Arkansas AWP Act Pre-empted

The 8th U.S. Circuit Court of Appeals in St. Louis ruled in September that the Arkansas Patient Protection Act of 1995, also known as the state's Any Willing Provider (AWP) law, is not enforceable. The decision upheld a 1997 ruling by U.S. District Judge James Moody, but went further by saying the Act was not applicable to any health plans. Judge Moody originally allowed the AWP law to apply to some plans not governed by the 1974 federal Employee Retirement Income Security Act (ERISA). The three-judge federal appeals panel said ERISA, which governs employee benefits, pre-empts the state law as it relates to any health plan.

The court's decision apparently hinged on a technical argument based on other U.S. Supreme Court precedents. Under those precedents, any law that refers to ERISA is pre-empted by the federal law. The Patient Protection Act contained a clause specifically exempting from its provisions any health plans that fall under the ERISA protections. According to the appellate panel, since the state law refers to ERISA, even by merely recognizing its protective nature, it is pre-empted by ERISA.

Among its provisions, the Patient Protection Act banned higher copayments for patients using healthcare providers who are not included on their plan's provider panels, but who are willing to accept the health plan's schedule of fees. It also required health plans to accept into their provider panels a wide range of healthcare providers. During the legislative debates, the law was opposed by several insurers and employers having self-funded health plans who argued the law would end their efforts to effectively manage patients' care and contain healthcare costs.

Arkansas System Purchased

Northwest Health System of Springdale and Quorum Health Group, the Brentwood, Tenn.-based company that manages ten Arkansas hospitals, have signed a letter of intent for Quorum to purchase the Northwest Arkansas nonprofit system. Under the proposed acquisition, Quorum would obtain Bates Medical Center in Bentonville, Northwest Medical Center in Springdale, a home health agency, and several primary care clinics. The deal, which is subject to normal regulatory reviews and approvals, was expected to close by the end of 1998.

Quorum, the nation's largest hospital management firm, currently owns 18 hospitals and manages 232 facilities in 44 states. In Arkansas, Quorum manages Saline Memorial Hospital (Benton), Delta Memorial Hospital (Dumas), Helena Regional Medical Center, Rebsamen Medical Center (Jacksonville), Chicot Memorial Hospital (Lake Village), Mena Medical Center, Howard Memorial Hospital (Nashville), and Siloam Springs Memorial Hospital, in addition to the Bentonville and Springdale facilities.

UAMS Center for Aging

The University of Arkansas for Medical Sciences (UAMS) broke ground September 2 for a new $18 million center that will focus on healthcare issues facing the elderly. The Donald W. Reynolds Center on Aging will be a four-story, 96,000 square-foot facility that will house one of only two departments of geriatrics in the U.S. The department and the center are being funded through a $29 million gift from the Donald W. Reynolds Foundation of Tulsa. The grant represents the largest donation ever received by the UAMS, which was chosen as the recipient over the University of Oklahoma and the University of Nevada.

David Lipschitz, M.D., who chairs UAMS' Donald W. Reynolds department of geriatrics said the center will be involved not only with treating illnesses associated with aging, but also with helping the elderly to avoid those illnesses. Already UAMS has added to its geriatric education for medical students through the department, which serves between 12,000 and 14,000 patients annually. All third-year medical students now do a four-week rotation in geriatrics. Also, research into Alzheimer's disease, musculoskeletal disease and nutrition and exercise are being conducted.

Lipschitz said the department hopes to establish "centers of excellence in geriatrics" across the state by linking UAMS resources to local communities via telecommunications and other electronic means. That would allow elderly patients in Arkansas to be no more than 50 miles from geriatric care, regardless of where in the state they live.

New Living Will Unveiled

Five Wishes, the first living will to include not only the medical wishes but also the personal, emotional and spiritual wishes of seriously ill persons, was introduced on October 22 by Aging with Dignity, a private, non-profit organization dedicated to affirming and safeguarding human dignity at the end of life. The Five Wishes document, which may be obtained free of charge at http://www.agingwithdignity.org, is legally valid in 33 U.S. states (including Arkansas) and the District of Columbia. This national project is funded in large part by the Robert Wood Johnson Foundation.

In the 17 states where the document is not legally valid, technicalities such as mandatory forms or intimidating mandatory warnings create barriers to filling out living wills. People in those 17 states may still use Five Wishes to put their preferences in writing as a guide to health care providers.

