Tag: Providers

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Medicaid-to-Medicare reimbursement ratio nears pre-Great Recession level

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A look into Medicaid participation by urologists reveals differences in managed care vs fee for service and across states.

 
 

 
 

The article below has been highlighted and summarized by our research team. It is provided here for member convenience as part of our Curator service.

A 2017 survey found approximately 75% of urologists accepted Medicaid managed care and 90% accepted Medicare Advantage, “suggesting some discernment when it comes including Medicaid managed care in a practice’s payment mix,” writes Ross E. Weber of the AACU.

 
 

Based on a partnership with Urology Times, articles from the American Association of Clinical Urologists (AACU) provide updates on legislative processes and issues affecting urologists. We welcome your comments and suggestions. Contact the AACU government affairs office at 847-517-1050 or in**@*****eb.org for more information.

Having contributed health policy updates to Urology Times® for more than 10 years, a decade-long search of the AACU’s archive yields only 1 headline that references Medicaid. In November 2014, when provisions of the Affordable Care Act related to Medicaid expansion were only 10 months old, the AACU addressed the pressure applied by state hospital associations for lawmakers to broaden eligibility requirements for their health care safety net programs. At the time, 25 states and the District of Columbia had approved laws to that end. Now, 7 years later, that number has increased to 38 states and the District of Columbia. This reminiscence is noteworthy in light of a recent report on the Medicaid-to-Medicare reimbursement ratio and statistics on Medicaid patients’ access to urological care.

On February 1, the journal Health Affairs published the latest results of an examination of Medicaid and Medicare physician fees dating back nearly 30 years. The authors, led by the Urban Institute’s Stephen Zuckerman, reported that Medicaid physician fees averaged 78% of Medicare physician fees for common non-primary care, non-obstetric procedures in 2019.

For all the tracked procedures, the Medicaid-to-Medicare fee index reached 0.72 in 2019, up from 0.66 in 2012 and very near the 2008, pre-Great Recession, ratio of 0.75. The study’s authors went on to relate these figures to physician practice patterns and public policy.

“Historically, low Medicaid fees have limited physicians’ participation in the program,” they wrote. Continuing, they expressed concern that Medicaid buy-in proposals in several states, “would pay physicians according to the state’s Medicaid fee schedule or negotiate a new fee schedule with those fees as a starting point. This approach would keep costs low but could limit physicians’ willingness to accept the new coverage.”

The 2017 American Urological Association (AUA) Census only barely bears out this claim. Medicaid covers about 1 and 5 people living in the United States, totaling approximately 40 million adults and 31 million children. Sixty-nine percent of those beneficiaries are enrolled in managed care plans and, according to the 2017 AUA Census, nearly 75% of urologists accept Medicaid managed care plans. That would seem to suggest that there isn’t a widespread lack of access to urologic care. Having said that, the same AUA survey finds 90% of urologists accept Medicare Advantage, thus suggesting some discernment when it comes to including Medicaid managed care in a practice’s payment mix.

A smaller study of urological surgeons indicates a bit more selectivity. Six hundred and fifty urologists surveyed by Overholser et al found 58.3% accepted some or all Medicaid insurance plans. Drilling down to individual states, the 2016 Overholser study reported the percentage of urologists accepting Medicaid varied by state, ranging from 10% to 90%.

That considerable variance in provider participation is not surprising given the sizable difference in physician fees state by state. According to Zuckerman’s 2017 report, Alaska and Montana Medicaid reimbursement is 126% of Medicare and 109% of Medicare, respectively, whereas Rhode Island and New Jersey meagerly reimburse physicians at 38% and 42% of the Medicare rate.

Florida urologist Kevin Lee, MD, FACS, takes Medicaid in his private practice and finds, “Some of us don’t mind the lower payments. The bigger problem, though, is the cost of oncological meds. Reimbursement for those therapies is always much lower than the price we paid in advance.”

Upon taking office, President Biden took steps to, in his way of thinking, support the Medicaid program. Many experts expect the Biden administration to reverse several of his predecessor’s policies, including block grant funding and work requirements. Jocelyn Guyer, managing director at Manatt Health, the firm where President Biden’s Centers for Medicare & Medicaid Services Administrator appointee most recently worked, is quoted by HealthPayerIntelligence as saying, “The administration is sending an incredibly powerful signal about where they’re heading on Medicaid policy and a return to viewing Medicaid as a key, foundational piece of the Affordable Care Act and a primary vehicle for coverage for people, particularly during the pandemic.”

 
 

 
 

Clipped from: https://www.urologytimes.com/view/medicaid-to-medicare-reimbursement-ratio-nears-pre-great-recession-level

 
 

 
 

 
 

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Congress Delays Medicaid DSH Cuts, Makes Targeted Medicaid Policy Changes | Manatt, Phelps & Phillips, LLP – JDSupra

 
 

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The latest COVID relief bill also delays DSH reductions another 4 years (they have been continuously delayed for more than 10 years now).

 
 

The article below has been highlighted and summarized by our research team. It is provided here for member convenience as part of our Curator service.

 
 

In late December, following several weeks of dynamic negotiations, Congress passed the Consolidated Appropriations Act, 2021 (the Act).1 The massive legislative package includes appropriations through September 30, 2021, $900 billion in supplemental appropriations to address COVID-19, a ban on surprise billing, extensions of expiring health programs and an amalgam of odds-and-ends health policy provisions.

