INSIDE THE ISSUE

> The HPC Benchmark Hearing
> Cyberbreach Payments
> Worker Wellbeing
> Federal Legislative Update
> Biden Budget
> Transitions

MONDAY REPORT

Does State Benchmark Miss Current, On-the-Ground Pressures?

The Health Policy Commission (HPC) and the legislature’s Joint Committee on Health Care Financing met last Thursday to discuss whether to modify the state’s healthcare cost growth benchmark for 2025. The benchmark is currently 3.6% and the HPC on April 11 will decide if it wants to adjust it.

Last Wednesday, the Center for Health Information and Analysis (CHIA) released its Annual Report on the Performance of the Massachusetts Health Care System, which is used to inform the HPC’s decision on the benchmark. CHIA found that in 2022, Massachusetts total healthcare expenditures (THCE) per capita increased by 5.8%, exceeding the 3.1% healthcare cost growth benchmark that was in effect at the time. (In 2022, the HPC moved the benchmark from 3.1% to 3.6%.)

Importantly, despite the enormous challenges hospitals were (and are) facing during the period covered in the CHIA report, hospital expenses (inpatient and outpatient) grew by only 1.8% between 2021 and 2022, according to CHIA. CHIA found troubling hospital financial trends in 2022, including:

• The statewide acute hospital median total margin in hospital FY 2022 was -4.2%, a decrease of 9.2% in comparison to the prior fiscal year.
• The statewide acute hospital median operating margin (-1.3%) and non-operating margin (-0.4%) decreased from the prior year.
• All four cohorts (academic medical centers, community hospitals, teaching hospitals, and community high public payer hospitals) reported decreases in median total, operating, and non-operating margins.

A key takeaway from the Thursday hearing and, in fact, from similar hearings over the years since the benchmark was created in 2012, is that the state is using past data – specifically, two-year-old data – to set the benchmark for the upcoming year. Or, as the HPC itself notes, “The healthcare cost growth benchmark is set prospectively for the upcoming calendar year, while actual performance is measured retrospectively.” MHA and its members have expressed their continued support for a strong benchmark tool, but only one that can account for the issues of the day.

“The statutorily required discussion that is taking place right here today is a relic of the past and is no longer serving our patients,” said MHA’s President & CEO Steve Walsh in his remarks before the HPC and Joint Committee. He urged the regulators to keep in mind, as they pored over the dated data from CHIA and the HPC, other metrics that reflect the “current, on-the-ground pressures” hospitals are facing, including: 19,000 job vacancies across Massachusetts providers; 1,500 patients stuck in hospitals because they cannot access the specialized care they need; one in seven medical-surgical beds that are currently tied up with patients who no longer need acute-level care; all five regions of the state in elevated “risk” status because of capacity constraints; nine Steward Health hospitals whose immediate future is uncertain; 20% of behavioral health beds offline due to staffing shortages; $24 million being lost daily due to a major cyberattack with Change Healthcare; and 100% of hospitals that are becoming financially weaker by the day.

Walsh called for a “Performance Improvement Plan” for the entire commonwealth. (Such PIPs are the tool that the HPC uses to address needed changes at individual organizations.) Such a commonwealth-wide PIP, Walsh said, “would include everything from healthcare planning, to strengthening the workforce, to doubling down on our commitment to health equity. But it also means modernizing our approach to how we measure access and affordability to include these real-time pressures that were not imaginable in 2012.”

While modernizing the benchmark process will not occur before the new mark is set on April 11, Walsh encouraged all parties in Massachusetts to come together in the coming year to create a new, more relevant system.

CMS Explains Limited Cyberbreach Payments, and OCR Investigates

The Centers for Medicare & Medicaid Services (CMS) last Wednesday issued a set of frequently asked questions that elaborated on its previous announcement that it would provide accelerated and advance payments (AAPs) to hospitals, physicians, and others affected by the Change Healthcare cyberattack.

Hospitals and health systems wishing to apply for AAPs should contact their Medicare Administrative Contractors. In the FAQs, CMS clarifies that it only will issue AAPs for disruptions in Medicare Part A and/or Part B claims payments, not for other providers’ claims payments.

As MHA previously reported, a spot survey the association conducted with its membership revealed that Massachusetts hospitals and health systems are losing at least $24 million daily due to the cyberattack.

In other Change Healthcare news, the U.S. Department of Health and Human Services’ Office for Civil Rights announced that it was opening an investigation into Change and its parent company, UnitedHealth Group, to determine whether a breach of protected health information occurred and whether the affected entities were following HIPAA rules.

