10 May 2012

California Edition
Calendar
May 17-20
9"41:/,61"!?--/@1"<1/6!/:!*5#-1@1"6!Q,/3R-! "663"4!@/6:+,+6@+A!F+-+,<!BR,167-!SATA! !",,1/<<&!*"4>!F+-+,<A!J/,>+,!9!B! ?2>161-<,"</,!F/6"42!G+,U1@P&!!AFA!1-!<5+! P+#6/<+!-R+"P+,A!LV%%NL$&WVOA 941@P!;+,+!:/,!!/,+!=6:/,>"<1/6

The CalOptima Board Self-Shuffles

Internal Probe Possible; FPPC Provides Advice
CalOptimas distinct style of musical chairs continues to rollick along. In what has been another tumultuous week at Orange Countys Medi-Cal managed care plan, its co-chair abruptly resigned and its chairman stepped aside at least temporarily. The changes occurred during and between two board meetings held earlier this week and last. Much of the turmoil appears to focus on grant applications involving two outside organizations headed or co-chaired by trustee Edward B. Kacic. But questions were also raised about whether the board is conducting business within the boundaries of Californias public meetings law. During the rst meeting on May 3, the board decamped from its usual place of business on the rst oor of CalOptimas Orange headquarters to the ninth oor, where it entered into a closed executive session for more than an hour. Such sessions are normally reserved to discuss personnel or litigation, and included CalOptima legal counsel Gary Crockett and its compliance director Denise Corley. However, that session excluded Kacic. I was told byCrockett that I needed to leave the room, Kacic said by e-mail. Therefore I was not privy to the discussion. Crockett did not respond to telephone and e-mail requests for comment. Acting CalOptima CEO Michael P. Engelhard conrmed that the board took a 10-0 vote to authorize a beeng up of CalOptimas compliance department and be prepared for a special meeting within a week. He also conrmed that Kacic did not participate in the closed session. Although board members are prohibited under state law to disclose to contents of an executive session, sources suggest some board members are seeking an internal probe involving the alleged use of two CalOptima employees to assist an organization called the Managed System of Care in its application for $12.7 million in intergovernmental transfers from CalOptima to revamp the way it provides care to its enrollees. Kacic co-chairs the Managed System of Care. Kacic is also CEO of the Irvine Health Foundation, which recently applied for a $9.3 million Medicaid grant that would be used for the care of some portion of CalOptimas 400,000 enrollees. CalOptima may eventually seek as much as $150,000 from the Managed System of
Continued on Next Page

May 23-25
!;/-R1<"4!?--/@1"<1/6!/:!B/3<5+,6! 9"4:1/,61"!"663"4!@/6:+,+6@+A!Q,"62!F+4! !",!D+-/,<&!B"6!F1+7/A!I5+!@/6:+,+6@+! <5+>+!1-!ED1-167!</!Q,+"<6+--!16! I3,)34+6<!I1>+-AK!LX'ONLW'OA 941@P!;+,+!:/,!!/,+!=6:/,>"<1/6

June 10-13

9"41:/,61"!;+"4<5!=6:/,>"<1/6!?--/@1"<1/6! 9/60+6<1/6A!B"6<"!94","!9/60+6<1/6! 9+6<+,C;#"<<!D+7+6@#&!B"6<"!94","A! EF,+">!G17H!9,+"<167!I5+!J3<3,+AK! LM%NLOO%A ! 941@P!;+,+!:/,!!/,+!=6:/,>"<1/6

WEBINAR

Thursday, May 24, 2012

10 A.M. PDT

HOSPITAL DISTRICTS: MAPPING THE FUTURE

E-Mail info@payersandproviders.com with the details of your event, or call (877) 248-2360, ext. 3. It will be published in the Calendar section, space permitting.

Please join Michael A. Dowell, partner, Hinshaw & Culbertson, Walter Kopp, president, Medical Management Services, Inc. and Cleo E. Burtley, manager, The Camden Group, to discuss the future of hospital district management. More Info @:

http://www.healthwebsummit.com/pp052412.htm
a HealthcareWebSummit Event
co-sponsored by