The Act contains several key Medicaid provisions, including a delay in Medicaid Disproportionate Share Hospital (DSH) allotment reductions, new Medicaid supplemental payment reporting requirements for states and codification of non-emergency medical transportation (NEMT) rules, described below.

But despite the vastness of the legislation, key Medicaid priorities were not included. States and other stakeholders have been lobbying Congress to increase the Medicaid enhanced matching rate that applies to medical expenditures for the duration of the public health emergency (PHE) and extend it beyond the duration of the PHE. This COVID-19 relief provision and other Medicaid proposals, such as a proposal to extend Medicaid coverage of postpartum women eligible for Medicaid on the basis of their pregnancy, will be high priorities for Democrats as they work with the incoming Biden administration to secure a fifth round of COVID-19 stimulus funding early this year.

DSH and Supplemental Payment Reporting Requirements

Delay in Medicaid DSH Allotment Reductions. The Act eliminates reductions in Medicaid DSH allotments—that is, the cap on federal match for state Medicaid DSH expenditures—in fiscal year (FY) 2021. It also delays the remaining four years of cuts until FY 2024, as shown in Figure 1 below.

Figure 1. Change in Medicaid DSH Allotment Reductions

  

FY 2021

FY 2022

FY 2023

FY 2024

FY 2025

FY 2026

FY 2027

Previous Reduction Amounts

$4 billion2

$8
billion

$8
billion

$8
billion

$8
billion

–

–

Modified Reduction Amounts

–

–

–

$8
billion

$8
billion

$8
billion

$8
billion

 
 

Changes to Calculation of Hospital-Specific DSH Limit. The Act also modifies the maximum amount of Medicaid DSH payments an individual hospital may receive, by redefining what costs are included when calculating hospital-specific DSH limits. States’ DSH payments to individual hospitals may not exceed a hospital’s uncompensated care costs for uninsured patients and Medicaid-enrolled patients. The second component—uncompensated care costs for Medicaid-enrolled patients—is the difference between the costs of services provided and payments received from Medicaid, and is referred to as the Medicaid shortfall.

Department of Health and Human Services (HHS) guidance and rulemaking regarding how hospitals calculate Medicaid shortfall for DSH purposes have been contentious and led to a litany of lawsuits. The issue at hand is how to account for Medicaid enrollees who have another source of coverage, such as Medicare or commercial insurance, when calculating Medicaid shortfall. Although HHS policy has been that states must account for all third-party payments when calculating hospital-specific DSH limits, some hospitals have argued that only Medicaid payments should count against the hospital-specific DSH limit.

Congress adopts an entirely different method for calculating Medicaid shortfall, as recommended by the Medicaid and CHIP Payment and Access Commission (MACPAC). Rather than focus on whether payments for individuals with third-party coverage should count in the hospital-specific DSH limit calculation, the Act simply omits from the calculation all costs for Medicaid-eligible patients with third-party sources of coverage where the third-party source of coverage is the primary payer. As a result, hospitals that treat high volumes of patients with Medicaid and third-party coverage (such as children’s hospitals that treat neonates, who commonly are covered by commercial insurance and Medicaid, or hospitals serving large numbers of dual eligibles) may report less Medicaid shortfall. And because many states use hospitals’ uncompensated care amounts to distribute DSH payments among hospitals, this change is likely to impact the distribution of Medicaid DSH payments among hospitals in certain states.

Supplemental Payment Reporting Requirements. The Act imposes new requirements on states to report any supplemental payments made through their Medicaid programs. By October 1, 2021, HHS must establish a system for states to submit reports on supplemental payment data as a requirement for a state plan amendment that would provide for a supplemental payment. In their reports, states will be required to explain, among other elements, (1) how supplemental payments are in keeping with the Social Security Act’s mandate that Medicaid payments be consistent with “efficiency, economy, quality of care, and access,” as well as with the purpose of the supplemental payment; (2) the criteria used to determine which providers qualify for a supplemental payment; (3) the methodology used to distribute the supplemental payments; and (4) the amount of supplemental payments made to each provider.3

Supplemental payments will continue to be a hot-button issue for many federal policymakers and increased transparency through required reporting may fuel future policy changes.

Other Medicaid Provisions

The Act includes several other Medicaid policies including:

