THIS WEEK IN U.S. DOMESTIC MEDICAL TRAVEL™
Volume 1, Issue 7
The defining year for health reform implementation is upon us. Many employers are making hard decisions regarding benefits and coverage for their workforce, with some opting to eliminate existing plans and place employees into a state or federal health insurance exchange.
Healthcare industry veteran, Thomas Johnston, discusses how EmployerDirect Healthcare's value-based healthcare model can help self-insured employers keep their plans with SurgeryPlus - a solution that incorporates medical travel programs and has the potential to appeal to business leaders.
I have had an inquiry from an employer in the U.S. who has employees living in Australia and the UK, and is seeking high quality, lower cost executive physicals in each of those destinations. Please be in touch if you or a colleague would like to participate in delivering this level of care.
Thank you for your interest in this exciting, growing market space. Please be in touch with your comments and editorial contributions, which can be sent directly to: editor@USDomesticMedicalTravel.com.
Editor and Publisher
SPOTLIGHT: Thomas Johnston, CEO, EmployerDirect Healthcare
Employer Direct Healthcare, a leader in value-based healthcare, transforms the way self-funded employer health plans purchase healthcare for their members, saving 30-50 percent on planned medical procedures with the potential to reduce total plan cost by 6-10 percent. The company also offers unique medical concierge service that assists covered members with selecting a provider, scheduling a procedure, transferring medical records, coordinating travel logistics and negotiating surgery costs before the surgery occurs. For more information about EmployerDirect, please visit www.edhc.com or call (512) 651-5551.
U.S. Domestic Medical Travel (USDMT): Explain how your model differs from others that have been looking at this opportunity to marry employers to specific Centers of Excellence?
Thomas Johnston (TJ): We offer self-funded employers a supplemental benefit, SurgeryPlus, which enables employers to keep their current health plans in place, but allows us to cover planned medical procedures.
We cover orthopedic cases, spine surgeries and general surgeries, and are beginning to see a rise in cardiac cases, such as valve operations and other procedures.
In comparison to other models, our model utilizes care coordinators who are assigned to each member when they initially call in.
The care coordinator helps the member find a provider, schedule the appointment, transfer medical records and ensure the patient understands the entire process from start to finish.
USDMT: How do you approach the employer market -- do you have a sales force in place?
TJ: We do have a sales force that is growing as we speak.
We approach our channel partners, the brokers that assemble the benefit packages for large self-funded employers, such as Towers Watson, Mercer, Buck Consulting and so on.
Our average employer has 13,500 members and that includes dependents, as well.
USDMT: How many lives do you cover now?
TJ: Currently, we cover 130,000 lives.
We have a few potential clients with over 100,000 lives looking at us for implementation as of Jan. 1, 2014.
We are anticipating two million lives by 2015.
USDMT: Tell me about your provider network.
TJ: We are a national company, and our network is national.
We have done cases in 38 states and have 300+ contracted providers in those states.
We have proved our model to employers by handling such a large number of cases and still providing our bundled rates, which offer anywhere from a 30-50 percent discount after their regular plan discount.
Our bundled rates include anything that occurs between admission to discharge, including the initial consultation, surgeon, anesthesiologist, assistant surgeon or CRNA, any medications, physical therapy, diagnostics, pharmaceutical needs, and two or three follow-up appointments.
USDMT: Is your provider network primarily hospitals? Surgery centers? Physician-owned facilities?
TJ: Roughly 80 percent of our cases are done in outpatient surgery centers, and a lot of the facilities are physician-owned -- or at least partially physician-owned.
We have quite a few physician-owned hospitals, physician contracts and ambulatory surgery center contacts, as well.
USDMT: Typically, how far does a patient have to travel to get to a facility that is in your network?
TJ: Roughly 60 percent of patients will travel 30-60 miles to get to a facility in our network, 30 percent of patients will travel 60-100 miles, and the last 10 percent will travel over 200 miles.
The first question we ask our members when they call is, "How far are you willing to travel?" Based upon the member's response, we will find a location within that proximity.
As we continue to pick up more lives and have our sites of excellence set up, we anticipate roughly 20 percent of members will be willing to get on a plane and travel further distances.
