Monday, October 7, 2013

Strategic Acquisitions, Charitable Grants, and Improved and Expanded Quality Health Care Services

  Research Report on Tenet Healthcare, Aetna, Cigna, WellCare, and Health Net

Published: Monday, Oct. 7, 2013 - 5:15 am
/PRNewswire/ --
Today, Analysts' Corner announced new research reports highlighting Tenet Healthcare Corp. (NYSE: THC), Aetna Inc. (NYSE: AET), Cigna Corp. (NYSE: CI), WellCare Health Plans, Inc. (NYSE: WCG), and Health Net, Inc. (NYSE: HNT). Today's readers may access these reports free of charge - including full price targets, industry analysis and analyst ratings - via the links below.
Tenet Healthcare Corp. Research Report
On October 1, 2013, Tenet Healthcare Corp. (Tenet Healthcare) announced that it has completed the acquisition of Vanguard Health Systems, Inc. for c.$4.3 billion, or $21.00 per share of Vanguard stock, including the assumption of $2.5 billion of net Vanguard debt. "Through this acquisition, we have significantly increased our scale and expanded the services we offer," said Trevor Fetter, Tenet's President and CEO. "We intend to be a leader in addressing the opportunities in our healthcare system, and we are strongly positioned to drive improvements in quality and value for the millions of people to whom we provide care." The Company informed that Vanguard Health Systems (NYSE:VHS) has ceased trading on the New York Stock Exchange as a result of the closing of this acquisition. The Full Research Report on Tenet Healthcare Corp. - including full detailed breakdown, analyst ratings and price targets - is available to download free of charge at: []
Aetna Inc. Research Report
On October 1, 2013, Aetna Inc. (Aetna) announced a partnership with the Junior Blind of America, a nonprofit organization dedicated to helping children and adults who are blind, visually impaired or multi-disabled achieve independence. The Company said that the Aetna foundation will award the non-profit organization a $25,000 grant at the organization's annual Children's Halloween Carnival, to be held on October 26, 2013. The funding will allow Junior Blind to offer its healthy living after school program free of charge to both sighted and visually impaired children from low-income families. Commenting on the grant, Garth Graham, M.D., M.P.H., President of the Aetna Foundation said, "We are pleased to support Junior Blind's After School Enrichment Program and help kids in South Los Angeles establish healthy habits at a young age, especially those who have an elevated risk of being overweight or obese." The Full Research Report on Aetna Inc. - including full detailed breakdown, analyst ratings and price targets - is available to download free of charge at: []
Cigna Corp. Research Report
On October 1, 2013, Cigna Corp. (Cigna) announced the expansion of its Medicare offerings for 2014 Annual Enrollment to serve the growing aging population. The Company' informed that its 2014 Medicare offerings will include a wide range of health and prescription drug plans, as well as supplemental and special needs plans. It further informed that all plans offer extra benefits not covered under Original Medicare and are designed to help customers better manage their health and limit out-of-pocket medical expenses. Herb Fritch, President of Cigna-HealthSpring, Cigna's seniors business unit said, "Our coordinated team approach to care focuses on prevention to proactively meet each person's health care needs and deliver on the triple aim of improved health, affordability and patient experience." The Full Research Report on Cigna Corp. - including full detailed breakdown, analyst ratings and price targets - is available to download free of charge at: []
WellCare Health Plans, Inc. Research Report
On October 2, 2013, WellCare Health Plans, Inc. (WellCare) announced the expansion of itsMedicare Advantage service area with the addition of eight new counties across three states to its 2014 Medicare Advantage service area. With these new additions, WellCare stated that it will offer Medicare Advantage plans in 210 counties in 14 states. Medicare's open enrollment period begins on October 15, 2013 and ends on December 7, 2013. The Company informed that when the open enrollment begins, eligible seniors in Arizona's La Paz, Maricopa and Pima counties; California's Fresno County; and Kentucky's Bullitt, Carroll, Gallatin and Owen counties will be able to select WellCare as their Medicare Advantage plan. The Full Research Report on WellCare Health Plans, Inc. - including full detailed breakdown, analyst ratings and price targets - is available to download free of charge at: []
Health Net, Inc. Research Report
On October 1, 2013, Health Net Inc. (Health net) announced that two of its subsidiaries, Health Net of Arizona, Inc., and Health Net Life Insurance Company are now offering qualified health plans on Arizona's health insurance exchange. "We are committed to providing products and services that are affordable, simple, dependable and local," said Rose Megian, President and CEO of Health Net of Arizona. "And we expect Arizonans will find our coverage to be competitively priced." According to the Company, Health Net's qualified health plans for individuals and their family members, as well as for eligible small businesses, are offered in all 15 Arizona counties through the exchange. The Full Research Report on Health Net, Inc. - including full detailed breakdown, analyst ratings and price targets - is available to download free of charge at: []

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As consumer tech speeds up innovation in health, can traditional med tech keep up?


