UofL and UMC File an RFP for a New Hospital Partner

The University of Louisville and University Medical Center Inc. seek a knight in shining armor to bail them out.

“Investing in and delivering healthcare services, education and research in conjunction with the University of Louisville and University Medical Center.”

The University of Louisville and University Medical Center, Inc. have jointly filed an RFP “to seek a business partner that will bring capabilities, experience, and commitment to include but not limited to: Critical Care, Facilities/Operations, Teaching/ Training and Research.

The following represents my initial thoughts as I read through the request for proposal (RFP) and the attached current Affiliation Agreement by which UMC operates University Hospital for the Commonwealth and the University. I apologize for typos and bad grammar. I am trading off timeliness for polish. I will attempt to clean it up in the days ahead. Because the timeline chosen by UMC and the University is deliberately and unduly brief, I would rather have something out there to work from then nothing at all.

Executive Summary
By way of an executive summary of my initial thoughts, shaped as they are by other recent events in our community, I offer the following.

The qualifications and criteria for judging responses to this RFP parallel exactly the justifications and solutions advanced at the time of the recently failed acquisition of University Hospital by Catholic Health Initiatives. I am having the feeling of déjà vu all over again. The extraordinarily short timeframe of action, together with the severely constricted avenues by which an external agency can gather information are not compatible with the due diligence that should be required of any third party not already intimately involved in the operation of the downtown medical center. The criteria for processing applications described in the RFP gives the University and UMC great leeway in whom they might select or refuse to consider. I cannot in my own mind come to any other conclusion than that this RFP was written solely with a single applicant in mind who has already signaled interest in close affiliation with University Hospital and with whom the structure of agreements has already been agreed. I cannot force the word, “sham,” from my thoughts. What a shame. I will be glad to be proven wrong.

The RFP process does not permit any public disclosure until after an agreement is signed. There is no recognition that any acceptance by the Commonwealth of Kentucky is required. The University of Louisville and UMC appear to have ignored any lessons they might have learned from the fiasco of last fall and winter. This community demanded the right to know what decisions were being made about their healthcare and by whom.

The rush to conclusion seems incongruous with the magnitude of the undertaking. I cannot personally ignore the conclusion that the haste is intended to allow documents to be signed before the Kentucky Appeals court has ruled on the issue of whether University Medical Inc. is a private entity free to do as it pleases, or whether it is an arm of the University and of the Commonwealth. What rational corporation would take on the responsibilities of this RFP without such determination made and finalized?

Many numbers are thrown out but fewer definitions and even fewer comparative data. An attempt is being made to compare our situation here in Louisville with other Academic centers around the country. This is justifiable and worthwhile, but cannot alone determine the direction our community should take. The current consultants to UMC have stressed that every medical center is different. We want ours to be different to. We want it to be better.

All the comments in this brief represent my personal opinions but I would like to think they are informed opinions. There is no one in Louisville more committed than I to the long-term survival of University Hospital as an ethical and excellent teaching facility, and for a healthcare support system for the underserved that is characterized by quality, dignity, and justice.

In my mind, the least positive implication of this rush to conclude a deal is that we will memorialize in stone for yet another generation, a segregated and second-class system of healthcare for those who do not qualify for mainstream medical services. The comments below are not mine, but I could not have expressed them better. A respected authority describes the system we have now in Louisville.

“If someone decides there are some hospitals in Louisville whose job it is to take care of the poor black and the marginalized and that it’s okay if they have to be kept waiting for a couple of weeks and it’s okay if the carpet is frayed, it’s okay if the phones don’t get answered, and it’s okay if the doctor is late, but there are other hospitals in Louisville where upper-class white people get taken care of by doctors who answer the phone on the first ring and smile a lot. There’s shag carpeting, and wood wainscoting on the wall. Was there a plebiscite … in Louisville where people voted and said they wanted to have segregated medical care? I don’t think so. But, there is a very strong theme that it’s okay for medical students and interns and residents to learn on poor people, but when you’re done, then you’ll be able to take care of private patients.”

Edward C. Halperin, MD
From: “Slave Medicine and the Banality of Evil.”
Gheens Foundation Lectureship,
University of Louisville School of Medicine, Feb 2, 2012

To participate in the above system of contemporary segregation is to participate in an evil.  I think it is time for a plebiscite in Louisville, and I trust that our citizens to favor a different set of priorities. Those decisions must not be made behind closed doors by a self-selected privileged few. The leadership of our University and our health care systems need to hear from all of us.