  • Codification of NEMT Requirements. The Act requires states to provide NEMT to Medicaid beneficiaries who lack access to regular transportation (including those enrolled in benchmark and benchmark equivalent coverage). Previously, the requirement existed only in regulation, and the Trump administration had threatened to eliminate it. In making NEMT a mandatory benefit through statute, Congress also establishes some guardrails around the new benefit, namely by including NEMT provider requirements and by directing that the Medicaid state plan provide for methods and procedures to prevent unnecessary utilization and to ensure that payments are consistent with efficiency, economy, and quality of care and sufficient to promote access. The Act directs the Government Accountability Office to study NEMT services, with a particular focus on preventing and detecting fraud and abuse. The legislation also requires CMS to report Transformed Medicaid Statistical Information System data to Congress along with recommendations regarding coverage of NEMT to medically necessary services; to convene a series of stakeholder meetings to discuss best practices for improving Medicaid program integrity related to NEMT; and to review and update, as necessary, CMS guidance to states about designing and administering NEMT coverage. Finally, the legislation authorizes states that utilize NEMT brokerage programs, as permitted under Section 1902(a)(70), to consult stakeholders in establishing their programs.
  • Eligibility Restoration for Citizens of Freely Associated States. The Act eliminates the five-year bar on Medicaid eligibility for citizens of the freely associated states (i.e., Micronesia, Marshall Islands, and Palau) who are legally residing in the United States. The legislation restores access to Medicaid for this population after a drafting error in the 1996 Personal Responsibility and Work Opportunity Reconciliation Act excluded them from coverage.
  • Medicaid Extenders. The Act includes funding through FY 2023 for the Money Follows the Person Rebalancing Demonstration, which helps states rebalance utilization and spending toward home- and community-based services (HCBS) rather than institutional care; spousal impoverishment protections, which allow states to disregard individuals’ spousal income and assets when determining eligibility for Medicaid HCBS; and the community mental health services demonstration program, which provides eight states with enhanced funding to improve behavioral health services through Certified Community Behavioral Health Clinics.

1 P.L. 116-260.

2 Beginning in December 2020.

3 The Act indicates in what appears to be a drafting error that each state’s report must provide an assurance that the total payments made to an inpatient hospital provider (but excluding DSH payments) do not exceed the upper payment limit (UPL). However, there is no hospital-specific cap on supplemental payments subject to the UPL; rather, the UPL is assessed at an aggregate level for defined classes of providers (which is established in statute). Congress and/or the Centers for Medicare & Medicaid Services (CMS) may seek to clarify this provision.

 
 

Clipped from: https://www.jdsupra.com/legalnews/congress-delays-medicaid-dsh-cuts-makes-8125523/

 
 

 
 

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The Centers for Medicare & Medicaid Services Could Improve Its Wage Index Adjustment for Hospitals in Areas With the Lowest Wages A-01-20-00502 12-30-2020

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A recent CMS audit of wages paid in hospitals will likely be used to increase the wage index used for rural hospital reimbursement.

The article below has been highlighted and summarized by our research team. It is provided here for member convenience as part of our Curator service.

12-30-2020 | A-01-20-00502 | Complete Report

Why We Did This Audit

The Centers for Medicare & Medicaid Services (CMS) has characterized its bottom quartile wage index adjustment as a way to increase the accuracy of the hospital wage index system. We are issuing this data brief because wage index accuracy is essential to the primary objective of the inpatient and outpatient prospective payment systems (IPPS and OPPS), which is to create incentives for hospitals to operate efficiently, while ensuring that payments are adequate to compensate hospitals for the reasonable costs of high-quality, necessary care. If hospitals are undercompensated because of inaccurate wage indexes, that puts them under financial stress, which could lead to a variety of adverse outcomes, up to and including closure.

The objective of this audit is to analyze certain characteristics of the hospitals with area wage indexes (AWIs) in the bottom quartile for 2020 to provide information to CMS and other stakeholders during the implementation of CMS’s bottom quartile wage index adjustment. We are providing the results of this audit in the form of a data brief to best present our results at this stage in the anticipated 4-year period during which CMS plans to adjust the wage indexes in the bottom quartile.

What Is an Area Wage Index? What Is “Circularity”?

CMS calculates AWIs annually and uses those AWIs to adjust Medicare standard payments to hospitals in the inpatient and outpatient prospective payment systems to reflect the prices hospitals face in their local labor markets. Researchers and stakeholders use the term “circularity” to refer to the fact that CMS calculates the current year’s AWIs based on wage data submitted by hospitals in their Medicare cost reports. Those wage data are approximately 4 years old when used by CMS to calculate wage indexes. Critics of circularity (or rather of circularity combined with that 4-year time lag) assert that it can prevent some hospitals from raising wages.

What Is the Bottom Quartile Wage Index Adjustment?

For 2020 (Federal fiscal year (FFY) for inpatient claims and calendar year for outpatient claims), CMS raised AWIs in the bottom quartile (the lowest 25 percent) to bring them closer to the 25th percentile wage index. CMS did this because, in its opinion, the wage index system had previously been perpetuating and exacerbating low wage indexes because of circularity combined with the 4-year time lag, as described above. Accordingly, CMS has stated that it intends to employ this new tactic of raising the wage indexes in the bottom quartile each year for at least 4 years, with the expectation that the hospitals in the bottom quartile will use the opportunity afforded by higher Medicare payments to raise wages.

We Found That:

  • Of rural hospitals in the IPPS, 55 percent had wage indexes in the bottom quartile for FFY 2020.
  • Of bottom quartile hospitals, 53 percent were rural.
  • Bottom quartile hospitals tended to be smaller and lower-volume hospitals.
  • Bottom quartile hospitals were located in 24 States overall, but 41 percent of bottom quartile hospitals were located in just 6 States.
  • Most States that did not expand Medicaid under the provisions of the Affordable Care Act had hospitals in the bottom quartile.
  • Most States with hospitals in the bottom quartile had the lowest possible State minimum wage.
  • The profit margins of hospitals in the bottom quartile varied significantly.
  • The average hourly wages of hospitals in the same area sometimes varied significantly. (That is, some hospitals already were paying significantly higher wages than other hospitals in the same area prior to the bottom quartile wage index adjustment.)

