Last week, the Michigan House of Representatives appointed Reps. Gary McDowell (D-Rudyard), George Cushingberry (D-Detroit) and Kevin Green (R-Wyoming) to serve on the fiscal year (FY) 2011 Michigan Department of Community Health (MDCH) budget conference committee. The House conferees will work with Sens. Roger Kahn (R-Saginaw Twp.), John Pappageorge (R-Troy) and Deb Cherry (D-Burton) to resolve the differences between the House and Senate versions of Senate Bill (SB) 1152.

Both versions of the bill address a top priority of the MHA and member hospitals by keeping all federal funding intended for Medicaid in the MDCH budget. However, adjustments to both the Medicare Part D prescription drug program (also referred to as the clawback) and refunds from previous years' federal medical assistance percentage will be a challenge to keep in the final MDCH budget as a result of the $243.5 million dollar shortfall in the state's general fund for FY 2010. At this time, it remains unclear what steps will be taken to address the shortfall and the impact that corrective actions may have on the development of state department budgets for FY 2011. Diverting federal funds that are intended for Medicaid to balance the state budget shortfall in FY 2010 could devastate the program in FY 2011, putting the state's most vulnerable populations at risk.

The MHA continues to advocate aggressively for adequate Medicaid funding and to prevent any additional provider cuts in both FYs 2010 and 2011. The association will soon ask members to contact their lawmakers and members of the conference committee to urge them to preserve critical healthcare services by approving the House-passed version of SB 1152. For more information, contact David Finkbeiner at the MHA.

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The U.S. Internal Revenue Service, Department of Labor, and Department of Health and Human Services (HHS) released final interim rules June 14 related to health plans offered by employers that have grandfathered status under the Patient Protection and Affordable Care Act (PPACA), including those offered by hospitals. This status provides the plans with additional time to implement provisions of the act that would otherwise have taken immediate effect. The rules list permitted changes and those that would eliminate the plan's grandfathered status under the PPACA.

According to the HHS, changes that will result in the plan losing its grandfathered status include significantly cutting or reducing benefits; raising co-insurance charges; significantly raising co-payment charges; significantly raising deductibles; lowering employer contributions by more than 5 percent; and adding or tightening an annual limit on what the insurer pays.

Under the rules, a plan will be allowed to increase deductibles and co-payments, but only up to a specified limit. The maximum limit is defined as the increase in the medical care component of the Consumer Price Index since March 23, 2010, plus 15 percentage points.

Collectively bargained multiemployer and single-employer plans that were in effect March 23, 2010, are not subject to the reform law rules until the last of the collective bargaining agreements ends. For more information, contact Nancy McKeague at the MHA.

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Among the speakers at the ceremony were (left to right) Jim Turner, director, USDA/Michigan Rural Development; Stupak; Brian Peters, executive vice president, operations, MHA; Stabenow; Nelson; and Ronald R. Mitchell, board chairman, Mackinac Straits Health System Inc.(Photo courtesy of St. Ignace News.)

U.S. Sen. Debbie Stabenow (D-Lansing) and U.S. Rep. Bart Stupak (D-Menominee) spoke at the June 2 dedication ceremony for the new Mackinac Straits Hospital and Tribal Health and Human Services Facility in St. Ignace. Both lawmakers were instrumental in securing a United States Department of Agriculture (USDA) loan to assist with the construction cost of the new facility, built on land donated by the Sault Tribe of the Chippewa Indians. Speakers at the dedication highlighted the unique nature of the partnership among the state, federal, city, county and tribal governments that led to creation of the new hospital facility. Rod Nelson, chief executive officer of the Mackinac Straits Health System Inc., along with community and tribal leaders, praised Stabenow and Stupak for their efforts to secure one of the largest USDA loans ever granted for hospital construction. Members with questions should contact David Finkbeiner at the MHA.

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The MHA is hosting a member forum next month to provide an update on the Medicare Recovery Audit Contractor (RAC) process and Medicare Advantage (MA) activity. Representatives from CGI Technologies and Solutions Inc., the RAC for Michigan hospitals, and the Centers for Medicare & Medicaid Services will be available during the first portion of the forum, with staff from Blue Cross Blue Shield of Michigan (BCBSM) and Health Data Insights (HDI) available for the second portion. BCBSM contracted with HDI to conduct medical necessity audits for its MA private fee-for-service Medicare claims and hospitals have been experiencing medical necessity denials. Following the formal presentation, there will be a question-and-answer session with hospitals to share their experiences from the RAC process and how they continue to prepare for future RAC audits.