Peter Hasselbacher, MD

Analysis of RFP continued below. Continue reading “UofL and UMC File an RFP for a New Hospital Partner”

Kentucky Medicaid Still a Mess: Month 4

Primum non noccre.  First do no harm.

Attributed to Hippocrates, the above aphorism is often cited in discussions of medical ethics.  The fact is that it is impossible to practice medicine without causing some harm.  Nothing from taking a medical history to administering chemotherapy and everything in between is free of potential harm.  As in life, few things are simple and a ballance of risk and benefit is always made.  The aphorism should be rewritten as:

Primum minimus noccre.  First do the least harm.

I no longer see patients and have no first-hand experience with the new state-wide Medicaid Managed Care systems.  I can however still read, and it is clear that things are not going very well, at least if the testimony at Frankfort hearings is generalizable.  Some of the reports sound just plain awful.  I cannot conceive that a stable epileptic would have medicines dolled out two weeks at a time.  Is there a copay involved that would also double?

Managed care companies are charged with weeding out the unnecessary or poor quality medical care that physicians and other providers are unable or unwilling to tackle themselves.  I acknowledge and even applaud those efforts. Active managed care however is very difficult to do and requires cooperation from both patients and providers– cooperation that has never been in abundance.  As a result, managed care companies have evolved to depend more on things like preauthorizations, copays, formularies, and restricted payments.  Cynics will call this rationing by inconvenience.  Modern insurers are certainly practicing medicine in the sense that they are determining treatments or withholding them.  (Sometime they practice better than free-range doctors.)  All this micromanagement might trim medical expenditures, but it also increases overhead costs to both the insurer and the providers.  Where is the balance point?   If needed services are delayed, then the cost will be more than just in dollars.  I honestly do not know how much is really saved by managed care as it currently is practiced.  Perhaps not much at all.  It has never been shown to me that Passport (which provided good care) ever saved the state money.

What to do now?

I do not believe things will be sorted out quickly.  Not only are the systems all new to the state and providers, but also to patients who do not know what to expect.  An attempt to apply the full bore of managed care protocols that might have worked elsewhere to a new population was probably doomed to failure here, at least I think so.  What the state needs to do now is to signal the three new Medicaid companies to back off a little and apply their controls in a more gradual manner.  This will require that some money be allowed to flow into the system.  Don’t waste time trying to adjudicate bills from last November or you will never catch up.   The overbearing principal here is that sick people should be protected.  This will hurt the bottom lines of doctors, hospitals, pharmacies, insurance companies, and the state treasury.  This was never going to be easy or cheap. Real reforms are not going to me made by requiring long phone calls between doctor’s offices and drugstores to authorize prescriptions.  Effective reforms must be made in the entire medical marketplace, and not just in the market of the most vulnerable.  Bite the bullet and make a nationwide medical system that is a coherent whole, not one in which some benefit at the expense of others.   Any Medicaid problem will then melt away.  This will take more political courage and true professionalism than we have been able to manage up to now.  I am not optimistic.  In the meantime, do less harm.

Medicus quidem faciendum malum.

Peter Hasselbacher
Feb 24, 2012

How does UofL hospital compare to other hospitals?

Let’s look at some numbers.

The University of Louisville is going to try and make a case that it has unique requirements that will require additional non-patient revenue to fix. Specifically, they are asking for more state money, or alternatively, permission to partner with an outside business entity that is willing to give them more money. The claim will be made they are caring for a disproportionate share of nonpaying patients, and do not have enough profitable patients to subsidize the losses the way other hospitals do. This is a reasonable argument to make but it is an incomplete one. The University’s problem will not be fixed by money alone. There are a host of other issues that must be addressed simultaneously. I have begun to discuss these elsewhere.

There are 3502 acute care hospitals that participate in the Medicare program. Of these, 1047 are teaching hospitals, and 601 are large urban teaching hospitals like the University of Louisville Hospital. It would be easy for the University or its consultants to pick and choose hospitals to compare with that would bolster its case. Picking your own benchmarks is one way to make yourself look good, or in this case bad. Much of the University’s credibility will hinge on the choice of comparable institutions. Fortunately, there is an ocean of comparative data available that I believe helps put things in perspective and can provide a starting point for a broad-based study of our medical school and its principal teaching hospital. I will try to present such information on the Institute’s website. Such analysis often challenges popular wisdom.