PAYERS & PROVIDERS

!"#!$%&!'%$'!(!'%$'!)#!*"#+,-!.!*,/012+,-!*3)41-5167&!889

Payers & Providers

Top Placement... Bottomless Potential

NEWS
CalOptima (Continued from Page One)
Care for the use of the employees services, according to sources. Both Englehard and Orange County Supervisor Janet Nguyen, who sits on the CalOptima board, declined to comment on those specic allegations. The potential conicts surrounding Kacics roles also prompted Orange County Counsel Chris Chrisos to seek advice last month from the California Fair Political Practices Commission on how to handle the matter. A FPPC spokesperson conrmed the agency responded to Chrisos on May 8, but will not make public its content until later this month. Chrisos did not respond to an e-mail and telephone call seeking comment. Meanwhile, the legality of last weeks closed session has been questioned by Kacic. Californias public meetings law, the Ralph M. Brown Act, permits boards to go into closed sessions to discuss litigation, insurance claims and discipline involving employees, ofcers and contractors. Nguyen said the item pertained to pending litigation. However, the Brown Act specically excludes the discussion of members of a legislative body. Kacic appears to qualify for that role. CalOptima vice-chair James McAleer was so concerned about the way the board was conducting business he resigned on May 8. In his resignation letter to Orange County Supervisor John Moorlach, McAleer noted that I have expressed concerns over what I perceive to be Brown Act violations in recent weeks to no avail, and continue to have reservations around that issue. McAleer, who is chief executive ofcer of the Alzheimers Association of Orange County, also said in his letter that I nd some of the actions of the Board in recent months to be in contradiction to what I believe are in the best interests of the agency and its consumers.

Page 2

Advertise Here
(877) 248-2360, ext. 2

In Brief
Kaiser Introduces iPhone App For Patients
Oakland-based Kaiser Permanente has introduced an application for Apples iPhone that allows its patients to access many of its health records remotely. The app permits access to the patients medical records, make appointments with providers, ll subscriptions and communicate with caregivers. "The mobile capabilities we offer allow members to securely access their health information when and where it's convenient for them," said Mark Groshek, M.D., a Kaiser Permanente pediatrician. My patients or their parents can send me a message, rell a prescription, or check test results right from the palm of their hand. It's really all about making it easy for our members to play an active role in their health care. Kaiser released a version for Android smartphones earlier this year. It has had about 95,000 downloads to date.

El Camino Hospital Introduces Sleep Disorders Program

El Camino Hospital in Los Gatos has launched a sleep disorders program, hoping to capitalize on a growing market. According to federal data, about 18 million Americans suffer from sleep apnea. The condition is often linked to obesity, and is also often connected to sexual dysfunction issues in men. Many of my patients come to me with a long list of health problems that none of their doctors has been

I am concerned that the needs of those we serve are no longer our rst priority. Just hours after McAleer resigned, the CalOptima board reconvened for the special meeting. At that session, the board voted 6-3 to remove Kacic as chairman. Orange County Health Agency Director Mark Refowitz was voted new chair on an interim basis. Lee Penrose, the chief executive ofcer of St. Jude Medical Center in Fullerton, was elected vice chair. The changes came less than a week after the Board of Supervisors appointed four new trustees to the CalOptima board. The closed session occurred as part of that newly minted groups rst meeting. During the May 8 meeting, Kacic defended the work of the Managed System of Care and challenged the legality of the prior weeks closed session. Nguyen, who has been criticized in recent weeks for orchestrating many of the changes on the CalOptima board and in turn has been critical of Kacic, said in a telephone interview after Tuesdays meeting that she supported the Managed System of Cares grant proposal, but never received a business plan she had requested. The mission and the goals are good goals for the county. But I cant support giving $12 million to anybody unless I know what youre going to do with the money, she said. Kacics term on the CalOptima board is set to expire Sept. 30. In late February, the Board of Supervisors voted 3-2 to delay what is typically a routine reappointment until an investigation regarding the Managed System of Care and the Irvine Health Foundations grant applications concluded. Along with the changes in CalOptimas governance, the organization is still searching for a CEO and ll other vacancies in the executive suite.

FOLLOW THE MONEY

]

CALIFORNIAS HEALTHCARE INDUSTRY AND POLTICAL FINANCE CALL (877) 248-2360, ext. 2 to order OR CLICK HERE
!"#!$%&!'%$'!(!'%$'!)#!*"#+,-!.!*,/012+,-!*3)41-5167&!889

Continued on Page 3

Payers & Providers

Longer ALOS!*

NEWS

Page 3

Advertise Here
(877) 248-2360, ext. 2
*For our ads, not your hospital

CalHIPSO Says Its Ahead of Curve

Provider Interest In EHRs Tops Original Projections
The California Health Information Partnership and Services Organization has moved more than 7,700 providers toward the adoption of electronic health records far ahead of the agencus initial projections. CalHIPSO began operations in 2010 with $33.2 million in federal grants. It originally predicted it would recruit just under 6,200 providers to receive initial subsidies for technical assistance and eventually work with regional health connectors to install EHR systems. Such installations are expected to move the providers smaller practices, clinics and rural hospitals toward stage one of meaningful use requirements, at which point they would begin receiving incentive payments from the federal government. We're well on our way to helping thousands of providers in California transition their practices from paper-based medical records to electronic systemsimproving both the efciency and quality of primary care," said CalHIPSO Executive Director Speranza Avram. However, some challenges remain. To date, only 210 of those providers currently qualify as meeting stage one of the meaningful use requirements. And only 813 rural providers have signed on to the program. Adoption of EHRs by rural providers is considered key for improving often sparse healthcare services in those regions. The barrier is not so much connectivity as it is nancing, Avram said. She added that CalHIPSO would soon announce agreements with lower-cost EHR vendors to better expedite adoption.