Consumer technology and telecom companies are changing the pace of innovation in health care, putting traditional med tech firms in an uncomfortable position, according to a new report from PricewaterhouseCoopers.
Consumer tech and telecom names like Verizon, AT&T and Sony may be relative newcomers to health care, but that doesn’t mean they’re not going to give industry stalwarts a run for their money.
According to a Monday report from PriceWaterHouseCoopers (PwC) the medical technology field is in the midst of big change. Medtech is transitioning from a growth industry to a more mature, stable one. But it’s also being shaped by a changing health care economy that’s more consumer-centric and emphasizes comprehensive approaches to treating diseases and providing care, the report said.
And increasingly, companies accustomed to spending heavily on years of research are facing new competition from consumer tech startups and mobile app makers that are steeped in a culture of being faster, better and cheaper.
“The new entrants from other industries have a much more aggressive view of what innovation is than traditional medtech companies,” said Chris Wasden, managing director of PwC’s health care strategy and innovation practice. “That will put these traditional medtech companies in a very uncomfortable mode . . . they’re not using to operating at the step-change mode of innovation.”

Learning how to “innovate innovation”

Some of the bigger newcomers mentioned in the report include Verizon, which offers an FDA-cleared remote monitoring system, Qualcomm Life, which provides a wireless platform for connecting a range of devices and apps, and Reebok, which has partnered with startup MC10 for a wearable sensor that monitors the severity of head injuries in contact sports like football.
But plenty of smaller startups, from Scanadu and Biosense Technologies to Glooko to Propeller Health (formerly Asthmapolis), are also finding creative ways to navigate U.S. Food and Drug Administration requirements and appeal to consumers with diagnostic and care-management tools.
PwC’s report was based on dozens of interviews with medtech and digital health leaders from big and small companies. While they overwhelmingly agreed that “the way [they] innovate has to be innovated,” Wasden said,  few have actually chosen to do it because the disruption is so great.
“There are very few companies that view themselves as innovation pioneers,” Wasden said. “Many think of themselves as fast followers.”
Traditional medtech companies have also been slower to adopt new social, mobile, analytic and cloud technologies, the report said. And that means greater opportunities for nimble startups and consumer tech companies familiar with using these kinds of tools to appeal to customers and consumers.

Finding new ways to improve care for the consumer

Not all traditional medtech players are taking a back seat when it comes to innovation, the report acknowledged. Medical device giant Medtronic acquired telehealth company Cardiocom this summer in an effort to get closer to the consumer. And medical device maker Covidien has stepped up its mobile and cloud services to improve the way it supports patient care and hospitals.
Going forward, which companies will be the ones to succeed? Those that can figure out how to appeal to the consumer.
“The people that will win in healthcare . . . are those that understand the customer the best and understand how to change consumer behavior most effectively,” Wasden said. “If you continue to focus on the doctor or hospital, you’re not going to be a winner in the future.”

Woman charged in Medicare fraud bought 20 cars

JACKSON, Miss. (AP) — Newly released court records claim the owner of a Mississippi hospice ran a multimillion Medicare fraud and used some of the money to buy 20 cars since December 2009.
The details about Angelic Hospice in Greenwood and its owner's purchases were outlined in a 27-page document dated Feb. 19 but only made public Oct. 3 in U.S. District Court in Oxford.
The document is an affidavit supporting prosecutors' efforts to seize cars and cash in the case. It said the hospice billed Medicare for millions of dollars services that were never rendered, sometimes involving forged documents.
Regina Swims-King was charged in June in a 37-count criminal indictment and pleaded not guilty. Her trial is scheduled for Dec. 2.
The hospice served numerous counties in the Mississippi Delta. It billed Medicare more than $11 million from 2007 to 2012, according to court records.
Swims-King is listed in court records as the person who wrote checks for the cars, though the vehicles were registered under various names, the court records said. The cars listed in court documents include a $92,000 Jaguar, a Lexus and a BMW.
Swims-King's lawyer, Cynthia Stewart, did not return a call seeking comment. A phone listing on the hospice website was disconnected. The website said the company was owned and operated by Swims-King and her husband, Robert King.
The newly released documents contain allegations that a hospice recruiter went door-to-door asking whether residents needed their blood pressure checked. The hospice then used their information to bill Medicare for services, prosecutors said.
In one example, authorities said the hospice billed thousands of dollars on behalf of someone who did not need hospice care and was healthy enough to walk several miles a day.
Some of the claims submitted to Medicare had the forged signatures of alleged beneficiaries and doctors, according to the indictment.