For example, teaching hospitals get billions of dollars of special funding from Medicare (and Medicaid) solely because they have medical residents on their wards. These Direct and Indirect payments for Graduate Medical Education (interns and residents) increased substantially over the years as a result of effective lobbying. It was argued from the start that teaching hospitals deserve more money because they have extra expenses related to faculty salary, inefficiencies of care, and for other reasons that may or may not be relevant today. Federal analysts estimate that Medicare pays teaching hospitals twice as much for graduate medical education than the actual cost of those programs to the hospitals. Not to be denied, the teaching hospital lobby continues to argue that they are entitled to the extra money because of their disproportionate service to the poor. Is it in fact true that teaching hospitals take care of more of the poor than non-teaching hospitals? I was frankly surprised when my first attempt to find out showed that in fact, the proposition does not appear to be true. Continue reading “How does UofL hospital compare to other hospitals?”

The Cardiac Gloves Come Off!

Why is your heart the punching bag?

My cardiologist is just as good as yours.

On the way to my gym on Shelbyville Rd., I noticed a billboard advertising Baptist Health’s cardiology service.  It advises me that “some of the best cardiologists around don’t practice downtown.”  This, of course, is true.  The ad is an obvious riposte to some of the advertisements of downtown hospitals, one of which advised that for your best chance of surviving a heart attack, you should take the next exit.  If corporations are people, it is now getting personal!

It’s hard not to notice that our area hospitals advertise their cardiac services heavily.  Each one is said be the better for you, and amazingly, many can produce reports from external review organizations appearing to back up their assertions.  What is distinctly lacking, in my opinion, is objective evidence in the promotional material to support claims of excellence.  For most of the Fall and Spring of 2008-09, I drove several times a week past the sign (and the exit) on Interstate 65 that promised my best chance of surviving a heart attack.  I wondered on what basis the hospital could make such a claim.  When I learned that Medicare’s Hospital Compare was then calculating risk-adjusted mortality following heart attack, I had to check it out.  In fact, not only did the advertising hospital not have the best survival rate in the city, it had the lowest.  Nevertheless, the sign stayed up for many months.  Today the mortality rates have evened out, but is all such advertising so much puffery?  How are we to know?

Why are cardiology patients fought over?

It is not a state secret why cardiology, cancer, orthopedics, or neurosurgery are advertised so heavily by hospitals. These are among hospitals’ most profitable services. My former hospital lobbyist colleagues were quite open in admitting that cardiology services are overpaid by Medicare and other insurance companies.  According to the bank robber Willie Sutton’s law of medicine, that’s where the money is. I will say more about this in another post because an absence of profitable services is relevant to the financial difficulties of Louisville’s University Hospital.  In my opinion, the other downtown hospitals have helped to keep University Hospital in its place.

The Baptist billboard is clever, and reminds me of the series of billboard ads for hotdogs and whiskey also containing witty one-liners that we all chuckle at.  I would not be surprised if the same advertising agency was responsible for some of the medical ads as well. That is, a very depressing thought however.  At a time when food and dietary supplements are marketed as though they were medicines, medicine is marketed as though it was soap powder.  Are we really that gullible or so easy to manipulate?  I have already told you how I feel about the quality and ethics of some of these advertising campaigns.  If you believe everything you see and hear, you will be badly served. Continue reading “The Cardiac Gloves Come Off!”

University of Louisville Looking for New Hospital Partner, or an Old Flame?

No one who has corresponded with me believes that the University has given up its quest to be acquired by Catholic Health Initiatives. The Chairman of the Hospital’s Board of Trustees pointedly refused to answer a direct question on the matter. One correspondent at Jewish Hospital believes the institution is treading water until the University can jump in the pool. I have already commented on what I believe is the University’s strategy to present the governor with an offer he cannot refuse. Indeed, I am hearing secondhand that President Ramsey is telling supporters he will push this thing through. It certainly seems as though that is true.  (If you have first-hand knowledge, I would love to hear from you.)

Today, reporters Chris Kenning and Patrick Howington tell us about yesterday’s closed session of the Trustees of the University of Louisville giving its medical center permission to issue a request for proposals to seek a new partner. (I thought closed sessions weren’t allowed for this sort of thing? So much for transparency.) Recall that failure to follow state procurement rules was one of many criticisms of the Attorney General’s Office supporting the rejection of the first merger effort. The University appears to be doing some backfill work. I have not yet seen this RFP, but University officials are quoted as saying they are seeking a “health care entity with a statewide network and capital resources to help maintain the hospital teaching and indigent care missions.” It seems to me this will be very short list. I will not be surprised that the RFP is written so narrowly that there is only one entity on earth that will fit the bill. (That is what some unethical employers do when they want to hire a particular person but yet be seen as following the procedures of affirmative action employment.) No doubt I will be proven wrong and will apologize for expressing an erroneous opinion. In fact, it just occurred to me that I am dead wrong. The University of Kentucky with its statewide presence and deep well of state support could easily be an eligible entity. The more I think of it, the better the idea seems! Brilliant!!  (Of course there are also the Baptist and Norton systems.)