Key Take-Away

When post-pandemic conditions allow for new initiatives, CMS could consider focusing the bottom quartile wage index adjustment more precisely toward the hospitals that are the least able to raise wages without that adjustment. Those hospitals are the ones with low or negative profit margins rather than higher, positive profit margins. CMS could also consider studying the question of why some hospitals in a particular area were able to pay higher wages than other hospitals in the same area prior to the implementation of the bottom quartile wage index adjustment. More information might enable CMS to focus the adjustment even more precisely.

Filed under: Centers for Medicare and Medicaid Services

6:54 AM

Clipped from: https://oig.hhs.gov/oas/reports/region1/12000502.asp


 

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Larry Hogan announces that Medicaid reimbursement increases will go into effect January 1

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Maryland will begin paying BH and LTC providers more January 1 via a rate increase of 3.5% and 4%, respectively.

 
 

The article below has been highlighted and summarized by our research team. It is provided here for member convenience as part of our Curator service.

 
 

 
 

 
 

 
 

 
 

Clipped from: https://stateofreform.com/featured/2020/12/60078/

Behavioral health and long-term care Medicaid reimbursement rate increases are set to go into effect on Jan. 1.. They were initially set to go into effect on July 1. The rate increases were passed through legislation in 2019.

Governor Larry Hogan announced the change on Thursday. Reimbursement rates will affect private health care providers who provide services to Marylanders on Medicaid.

 
 

 
 

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The changes to long-term care reimbursement will include nursing facilities, Rare and Expensive Case Management (REM), Development Disabilities Administration (DDA) targeted case management for certain individuals and private duty nursing. The Medicaid reimbursement rate for each will increase by 4 percent.

Behavioral health programs included in the bill will see a 3.5 percent increase in reimbursement. This includes behavioral analysis, adult residential and community-based substance use disorder treatment (SUD), mental health services, behavioral health targeted case management for children and adults, the 1915i community-based services program and therapeutic behavioral services.

The costs associated with the changes will be split between the state’s general funds and federal Medicaid funding.

 
 

 
 

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Nursing Home Providers Sue for Access to $153M in COVID-19 Medicaid Rate Boosts – Skilled Nursing News

The article below has been highlighted and summarized by our research team. It is provided here for member convenience as part of our Curator service.

 
 

 
 

Curator summary

 

PA nursing homes argue that the provider taxes they pay (“assessments”) allowed the state to draw down $153M extra federal funds as part of COVID relief- but the nursing homes did not get any of the extra funds.

 
 

 
 

 
 

Clipped from: https://skillednursingnews.com/2020/12/nursing-home-providers-sue-for-access-to-153m-in-covid-19-medicaid-rate-boosts/

Three senior living and care organizations in Pennsylvania filed suit against the state over $153 million in additional Medicaid funds allocated in response to the COVID-19 pandemic, charging the Keystone State with treating the money “as its own piggybank and disregarding the substantial need of the Commonwealth’s most vulnerable citizens.”

The petition, filed on December 7 in the Commonwealth Court of Pennsylvania, argues that the state is failing to comply with a statutory obligation to distribute Medicaid funds received from the federal government to nursing facilities.

According to the provider associations — the Pennsylvania Health Care Association (PHCA), LeadingAge PA, and the Pennsylvania Coalition of Affiliated Healthcare & Living Communities (PACAH) — the assessments paid by their nursing facility members contributed to an increase in the Medicaid funds that Pennsylvania received.

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Medicaid is funded by both states and the federal government, with the federal government’s matching share varying by state depending on per capita income. In Pennsylvania, the state makes use of provider assessments, or taxes, that bolster the state share of Medicaid and in turn increase the amount of federal Medicaid dollars that the state can draw down.

In March, the Families First Coronavirus Response Act increased the federal government’s share of Medicaid expenses, or the Federal Medical Assistance Percentage (FMAP), by 6.2 percentage points.

The Pennsylvania providers argue that under Pennsylvania’s Assessment Law, the state Department of Human Services is required to establish “a restricted account in the General Fund for the receipt and deposit of moneys from the assessment [and] any Federal financial participation received by the Commonwealth as a direct result of the assessment.”

The funds that go into this restricted account should be put in some way toward assistance for nursing facility providers, the lawsuit argues. And because of the FMAP increase passed in March, the provider assessments contributed to more federal dollars being drawn down for Medicaid, the groups claimed in the petition.

Specifically, the increased FMAP from provider assessments will lead to “an additional $153 million in funds for Medicaid payments to nursing facilities for 2020 alone,” according to the petition.

The suit argues that the Assessment Law requires the Department of Human Services to distribute all funds from the federal government “as a result of the assessments to the nursing facilities,” but it has not agreed to use the Enhanced FMAP funds for supplemental payments to nursing facilities.

“Instead of using the Enhanced FMAP funds to provide additional payments to the notoriously underfunded nursing facilities caring for Medicaid recipients, the Department is playing a shell game — it is using the Enhanced FMAP funds in lieu of other payments that were already appropriated to the nursing facilities and using those funds to fill budget holes for other programs,” the petition reads.

