Mark Hall, JD Interview

February 19, 2019

  • Mark Hall, JD Introduction:  

    • University of Chicago Law School

      • Experience representing for-profit hospitals

    • Professor of Law and Public Health at Wake Forest University

      • Focus on Healthcare, Finance, and Public Policy Issues

 

  • How will HCA impact access to healthcare?

    • Major changes are not expected for the first 10 years

      • Short to medium term, access to care should remain the same

      • Detailed list of services expected to be maintained, though it is possible that some are missing (no major changes)  

    • Following the first 10 years, HCA will likely react to the market and environment

    • HCA likely saw Mission as an appealing hospital system to own and wants to maintain Mission’s path of success (easy decision to purchase vs example of purchasing a distressed hospital and having to renovate)

    • HCA seems committed to pursuing the same projects Mission had planned (ex: new hospitals in Franklin, Asheville, and new tower on main hospital campus)

 

  • How will HCA impact cost of healthcare?

    • Prices are constrained by market and regulatory forces set by medicare and Medicaid, accounting for up to ⅔ of patient volume

    • For-profit hospitals have a track record of being more efficient and reducing costs (opportunity to return profits to shareholders encourages economizing measures)

    • Natural efficiencies to be expected due to larger hospital ownership with centralized back office operations (Nashville HQ)

      • Avoid duplication of basic administrative functions

    • Corporate discounts could actually encourage a win/win (no lose) situation

    • There is no reason to expect HCA to take an unduly restrictive approach to staffing, quality, etc.

    • HCA’s negotiating power is no different than a non-profit system

    • Blue Cross relationship should remain the same

    • HCA does have “charge masters” that are substantially higher than non-profits and patients (not covered by government or charity care) receiving care out of network (covered by auto insurance, etc.) may be impacted (no negotiated discounts)

 

  • How will HCA impact charity care?

    • Common concern switching from non-profit to for-profit system

    • HCA has new policy in place effective as of February 1, 2019

      • Under 200% Federal Poverty Line is free only for emergency care and eligibility is determined only after the bill has been rendered

      • Concerns about implementation: Does it apply to all services or only a select few? How is it administered? Must patients re-qualify every visit or is advanced qualification (federally qualified health center coordinating eligibility process) available?

    • After 10 years: objective benchmark to have a policy at least as generous as the largest non-profit in the state

 

  • How will HCA impact Physicians/Medical Staff?

    • Difficult to predict impact

    • For-profits and nonprofits have more in common than they have not in common (track same dynamics regardless, especially if not physician owned)

    • HCA is committed to maintaining current self-governing staff by-laws (cannot force radical changes on medical staff)

      • A lot of inherent protection and basic independence

    • Contracted physicians may be impacted differently due to expiration of COPA

 

  • How will the expiration of COPA impact providers?

    • Special arrangement in place since mid 90s when Mission merged and acquired St. Joseph Hospital

      • Permitted only if hospital submitted itself to financial oversight to make sure it didn’t misuse market power

    • Oversight and caps were lifted one year ago and now hospital is free to contract with physicians as they choose

    • Difficult to know what to expect, as there are limited examples of COPA expiring in the country

    • HCA may change who they contract with or how they contract as they choose (antitrust law is the only regulatory factor now that COPA has expired)

 

  • What other changes should providers expect following consolidation?

    • Merging/consolidation is a less accurate description than a shift in ownership (all other hospitals owned by HCA are in other states)

    • Although a 10 year commitment has been made, there can be exceptions (if maintaining facility or area of service becomes unreasonable, they can make a change)

      • Important monitoring process has been established consisting of an advisory board appointed with respect to each of the 6 hospitals (1 main, 5 satellite) composed ½ and ½ by HCA and Dogwood Trust and neutral/ independent monitor requested by the attorney general (all must agree that conditions warrant an exception)

    • More resources may become available for health improvement activities (net value of the enterprise is placed into charitable foundation/trust to pursue similar purposes including both Dogwood foundation and other smaller, local foundations

      • Dogwood promised to tackle Social Determinants of Health

    • Enterprise is now taxable which could potentially improve infrastructure  

 

  • How can providers stay informed about ongoing changes related to HCA?  

    • Public record to be created that providers can observe and/or contribute to

    • Physicians are subject to antitrust rules and do not have any new negotiating power with this change

    • Public oversight process is a safe, available way to voice concerns, collect information, and have input

    • Antitrust rules constrain hospitals and individual providers can consult with antitrust lawyers

 

  • Do you have any comments about Medicaid Transformation and the reveal of managed care companies selected to run Medicaid in North Carolina?  

    • North Carolina is the largest state to previously not have Medicaid managed care

    • 4 companies selected to offer Medicaid managed care throughout the state

      • Blue Cross

      • United

      • AmeriHealth

      • WellCare

    • Medicaid managed care legislation originally called for a mix of commercial health insurers and provider led intenties and ended up with substantially fewer of those than expected

      • Commercial health plans were selected over plans managed by doctors and providers

        • Ex: Carolina Complete Health: Physician Based Plan by NCMS & NCACHS (regional plan in Charlotte Area) denied for statewide bid but accepted for Charlotte regional coverage

          • Another plan sponsored by several hospital systems in the state was denied entirely

    • New contracting dynamics at play

      • Unclear how change will impact rates

      • Possibility for more value based contracts, risk sharing arrangements, etc.

      • Expected to unfold quickly because enrollment begins in the fall and contracts will be completed over the next few months

    • For clarification: Medicaid transformation only impacts currently qualified patients and does not equal Medicaid expansion

      • The hope is that transformation will lead to expansion

 

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