KentuckyOne Health told its physicians today that it has been aware (was anyone else?) of the process and believes that a “close working relationship with the University of Louisville School of Medicine and University Medical Center is important to our vision as an organization.” In fact they seem downright eager to respond to an RFP.

Shame on the University of Louisville for dragging its community through this monkey business all over again. Arrogance is a descriptor that comes to mind. Of course, if you know you will ultimately get your way, how you appear is of less consequence. There are many in our community who want to help the University and to protect our public hospital. The University is making it difficult for us to do so.

Peter Hasselbacher, MD
Feb 17, 2012

 

A printable PDF version of this post is available here.

University of Louisville’s Review of Its Hospital Operations.

And Who Will Take Care of the Poor?

One doesn’t ask of one who suffers: What is your country and what is your religion? One merely says, you suffer, That is enough for me. You belong to me and I shall help you.        Attributed to Louis Pasteur.

The Commonwealth of Kentucky once required hospitals and doctor’s offices to post the prices of their top 20 services. This was fair– hospitals were asking their patients how they expected to pay. The policy concept of disclosure was and is reasonable, but the results were embarrassing, unused, and perhaps not even helpful. Under pressure, the Commonwealth repealed the law after two years.

I suggest we would all feel better (and probably even be better) if we would post the above thesis instead. Why don’t we? Most or all of the doctors with whom I went to medical school would have echoed Pasteur at the time. I suspect most hospital administrators and their corporate boards also wish they could post Pasteur’s profession on their front doors. After all, the earliest hospitals were established almost entirely to serve the poor. The non-profit status of today’s hospitals stems from those charitable roots. The sad fact is that in our system, no single physician or hospital could stay in business if they actually tried to serve all who showed up on their doorstep. It takes a community effort. In Louisville, talk of indigent care usually focusses on University Hospital. Why is that, and should it?

Fitness of University Hospital to serve the poor.

Earlier this month, and under the sword of an examination by the State Auditor’s Office, the University of Louisville announced that it would review its hospital operations to address questions of the strengths and vulnerabilities that were raised during the debate over their proposed merger/acquisition by Catholic Health Initiatives. They will retain an outside consultant of their choosing and have named a 9 person review committee. We are told that the review will consider how University Hospital compares to other academic hospitals financially and in the amount of “indigent care” provided. The University obviously still has a partnership on its mind, but declined to answer a direct question of whether it had resumed discussions with the new KentuckyOne Health entity. [Of course it has!]

I credit the University folks for opening the planned meetings to the public, but it looks to me that they want to control what is discussed just as tightly as they did when they rolled out their campaign for last Fall’s failed merger. Faced with a truly independent outside audit, and still embroiled in the courts over their withholding of court-ordered documents, some damage control might be judged imperative. It is axiomatic in matters such as these, that if you can select the issues and define the vocabulary of the debate, you have won before you even start. The University wants this discussion to be about how many medically indigent patients they serve, and to convince us that all that is needed is more money from the state or elsewhere. One strategy that I see evolving, seeks to give the Governor and Attorney General’s offices the political cover needed to reverse their previous rejection of the CHI acquisition.  The University leadership has (1.) already demanded more money than they know the Commonwealth can provide, (2.) will claim that only more money will solve the problem, and then (3.) present once again a deal they still hope to make with Jewish Hospital and CHI, (now KentuckyHealth One).  This would be an incomplete victory. Continue reading “University of Louisville’s Review of Its Hospital Operations.”

Horse Liniment for Your Arthritis and Healthcare Reform.

While looking in today’s paper for inspiration for something to write about, I saw an advertisement claiming that the “Arthritis Pain Mystery” had been solved, and that the secret was “Horse Liniment.” Naturally there was something you can buy. The only corporate identification or images in the ad were the prominent trademarks of both Walgreens and RiteAid. I know something about arthritis, and I initially assumed that these two giant drugstore competitors had joined forces to bring this breakthrough to the public. At first it looked to me like the drugstores had placed the ad themselves.