PHCA president and CEO Zach Shamberg described the lawsuit as “our last resort,” telling Skilled Nursing News on Tuesday that providers have been negotiating with the Department of Human Services since spring on the destination of the enhanced FMAP funds.

“We’re on month eight of those negotiations, and still no dollars have been sent to long-term care providers,” he said. “So this was really our last resort, our last recourse, getting these dollars to where they needed to go.”

The Department of Human Services did not agree.

“This lawsuit seeks only more money for nursing facilities throughout the commonwealth that have already received more than $800 million in taxpayer stimulus,” it said in a statement sent to SNN. “The assertions made in the materials the associations distributed to the media are simply false. The money at issue is being used to support residents of our nursing facilities.”

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-Centene, Walgreens and RxAdvance Announce Partnership to Provide Innovative Pharmacy Management Model


Centene, Walgreens and RxAdvance Announce Partnership to Provide Innovative Pharmacy Management Model (highlighted)

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Oct 17, 2019, 07:00 ET
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ST. LOUIS and DEERFIELD, Ill., Oct. 17, 2019 /PRNewswire/ — Centene Corporation (NYSE: CNC), Walgreens and RxAdvance today announced a strategic partnership to introduce an innovative model for pharmacy management that aims to increase transparency, enhance customer experience and ultimately result in better health outcomes at lower costs. The partnership builds upon an existing Centene and Walgreens relationship, leveraging Walgreens trusted retail pharmacy expertise and Centene’s national leadership in providing comprehensive health care services to the underserved, while also utilizing RxAdvance’s innovative pharmacy benefit management model powered by its Collaborative PBM Cloud platform.
There is a growing need for new approaches to pharmacy benefit management, particularly to serve the Medicaid population. This partnership addresses the need for leading companies to collaborate on a better model, and one which provides higher quality care and lower pricing for drugs.
“Centene is committed to supporting a transparent pharmacy benefit management model that is sustainable with higher quality care for members at a lower cost to our customers,” said Michael F. Neidorff, chairman, president and CEO, Centene. “This new approach to pharmacy management will improve the transparency and quality of care, while reducing unnecessary medical costs for millions of people.”
Using RxAdvance’s Collaborative PBM Cloud™ transactional platform and clinical intelligence, the companies will work together to improve overall patient care across the continuum of health care and to offer such a model to other large payers.
“Collaboration between retail pharmacies and payers like Centene can further transform the way we provide care,” said Stefano Pessina, executive vice chairman and CEO, Walgreens Boots Alliance, Inc. “Using RxAdvance’s Collaborative PBM Cloud, our partnership can empower our pharmacists to make critical decisions at the point of sale to help improve adherence and also to reduce avoidable medical costs.”
The parties have identified initial markets to deploy the partnership model and are working with community leaders on new pharmacy models.
Further exemplifying this commitment, Walgreens has made a small investment in RxAdvance, and Centene has increased its stake in RxAdvance, following its initial investment announced in March 2018.
“I am excited that today we have partners across the care continuum – Centene and Walgreens – who are committed to the power of RxAdvance’s collaborative PBM model, and to completely reimagine what is possible in this industry,” said Ravi Ika, founder and CEO, RxAdvance. “By pushing the limits of innovative technology and existing transaction standards, there is a clear path forward to reduce administrative costs, avoidable medical costs, and to improve overall quality of care.”
About Centene Corporation
Centene Corporation, a Fortune 100 company, is a diversified, multi-national healthcare enterprise that provides a portfolio of services to government sponsored and commercial healthcare programs, focusing on under-insured and uninsured individuals. Many receive benefits provided under Medicaid, including the State Children’s Health Insurance Program (CHIP), as well as Aged, Blind or Disabled (ABD), Foster Care and Long-Term Services and Supports (LTSS), in addition to other state-sponsored programs, Medicare (including the Medicare prescription drug benefit commonly known as “Part D”), dual eligible programs and programs with the U.S. Department of Defense. Centene also provides healthcare services to groups and individuals delivered through commercial health plans. Centene operates local health plans and offers a range of health insurance solutions. It also contracts with other healthcare and commercial organizations to provide specialty services including behavioral health management, care management software, correctional healthcare services, dental benefits management, commercial programs, home-based primary care services, life and health management, vision benefits management, pharmacy benefits management, specialty pharmacy and telehealth services.
Centene uses its investor relations website to publish important information about the Company, including information that may be deemed material to investors. Financial and other information about Centene is routinely posted and is accessible on Centene’s investor relations website, http://www.centene.com/investors.
About Walgreens
Walgreens (walgreens.com), one of the nation’s largest drugstore chains, is included in the Retail Pharmacy USA Division of Walgreens Boots Alliance, Inc. (NASDAQ: WBA), the first global pharmacy-led, health and wellbeing enterprise. Approximately 8 million customers interact with Walgreens in stores and online each day, using the most convenient, multichannel access to consumer goods and services and trusted, cost-effective pharmacy, health and wellness services and advice. As of Aug. 31, 2018, Walgreens operates 9,560 drugstores with a presence in all 50 states, the District of Columbia, Puerto Rico and the U.S. Virgin Islands, along with its omni-channel business, Walgreens.com. Approximately 400 Walgreens stores offer Healthcare Clinic or other provider retail clinic services.
About RxAdvance
RxAdvance is an innovative national full-service pharmacy benefit manager (PBM) that leverages their Collaborative PBM Cloud™ platform to deliver integrated services that reduce overall pharmacy costs and avoidable drug-impacted medical costs while optimizing specialty spend. In addition, standing shoulder-to-shoulder with plan sponsors, RxAdvance offers a global pharmacy risk partnership model. Our tailored, world-class services are for all plan sponsors — health plans, accountable care organizations (ACOs), exchanges, state Medicaid programs, and employer groups. We provide contractually guaranteed savings in administrative costs, ingredient unit costs, and rebate revenues. For more information, visit www.rxadvance.com.
Forward-Looking Statements
All statements in this release that are not historical are forward-looking statements made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Without limiting the foregoing, forward-looking statements often use words such as “believe,” “anticipate,” “plan,” “expect,” “estimate,” “intend,” “seek,” “target,” “goal,” “may,” “will,” “would,” “could,” “should,” “can,” “continue” and other similar words or expressions (and the negative thereof). In particular, these statements include, without limitation, statements about our future operating or financial performance, market opportunity, growth strategy, competition and investments. These forward-looking statements reflect current views with respect to future events and are based on numerous assumptions and assessments made in light of current experience and perception of historical trends, current conditions, business strategies, operating environments, future developments and other factors believed to be appropriate. These forward-looking statements are not guarantees of future performance and involve risks, assumptions and uncertainties, including those described in: “Risk Factors” appearing in the registration statement on Form S-4 filed by Centene Corporation with the Securities Exchange Commission on May 23, 2019; Item 1A (Risk Factors) of the Walgreens Boots Alliance, Inc. Form 10-K for the fiscal year ended August 31, 2018; and in other documents that Centene Corporation, Walgreens Boots Alliance and RxAdvance may file or furnish with the Securities and Exchange Commission. Should one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, actual results from this collaborative effort may vary materially. These forward-looking statements speak only as of the date they are made and are based only on information available on the date hereof. Except to the extent required by law, Centene Corporation, Walgreens Boots Alliance, Walgreens and RxAdvance do not undertake, and expressly disclaim, any duty or obligation to update publicly any forward-looking statement after the date of this release, whether as a result of new information, future events, changes in assumptions or otherwise. You should not place undue reliance on any forward-looking statements, as actual results may differ materially.
SOURCE Centene Corporation