USDMT: Do you foresee sending patients outside the U.S.?
TJ: No, and that is because when the cost of traveling internationally is totaled, our pricing is equally as good.
That's not to say that there isn't great quality of care abroad, but from a cost or quality standpoint we don't feel the need to send patients outside the country.
We've had companies from Canada call us that are interested in sending patients into the U.S. to experience our bundled pricing.
USDMT: Regarding quality, how do you choose the providers?
TJ: First and foremost, 100 percent of our physicians must be board certified.
We research the provider's quality measures and outcomes, fellowship area, patient satisfaction rates and malpractice history.
We look for high-volume surgeons because we discovered these surgeons yield the best quality care.
We also look at all the national accreditations - Leap Frog, Delta Check, Delta Group Care Check, etc.
USDMT: Do you think the new Affordable Care Act will impact your model?
TJ: We think the Affordable Care Act will actually help us.
The self-funded market is going to decrease because there will be employers that may decide not to provide health insurance for their workers anymore.
However, the self-funded arena consists of approximately 150 million people. Even if 20 million left the self-funded market, there's still 130 million people under self-funded plans.
Employers don't have employees located just in one area. Out of our 130,000 lives, the most lives one of our employers has in one area are roughly 1,200.
One accountable care organization (ACO) won't be able to handle all of that employer's employees - they will need something like our model, which has a national network, to take care of their employees.
USDMT: Is there anything that differentiates you from a third party administrator (TPA) that you would like to point out?
TJ: We pay the claims and directly invoice the client - which includes the bundled rate -- and our transparency pricing, including all travel fares.
The client will then pay us and we pay the provider within 7-10 days of the procedure.
EMPLOYERDIRECT HEALTHCARE WELCOMES THOMAS D. JOHNSTON AS ITS NEW CEO
Healthcare industry veteran has more than 26 years of management experience and a strong track record working with emerging healthcare companies
EmployerDirect, a leader in value-based healthcare that helps large, self-insured employers improve the quality of their employees planned medical procedures while reducing costs, is pleased to announce that Thomas D. Johnston, J.D., has been appointed as its new CEO. Mr. Johnston has more than 26 years of healthcare management experience and a strong track record working with emerging companies.
"EmployerDirect is fortunate to have Thomas Johnston join the company at this exciting time in its development. His overall healthcare industry experience and background as a hospital and physician group leader, lawyer and management consultant, make him the ideal executive to help fuel the company's growth," said Philip Sanger, M.D., Employer Direct Healthcare chief medical officer and general partner with TEXO Ventures.
Prior to joining EmployerDirect, Mr. Johnston most recently served as vice president at Paragon Health and as a director at Navigant Consulting's Healthcare Division. During his tenure at Navigant, he developed and led multiple facets of new healthcare business partnerships, including areas such as overseeing strategies for new business development, managing physician real estate holdings and construction projects, while having responsibilities for profit and loss in many healthcare joint ventures.
Previously, Mr. Johnston also gained experience serving as CEO of Cardiothoracic & Vascular Surgeons, PA of Austin, Texas for over 14 years - this group eventually gained national prominence as a partner in the development of the "Heart Hospital of Austin."
Mr. Johnston also served as vice president of Eisenhower Medical Center in Rancho Mirage, Calif., where he managed the integration of several large specialty physician practices working in 10 medical clinics throughout the California desert region. He also served as president for both the Texas Medical Group Management Association and Surgical Leadership Alliance, and co-founded the Capital City Medical Group Administrators.
"I am very excited to lead the team at EmployerDirect Healthcare," said Johnston. "This company has the opportunity to fundamentally change the way large, self-insured employers offer healthcare coverage to their employees. There is national focus on reducing healthcare costs while still improving the quality. Based on my experience in the industry, I know this can be done. This is the future of healthcare. Patients have a right to know about the quality and the costs of healthcare in a transparent way so they can make better choices for their care."