Actually, the truth is that this advertisement caught my eye because is was one of a long series by many companies that make what is in my professional opinion overly sensational, misleading, and unsupported claims to be effective treatments for arthritis and other musculoskeletal ailments. I have always had to look hard and usually unsuccessfully for the grain of truth in these kinds of ads that might make them legal. No doubt the promoters of ARTH ARREST, “considered a medical miracle by some” had their ad reviewed by lawyers. It may well have passed such muster, but in my professional opinion, it fails the sniff test of ethical medical promotion. Any ad with the word “miracle” or which relys on anecdotal testimonials should wave a red flag. Even the big pharmaceutical companies do not make such claims, and they are not my ethical champions.  When I read closer, I saw that the drugs were simply available at Walgreens and RiteAid. Both companies were apparently merely lending their good names to the promotion. Continue reading “Horse Liniment for Your Arthritis and Healthcare Reform.”

Kentucky Medicaid is a Mess.

Slow-Payments or No-Payments for medical care.

A week ago I was pretty tough on a possibly hypothetical physician who was said at a Frankfort hearing to have abandoned two child patients because one of the three new Kentucky Medicaid Managed care vendors had not paid him for three months. What is not hypothetical is that the Medicaid system is now in shambles. There are now four independent Medicaid managed care systems in Kentucky plus original Medicaid itself to deal with. Each of these has its own bureaucracy and unique systems. Thats a lot of different hoops for physicians and other healthcare providers to jump through. I have no doubt all are pulling their hair out. By all accounts, all three new vendors are in the pay-slow, pay-low mode. Cynics will point out that this is an easy way for an insurer to make a profit. After all, even Kentucky government uses the gimmick of paying healthcare providers late as a way to balance the books and make it look like they have actually been doing their jobs.

It is easy to assume that the three new managed care companies are to blame. That does not easily explain why all three seem to have failed at the same time, or why they appear successful in other states in which they work. When I worked in Kentucky Medicaid in the 1990s during my first-ever sabbatical and later as a faculty fellow, it was clear to me that there were major inadequacies in the state’s Medicaid computer systems and their ability to transfer and analyze information. I hope things have improved since then. Remember that all information about eligible beneficiaries, hospitals, and other providers has to be transferred to the managed care companies and continually updated so they know who to pay and for what. The three vendors have been silent publicly, but I will bet a martini in your favorite Louisville bar that internally they are struggling to interface with the state’s system. When you consider that each hospital and doctor’s office may also have their own computer system, it is no surprise that Kentucky Medicaid is staggering under its own weight and complexity. I hope we can pull out of this death spiral of cost and confusion. I still expect the state and providers to hold patients harmless, but that cannot continue infinitely. What a mess! Continue reading “Kentucky Medicaid is a Mess.”

Is the University of Louisville Moving in the Right Direction or Not?

A few weeks ago, following the collapse of the attempted merger/acquisition of University of Louisville Hospital by private interests, a respected member or the community asked me how we had arrived at a point where the advocates of the takeover failed so miserably to understand the critical issues of concern to the public. I attempted an explanation, but there is no simple answer to this complex issue. Here is the reply I offered. Continue reading “Is the University of Louisville Moving in the Right Direction or Not?”

Loss of Medical Privacy? Is that OK?

Yesterday, Phil Galewitz reported for Kaiser Health News (reprinted in USA Today) on a practice that is one of my biggest disappointments in our health care system, the sale of our personal health information for the benefit of someone else.  I do not mean the use of de-identified medical information to improve public health, medical quality, enhancement our ability to treat disease, or even for law enforcement.  I am talking about the use of your individual health information to try to sell you something else that you may or not need.  Did you ever wonder why all of a sudden you started getting ads for diabetes supplies?  Or why ads for erectile dysfunction started arriving in your mailbox as well as your email?  It is because your personally identifiable medical information is being shared to improve the bottom lines of those who have access to your medical records.  The story highlighted the practices of hospitals that use information from their medical records to peddle other services to their current or former patients  Partnering with mass marketing companies, your hospital knows a lot more about you than is present in their records.  For example, if you smoke, you get a directed ad for lung cancer screening.   Believe me, when you come in for a “screening,” something can almost always be found that ”needs” to be done.    Screening can be a hospital’s or doctor’s best friend.  It all depends on how ethical or financially strapped the provider is that determines how far evidence-based scientific medical practice will be stretched.  Examples of abuse are easy to find. Continue reading “Loss of Medical Privacy? Is that OK?”