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-Hackensack Meridian Health to merge with Englewood Health


Hackensack Meridian Health commits $400M to Englewood Health in proposed merger

Hackensack Meridian Health and Englewood Health have signed a definitive agreement to merge, the not-for-profit New Jersey health system and hospital announced Tuesday.
Hackensack pledged a $400 million capital investment in Englewood, which executives hope will further Englewood’s position as a tertiary academic hub in northern New Jersey. Those investments include new operating rooms, additional ambulatory care facilities and expanded cardiac catheterization labs, among others.
State and federal officials will need to sign off on the deal, which is expected to be completed in a year.
“We recognize that more and more healthcare is delivered outside of the four walls of a hospital,” said Robert Garrett, CEO of Hackensack Meridian Health.
An expanded ambulatory network will increase access and lower costs, he added.
Hackensack, which has 17 hospitals and an affiliation with Memorial Sloan Kettering Cancer Center, has had a clinical and academic partnership with Englewood since 2015. Englewood Health includes Englewood Health Physician Network, Englewood Health Foundation and Englewood Hospital and Medical Center, which deliver cardiovascular care, neurosciences, oncology, robotic surgery, women’s health and neonatal intensive care, stroke care, thoracic surgery and ambulatory care. They both operate on the Epic electronic health record.
“Hackensack recently opened its first behavioral health urgent care center—those are areas where on your own you could really just scratch the surface, but together you can make the investments necessary to create access and address affordability at the same time,” said Warren Geller, president and CEO of Englewood Health.
Hackensack and Englewood plan to create a regional cardiac surgery program, but that doesn’t mean those services will cease at Englewood, Geller said. It means they will link the patient to the right care in the most effective setting, he said.
The number of independent hospitals, in New Jersey and across the country, continues to wane. Nearly three-quarters of all hospitals were part of multihospital systems in 2017, up from 70.4% in 2012, according to Modern Healthcare Metrics data.
Lower reimbursement rates, declining inpatient admissions, and higher staffing, pharmaceutical and technology costs are weakening margins. More than half the nation’s stand-alone hospitals (53.2%) have lost money on an operating basis each year spanning 2012 to 2017, which is more than twice the share of system-owned hospitals (25.9%), Metrics data show.
Meanwhile, health systems are looking to acquire hospitals in the same or adjacent markets as they claim that scale is necessary to contain costs, improve access to capital, bolster care and boost their leverage with payers and vendors. Economists maintain that health systems often raise prices following mergers and so-called efficiencies are seldom reached given the complexity of integration.
Fellow New Jersey health system RWJBarnabas Health announced a deal to acquire Trinitas Regional Medical Center last week.
“There is no question that many of the independent hospitals in New Jersey have either merged with a larger health network or affiliated to receive the benefits that a large network can bring,” Garrett said, citing potential supply chain savings, better pricing on drugs and supplies, and clinical alignment. But one size does not fit all, he added.
Hackensack, which formed a clinical partnership with St. Joseph’s Health last month, reported an operating income of $274.4 million on revenue of $5.4 billion in 2018, down from $228.2 million of operating income on $4.4 billion of revenue in 2017, according to Modern Healthcare’s financial database.
Englewood’s operating revenue was cut in half in 2018, dropping to $14.5 million on operating revenue of $665.9 million. It reported $32.5 million in operating revenue on $629.9 million of operating revenue in 2017.
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-Community Health Systems Announces Definitive Agreements to Sell Three Virginia Hospitals | Community Health Systems, Inc.