Physician-Owned Hospitals Continue Spread Across North Texas, But Not Without Growing Pains

Forest Park Medical Center’s tony ambience fits its newest home in upscale Southlake.
The entrance features high ceilings, flowing water, and concierge-style service. The hospital, which opened in June, features 54 private patient rooms, 10 family suites, and 12 gleaming operating rooms. The physicians’ lounge features a buffet prepared by executive chefs.
In its infomercials, Forest Park patients rhapsodize about their Forest Park experiences using words such as “spa” and “five-star hotel.” Hospital chief executive officer Charles Nasem proudly declares, “We are the Disney of healthcare.”
In August, Victory Healthcare opened a smaller—but equally inviting—facility called Victory Medical Center Craig Ranch in McKinney.
The company declares, “We create a first-class experience for our patients in our state-of-the-art facilities that include concierge services, a one-to-one nurse-to-patient ratio, and personalized service in an environment designed to promote comfort and healing.”
Forest Park and Victory Healthcare are physician-owned hospitals. Neither accepts Medicare and Medicaid patients. Both focus on high-margin surgeries. Both are criticized by full-service hospitals, which believe they siphon away commercially insured patients. The American Hospital Association and Federation of American Hospitals campaign against what they say is physician self-referral at physician-owned hospitals that concentrate on attracting healthier and more profitable patients, and encouraging overtreatment.
“These hospitals are on balance not seeing the same population,” said Daniel Podolsky, MD, president of UT Southwestern Medical Center in Dallas. “A lot of that is the demographics and the geography.”
Doug Hawthorne, chief executive officer of Texas Health Resources, said the fact that some hospitals will not take Medicare and Medicaid patients creates an uneven playing field for community hospitals.
“[This] really leaves some of us caring for those who can’t care for themselves because others won’t take those patients and we have that discrimination in North Texas,” he said.
Proponents of physician-owned facilities say they perform high volumes of the same procedures as a “focused factory,” allowing them to improve quality and reduce costs. They also say greater physician control encourages greater productivity and quality. Opponents say their existence threatens the ability of community hospitals to cross-subsidize less profitable services and uncompensated care.
Physician-owned hospitals typically have higher quality scores. Of the 161 physician-owned hospitals eligible for the Centers for Medicare and Medicaid Services quality programs, 122 earned quality bonuses, according to a Kaiser Health News analysis.
According to a recent story in The Wall Street Journal, nearly half of the procedures at Forest Park’s Dallas hospital are bariatric and general surgeries. Spine and orthopedic surgeries comprise 50 to 75 percent of the procedures performed at Victory Healthcare’s facilities.
Of the top 10 U.S. hospitals earning Medicare quality bonuses based on 12 measures of clinical care, nine are physician-owned. Of those, three are Baylor Health Care System joint-venture facilities: Baylor Medical Center at Trophy Club; Baylor Medical Center at Uptown in Dallas; and Baylor Heart and Vascular Hospital in Dallas. Irving Coppell Surgical Hospital also is in the top 10.
Physician-owned hospitals receive high scores on patient satisfaction surveys, which account for 30 percent of the value-based purchasing program. Patients react positively to amenities and facilities that do not have the familiar sights and smells of a traditional hospital.
However, those hospitals have stepped up their game. Recently, the New York Times published 10 photos and asked readers whether they were hotels or hospitals—underscoring the fact that they increasingly are becoming indistinguishable. And patients rank hospital amenities and hospitality higher than clinical quality, research shows.
Texas: A Market Ripe for Physician-Owned Hospitals
The lack of a certificate-of-need law in Texas encourages the creation and expansion of physician-owned facilities. CON laws in other states require companies to seek state permission to build such facilities.
Forest Park has hospitals in Dallas and Frisco, and is building facilities in Fort Worth, San Antonio, and Austin. The hospitals have about 70 percent physician ownership, with Forest Park owning the balance.
Forest Park founder and managing director Dr. Robert Wyatt said Forest Park would accept Medicare and Medicaid patients if not for federal prohibitions.
The Stark law prohibits doctors from referring Medicare patients to hospitals, labs and other physicians for healthcare services if the referring doctor has any financial relationship with that entity. The purpose of the law, which was passed in 1989, was to protect federal health insurance programs from overuse of healthcare services.
