News briefs
Report: Mergers may save less than thought
A report commissioned by the Agency for Healthcare Research and Quality suggests that hospital mergers may produce fewer savings than previously estimated. The study, which appears in the July issue of Health Affairs, traces the cost and price changes in nearly 1,800 short-term hospitals from 1989 to 1997. Researchers, who compared merging hospitals in high HMO-penetration markets with their nonmerging rivals, said the merging hospitals’ average cost savings was 2.3 percentage points.
The average price growth was nearly identical to nonmerging competitors, according to the report. Conversely, in low HMO-penetration markets, mergers appear to produce greater cost and price savings for the hospitals. The report, "Hospital Mergers and Savings for Consumers: Exploring New Evidence," can be found at www.healthaffairs.org.
Ohio joins the states with prompt-pay laws
Ohio Governor Bob Taft has signed into law legislation aimed at ensuring that hospitals and other health care providers receive timely payments for services. Taft signed the bill in late July at Doctors Hospital West in Columbus. Senate Bill 4, the prompt-pay bill that passed the Ohio General Assembly in late June, becomes effective in one year.
Check your status
The Ohio Hospital Association reports that the new law requires insurers to establish a system whereby providers and patients can check the status of a claim. It also requires insurers to pay claims within 30 days, or 45 days if the insurer needs additional documentation. And, it prohibits insurers from contracting for time frames longer than those stipulated in the bill.
At the bill signing, the governor said the new law will allow hospitals and doctors to spend more time on medicine and less time collecting bills.
Hospital closures are said higher this year
During the first half of this year, 24 hospitals with 4,088 staffed beds have either closed their doors — partially or entirely — or announced plans to do so, compared with 20 for the same six months last year, according to an Ohio health care consulting firm.
Dynamis Healthcare Advisors of Cleveland said the closure trends this year are similar to those exhibited in 2000. Five of the 2001 closures have been in rural communities, and 19 were urban hospitals. Seven of this year’s closures were for-profit and 17 were not-for-profit facilities.
Midwestern closures
Geographically, most of this year’s closures were in the Midwest, followed by the East Coast. Ohio led the list of closures with four closures or announcements. At the same time last year, Ohio also led the list with five. Closures to date in 2001, according to the report, have affected 4,203 staffed beds and approximately 13,000 employees. For more information, go to www.dynamis-hc.com.
CMS to conduct listening tours
The Center for Medicare and Medicaid Services (CMS, formerly the Health Care Financing Administration) will conduct listening tours to get input on running those government programs more efficiently, says CMS administrator Tom Scully.
Making the announcement at a House of Representatives Small Business Committee hearing focusing on reducing the paperwork burden for small health care providers, Scully said the move marks the first of several steps geared toward reform, according to a report by the on-line news service AHA News.
Next, CMS will convene seven health-sector work groups to meet with advocacy groups in Washington representing all facets of the health care work force, Scully said. They will focus on improving interactions with CMS and reducing regulatory complexity and burden.
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