Community Health Systems Announces Definitive Agreements to Sell Three Virginia Hospitals

10/28/19
FRANKLIN, Tenn.–(BUSINESS WIRE)–Oct. 28, 2019– Community Health Systems, Inc. (NYSE: CYH) announced today that affiliates of the Company have signed a definitive agreement to sell three Virginia hospitals – 300-bed Southside Regional Medical Center in Petersburg, 105-bed Southampton Memorial Hospital in Franklin and 80-bed Southern Virginia Regional Medical Center in Emporia, and their associated assets to subsidiaries of Bon Secours Mercy Health, Inc. The transaction is expected to close by the end of 2019, subject to customary regulatory approvals and closing conditions.
About Community Health Systems, Inc.
Community Health Systems, Inc. is one of the largest publicly traded hospital companies in the United States and a leading operator of general acute care hospitals in communities across the country. The Company, through its subsidiaries, owns, leases or operates 102 affiliated hospitals in 18 states with an aggregate of approximately 17,000 licensed beds. The Company’s headquarters are located in Franklin, Tennessee, a suburb south of Nashville. Shares in Community Health Systems, Inc. are traded on the New York Stock Exchange under the symbol “CYH.” More information about the Company can be found on its website at www.chs.net.
Forward-Looking Statements
Statements contained in this news release regarding potential transactions, operating results, and other events are forward-looking statements that involve risk and uncertainties. Actual future events or results may differ materially from these statements. Readers are referred to the documents filed by Community Health Systems, Inc. with the Securities and Exchange Commission, including the Company’s annual report on Form 10-K, current reports on Form 8-K and quarterly reports on Form 10-Q. These filings identify important risk factors and other uncertainties that could cause actual results to differ from those contained in the forward-looking statements. The Company undertakes no obligation to revise or update any forward-looking statements, or to make any other forward-looking statements, whether as a result of new information, future events or otherwise.
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Source: Community Health Systems, Inc.
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-California AG rejects Adventist-St. Joseph merger


California AG rejects Adventist-St. Joseph merger

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California Attorney General Xavier Becerra
California regulators have rejected a proposed merger between Adventist Health System/West and St. Joseph Health System that would have created a joint operating company to manage nine hospitals in six largely rural counties in Northern California.
The California Justice Department issued a denial letter Thursday citing concerns that the transaction is not in the public interest, has the potential to increase healthcare costs, and could limit access and availability of healthcare services.
The health systems said the merger would boost access to quality care throughout Northern California, with a focus on vulnerable and underserved populations. They also said the merger would enable their facilities to compete more effectively against Kaiser Permanente, which has a large market share in those six counties even though it has no hospital there.
But the state Justice Department did not agree.
“After careful review, we found this proposal falls short of protecting consumers,” said Sean McCluskie, chief deputy to Attorney General Xavier Becerra.
The health systems indicated they were blindsided by the decision.
“Both Adventist Health and St. Joseph Health are very disappointed in the outcome of this decision,” the systems said in a joint written statement. “Our intent has always been to better serve our communities, increase access to services, and create a stronger safety net for families in northern California. At this time, our organizations will need to take a step back and determine implications of this decision. The well-being of our communities remains our top priority.”
Consumer advocacy groups had objected to the merger, warning that it would raise prices and could limit access to certain services that are prohibited by the Ethical and Religious Directives for Catholic Health Care Services, such as tubal ligations, contraception, gender transition care and physician aid-in-dying.
A transgender patient has a lawsuit pending against St. Joseph, claiming he was discharged from the St. Joseph Hospital in Eureka minutes before a scheduled hysterectomy in 2017, after hospital officials learned he was transgender.
In its response to the suit, St. Joseph said it has a constitutional right to refuse to perform procedures barred by Catholic religious doctrine.
The American Civil Liberties Union of Northern California applauded the state’s decision to bar the merger.
“This is a strong statement by the attorney general that healthcare should be available and accessible to patients,” said Phyllida Burlingame, the group’s reproductive justice and gender equity director. “More than one in six hospital beds in California are already in hospitals like those in the St. Joseph network that deny patients needed reproductive healthcare and gender-affirming care based on doctrine established by Catholic bishops. Californians, particularly those in the rural areas where these hospitals are primarily located, need more access to these essential healthcare services, not less. This decision helps move our state in a positive direction.”
The merger denial contrasts with the same agency’s decision last November to approve the much larger merger of CHI and Dignity Health, two Catholic-affiliated systems which formed CommonSpirit Health earlier this year. That deal also was opposed by the ACLU and a number of other advocacy groups on the grounds that it would raise costs and limit access to certain types of care.
Adventist and St. Joseph had sought to reassure regulators and their religious sponsors that the merger would not change either organization’s mission or religious operating rules. Under the deal, each partner would retain management and control over its own facilities. Neither would be allowed to cause the other to violate its religious rules.
Unlike Catholic-sponsored St. Joseph, Adventist permits contraception, sterilization, in vitro fertilization, and calls itself LGBTQ-friendly. But Adventist, like St. Joseph, does not offer gender transition surgery or participate in physician aid-in-dying.
Anthony Wright, executive director of Health Access California said the proposed merger raised other concerns as well, including potentially higher costs in the already highly concentrated California market.
“Bigger is not often better with hospital chains and health care in general, as consolidation is closely correlated with much higher costs for consumers,” he said.
Correction: The proposed merger involved only nine hospitals. The attorney general’s statement listed one hospital under two names.
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-Sanford Health, UnityPoint Health call off merger