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SurgeryPlus from EmployerDirect Reduces the Costs of Planned Medical Procedures by 30-50 Percent
Helps large, self-insured employers improve the quality of their employees' planned medical procedures and negotiates all costs prior to surgery
EmployerDirect, a leader in value-based healthcare that helps large, self-insured employers improve the quality of their employees' planned medical procedures, is pleased to announce that it now offers SurgeryPlus, a supplemental healthcare benefit that reduces the costs of planned medical procedures by 30-50 percent through bundled case rates at high-quality providers. SurgeryPlus is implemented by a personalized care coordinator team and negotiates all costs prior to surgery, thereby empowering patients in the decision-making process. All surgeons in the SurgeryPlus Network are also required to be board certified and meet strict selection criteria. It's an easy overlay to any existing medical plan and offers an expanded choice of providers within the medical plan.
"SurgeryPlus allows companies to drastically lower the cost of quality care, which is a benefit to the employer's bottom line that can be passed down to employees. It also helps physicians build their practices by providing new patients through direct referrals of new surgical volume," said Thomas Johnston, EmployerDirect CEO. "We emphasize and deliver quality over all other aspects, resulting in better outcomes for patients."
SurgeryPlus offers bundled case rates for planned medical procedures by pre-negotiating and consolidating all costs before surgery, including surgeon, assistant surgeon, anesthesia fees, facility costs, inpatient diagnostics, therapy and pharmacy. The covered procedures are mostly elective and include orthopedic, spine, cardiovascular, bariatric, general surgery and carpel tunnel surgeries, along with minor outpatient procedures such as colonoscopy, endoscopy and arthroscopy. Each procedure is implemented by the care coordinator, who acts as a personal assistant for each member. Care coordinators help select a SurgeryPlus provider, schedule appointments, aid in transferring medical records, manage travel logistics for patients when necessary, and supervise a member satisfaction survey. SurgeryPlus is receiving overwhelming positive feedback from members.
"A unique advantage with SurgeryPlus is that we select specific physicians to provide extraordinary care for members," said Philip Sanger, M.D., EmployerDirect chief medical officer and a founder of Healthspring Medicare Advantage Program. "Our complication rate has proven to be best-in-class without any readmissions or mortalities, which confirms that selecting quality surgeons is one of SurgeryPlus's differentiators among healthcare plans."
Surgery sites are selected with equally high criteria. Most of the procedures are performed at specialty hospitals and surgery centers, where nurse-to-patient ratios and service is better, and exposure to patients with multiple medical issues is not present. Patients at high risk for a procedure like a heart valve repair or replacement receive direct access to acute care hospital with SurgeryPlus. EmployerDirect collects data on local hospitals, physician-owned hospitals and ambulatory surgery centers, and looks at quality comparison analysis at each site as specific to each specialty when selecting medical centers.
Medicare Identifies 97 Best and 95 Worst Hospitals for Hip and Knee Replacements
by Jordan Rau
Kaiser Health News - Medicare has begun tracking the outcomes of hip and knee replacement surgeries, identifying 95 hospitals where elderly patients were more likely to suffer significant setbacks. The government also named 97 hospitals where patients tended to have the smoothest recoveries.
The analysis, which was released last week, is the latest part of the government's push to improve quality at the nation's hospitals instead of simply paying Medicare patients' bills. Medicare already assesses hospital death rates, how consistently hospitals follow basic medical guidelines and how patients rate their stays. The evaluation of hip and knee surgery outcomes is significant because for the first time, Medicare is rating hospitals' performance on two common elective procedures.
Many patients needing joint replacements want to know a hospital's record when choosing where to have the procedure done. This is not usually the case for treatment of conditions Medicare has evaluated previously, such as heart attacks.
Of the 95 hospitals where knee and hip surgery patients experienced difficulties after the operation, nine were rated having both high readmissions and high complication rates. Those hospitals were: Froedtert Hospital in Milwaukee; Grant Medical Center in Columbus, Ohio; Mercy St. Anne Hospital in Toledo, Ohio; Northwestern Memorial Hospital in Chicago; the Pennsylvania Hospital of the University of Pennsylvania Health System in Philadelphia; Peterson Regional Medical Center in Kerrville, Texas; Reston Hospital Center in Reston, Va.; Shannon Medical Center in San Angelo, Texas, and Southside Regional Medical Center in Petersburg, Va.