Until the Affordable Care Act passed, the Stark law had an exception known as the “Whole Hospital Exception,” meaning physicians were free to own hospitals if ownership interest was in the whole hospital rather than just a specific service line. The ACA abolished that exception for new hospitals and limited the expansion of existing hospitals. The American Medical Association has published a 79-page “overview” detailing the law’s intricacies.
More broadly, the ACA prohibits the construction or expansion of new physician owned-hospitals within the Medicare program. The Physician Hospitals of America, the trade group representing physician-owned facilities, is fighting hard to have this portion of the ACA overturned. A lawsuit challenging that ACA provision was dismissed, citing a lack of jurisdiction.
Wyatt said Forest Park hires hospital CEOs with a bent toward customer service. However, he said catering to the needs of physicians is as important as the patient experience.
“Happy patients make happy doctors. A critical aspect of getting the best patient experience is making sure you involve doctors in designing the patient experience. That includes efficient scheduling and efficient room turnover. We also pay attention to physician experience.”
In addition to McKinney, Victory Healthcare has hospitals in Plano and Hurst, and plans to open one in Fort Worth’s Medical District next year. He anticipates nearly doubling the company to 15 hospitals—including a total of six in DFW—by 2015.
Unlike Forest Park, Victory’s strategy is to remain out-of-network and cannot foresee a day when it would take Medicare and Medicaid patients.
“It’s a matter of choice,” said Victory Healthcare chief executive officer Robert Helms. “The [government] programs have been stripped and doctors are running away from them at a high rate of speed. We pay real estate taxes. We pay [corporate] income taxes. The non-profits need to be handling these cases.”
Of its out-of-network status, Helms said private-insurance policyholders pay higher premiums for the right to pay out-of-network rates.
With Growth Comes Controversy
Forest Park recently paid more than $260,000 and accepted federal monitoring for up to two years stemming from charges that it paid physicians cash and gift cards for referring military families to its facilities.
In a statement, chief operating officer Archie Drake said, “Forest Park Medical Center Dallas fully cooperated with the United States Attorney’s Office throughout this process and began an open dialogue with them.  We are pleased that we have reached a non-prosecution and civil settlement agreement with the United States Attorney’s Office.  This decision follows our full cooperation during the investigation.  Prior to and during this process, we took the opportunity to perform an in-depth review of our practices and made appropriate changes. We have agreed to a modest monetary civil settlement, and we will continue to enhance our corporate compliance.  We are pleased that this issue is now behind us. Our focus at this time is on moving forward and continuing to provide extraordinary care to our patients.”
And Victory filed suit against Cigna in June, saying it reneged on $22.3 million in payment claims. Victory claimed that Cigna violated the Texas Insurance Code and the federal Employee Retirement Income Security Act by failing to pay in a timely manner and unilaterally reducing reimbursement.
Helms said Cigna was lumping Victory with other out-of-network providers that waive patient deductibles and coinsurance, which Victory does not do.
Victory’s hospitals in San Antonio and The Woodlands sued Blue Cross and Blue Shield of Texas in 2012 for $55 million on similar grounds.
“[Insurers] have no right to sell a policy and fail to honor it,” Helms said. “There is no need to be bashful about being paid for what we do. We hold our hospital up to a higher standard. Our operating rooms are larger and newer. Our technology is totally up to date. We handpick our staff and pay premium wages. We have a 1:1 nurse-patient ratio. If patients are going to pay for a higher quality product, we have the responsibility to have a higher-quality product.”
BCBSTX and Cigna declined to comment on the lawsuits, but Cigna spokesman Mark Slitt said, “Certain out-of-network health care providers charge insurers and employer groups, and through them, local consumers, grossly excessive fees for their medical services – sometimes at rates 1,000 percent higher than the rest of the market. Most out-of-network health care providers do not engage in such conduct, but those that do raise costs for employers and consumers.”
Steve Jacob is founding editor of D Healthcare Daily and author of the book Health Care in 2020: Where Uncertain Reform, Bad Habits, Too Few Doctors and Skyrocketing Costs Are Taking Us. He can be reached at