Sanford Health, UnityPoint Health call off $11 billion merger

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Sanford Health and UnityPoint Health nixed their proposed merger that would have formed an $11 billion, 76-hospital system, the organizations said late Tuesday.
The not-for-profit health systems announced their letter of intent to merge in June. The combined entity would have ranked among the top 15 not-for-profit health systems by revenue, with operations across 26 states and more than 83,000 employees.
Kelby Krabbenhoft, the president and CEO of Sanford, said in a statement that the UnityPoint board failed to embrace the vision of a new health system of national prominence.
“We were excited at the opportunity our combination would have provided to create a new health system of national prominence,” he said. “The executive management teams and physicians worked diligently for 18 months to provide a merger recommendation to the boards. We are disappointed that the UnityPoint Health board failed to embrace the vision. Our focus now is on the patients and communities we serve and the 50,000 people working tirelessly to support them.”
Vision represents a long-term view of how the business will operate and how the culture will manifest both within the organization and as it faces patients and stakeholders, said Joe Lupica, chairman of Newpoint Healthcare Advisors.
“When one party says visions don’t align, this means it is not a failure that happened in the trenches,” said Lupica, explaining that it’s something more fundamental than disparate IT systems or fragmented supply chains.
Executives hoped that the merger would have allowed the combined organization to become a world leader in personalized primary care.
“Our organization concluded we can most effectively fulfill our mission by maintaining our existing corporate structure,” Kevin Vermeer, president and CEO of UnityPoint Health, said in a statement.” As a leader in the delivery of value-based care, UnityPoint Health remains strong and competitively positioned for the future.”
It is hard to imagine spending a year and a half on a transaction and having it fall apart, said Robert Creighton, managing partner at Farrell Fritz.
“It makes me think that the preliminary work maybe was not as thorough,” said Creighton, adding that they may have never come to an understanding of what the vision was.
The deal may have been related to a culture clash, mismatched or unmet expectations when it comes to estimated savings benchmarks, their relationships with physicians or other labor-related issues, he said.
“These are incredibly complex (and costly) transactions,” Creighton said. “You have to get all the pieces to fit, and it is not surprising that some deals will fail.”
Sioux Falls, S.D.-based Sanford reported an operating income of $117.1 million on $4.59 billion of operating revenue through the first nine months of fiscal year 2019, up from $92.3 million of operating income on operating revenue of $3.53 billion over the same period last year, according to Modern Healthcare’s financial database.
Last month, Sanford agreed to pay the federal government $20.25 million to settle allegations that one of its neurosurgeons received kickbacks for using implantable devices distributed by his physician-owned distributorship. The settlement also involved hiring a compliance officer and setting up a compliance committee, implementing a risk-assessment program and hiring an independent review organization to oversee Medicare and Medicaid claims at Sanford Medical Center. Sanford denied any wrongdoing.
Des Moines, Iowa-based UnityPoint reported an operating income of $49.4 million on revenue of $2.26 billion through six months of fiscal year 2019—the most recent financial statement available. That was up from $32.8 million of operating income on $2.19 billion of revenue over the same period the year prior. UnityPoint recorded a $21.5 million operating loss in 2017.
While this dismantled deal may throw up a caution flag to other providers exploring mergers, Creighton still expects significant consolidation in the hospital sector given the potential cost and quality benefits of a smaller organization joining a bigger system, he said.
As health systems continue to pursue massive regional and national networks in search of the highly touted benefits of scale, economists and policy experts have cautioned about consolidation’s tendency to raise prices.
Hospital mergers and acquisitions have seemingly cooled in 2019 after several years of significant activity, possibly in part because the projected synergies of scale have not met expectations, hospital M&A experts said. In some cases, health systems rushed into a letter of intent, they said.
Baylor Scott & White Health and Memorial Hermann Health System called off their merger in February, about five months after the Texas-based health systems signed a letter of intent.
M&A experts expected there had been some concern regarding the alignment of their academic missions as well as a mismatch of their physician-management models.
Atrium Health (formerly Carolinas HealthCare System) and UNC Health Care scuttled their deal last year, about six months after the letter of intent was signed.
Cone Health and Randolph Health, also based in North Carolina, called off their deal in May 2018 after more than a year of talks as Cone Health was unwilling to “scale back projects or put them on hold,” Cone Health executives said.
“The savings executives thought they were getting from eliminating redundancies haven’t panned out,” Lupica said.
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