Registration information for the forum, which will be held from 9 a.m. to 1:30 p.m. July 14 at the Michigan State University Kellogg Hotel & Conference Center in East Lansing, is available electronically. Audio-only participation is also available for this forum and is free to MHA members. Members with questions regarding registration should contact Donna Conklin at the MHA at (517) 703-8617. For further information on the RAC process and implementation or MA audits, contact Marilyn Litka-Klein at the MHA.

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(Left to right) Newly installed MAHA president Cathy Crimmins and outgoing MAHA president Mary Lou McFadden.

The Michigan Association of Healthcare Advocates (MAHA) recently hosted its 61st Annual Meeting and Educational Institute at the Grand Hotel on Mackinac Island. The MAHA has maintained a close working relationship with the MHA on many issues throughout its history. During an update on legislative activity, participants learned how the founding missions of the two organizations complement one another for efforts directed at grassroots political advocacy. Through educational workshops, conference attendees received information on movement disorders, Alzheimer's disease, how to eat right, and issues related to the aging eye. Outgoing MAHA president Mary Lou McFadden, Allegiance Health, Jackson, praised members for the significant contributions made to their local hospitals and outlined efforts to develop a new strategic plan for the organization.

At the meeting banquet, Frank Sardone, president/chief executive officer, Bronson Healthcare Group, Inc., Kalamazoo, and chairman of the MHA Board of Trustees, installed the 2010-2011 MAHA officers. The new officers are Cathy Crimmins, Marquette General Health System, president; Betty Bierman, North Ottawa Community Hospital, Grand Haven, president-elect; Pam Starkweather, Memorial Healthcare, Owosso, secretary; and Jeanette Havel, St. Joseph Health System, Tawas, treasurer. Immediate past president Mary Lou McFadden will serve as counselor. Members with questions should contact Stacy Dowdy at the MHA.

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Ninety-nine percent of healthcare professionals have seen disruptive behavior on the job and about one-third see it every week. Disruptive behavior is a sensitive subject; nevertheless, it must be addressed to ensure the best patient care. In fact, The Joint Commission now requires hospitals to address disruptive behavior by physicians, nurses and other staff members to maintain accreditation. To address this issue, the MHA Health Foundation is offering a full-day workshop, Disruptive Behavior - Diagnosis and Response, scheduled for July 27 at the Somerset Inn, Troy. The workshop will outline the devastating impact of disruptive behavior among caregivers, including hostility, stress, frustration, loss of focus and poor communication; but more importantly, the adverse effect on patient outcomes. The workshop contains four hours of hands-on practice related to diagnosing disruptive behavior and interactions to avoid disruptive behavior.

An early registration discount is being offered through July 6. For more information on the workshop or to register, contact Leigh Anne Jewison at the MHA.

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Last week, the MHA submitted comments to the Centers for Medicare & Medicaid Services (CMS) regarding the fiscal year (FY) 2011 proposed rule to update the Medicare inpatient prospective payment system (IPPS) and the supplemental proposed rule that implemented provisions of the Affordable Care Act of 2010 (ACA). The MHA's comments focus on the proposed 2.9 percent coding and documentation adjustment, which is estimated to reduce inpatient payments to Michigan hospitals by $130 million and long-term, acute-care hospitals by $5 million in FY 2011. Other key comments focus on:

• Opposition to the CMS proposal to include all-patient volume data in the Reporting Hospital Quality Data for Annual Payment Update (RHQDAPU) program. This proposal would require hospitals to submit all-patient volume data for the 55 Medicare-severity diagnosis-related groups that relate to the RHQDAPU program, further increasing the burden on hospitals. This requires transmittal of patient identifiable information to a federal agency that exceeds the requirement for payment or quality reporting. Transmittal of this information may not comply with the Health Insurance Portability and Accountability Act of 2006, since the requested data represent identifiable patient information on patients who have no relationship to the Medicare program.
• Opposition to the CMS proposal that Medicaid provider taxes could potentially be excluded from Medicare allowable costs for critical access hospitals, whose payments are based on Medicare allowable costs. In its proposal, the CMS indicated that Medicare contractors would determine on a case-by-case basis whether the provider taxes are an allowable cost. The MHA opposes this change due to its vagueness and inconsistent application and believes it is inappropriate and unreasonable for the CMS to solicit comment on an unspecified revision.
• The need for the CMS to provide an additional opportunity for hospitals to apply for FY 2011 geographic reclassifications. An ACA provision reduced the average hourly wage criteria needed to qualify, making additional hospitals eligible. While the CMS modified the qualifying criteria, it failed to modify the statutory reclassification application deadline of Sept. 1, 2009.
• The lack of transparency regarding the CMS data and methodology used to determine eligible hospitals and their share of the $400 million in payments for hospitals with lower per capita Medicare spending.
• The need to evenly distribute funds to hospitals that qualify for the lower per capita payments. The MHA suggests that the CMS distribute $200 million in FY 2011 and $200 million in FY 2012, rather than the proposed $150 million in FY 2011 and $250 million in FY 2012.