Some of those hospitals complained Monday that Medicare's assessments were outdated since they covered operations between July 2009 through June 2012. A spokeswoman for Shannon Medical Center said the hospital has improved since then, adding better technology and opening a clinic to follow up with patients seven days after leaving. A spokeswoman for Southside Regional Medical Center said that the hospital adopted a new treatment model in 2012 for joint and spine patients and that their outcomes have "drastically improved."
Medicare was cautious in how it marked hospitals, only categorizing them as outliers when their records in hip and knee replacements were statistically different from the national average. The overwhelming majority of hospitals-about 19 out of 20-were branded average, a Kaiser Health News analysis found.
Out of the 97 hospitals that did better than average in avoiding either readmissions or complications, 25 were rated as being better at both measures. Those included some big hospitals such as Sutter General Hospital in Sacramento, Calif., and the Hospital for Special Surgery in Manhattan. They also included some local hospitals such Holy Cross Hospital in Fort Lauderdale, Fla., and several physician-owned hospitals that specialize in these types of surgeries, such as Arkansas Surgical Hospital in Little Rock.
About 600,000 patients in the traditional Medicare program have their hips or knees replaced each year. The growing popularity of these operations has made them a more significant expense for Medicare and private insurers. In 2010, there were 719,000 knee replacements costing nearly $12 billion and 332,000 hip replacements nearly $8 billion, according to the National Center for Health Statistics.
Medicare published the new outcomes data on its Hospital Compare website. While few consumers use that site, this information may reach a greater audience later on through groups and publications, such as Consumer Reports, that tap Medicare's data in devising their own hospital ratings.
"With elective procedures, consumers like to do a lot of research to pick the right doctor and the right hospital, so this is a good first step," said Leah Binder, CEO of the Leapfrog Group, a non-profit funded by employers that judges hospital quality. However, she said the new ratings would be of limited use for most patients because the Centers for Medicare & Medicaid Services judged most hospitals' performance as normal.
"We know there's a significant variation among hospitals, but CMS reports them all as average," Binder said.
Hospitals may soon feel a financial pinch from the evaluations. Medicare plans to add hip and knee readmission rates to the criteria it uses when deciding whether to penalize hospitals each year.
Since October, Medicare has been paying less than it normally does to 2,225 hospitals after determining their rates of rebounds for patients with pneumonia, heart attacks and heart failure were too high, even by a small amount. Starting in the fall of 2014, when the joint replacements are to be factored into the penalty program, hospitals are at risk of losing as much as three percent of Medicare payments for each patient stay.
In its new evaluation of hip and knee replacement patients, Medicare used two measures. One was how often the patients ended up being readmitted to the hospital within 30 days of discharge. The other was how often they suffered one of eight complications after the operation. Those included a heart attack, pneumonia, sepsis or shock within seven days of admission. They also included bleeding at the site of the surgery, a blood clot in the lung or death within a month of admission. Medicare also counted mechanical complications with implants and infections of the joint or wound within 90 days of admission.
The quality of joint implants has been under scrutiny for several years. Some of the surgical devices have been plagued by quality problems, especially among artificial hips made of interlocking metal parts. The friction created by these joints can create metal debris that damages the surrounding flesh and bone. Two manufacturers have recalled their devices since 2010.
Problems Are Declining
Nationwide, the number of readmissions following hip and knee replacement surgeries has been dropping, but not as quickly as readmission rates for heart attack, heart failure or pneumonia patients, according to a Medicare-commissioned study by the Yale New Haven Health Services Corporation Center for Outcomes Research and Evaluation.
Dr. Eric Coleman, an expert on readmissions at the University of Colorado Anschutz Medical Campus, said some hospitals are trying to prevent joint replacement patients from returning by educating them ahead of the surgeries about how to take care of themselves and warning signs of problems. This program provides "a chance to walk you through what to expect, what your family would expect, how to arrange your home," Coleman said. "In most of the cases of readmission reductions, we're still very reactive."
Hospitals' clientele appears to play some role in how they fared after these surgeries. The outcomes for hip and knee replacements tend to be slightly worse for hospitals that serve a high proportion of Medicaid patients, according to the Yale study. The study also found that hospitals where more than one out of every five patients were African-American tended to have slightly higher complication and readmission rates than did hospitals with no black Medicare patients. However, the report noted, some of these hospitals serving large numbers of Medicaid or black patients also performed very well.
