Kaiser Health News. (Read more)

Expert: Health care landscape already changed, despite what Supreme Court decision is this week

Whether or not the federal health-care reform law is upheld by the U.S. Supreme Court tomorrow, initiatives are already in place that will change the way health care is delivered, an expert said at a Lexington conference Tuesday. Gregg Nunziata, senior director at research and consulting firm The Advisory Board in Washington, D.C., "said the burgeoning number of baby boomers entering retirement, the ever-accelerating advances in technology and the increasing public health crisis that finds more and more Americans with chronic illness such as diabetes, are fundamentally changing how health care works in America," reports Mary Meehan for the Lexington Herald-Leader. As people age, they are "demanding a different kind of care, and they will be living long into their golden years," he said. When they become seniors, who already tend to cast their vote, they will become a powerful voting bloc.

Health officials are looking at ways to cut down on costs, which is necessary because "the government is the major funding source, and the major funding source is broke," Nunziata said. To cut costs, the government and insurers are looking at new ways to pay for health care. One example is the Centers for Medicaid and Medicare scoring hospitals based on their performance and paying them accordingly. "A low score could reduce payments by only 1 percent or 2 percent," Meehan reports, but that can translate to a multi-million dollar loss. "Every hospital is being judged and Washington is keeping score," he said.
Bundling payments is another method being tried, in which one flat fee covers all of the care that is provided in a procedure. "The idea would be to force more efficient and cost-effective care by encouraging cooperation," Meehan reports. (Read more)

Rural health care is a notch below care in urban areas, but its costs are lower and its emergency rooms are faster, study finds

A national study has found a narrow gap between the quality of health care in rural and urban settings, but it does recognize the "significant differences" differences between urban and rural care.

The report is an update to "Rural Relevance Under Healthcare Reform: A Tracking Study," by iVantage Health Analytics, and evaluates performance measures across physician, outpatient, hospital and emergency room settings. According to a press release, the report reveals that in Medicare could save about $7.2 billion if costs per patient were the same in rural and urban settings. The report also finds that for rural patients, physician payments are 18 percent lower and hospital payments are 2 percent lower than in urban areas, but outpatient payments are 14 percent higher. The overall cost per Medicare patient is 3.7 percent lower for rural patients.

Rural emergency care is faster overall than urban emergency room care, with rural patients seeing a doctor 30 percent faster (once the patient gets to the hospital, we should add). This results in fewer hospital admissions. The full report can be accessed here.