The CMS accepted comments on the proposed rule through Friday and a final rule is expected by Aug. 1. The rule is scheduled to take effect Oct. 1, 2010. Members with questions should contact Vickie Seal at the MHA.

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The purpose of discovery has long been to identify, retrieve, review and produce documents that are relevant to litigation. Now that "e" has been put in front of discovery, finding all the pertinent issues in the case has become even more difficult and costly. But the "e" in e-discovery was not intended to mean "everything." What hospital legal counsel, risk management and technology staff must know is the data needed; how it is stored, managed and preserved; and how to effectively and efficiently locate it for litigation. The MHA Health Foundation webinar series Electronic Discovery and Evidence will help hospitals use technology to leverage the expertise locked in lawyers' heads, while eliminating the need to look at an excessive number of documents. The webinar Electronic Discovery - If It Hasn't Touched You, It Will, scheduled for Aug. 3, will review the nuts and bolts of electronic discovery. The Aug. 17 webinar Collecting and Handling Electronic Evidence will examine electronic discovery, the chain of custody, and best practices for collecting and handling electronic evidence, and the Aug. 30 webinar The Good, The Bad and The Ugly of Electronic Discovery includes case studies with valuable lessons about the costs and potential ramifications of not correctly responding to the rules for electronic discovery.

The connection fee for all three webinars is $550 per participating MHA-member organization; the fee for a single webinar is $195. For more information or to register, contact Leigh Anne Jewison at the MHA.

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Kathleen McManus, RN, has been named executive vice president and chief operating officer for Munson Medical Center, Traverse City, taking responsibility for all patient care services and operational areas. McManus has extensive management experience at local and state health agencies, as well as hospitals. She served as vice president of patient services at the former Traverse City Osteopathic Hospital and joined Munson Medical Center in 1992, where she has held the roles of director of Radiology Services, director of Imaging and Cardiac Services, vice president for outreach and network development, and senior vice president. McManus will continue in her role as president of North Flight emergency medical service, based in Traverse City.

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At the MHA Annual Membership Meeting this week, 63 hospitals/healthcare systems will be formally recognized and commended for achieving or exceeding their organizational Health PAC goals. Given the significant number of election issues and races to be determined this year, Health PAC contributions are especially vital in the election of legislators who recognize the importance of healthcare.

As of June 18, the campaign had raised more than $276,000 toward the $350,000 statewide goal. Eight additional hospitals/health systems have achieved their organizational goals: Community Health Center of Branch County, Coldwater; Hayes Green Beach Memorial Hospital, Charlotte; Helen Newberry Joy Hospital, Newberry; Henry Ford Health System, Detroit; Mercy Hospital Grayling; Michigan Association of Healthcare Advocates; Oakwood Healthcare, Inc., Dearborn; and Otsego Memorial Hospital, Gaylord. All those who contribute to the campaign secure membership to one of the following clubs: Chairman's Circle ($1,000+), Trustees' Club ($750+), President's Club ($500+), Capitol Club ($350+) and Century Club ($250+). For more information on the campaign, goal achievers and club members, visit the Health PAC website.

MHA-member hospitals/health systems that have not yet met their organizational goals are encouraged to take the necessary steps to initiate or complete their fundraising campaigns by June 30. At a minimum, the Health PAC Board is encouraging every hospital chief executive officer to make a contribution to Health PAC. Members with questions should contact Stacy Dowdy at the MHA.  

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• The MHA Health Foundation Board will meet from 2 to 4 p.m. Tuesday at the Grand Hotel, Mackinac Island. The board will discuss the national expansion of patient safety and quality efforts. For more information, contact Brian Peters at the MHA.

• The MHA Board of Trustees will meet at 9 a.m. Wednesday at the Grand Hotel, Mackinac Island. The board will discuss issues surrounding the 2010 elections and review further developments around the association's work plan for healthcare reform. For more information, contact David Seaman at the MHA.

• The MHA Annual Membership Meeting will be held Wednesday through Friday at the Grand Hotel, Mackinac Island. Attendees will learn what's ahead for hospitals in Michigan and throughout the nation, from healthcare reform to the impact of the 2010 elections on healthcare. For more information, contact Erin Steward at the MHA.

• The precertification department of Blue Cross Blue Shield of Michigan has notified the MHA that it is discontinuing its practice of staffing telephone lines during corporate holidays. Hospital utilization staff should take the department's holiday closures into account when planning to admit patients. Specific holidays the department will observe will be posted on Web-DENIS. Members with additional questions should contact Morgan Stocking at the MHA.