Needless Stents Alleged at Kentucky Hospital Amid 2-Year Probe By Peter Waldman October 07, 2013 12:01 AM EDT

A doctor holds a cardiac stent, an implant used to prop open arteries. Photographer: Darrell Goemaat/Chicago Tribune/MCT via Getty Images
An Appalachian Kentucky hospital that’s been among the nation’s leaders in the rate of coronary stenting is under federal investigation for implanting the metal mesh devices needlessly, according to its spokesman.
Federal prosecutors have been probing King’s Daughters Medical Center in Ashland, Kentucky, since 2011 for suspected overstenting, said Tom Dearing, the 373-bed hospital’s marketing and public relations manager.
The investigation involves stents inserted by the heart center’s namesake, cardiologist Richard E. Paulus, according to his lawyer, Robert S. Bennett of Hogan Lovells inWashington. Bennett said Paulus had done nothing wrong.
The investigation signals a new front in a series of Department of Justice probes into interventional cardiology and stenting that began surfacing in 2006. At least 11 hospitals have settled federal allegations that they billed public health programs for needless stents and related misdeeds. Federal investigations continue in five states.
Earlier this month, another Kentucky doctor, Sandesh Patil, became the third U.S. cardiologist convicted on federal charges linked to doing needless stents. He was sentenced in U.S. District Court in Frankfort, Kentucky, to 30 months behind bars, after pleading guilty to a single charge of Medicaid fraud.
Stents, the tiny coils inserted into arteries with catheters to prop open coronary blockages, can save lives of heart-attack victims. Their use in stable patients is in dispute among medical researchers.

‘Vigorously Contest’

Paulus and King’s Daughters were also named in a civil lawsuit filed Sept. 30 in Kentucky state court, alleging that the cardiologist “dramatically” misrepresented the extent of a patient’s heart disease to justify implanting five unneeded stents.
Dearing declined to comment on the suit or the federal investigation. Bennett said Paulus will “vigorously contest” all charges, civil or criminal.
“We have thoroughly investigated this case and are convinced Dr. Paulus always acted in the best interest of his patients and never inserted a stent that was not medically appropriate,” Bennett said. “I am hopeful that after the government completes its investigation, it will conclude that Dr. Paulus has done nothing wrong.”
Kyle Edelen, spokesman for the U.S. Attorney’s office in eastern Kentucky, said on his office voicemail that he can’t answer media calls during the government shutdown. AU.S. Department of Justice spokesman in August declined to comment on any investigation of unneeded stenting in Ashland.

Community Rumors

Located in northeast Kentucky, Ashland ranked fourth out of 1,768 U.S. regions in the number of stent-related procedures per 1,000 Medicare enrollees in 2010, according to an analysis by researchers affiliated with Dartmouth College in Hanover, New Hampshire. King’s Daughters has the only cardiac-stenting facility in the town of 22,000 residents.
The hospital’s chief executive officer, Fred Jackson, addressed “rumors in the community” about the federal investigation during a local Rotary Club speech in August, said Dearing, the hospital spokesman. Jackson told his audience the rumors drove patients elsewhere and contributed to financial losses at the hospital in the past two years, Dearing said.
As a result, King’s Daughters laid off about 150 of its 3,800 employees in August, Dearing said. On Aug. 30, Moody’s Investors Service downgraded $240 million of the hospital’s debt, citing, among other factors, a 45.5 percent drop in cardiac catheterization procedures in its 2013 fiscal year.

Allergic Reaction

In the state lawsuit, patient Robert Huron, 50, claims Paulus gave him multiple unnecessary stents between 2006 and late 2010. Huron suffers a constant allergic reaction to the stents’ polymers, according to the suit. The allergy causes hives, joint pain and swelling in his throat, Huron said in an interview.
An expert hired by Huron’s lawyer found his first stent was implanted at the site of a catheter-induced spasm in his artery and not a significant blockage, while his second one was done because scar tissue from the first stent had blocked the same artery, said his lawyer, Hans Poppe of Louisville, Kentucky. The subsequent stents were similarly unwarranted, Poppe said.
“I’ve lost seven years of my life, and spent a lot of money I shouldn’t have spent, and now I’m worse off because of the allergy,” Huron said.