AFMC Project Gets National Attention

A statewide cardiac project initiated by the Arkansas Foundation for Medical Care (AFMC) has resulted in a nearly 60% increase in the use of potentially life-saving drugs called beta blockers by Arkansas physicians. Using data collected in part by AFMC, studies published recently in the New England Journal of Medicine (August 20, 1998) and the Journal of the American Medical Association (August 19, 1998) highlight the importance of beta blocker usage. Beta blockers reduce stress on the heart by lowering blood pressure and heart rate. Studies show that patients receiving beta blockers after a heart attack are 43% to 50% less likely to die in the first two years after an attack than patients who do not receive these drugs.

AFMC collaborated with 62 Arkansas hospitals on the Cardiovascular Cooperative Project, a national project sponsored by the Health Care Financing Administration (HCFA). At the start of the AFMC project in 1995, Arkansas physicians prescribed beta blockers to just 27% of eligible heart attack patients. Similarly, physicians throughout the U.S. under-used the drugs. Considering the proven effectiveness of this drug therapy in preventing cardiac death, experts recommend all eligible patients receive beta blockers after a heart attack. In less than two years, Arkansas patients receiving beta blockers increased from 27% to 43%.

AFMC's project also resulted in a significant increase in the use of aspirin. A single aspirin given at the onset of a heart attack is highly effective in reducing the risk of death from heart attack. Aspirin is also useful in preventing a second heart attack.

Arkansas Hospitals Receive Quality Awards

Nine Arkansas hospitals were among 57 state business organizations receiving Arkansas Quality Awards recently. Arkansas Hospital Association members named as award winners were Drew Memorial Hospital, Monticello; National Park Medical Center, Hot Springs; North Arkansas Regional Medical Center, Harrison; and St. Vincent Infirmary Medical Center, Little Rock, all recipients of Quality Achievement Awards. Baptist Memorial Hospital-Blytheville; Baptist Memorial Hospital-Forrest City; Baptist Memorial Hospital-Osceola; St. Mary's Regional Medical Center, Russellville; and St. Vincent North Rehabilitation Hospital, Sherwood, were each recognized with Quality Commitment Awards.

The awards, which recognize organizations' achievements in implementing quality principles and practices, were presented October 20 by Governor Mike Huckabee during the annual Arkansas Quality Awards ceremony in Little Rock.

LR Study Shows Respiratory Illnesses Kill Fewer Children

According to a study by researchers at Arkansas Children's Hospital, children sent to intensive care units for serious respiratory illness or other diseases stand a better chance of surviving now than in the early 1980s. Researchers found that death rates for those children dropped by 45% between the early and mid-1980s and 1993. Those illnesses, including asthma, bronchitis, and pneumonia, are the most common causes of children's intensive care visits.

The federally sponsored study also showed that death rates for infants less than one month old fell by 39%, and those for other children under a year fell by 28%. Overall, the mortality rate for pediatric intensive care patients fell 15% from the early 1980s to 1993, the study found.

John Tilford, an assistant professor of pediatrics at the University of Arkansas for Medical Sciences, who led the research, said researchers didn't examine the reasons for the decreasing death rates. However, he and another of the study's authors said technological advances and the increasing numbers of critical care specialists since the 1980s have increased the quality of care.

GAO Eyes Healthcare

A recent report from the General Accounting Office (GAO) shows that the nation's healthcare industry is getting the lion's share of scrutiny from the federal Department of Justice. Out of 6,500 civil fraud cases filed in 1997, 4,000 were aimed at healthcare providers. In 1992, the DOJ reviewed only 270 healthcare fraud matters. As of April 1998, about 3,000 hospitals nationwide had received Justice Department letters for recoupment of overpayments related to inappropriate outpatient and laboratory Medicare billings. Almost 2,500 of those have reached settlement agreements with the government.

Budget Bolsters HHS Programs

The new budget for federal fiscal year 1999, agreed on recently by members of Congress, will give programs of the Department of Health and Human Services (HHS) their largest spending increase in seven years. Among the most generously treated government departments, HHS will have about $40 billion to spend in FY 1999, up 10.3% from fiscal 1998 levels. That's about $1.3 billion more than the president requested. The National Institutes of Health (NIH) came away from the budget talks as the big winner, garnering $2 billion of the increased spending. The NIH budget will grow from $13.6 billion to $15.6 billion---a 14% increase that will be used primarily for research.

The federal Centers for Disease Control and Prevention (CDC) will get an extra $187 million to help local health departments strengthen their operations; and an extra $161 million will be available for use in efforts to prepare for reaction to bioterrorism, where terrorists could release diseases like anthrax into U.S. cities. The additional HHS funding does not include money appropriated for federal entitlements like Medicare and Medicaid.

