Professional Documents
Culture Documents
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JOURNAL REPORT
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Theres a major effort under way to make sure patients know what theyll have to paybefore they make
any decisions about treatment. Some people think it will make all the difference.
BY MELINDA BECK
Hospitals list prices for common procedures vary dramatically, even in the same area. Based on 2011 Medicare data,
here are the average charges for four procedures at selected hospitals in greater Los Angeles. Hospitals say very few patients
or insurers pay these list prices, which reect many complex factors, but they often are starting points for negotiations.
$31,668
$39,795
Chest pain
$13,133
Kidney failure
$21,106
$178,435
$146,428
Chest pain
$52,580
Kidney failure
$77,719
Brain hemorrhage
$167,860
$125,036
Chest pain
$43,715
Kidney failure
$88,191
2 mi
5 km
Brain hemorrhage
$60,176
$52,110
Chest pain
$15,356
Kidney failure
$21,864
Brain hemorrhage
$85,156
$57,735
Chest pain
$15,835
Kidney failure
$53,128
An Incentive to Change
Huge Differences
INSIDE
Getty Images
A New Ending
Bloomberg News
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$2,844
4,500
$695
4,000
3,500
$1,990
3,000
$617
2,500
$520
$341-$362
$335
Medicare rate
Facility
Professional
Fair price
$1,588
2,000
1,500
500
0
Shining a Light
Step by Step
1,000
>>
Parts Suppliers
69%
$500 billion
450
400
40%
350
Percentage of medical-device
spending that goes to
supply-chain costs
300
250
200
21%
150
100
50
0
Order Control
46%
2005 06 07 08 09 10
11
12
13
14
15
16
17
18
Sources: Evaluate Medtech (chart); FactSet Research Systems Inc. (average gross margin);
McKinsey (supply-chain costs); Health Affairs (doctors estimates)
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Where to Save
Bloomberg News
BY LAURA LANDRO
imbursement.
Comparing Costs
Labor productivity
$5.1
Length of stay
$3.1
Readmissions
$3.0
$1.8
Use of overtime
$1.8
Laboratory tests
$1.7
Respiratory therapies
$1.5
$1.4
High-tech tools help hospital pharmacies manage inventories and thwart employee drug theft
Aethon
HOSPITALS HAVE a drug problem. And theyre looking to technology to solve it.
The problem is the way medications are being handledand
mishandledby the hospital
pharmacies and out on the
wards. Inventory management is
inefficient, drugs are too often
misplaced, and narcotic medications are prone to theft.
So hospitals are turning to
high-tech solutions. In addition
to password-protected dispensing machines, radio-frequency
identification tags and roaming
robots to deliver prescriptions
securely to units, hospitals are
adopting software that tracks
University of Maryland Medical Center nurses use passcodes and fingerprint scanners to take delivery of drugs from Aethons Tug mobile robots.
Robots Deliver
Catching Abusers
Composite
report.
When I sit down and go over
the medication-surveillance reports, I am looking for patterns
of suspicious transactions, Ms.
New says.
For example, drugs now come
in single-use vials, and if a patient is administered a smaller
dose than what is in the vial,
hospital staff are required to
properly dispose of the rest, or
waste it, following a protocol
that includes a signature from a
witness. In one case, Ms. New
says, a nurse was waiting until
the end of her shift, then disposing of multiple syringes at a
time without following procedures. The nurse was warned,
but the Pandora surveillance reports indicated that she started
doing it again. Further investigation discovered that she was collecting leftover medication and
injecting it in the parking lot before driving home, says Mr. New.
This was also a community
safety issue, she says.
Joseph Adkins, a clinical
pharmacist at Springhill Medical
Center, in Mobile, Ala., says using Pandora is much faster than
poring through spreadsheets to
examine medication data. His facility conducted five investigations of suspicious activity in
the first six months of using the
software, and in three of those
cases found diversion was taking
place. Audits of the records of
one nurse showed she was accessing an automated-medication cabinet when the unit was
closed.
If I am a patient, I dont
want a nurse who is potentially
taking narcotics taking care of
me, and as a pharmacist I dont
want that person working in my
hospital, Mr. Adkins says.
Eyes on Inventory
------------------------
------------------------
------------------------
February 2014
December 2013
December 2013
$40,000,000
$65,000,000
PARKWOOD
PROPERTIES, INC.
$46,650,000
------------------------
------------------------
------------------------
November 2013
October 2013
October 2013
------------------------
------------------------
------------------------
August 2013
July 2013
July 2013
$90,000,000
$40,000,000
$85,000,000
$80,000,000
$60,000,000
$45,500,000
Brooks Hubbard
Head of Healthcare Banking
615.770.4242
regions.com/healthcare
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BY LAURA LANDRO
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For an appendectomy, 76 items added up to nearly $30,000. Where did the money go?
Decoding a hospital bill can feel like spycraft.