Center’s Namesake

Paulus, 66, retired this summer after 21 years practicing interventional cardiology in Ashland, where he was widely admired for his work ethic and concern for patients, according to an article in the local newspaper, The Daily Independent. He was “very, very, very surprised” when the hospital in 2006 named its new heart center the Richard E. Paulus Pavilion Heart and Vascular Center, he told the paper.
In 2011, Paulus earned $2.6 million, according to an Internal Revenue Service filing by his employer, Kentucky Heart Foundation Inc.
Poppe, Huron’s attorney, represents 362 plaintiffs in over-stenting suits filed against Patil and other defendants in London, Kentucky, about 170 miles southwest of Ashland.
Doctors in Ashland did stent-related procedures on 27 out of every 1,000 Medicare enrollees in the area in 2010, according to an analysis by the Dartmouth Atlas of Health Care. That was about 3.5 times the U.S. average. In neighboring Huntington, West Virginia, doctors performed 8.6 stent-related procedures for every 1,000 Medicare enrollees -- less than one-third Ashland’s rate. More than 90 percent of such procedures nationally result in the insertion of a stent.

‘Sore Thumb’

“Ashland is a sore thumb sticking out that needs to be diagnosed,” said Peter Hasselbacher, an emeritus professor of medicine at the University of Louisville who has written about high rates of cardiac stenting in eastern Kentucky. “Income appears to be driving medical decisions, not medical need.”
At its 2011 peak, King’s Daughters did 28 percent more stent-related procedures than any other hospital in Kentucky, including the major metropolitan medical centers in Louisville and Lexington, state data show.
In 2012, after the federal investigation began, the number of the most common stent procedures at King’s Daughters fell 47 percent from 2011, according to Huron’s suit, which was filed in Boyd County Circuit Court in Catlettsburg, Kentucky.

SNF Medicare Part A appeals increase, success rate holds steady: OIG report

SNF Medicare Part A appeals increase, success rate holds steady: OIG report
SNF Medicare Part A appeals increase, success rate holds steady: OIG report
Skilled nursing facilities have been filing more appeals related to Medicare Part A claim determinations since 2008, and the proportion of successful appeals has remained largely steady, according to a new government report.
After receiving a claim determination from a Medicare contractor, a provider has 120 days to file a first-level appeal, known as a redetermination. A provider might appeal a contractor's determination that it received an overpayment, for example.
SNFs filed about 8,900 redeterminations in 2008, compared with about 11,300 in 2012, representing a 27% increase. The Department of Health and Human Services Office of Inspector General derived these figures from an analysis of a government database, and released the numbers in the report “The First Level of the Medicare Appeals Process, 2008-2012: Volume, Outcomes, and Timeliness.”
SNFs' redetermination success rate was in the 16% to 19% range between 2008-2012, except it spiked to 24% in 2011, according to the report. Last year, it was at 16%.
Taking into account all provider types, the number of redeterminations processed by Medicare contractors increased 33% for the four years leading up to 2012, the OIG found. However, the success rate of first-level appeals plummeted from 50% to 24%.
Specifically, the success rate for inpatient hospital claims and home health claims decreased dramatically. Home health redeterminations were 22% successful in 2008 but only 3% in 2012. For hospital inpatient claims, these numbers were 31% in 2008 and 10% last year.
The growth of the recovery audit contractor program is linked to these trends, the report indicates. Short-term inpatient stays often require medical review and are the most common type of claim involved in a RAC-related appeal, according to Medicare contractors interviewed for the report.
Some long-term care stakeholders have said the RAC activity encourages hospitals to keep patients under observation status rather than admitting them as inpatients. This could prevent Medicare beneficiaries from qualifying for subsequent skilled nursing care.
Click here to access the complete report, dated Oct. 2.