We’re Continuing Our Work on Wellbeing

MHA has long supported efforts to improve the wellbeing of caregivers across the continuum through various workgroups, initiatives, and system-wide reforms. Starting years before the COVID-19 pandemic, MHA’s Workforce Wellbeing Workgroup, Healthcare Safety & Violence Prevention Workgroup, MHA-MMS Physician Burnout Taskforce, and Caring for the Caregiver Taskforce have all looked at ways to support the safety and wellbeing of healthcare workers in many different roles, from front-line workers to the C-suite. A few of the accomplishments to-date include:

• Publishing the landmark Caring for the Caregiver Taskforce Report, and hosting an ongoing webinar series featuring speakers on a variety of topics related to wellbeing, engagement, and safety;
• Taking the nation-leading step of having every Massachusetts hospital, health system, and local health plan committing to eliminating potentially stigmatizing or invasive questions from their credentialing processes;
• Publishing a Wellness Toolkit that gives providers a roadmap for expanding their internal employee-facing efforts;
• Constructing a unified set of principles for hospital patient and visitor codes of conduct that were unanimously endorsed by MHA’s Board of Trustees, and publishing a call to the public to treat all healthcare workers with kindness and respect;
• Hosting several education events with content relating to safety, workforce, and wellbeing;
• Publishing articles on the burnout crisis and importance of wellbeing; and
• Championing legislation at both the state and federal levels that would bolster violence prevention in healthcare settings, strengthen supports for workers who are assaulted, and strengthen penalties for offenders who knowingly harm hospital staff.

MHA encourages its members and partners to take this recognition day as an opportunity to review the above resources and reflect on their own wellbeing goals.

Federal Update: Telehealth & Hospital-at-Home

Bipartisan Bill Introduced to Permanently Extend Telehealth Reimbursement

Last Monday, Representatives Buddy Carter (R-Ga.) and Lisa Blunt Rochester (D-Del.) introduced the Telehealth Modernization Act of 2024 (H.R.7623), which would permanently extend many of Medicare’s telehealth flexibilities that are currently set to expire at the end of 2024. Additionally, the legislation would expand telehealth reimbursement to services provided by federally qualified health centers and rural health clinics. It would also allow for audio-only services in areas in which internet access is unavailable. Telehealth utilization rapidly increased during the COVID-19 pandemic and has garnered widespread, bipartisan support from lawmakers.

Discussion Draft to Extend Hospital-at-Home Until 2027

Also last Monday, Representatives Brad Wenstrup (R-Ohio) and Earl Blumenauer (D-Ore.) issued a bipartisan discussion draft for legislation that would extend the Hospital-at-Home program until 2027. The Hospital-at-Home program that launched during the COVID-19 pandemic had, as of March 2023, 227 participating hospitals across 37 states. The program currently expires at the end of 2024. In a press release, Representatives Wenstrup and Blumenauer welcomed input and feedback from patients, providers, and hospitals that participate in, or are considering participating in, the Hospital-at-Home program.

President Biden’s FY2025 Budget Proposals

The Biden Administration’s last week released its FY2025 Budget Proposal as well as a U.S. Health & Human Services FY2025 Budget in Brief. Such presidential documents have historically served as merely an overview of an administration’s priorities; Congress is unlikely to consider the outlined legislative proposals.

Overall, the HHS Budget in Brief proposes $130.7 billion in discretionary budget authority and $1.7 trillion in mandatory budget authority for FY2025. Notably, the budget proposes banning hospital facility fees for telehealth services, and for certain outpatient hospital services for individuals covered by commercial insurance.

Additionally, the budget proposes investing $1.3 billion over 10 years in a new Medicare program that encourages hospitals to update their cybersecurity practices. The program establishes two incentive structures that steadily increase cybersecurity expectations from “essential” to “enhanced.” Hospitals that fail to adopt essential and enhanced cybersecurity strategies would face penalties beginning in FY2029 and FY2031.

The American Hospital Association immediately slammed the concept, saying it “cannot support proposals for mandatory cybersecurity requirements being levied on hospitals as if they were at fault for the success of hackers in perpetrating a crime. Many recent cyberattacks against hospitals and the healthcare system, including the current Change Healthcare cyberattack, have originated from third-party technology and other vendors. No organization, including federal agencies, is or can be immune from cyberattacks. Imposing fines or cutting Medicare payments would diminish hospital resources needed to combat cybercrime and would be counterproductive to our shared goal of preventing cyberattacks.”

The Biden budget also proposes investing in the workforce by increasing funding to the National Health Service Corps, Teaching Health Center Graduate Medical Education, Mental Health and Substance Use Disorder Workforce, and Nursing Workforce Development Fund.

Transitions

Peter Banko will become the president & CEO of Baystate Health, effective June 3. Baystate is the largest health system in Western Massachusetts. He succeeds Dr. Mark Keroack, a former MHA Board Chair who at the end of 2023 announced his retirement. Banko most recently served as president and CEO of Centura Health, in Centennial, Colorado, which was part of the national CommonSpirit Health system. He has a Bachelor of Business Administration degree from the University of Notre Dame and a Master of Health Administration degree from the Sloan Program in Health Services Administration at Cornell University.

Mass General Brigham announced a reorganization of its Massachusetts General and Brigham and Women’s hospitals. The system will integrate clinical departments at both facilities and place each one under a single department chair. David Brown, M.D., the current president of MGH, has been named the president of MGB’s Academic Medical Centers. Marcela del Carmen, M.D., and Giles Boland, M.D., will serve as presidents of Massachusetts General Hospital and Brigham and Women’s Hospital, respectively. Del Carmen and Boland will also continue to serve in their current roles as presidents of the Massachusetts General Physicians Organization and Brigham and Women’s Physicians Organization. Anne Klibanski, M.D. continues to serve as president and CEO of the entire Mass General Brigham system.

John LoDico, Editor