Most people cant read a bill, says Nancy DavenportEnnis, chairwoman of the Patient Advocate Foundation,
a nonprot that helps patients solve insurance and healthcare access problems. They dont understand what the abbreviations and billing codes mean, she says, so they cant
tell whether they received particular services theyre being
charged for.
Billing practices vary, but typically a patient will be charged
for medications, room and board, doctors time, anesthePHARMACY Commonly known
as Cipro, this medication is an
antibiotic typically given to treat or
prevent infection. It was one of 35
medications listed on the patients
bill that amounted to $1,878.90 in
pharmacy charges during the
two-day hospital stay. The cost is
higher in the hospital than it would
be in a local pharmacy, because a
hospital pharmacy has lower volume
and a different cost structure.
Patient Name
Account Number
Service From
Service To
Statement Date
Xxxxx
Xxxxx
10/08/11
10/09/11
01/06/12
Department
Date
Description
Charge
PHARMACY
10/08/11
10/08/11
10/08/11
SUPPLIES
10/08/11
10/08/11
10/08/11
LABORATORY
10/09/11
10/09/11
10/09/11
10/09/11
RADIOLOGY
10/08/11
OBSERVATION
10/08/11
10/09/11
Observation Private
Observation Private
EMERGENCY ROOM
10/08/11
10/08/11
10/08/11
ED Fee Level V
ER Therapypro/DX IV Push INI
THPY/Pro/DX IV Push Addl Seq
10/08/11
QTY
Total
$35.00
$22.40
$7.90
1
2
1
$35.00
$44.80
$7.90
$661.80
$1,065.70
$585.30
1
1
2
$661.80
$1,065.70
$1,170.60
$138.10
$256.00
$28.00
$235.70
1
1
1
1
$138.10
$256.00
$28.00
$235.70
$3,962.80
$3,962.80
$35.42
$35.42
5
14
$177.10
$495.88
$1,600.00
$221.90
$129.50
1
1
5
$1,600.00
$221.90
$647.50
$185.70
$185.70
10/08/11
$795.00
$795.00
10/08/11
$1,080.00
$1,080.00
OPERATING ROOM
SERVICES
10/08/11
10/08/11
$8,744.80
$1,498.70
1
1
$8,744.80
$1,498.70
PHYSICIAN(S) FEE
10/08/11
99284 ER MD-Level IV
$350.00
$350.00
ANESTHESIA
ANESTHESIA Anesthesia is
typically billed in 30-minute
intervals, Mr. Gundling says.
After the initial 30 minutes, prices
typically fall since the initial administration is typically the most laborintensive part of the process.
Some provisions already have taken effect, but others wont kick in for several years
Composite
Slower Rise
Whats
14%
happened to
health-care spending in the
U.S. since the law was
passed?
Awaiting the Bills | Health cost trends and the ACAs possible impact
Annual percentage change in health spending in the U.S.
12
10
8
6
4
2
0
02
03
04
05
06
07
08
09
10
11
12
Cost Curbs
Projected federal savings or revenue gains through 2019 from provisions in the Affordable Care Act
Accountable care organizations
$4.9 billion
$7.1 billion
$1.3 billion
$2.2 billion
$32 billion
$1.4 billion
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BY LOUISE RADNOFSKY
$15.5 billion
The Wall Street Journal
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A New Ending
Costs of Care
$50 billion Annual spending,
More to Come
Aetna customers
dont have to give up
aggressive treatment
to participate in
palliative care.
amount of health-care spending.
About 25% of Medicare costs
cover the last year of patients
lives, while 80% of the government health programs spending
during the last month is for hospitalization. A visit to an intensive-care unit alone can cost
more than $4,000 a day.
Evidence suggests that the
palliative-care programs can
make a major dent in those
costs. Studies by Kaiser Permanente, for instance, found that
such programs can save $5,000
to $7,000 a patient by preventing costly trips to emergency
rooms and avoidable readmissions to hospitals. Aetna Inc.
says it saved $55 million in 2012
among its Medicare Advantage
patients.
If there is an opportunity to
impact at the intersection of
quality and cost, this is the
mother lode, says Randall
Krakauer, Aetnas director of
medical strategy, who helped establish his companys program.
Typical candidates for palliative care include patients suffering from congestive heart failure,
chronic
obstructive
pulmonary disease and dementia. Many participants have cancer, typically at an advanced
stage. Dedicated teams of doctors, nurses, chaplains and social
workers step in to interview the
patients to assess their needs
and develop a plan for their extra care.
Team Effort
Paula Gibson Massey, once an avid hiker, initially resisted signing up for palliative care while fighting lymphoma.
Tough Decisions
Composite
INSURERS ARE establishing programs that give the sickest patients the chance to receive extra care for their pain, suffering
and emotional needs, in a move
that turns out to cut spending
substantially.