Improving Health Care, Controlling Costs – Rutgers Launches New Initiative

One key factor sets Robert Wood Johnson Partners apart from other attempts at reform – the Accountable Care Organization has the power of a major research university behind it
Dr. Alfred Tallia examines Barbara Carcich
Credit: Nick Romanenko
Nurse Donna Bonavitacola assists as Alfred Tallia examines Barbara Carcich.
'This is one of the first tangible benefits of how the new Rutgers is going to serve the state of New Jersey in health care. This was not possible before. Now we have all the pieces under one roof.' – Alfred Tallia

Meet the some of the collaborators and researchers behind Robert Wood Johnson Partners:
Lynn Clemow, a clinical associate professor in the RWJMS Department of Family Medicine and Community Health, coordinates a program to place graduate students from the Department of Psychology and the Graduate School of Applied and Professional Psychology at the Monument Square primary care practice. The graduate students work with patients to quit smoking, take their medicine and on more traditional mental health issues. "Mental health services are a nightmare of poor reimbursement and poor access,'' Clemow said. "This cuts through the stigma of seeking out services and having to call an 800 number, talk to a clerk about your issues and get a list of providers, many of whom arent taking patients or on the plan anymore, Clemow said. About 15 percent of patients recommended for mental health services outside the office make an appointment, but closer to 90 percent of patients do in an integrated system, she said. "Depressed people don't take as good care of themselves, they don't take their medications because they don't seem to have the energy to do that, Clemow said. "If you treat the depression, everything works better.''
Xiaomu Zhou, an assistant professor in the School of Communication and Information, wants to study how access to information through the patient portal can improve communication between patients and doctors. "I want to understand how information technology can be designed to provide more information access to patients, facilitate communication and lead to better health outcomes,'' Zhou said.
Professors Kang Li and Susan Albin, in the School of Engineering, will use mathematical modeling and statistical analysis to study workflow in the primary care office and define the role of a patient care coordinator. "The availability of services from a patient care coordinator could reduce patients frustration obtaining care, fulfill doctors’ plans for how best to help the patient, and reduce the cost burden on the whole community with fewer emergency room visits and hospital admissions,'' said Albin, a professor in the Department of Industrial and Systems Engineering.