In Brief
able to link together heart disease, obesity, depression, fatigue. So I ask, Hows your sleep? said Edward Karpman, M.D., an El Camino urologist. (I) nd out they havent had a really good nights sleep in years. I think trying to gure out the sleep angle is just as important as everything else. El Camino ofcials say they will integrate the sleep disorders program with several other departments, including endocrinology and cardiology, in order to discover the underlying cause of the sleep disruption.

Molina Healthcare Makes Fortune 500 List Of Companies

Molina Healthcare, the Long Beachbased Medicaid managed care plan, was named to the latest edition of Fortune magazines 500 list of largest U.S. companies. I am pleased with our management team and our employees, who have worked hard to help shape and grow our company. I would also like to thank our state agency partners for working with us to serve the Medicaid beneciaries in their communities, said Molina Chief Executive Ofcer J. Mario Molina, M.D. Molina debuted at number 500 on the Fortune list. Its revenue was $4.6 billion in 2011, and it expects to inch toward $5 billion in 2012. Less than a decade ago, Molinas revenue was about $500 million a year. However, the company has expanded rapidly in markets outside of California. It focuses primarily on states looking to reduce their Medicaid costs. Molina was founded in the late 1970s. It originally operated out of a single clinic in Long Beach. It currently has 1.8 million Medicaid managed care enrollees in 10 states.

Study Links Low Co-Pays To ER Use

But Consumer Cost Consciousness on The Rise
The relatively low out-of-pocket cost to visit a hospital emergency room may be driving overutilization of that resource compared to primary care, according to a new study. Based on research conducted by the Boston-based HighRoads and the Corporate Executive Board, the average co-payment for an emergency room visit is $76. The study correlates that to two of the 10 most common conditions for ER visits: Toothaches and sprains. The study also found that there is a minimal out-of-pocket differential between urgent care and primary care ($32 versus $17), which may also be driving more urgent care visits because they keep longer hours than the ofces of primary care physicians. The interesting data on co-pays show employees are basically acting as price sensitive consumers and going for what they perceive as the best value and convenience for the price, said CEB Senior Director Ania Krasniewska. However, it also sounds a warning that some visits to ER and urgent care facilities should, in fact, be handled at the more cost-effective primary care level. Not only does this affect cost to the employee in the end, but in large quantities, this signicantly affects the cost to the organization.

HEALTHCARES BEST ADVERTISING VALUE

]

PAYERS & PROVIDERS reaches 5,000 hospital, health plan and nonprot executives statewide. There is no better venue for marketing your organization or conference, or recruiting new staff.

CALL (877) 248-2360, ext. 2 OR CLICK HERE

!"#!$%&!'%$'!(!'%$'!)#!*"#+,-!.!*,/012+,-!*3)41-5167&!889

Payers & Providers

OPINION

Page 4

:/43;+!<&!=--3+!$>
*"#+,-!.!*,/012+,-!1-! ?3)41-5+2!+0+,#!@53,-2"#!)#! *"#+,-!.!*,/012+,-!*3)41-5167&! 889A!B6!"663"4!16210123"4! -3)-C,1?D1/6!1-!EFF!"!#+",! GE$<F!16!)34H!3?!D/!$%! -3)-C,1)+,-IA!=D!1-!2+410+,+2!)#! +J;"14!"-!"!*KL!"DD"C5;+6D&! /,!"-!"6!+4+CD,/61C!6+M-4+DD+,A
B44!"20+,D1-167&!-3)-C,1)+,!"62! +21D/,1"4!16N31,1+-O
G>PPI!'<>J'QR% 16S/T?"#+,-"62?,/012+,-AC/;

Is Premium Regulation In The Air?