OIG Releases Work Plan

The Department of Health and Human Services' Office of Inspector General (OIG) has released its work plan that details the areas it will investigate for possible fraud and abuse in fiscal year 1999. The OIG listed more than 100 goals in the 104-page document. Among other tasks, the OIG plans to accomplish the following:

• Issuing compliance guidance within the next six months pertaining to independent third-party billing companies, coordinated care plans in the Medicare+Choice program, and durable medical equipment companies.
• Assessing the Health Care Financing Administration's (HCFA) oversight of private accreditation and state certification activities of hospitals, as well as the role of private accreditation and state licensure.
• Determining the extent to which hospitals purchase services "under arrangement," and identifying the services that hospitals purchase most frequently. The OIG previously found Medicare pays substantially more when nursing homes purchase services "under arrangement" from ancillary service providers, such as therapy/rehabilitation agencies, and portable x-ray suppliers.
• Identifying potential vulnerabilities to fraud and abuse arising from the proliferation of provider-based physician practices.
• Increasing the number of "anti-dumping" cases analyzed, negotiated, and litigated.
• Examining nursing homes' response to the new consolidated billing requirements and the guidance that HCFA provided to nursing homes to implement consolidated billing.
• Assessing the effect of the Medicare home health interim payment system on beneficiary access to home health services.

The work plan is posted on the OIG's Web site at www.hhs.gov/progorg under the "what's new" section.

JCAHO Surprise Visits

Organizations accredited by the Joint Commission on Accreditation of Healthcare Organizations (JCAHO) that are suspected of engaging in unethical or fraudulent behavior could be in for a surprise visit from the JCAHO. Even an allegation of fraud may now produce an unannounced survey. In a recently released statement, JCAHO outlined its stance on the issue: "If there are allegations of financial fraud that suggest the quality of care may be affected, the Joint Commission will take quick action to investigate. Depending on the seriousness of the issue, the Joint Commission can perform a for-cause, unannounced survey." In addition, JCAHO requires accredited organizations to uphold an ethical standard. If an organization is convicted of fraud, JCAHO will conduct an on-site assessment of the organization's code of ethics and its implementation policies.

According to Joint Commission officials, three standards can be interpreted as referring to fraudulent behavior. These standards are being invoked in order to give the JCAHO the power to make unannounced surveys. They are:

• Intake and access opportunities (CC.1) deals with decisions made on behalf of the patient regarding types of care, locations of care, or care in itself.
• Patient complaint and advocacy systems (RI.1.3) outlines methods for complaint resolution. Emphasis is placed on thoroughness, follow-through, and reduction of complaint issues by demonstrated practices.
• Hospital plan for patient care delivery covers all facets of the delivery of care in a hospital. Every facet of the delivery system, from the philosophy to the handling of money, is described.

EMTALA Interpretive Guidelines

In June the Health Care Financing Administration (HCFA) issued a set of interpretive guidelines relating to investigations of alleged violations of the Emergency Medical Treatment and Active Labor Act (EMTALA). The guidelines revise section 3400 of HCFA's Medicare State Operations Manual and set standards that HCFA surveyors are to use in determining whether a hospital's actions complied with EMTALA. While the guidelines don't carry the force of law, some may be troublesome to hospitals in Arkansas and across the country because of HCFA's broad interpretation of the act and its rules.

Among its "interpretations," HCFA extends the definition of a hospital emergency room to areas of the hospital apart from the emergency department. Other hospital-owned facilities, both contiguous and non-contiguous to the land on which the emergency department sits, may also be considered as areas where hospital emergency services can be delivered, if they operate under the hospital's Medicare provider number. According to the guidelines, that could include a physician's office, an off-campus clinic, or ambulances owned and operated by the hospital, even if the ambulance is not on hospital grounds.

HCFA's new interpretive guidelines also cover such topics as:

Intrafacility Transfer of Patients--Patients who present to the hospital ER may be sent to other areas of the hospital for services, but only under certain conditions;

• Medical Screening Examination--The exam can range from a brief history and physical exam to a complete work-up, depending on the patient's condition. The key is to assure the screening process is applied in a non-discriminatory manner that is "reasonably calculated to determine whether an emergency medical condition exists."
• Meaning of the Term "To Stabilize"--A patient is deemed "stabilized" if the treating physician has determined "within reasonable clinical confidence" that the emergency medical condition has been resolved.

In addition, the guidelines discuss subjects including psychiatric emergency medical conditions and stabilization; health plan authorization for emergency treatment; maintenance of a central log on all individuals coming to the emergency department; determining when an immediate and serious threat is present; and the prohibition against using a hospital's Plan of Correction for addressing a violation as an admission of the violation.

Arkansas hospitals should review their emergency department policies to ensure they comply with the revised interpretive guidelines. The guidelines are a product of a HCFA task force that worked over a two-year period to address concerns about inconsistencies in the way regional offices and surveyors have interpreted and applied EMTALA rules during investigations of alleged violations.