One Rutgers, A World of Discovery

The new Rutgers, combining nearly 250 years of academic excellence with a renewed commitment to medical education, is inspiring faculty, students and staff to form innovative partnerships in academic research and public service. In an online series, Rutgers Today examines the new ways that members of the university community are collaborating, across a wide range of disciplines, to better meet the needs of the people of New Jersey and beyond.
– The Editors
During nearly three decades as a primary care physician, Alfred Tallia has identified a daunting list of flaws with the nation’s health care.
Specialists rarely coordinate care for patients with chronic illnesses such as diabetes and high blood pressure – which can lead to repetitive, expensive tests.
In most doctors’ offices, no one is responsible for developing plans with patients to lose weight, exercise and change their diet – or for following up with those patients to help them meet their goals.
But Tallia, chair of the Department of Family Medicine and Community Health at Robert Wood Johnson Medical School – now part of Rutgers – is getting ready to launch a solution he believes will deliver more effective care at a lower cost.  
“The idea of improving quality and controlling costs, that is something here to stay,’’ Tallia said. “We can’t keep spending 18 percent or more of the Gross Domestic Product on health care, not cover everybody and have disappointing outcomes. That is what we have now.’’
Tallia is spearheading the creation of an Accountable Care Organization, called Robert Wood Johnson Partners, that will coordinate treatment among doctors, other health professionals, and hospitals through better use of electronic health records. The project also involves restructuring doctors’ offices to improve communication with patients, and directly involve them in developing plans to benefit their health.
Although similar efforts have been rolled out around the country since health care reform became law in 2010, one key factor sets Tallia’s work apart :
Robert Wood Johnson Partners has the power of a major research university behind it.
Tallia and others in the medical school – in partnership with Robert Wood Johnson University Hospital and Health System – are teaming up with researchers across different disciplines at Rutgers to find the best ways to improve care and curtail costs. This includes the School of Engineering, the Department of Psychology, and the School of Communication and Information.
Alfred Tallia
Credit: Nick Romanenko
Physician Alfred Tallia at Robert Wood Johnson Medical Group’s Family Medicine office at Monument Square.
“The reason for Robert Wood Johnson Medical School and Rutgers to be involved is to answer the many outstanding questions about how a system should work,’’ Tallia said.  “We are in the best position not only to deliver care, but to also do the research to make it better.’’
For example, a professor in the School of Communication and Information plans to study the use of a patient portal, an online information hub that would allow patients to access test results and other health information. The technology will also allow patients to schedule appointments, request or renew prescriptions, pay bills and ask questions about their care.
Graduate students from the Department of Psychology in the School of Arts and Sciences and the Graduate School of Applied and Professional Psychology will work in a primary care practice to help patients quit smoking, improve eating habits and address other behavioral health issues.
And professors in the School of Engineering will use mathematical modeling and statistical analysis to study workflow in the primary care office and define the role of a patient care coordinator. The person in this position would be dedicated to helping patients adhere to plans for their health – which could involve communicating with pharmacies to make sure prescriptions are filled, keeping tabs on exercise plans and coordinating appointments.
“Part of what the engineering department is going to do is help us make our care more efficient so we can spend more time on things that really matter,’’ said Elizabeth C. Clark, an assistant professor in the RWJMS Department of Family Medicine and Community Health.
“If doctors are spending less time doing paperwork they will have more time to spend with patients,’’ Clark said.
The medical schools, nursing, pharmacy, and other professional programs at Rutgers can also build on lessons learned to train a team-based workforce suited to meet the health care needs of the future, Tallia said.
Brian L. Strom, the incoming chancellor of Rutgers Biomedical and Health Sciences who is also a primary care physician, echoed concerns about the health care system and called Tallia a “national leader in this area.’’
“As a nation, we need to move away from an episode-based disease management system,’’ Strom said.
“This will require a multidisciplinary approach to population health, and a multidisciplinary approach to evaluating the new models of care that emerge, like the ACO planned by Dr. Tallia. Rutgers, with its depth and breadth across health and non-health fields, is enormously well positioned to be a leader in this field."
A Timeline for Providing Care
Robert Wood Johnson Partners is seeking approval to start treating Medicare patients early next year. The Affordable Care Act encourages the creation of such Accountable Care Organizations for Medicare patients, but most have been developed around hospital systems.
Rutgers would be one of the first academic institutions to launch such an organization, Tallia said.
Tallia is also talking to some of the state’s major health insurance companies including Horizon Blue Cross Blue Shield and Aetna to expand into a statewide organization next year called Rutgers Health Partners.
In the meantime, the Robert Wood Johnson Partners would be modeled on the restructuring of Rutgers Robert Wood Johnson Medical Group’s Family Medicine office at Monument Square in New Brunswick. The primary care practice, which is part of the Robert Wood Johnson Medical School, has been organized into a “patient-centered medical home,” where medical providers share information and work with patients to closely coordinate care.
Nearly 30 additional primary care practices have signed contracts to participate in the upcoming rollout of Robert Wood Johnson Partners.
The partnership would also include the 500 specialists in the Rutgers Robert Wood Johnson Medical Group along with clinicians on staff at Robert Wood Johnson University Hospital and the other hospitals within Robert Wood Johnson Health System.
Medicare and insurance companies offer financial incentives for such reform efforts that meet benchmarks for improving care while moderating costs. Participating doctors, hospitals, and other providers would receive a share of the savings. And in Robert Wood Johnson Partners, patients may also share in the benefit.
A Difference Patients Will Notice 
What this will mean for patients is seamless care, much like the experience Lou and Barbara Carcich have with the doctors at Monument Square, where some of the changes have already been introduced. When Barbara Carcich went for a follow up visit after a hospital stay, the doctor had all the information about her illness and treatment at his fingertips.
“I didn’t have to go through the whole thing again: why I went in, what happened,’’ said Carcich, of Somerset. “You know the information you usually have to retell, it was all there. My doctors in the hospital communicated and all care was coordinated with Dr. Tallia and his nursing team at Monument Square."
And Lou Carcich finds it reassuring that Tallia and his cardiologist receive the results of his blood work simultaneously. “I feel very confident and comfortable knowing that I have two doctors working for me who are both on the same page," he said.
What the Somerset couple doesn’t see is the coordination behind the scenes. Tallia and the cardiologist both have access to Lou Carcich’s electronic medical records. If there is an issue Tallia wants the cardiologist to look into, he can make a note in the record for the cardiologist.
Tallia and other members of his team are looking forward to forming new partnerships with faculty from other academic units and research institutes at Rutgers – including the College of Nursing, the School of Social Work, the Edward J. Bloustein School of Planning and Public Policy, Rutgers Center for State Health Policy and all the units of the new Rutgers Biomedical and Health Sciences – as Robert Wood Johnson Partners moves ahead.
“This is one of the first tangible benefits of how the new Rutgers is going to serve the state of New Jersey in health care,’’ Tallia said. “This was not possible before. Now we have all the pieces under one roof.’’