These kind of racial and economic disparities in readmissions have long troubled health policy experts. Some hospitals mostly cater to prosperous patients who have the money, resources and education to get necessary post-surgical care after discharge. But safety net hospitals often have a harder time ensuring that low-income, less educated people follow the often complex instructions about how to recover from a major surgery or hospitalization.
In Medicare's new analysis, on average, hip and knee patients had a 5.4 percent chance of having to return to the hospital. Nationally, the average complication rate for patients after hip and knee replacement surgery was 3.4 percent. One hospital, Beaumont Health System in Royal Oak, Mich., had a mixed record: Patients there were more likely to be readmitted but less likely to suffer serious complications.
Hospital-Wide Readmissions Published
The government last week also released its first ratings of how often Medicare patients of all diagnoses returned to hospitals within 30 days. That "all cause" measure is more encompassing than Medicare's appraisals based on heart attack, heart failure and pneumonia. A number of prominent experts, including Congress' Medicare Payment Advisory Commission, have been pushing for this measure to be used in setting financial penalties for hospitals.
Medicare's analysis found that 16 percent of Medicare patients ended up returning to a hospital within 30 days between July 2011 through June 2012. Again rates varied significantly. At 364 hospitals, or eight percent, patients were more likely than average to return within a month, according to the data. These included the Cleveland Clinic, as well as the clinic's hospital in Weston, Fla.; both of Johns Hopkins's hospitals in Baltimore; and New York-Presbyterian Hospital in Manhattan.
Medicare did not count cases where the patient was scheduled to return to the hospital, such as when a lung cancer patient was admitted for pneumonia and later came back for a chemotherapy treatment that had been planned. Medicare calculated that patients were less likely than average to end up back for any reason at 315 hospitals, or seven percent of the nation's total.
Nancy Foster, an executive with the American Hospital Association, said that tracking hospital-wide readmissions was of limited value to hospitals that wanted to do better. "Most of the interventions you would use are built and targeted around particular conditions," she said. "You have to know what's driving patients back into the hospital to address the problem. When you get this lump of all-cause readmissions, you don't know what to go after."
KHN reporters Ankita Rao and Marissa Evans contributed.
This article was produced by Kaiser Health News with support from The SCAN Foundation.
Kaiser Health News is an editorially independent program of the Henry J. Kaiser Family Foundation, a nonprofit, nonpartisan health policy research and communications organization not affiliated with Kaiser Permanente.
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Google's and Cleveland Clinic's .Med Top Level Domains Rejected
by Andrew Allemann
Panel determines .med would create likelihood of detriment to medical community.
Internet powerhouse Google and one of the world's most respected health institutions, The Cleveland Clinic, have both seen their hopes for operating a .med top level domain name dashed by an arbitration panel.
Both parties were on the losing end of community objections filed by Independent Objector Alain Pellet as part of the new top level domain name objection process.
International Chamber of Commerce arbitration panelist Fabian von Schlabrendorff ruled that "med," short for "medical," represents a clearly delineated community that would face a likelihood of material detriment should either Google or Cleveland Clinic be delegated the .med top level domain name.
This decision is consistent with another arbitration panel's ruling against Donuts' bid for .medical.
The Independent Objector also filed Limited Public Interest objections against Google, Cleveland Clinic, HEXAP. He lost all of those objections.
Because HEXAP filed its application as a community application, Pellet did not file a community objection against it. Therefore, assuming ICANN does not create a way to reverse panel decisions, only HEXAP's .med application continues.
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St. Louis Leads State in Medical Tourism Impact
by Samantha Liss
Bizjournals.com - Medical tourism contributed $1.6 billion to the state's overall economy in 2012.
And the St. Louis metropolitan area leads the way for attracting out-of-state patients. Medical tourism in St. Louis contributed $902.5 million to the state's economy, according to a report from the Missouri Hospital Association (MHA), and 12 percent of all hospital services in the St. Louis area were provided to non-residents in 2012.
Overall, 47,901 individuals from out-of-state were discharged as inpatients from St. Louis hospitals in 2012 compared with the 413,930 out-of-state, outpatient visits in the area - the most of any region in the state, including Kansas City.
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