Signs Suggest a Major Change Could Occur Soon
Many scents waft through the gentle breeze of was given this power through the signing of SB a California spring. Rose, citrus and ballpark 1163 into law in late 2010, which allowed his peanuts are among them. But if youre in ofce to review the justication for rate healthcare, one smell is beginning to overtake increases and declare them unreasonable if all the others: premium regulation. believed it is actuarially justied to do so. Consumer Watchdog, the scrappy, inJones, a Democrat who introduced a your-face Santa Monica-based advocacy number of premium regulation bills while he group, reported last week that it has gathered served in the Assembly most of which died more 550,000 signatures to qualify an bided his time in speaking out. It was no initiative for the November ballot doubt in an attempt to look that would regulate health credible rather than zealous. insurance premiums, giving It appeared Jones was going power specically to the to criticize some proposed rates California Insurance increases submitted by Blue Commissioner to reject Shield of California late last year, proposed increases. It needs but instead got the San about 505,000 signatures to Francisco-based insurer to qualify, but is seeking about moderate them. He nally 200,000 more for a margin of criticized Aetnas proposed safety. increases for small groups last In case you happened to month. Some of the groups were have spent the last decade on a facing a 30% jump in premiums hippie commune and recently over the next two years. decided to return to healthcare Aetna rejected Jones advice and By management, insurance has gotten put the increases in place anyway. It Ron Shinkman extremely expensive. Some carriers may ll their coffers but wont win have jacked up rates 20% or more on them fans among consumers. some policyholders in recent years, using the Taken as a whole, its become apparent rise of medical claims to the impending that too many individuals, businesses and Affordable Care Act as a pretense for doing so. regulators in California are fed up with the Lurking behind all those other scents is a routine of coughing up more money for health pervasive air of consumer crankiness. coverage that continues to shrink. They are all One of the levers for that crankiness was no doubt waiting to see how the industry will the fate of AB 52, a rate regulation bill that use the upcoming Supreme Court decision on died in the Senate last year after it had been ACA to further jack up rates. They are also passed by wide margins in a couple of rightly cynical that the Legislature will ever committees. As reported on these pages and in help out. special white paper last year, insurance As a result, I predict that should the rate interests funneled funds to key members of the regulation measure make it to the ballot, it Senate to control their votes. And Senate will pass by a wide margin, despite the Health Committee Chairman Ed Hernandez, a likelihood the insurance lobby will frame it as West Covina Democrat, gets nearly $70,000 a a big government takeover. It will also likely year in rental income from Kaiser survive judicial review, given it it so similar to Permanente. Hernandez is an optometrist by Proposition 103 in scope and structure. training, and will always be remembered for Californians believe that the current lack the special prescription he wrote himself that of regulation in this area stinks. Its a smell blinded his ethics. they no longer wish ll their nostrils. Aside from Consumer Watchdog whose founder Harvey Roseneld made history in Ron Shinkman is the publisher of Payers & the 1980s by getting premium regulation for Providers. automobile insurers passed by voters and kept it intact through a brutal years-long court Op-ed submissions of up to 600 words are battle that crankiness is also being expressed welcomed. Please e-mail proposals to by Insurance Commissioner Dave Jones. He
editor@payersandproviders.com

!"14167!"22,+--O
>$>!UA!V/44#M//2!W"#&!X31D+!Y Y3,)"6H&!9B!F$Z%Z

W+)-1D+
MMMA?"#+,-"62?,/012+,-AC/;

L"C+)//H
MMMAS"C+)//HAC/;[?"#+,-?,/012+,-

@M1DD+,
MMMADM1DD+,AC/;[?"#+,-?,/012+,-

\21D/,1"4!Y/",2
XD+0+6!@A!:"4+6D16+&!*,+-12+6D&! @5+!9";2+6!],/3? ^/--!]/42)+,7&!=;;+21"D+!*"-D! *,+-12+6D&!8/-!^/)4+-!V/-?1D"4! "62!!+21C"4!9+6D+, !",H!L163C"6+&!!"6"7167! K1,+CD/,&!B40",+_!.!!",-"4 V+6,#!8/3)+D&!951+S!XD,"D+7#! `SS1C+,&!a++6"6 B6D5/6#!W,175D&!\b+C3D10+! K1,+CD/,&!V+"4D5!BCC+--!9"41S/,61"

*3)41-5+,[\21D/,
^/6!X516H;"6
?3)41-5+,T?"#+,-"62?,/012+,-AC/;

9/6D,1)3D167!\21D/,
a"D5#!!144+,!a+44+#
=S!#/3!2/!6/D!,+C+10+!#/3,!1--3+!/S! *"#+,-!.!*,/012+,-!)#!$!*A!A!/6! @53,-2"#&!?4+"-+!C"44!G>PPI'<>J'QR%A

!"#!$%&!'%$'!(!'%$'!)#!*"#+,-!.!*,/012+,-!*3)41-5167&!889

Payers & Providers

MARKETPLACE/EMPLOYMENT

Page 6

It costs up to $27,000 to fill a healthcare job*

will do it for a lot less.

Employment listings begin at just $1.65 a word Call (877) 248-2360, ext. 2 Or e-mail: advertise@payersandproviders.com Or visit: www.payersandproviders.com
*New England Journal of Medicine, 2004.

SEEKING A NEW POSITION?

CAN HELP.
We publish advertisements for those seeking new career opportunities for just $1.25 a word. If you prefer discretion, well handle all responses to your ad. Call (877) 248-2360, ext. 2, or e-mail advertise@payersandproviders.com.

!"#!$%&!'%$'!(!'%$'!)#!*"#+,-!.!*,/012+,-!*3)41-5167&!889