Monday, July 22, 2002
Proposed Transfer Policy Could Cost Hospitals $2 Million
Hospitals stand to lose between $900 million and $1.9 billion in fiscal year 2003 alone under a proposal from the Centers for Medicare & Medicaid Services (CMS) to expand the post-acute care transfer policy.

Currently, patients in 10 Diagnosis Related Groups (DRGs) that are most likely to utilize post-acute care services are defined as transfer cases, not discharges, if they are sent from an acute care hospital to a post-acute care setting - rehabilitation, psychiatric, skilled nursing facility or home health care - after less than the national average length of stay (LOS). Hospitals then receive a per-diem, per day payment, rather than the full fixed DRG rate.

The proposed rule for the FY2003 Inpatient Prospective Payment System (PPS) would either expand the post-acute care transfer policy to include an additional 10-13 DRGs, costing hospitals $916 million, or expand the policy to all DRGs, a cut of $1.9 billion. Thus the proposed policy would penalize hospitals that have achieved efficiencies in health care delivery and would also violate the principal that the PPS system is based on a system of averages - a longer LOS receives a lower payment while a shorter LOS receives a higher payment.

OHA is asking Congress to contact CMS and oppose the proposed transfer policy expansion. Hospitals are encouraged to call their members of Congress and urge them to oppose the proposal as soon as possible since CMS is expected to make a final decision on the proposal by Aug. 1. (Charles Cataline, charlesc@ohanet.org)

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Tuesday, July 23, 2002
Maternity Licensure Rules Revised
The Ohio Department of Health (ODH) last week posted to its Web site the proposed Maternity Licensure Rules and is soliciting comments, which can be submitted to ODH until Sept. 3. The rules will then proceed to the Public Health Council in October. Major changes were made to align the quality rules and maternity licensure rules such as moving all equipment/supply rules to the licensure rules and removing care/service rules from licensure rules. To review the proposed rules, visit www.odh.state.oh.us/, select “Rules and Regulations,” then “Draft Rules.” Please forward any comments or concerns to Rosalie Weakland, rosaliew@ohanet.org, or Jean Scholz, jeans@ohanet.org, or call 614.221.7614.

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Thursday, July 25, 2002
Troubled Renaissance Health Plan To Sell
Renaissance Health Plan has notified providers of its intent to sell its operations to an unnamed buyer in the next several months. Renaissance will use the sale proceeds to pay medical claims and other liabilities. In a letter to providers dated July 24, Renaissance says the “potential buyer is a financially stable company that has an excellent track record of service to members and providers.” Renaissance participating providers may be contacted by the buyer through its due diligence process as it proceeds next month.

As of July 1, Renaissance had 36,263 Medicaid enrollees in Cuyahoga, Summit and Lorain counties. Renaissance withdrew from the Medicare managed care market at the end of 2001 and is in the process of phasing out all commercial business over the next year. Key management personnel, including the president and chief executive officer, were replaced in mid-May. Cleveland-area providers have reported delays in claims payment by the troubled health plan.

A group of investors led by New York venture capital firm Emigrant Capital purchased the HMO, then called Emerald HMO, in 2000. Annual reports filed with the Ohio Department of Insurance (ODI) have shown a decrease in net worth from $4,105,385 in 2000 to $891,953 in 2001.

OHA has been in contact the past several months with ODI and Renaissance’s legal counsel and will continue to follow the progress of Renaissance closely. (Mary Gallagher, mailto:maryg@ohanet.org)

Hospital Association Warns Against False Survey Calls
The Minnesota Hospital and Healthcare Partnership (MHHP) is warning health facilities nationwide to be on the lookout for false Medicare survey calls to hospitals. The hospital association knew of at least one hospital that received a call at 4 a.m. local time from a “Medicare after-hours assessment surveyor.” The surveyor asked a nurse on duty how the health practitioner would respond to a fractured leg or chest pain. Hospital officials then checked with the Minnesota State Department of Health, which conducts the surveys, and the Centers for Medicare & Medicaid Services and were told no such survey is being conducted. Association officials said the call might stem from advocacy groups who are using illegal tactics to gain information on hospital operations. Any Ohio hospital receiving a similar call is asked to notify Rosalie Weakland at OHA at rosaliew@ohanet.org or 614.221.7614. (Rosalie Weakland, rosaliew@ohanet.org)

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(Editor’s note: The news clips are being password-protected on the OHA Web site. OHA members will be notified separately of the password. HEALTH e-NEWS Plus subscribers can still access news clips through the daily e-mail without a password.)