Illinois Hospital Association Leadership Summit

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Illinois Hospital Association Leadership
Summit Rich Umbdenstock September 24, 2009
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The Steep Health Care Cost Curve
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In Illinois

• There are more than 1.7 million uninsured in
  the state of Illinois
• About the same number of people who live in
  DuPage and Lake counties

At a cost of about 1.8 Billion
July 1, 2008 US census data From the GAO
uncompensated care model and The Hospital Cost
Report
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Hidden Cost on All of Us

From Center for Financing, Access and Cost
Trends, Agency for Healthcare Research and
Quality, Medical Expenditure Panel Survey, 2006.
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At the White House

• Coverage for all is Key
• Affordability is
• Central to Extending
• Coverage for all
• Cost Reductions are
• a Shared Responsibility

Bottom Line Hospitals Support Comprehensive and
Meaningful Health Care Reform
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Six Groups, One GoalBending the Cost Curve
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Pursuit of Excellence Campaign

• Use Field Tested Best Practices to
• Reduce Surgical Infections and Complications
• Reduce Central line-associated Blood Stream
  Infections
• Reduce Methicillin-resistant Staphylococcus
  aureus
• Reduce Clostridium difficile Infections
• Reduce Ventilator-associated Pneumonia
• Reduce Catheter-associated Urinary Tract
  Infections
• Reduce Adverse Drug Events From High-hazard Meds
• Reduce Pressure Ulcers

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AHA Members Supportive of Reform
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AHA Members Supportive of Reform
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Consensus Across Bills

• Coverage expansions to 95 to 97 percent of all
  Americans
• Employer contribution
• Individual contribution
• Medicaid expansions
• Federal subsidies to help individuals purchase
  coverage
• Creation of insurance exchanges
• Insurance reforms
• Incentives for quality care
• Delivery system reform options
• Expanding health professions education
• Restrictions on physician self-referral
• Medicare and Medicaid provider cuts
• Revenue (new taxes) component

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Key Issues at a Glance
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The Math in the House
218
Democrats 256
No Republican support 0
Democratic vote margin 38
52
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Senate Finance Committee
Gang of Six
Max Baucus Chuck Grassley
(D-MT) (R-IA)
Jeff Bingaman Kent Conrad Mike Enzi
Olympia Snowe (D-NM)
(D-ND) (R-WY) (R-ME)
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Americas Healthy Future Act of 2009
Hospitals Contributions To Reform 155b

• Payment Rate Reductions 106.3b Market Basket
  update
• reductions.
• Medicare/Medicaid DSH Reductions
• Medicare DSH 22.9b over 10 years. 75
  reduction beginning in 2015.
• Medicaid DSH 24.9b over 10 years. Once a
  states uninsured rate is reduced by 50 DSH
  allotment is reduced by 50.
• Readmission Cuts 2.1b over 10 years.

Coverage Extended to about 94 of people in the
Country.
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Senate Finance Committee
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Americas Healthy Future Act of 2009
Delivery System Reforms

• Transitional Care Program to Reduce
• Preventable Readmissions
• Value Based Purchasing
• Hospital-acquired Conditions
• Accountable Care Organizations
• National Program on Payment Bundling
• Self-referral Ban

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Americas Healthy Future Act of 2009
Rural Provisions and Other Program Extensions add
800 million over 10 years.

• Extends the Medicare rural FLEX program
• Extends outpatient PPS hold harmless for small
  rural hospitals
• Extends and expands outpatient PPS hold harmless
  for sole
• community hospitals
• Extends cost base payment for lab services in
  small rural hospitals
• Extends the rural community hospital
  demonstration program
• Extends the Medicare Dependent Hospital program
• Expands and improves the Medicare inpatient PPS
  adjustment for low
• volume hospitals for two years
• Extends rural add-on for ambulance services
• Extends the exception process for therapy caps
  for two years
• Extends payment of physician pathology services
  for certain hospitals

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Our Key Challenges

• Revenues as part of solution
• Financing health reform
• Payment reforms
• Readmissions
• Bundling
• Value-based purchasing
• Payment reductions
• Update factors
• IME
• DSH
• Delivery system reformsreadiness for
  coordinated care
• Tax-exempt status
• Health manpower supply
• Delayed (or marginal) coverage expansions

Maintaininga fair andbalanced package
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Reconciliation?
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What You Can Do
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Well Have to See What Happens in Washington
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The Future Thats Occurred
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Illinois Hospital Association Leadership
Summit Questions?