Such palliative-care programs
aim to provide assistance to patients with chronic or terminal
illnesses, and go beyond the
drug prescriptions and surgeries
such patients typically receive.
Under the programs, doctors are
often called in to prescribe drugs
treating pain, anxiety and depression, while home-care aides
visit residences to give baths
and change sheets. Social workers may try to resolve conflicts
between estranged siblings.
The programs have their critics, who say the insurers real
goal is to bolster profits by
pushing patients to forgo costly
treatments that could prolong
their lives. But supporters counter that the lowered costs are
simply a fortunate side effect,
and that fulfilling patients
wishes and needs is the main
goal.
By improving quality of care
for that group, it can also reduce
the number of repeat hospitalizations and other emergency interventions, which is extremely
expensive for payers, says Emily Warner, a senior policy analyst at the Center to Advance
Palliative Care at the Icahn
School of Medicine at Mount Sinai.
ENGAGE
2014 Dow Jones & Company, Inc. All rights reserved. 4DJ1123
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BY JONATHAN D. ROCKOFF
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Hospital care tops the charts but nursing-home care consumes growing share; dread diseases get costlier
and projectedits clear that this will remain a
daunting challenge.
Meanwhile, nursing-home care and other services
for older Americans make up a growing portion of
costs. Big increases also show up in treatment costs
for so-called dread diseases such as cancer and
heart conditions. Spending on heart conditions,
including emergency-room and clinic visits,
prescriptions and other costs, doubled to $116 billion
in 2011 from $58 billion in 1996.
Hospital care
$1,000
900
800
700
600
500
400
300
200
100
0
J
J
J
60 70 80 90 2000 10
2012
50%
45
40
35
30
25
20
15
10
5
0
300
J
200
150
100
14
12
10
8
50
0
2
60
70 80 90 2000 10 2012
600
30
500
400
In the Hospital
25
15
200
10
100
50
60 70
80 90 2000 10
2012
$100
90
80
70
60
50
40
30
20
10
0
J
J
J
60
70
80
90 2000 10
2000
2012
10%
9
8
7
6
5
4
3
2
1
0
$200
180
160
140
120
100
80
60
40
20
0
400
200
1970
90
10
2010
80
60
2012
40
20
60
60
70
70 80 90 2000 10 2012
10%
9
8
7
6
5
4
3
2
1
0
80
60
40
20
120
80
100
40
20
60
70
80
90 2000 10
2012
2
60
70
80
90 2000 10
2012
2,000
1,500
60
2,500
TOTAL
10
$3,000
7
J
12%
1,000
500
0
60
70
80
90 2000 10
2012
2011
Heart conditions
$58.0
Heart conditions
$116.3
Cancer
$37.7
Cancer
$88.7
Trauma-related disorders
$37.1
Trauma-related disorders
$81.8
$28.6
Mental disorders
$77.6
Mental disorders
$28.2
$76.2
$22.0
COPD, asthma
$75.2
400
$18.3
Diabetes mellitus
$55.2
200
Hypertension
$17.3
Hypertension
$42.7
Diabetes mellitus
$14.1
$39.4
Cerebrovascular disease
$12.6
Hyperlipidemia
$38.9
Higher Traffic
450
115
375
110
425
400
Total visits
in millions
(left scale)
105
04
Total
06
08
10
30%
25
20
325
300
2000
2010
15
10
lenge for them is finding a reasonable balance between overtesting and missing a diagnosis
in an atmosphere that puts them
at high risk for medical liability.
ER doctors have been trained
to rely on medical-imaging techniques, and many worry that reducing their use will affect the
quality of care. Patients, too, often demand tests, widely believing that more testing is equivalent to better care. Under
serious time pressures to meet
patient-satisfaction goals, it can
be easier for a doctor to order
testing rather than spend time
discussing the pros and cons of
doing so with patients. The fact
that ER doctors havent seen
many of their patients before,
may not have access to their
medical records and typically
arent involved in follow-up care
also creates more urgency to
pinpoint problems immediately
in the ER, many of them say.
Momentum Grows
350
Composite
2012
100
Under 18 18-64
65 and
over
Total
Big Savings
Sharp Impact
2007
$92
2012
$116
$132
$176
$69
$58
$40
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A Fine Line
90 2000 10
140
next decade.
100
2000 02
10
8%
80
$160
2000 10
90
$120
80
Dental services
70
600
2030
100
1960
12%
1996
800
600
90 2000 10
Spending on some of the most expensive kinds of health problems in the U.S., 1996 and 2011, in billions
1,000
800
70 80
10
60
100
Costly Conditions
$1,200
1,000
100
$1,200
J
J
150
300
200
$120
12%
200
20
In the ER
250
300
$300
35%
400
Prescription drugs
$700
Medical equipment
(durable and nondurable)
16%
250
$500
$174
$245
The Wall Street Journal
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