Last Tuesday (April 23), the Federal Trade Commission (FTC) issued a 570-page final rule in a partisan 3-2 vote prohibiting employers from binding most American workers to post-employment non-competition agreements (the “Final Rule”):
“Pursuant to sections 5 and 6(g) of the Federal Trade Commission Act (“FTC Act”), the Federal Trade Commission (“Commission”) is issuing the Non-Compete Clause Rule (“the final rule”). The final rule provides that it is an unfair method of competition—and therefore a violation of section 5—for persons to, among other things, enter into non-compete clauses (“non-competes”) with workers on or after the final rule’s effective date. With respect to existing non-competes—i.e., non-competes entered into before the effective date—the final rule adopts a different approach for senior executives than for other workers. For senior executives (in policy setting/executive positions who earned more than $151,164 last year), existing non-competes can remain in force, while existing non-competes with other workers are not enforceable after the effective date.” (p.1)
“Concerns about non-competes have increased substantially in recent years in light of empirical research showing that they tend to harm competitive conditions in labor, product, and service markets. … When a company interferes with free competition for one of its former employee’s services, the market’s ability to achieve the most economically efficient allocation of labor is impaired. Moreover, employee-noncompetition clauses can tie up industry expertise and experience and thereby forestall new entry… competes by employers tends to negatively affect competition in labor markets, suppressing earnings for workers across the labor force—including even workers not subject to noncompete. This research has also shown that non-competes tend to negatively affect competition in product and service markets, suppressing new business formation and innovation… Yet despite the mounting empirical and qualitative evidence confirming these harms and the efforts of many States to ban them, non-competes remain prevalent in the U.S. economy. Based on the available evidence, the Commission estimates that approximately one in five American workers—or approximately 30 million workers—is subject to a non-compete. The evidence also indicates that employers frequently use non-competes even when they are unenforceable under State law.” (p.6)
On its home page, the FTC says “with a comprehensive ban on new non-competes, Americans could see an increase in wages, new business formation, reduced health care costs and more.”(www.ftc.gov)
The rule takes effect 120 days following its publication in the Federal Register and is applicable to every employer including specified operations in not-for-profit organizations (which represents the majority of hospitals, nursing homes and others). The agency noted it received 26,000 comment letters since the proposed rule was published January 19, 2023 including significant reaction from healthcare organizations. By the end of last week, two lawsuits were filed: one by the Chamber of Commerce in the United States District Court for the Eastern District of Texas and the second by a global tax services and software company in the Northern District of Texas – each challenging the Final Rule and arguing that the FTC lacked the authority. Others are likely to follow and its implementation will be delayed as arguments about its merits and the FTC’s standing to make the rule find their way thru the courts.
Special attention to hospitals and physicians in the rule
Notably, the use of non-competes in healthcare is a central theme in the rule, particularly in tax-exempt hospital and medical practice settings. Noting that one in 5 workers (30 million) and up to 45% of physicians work under non-compete agreements today, the Commissioners illustrated the need for the rule by inserting vignettes from 14 workers in their introduction: 4 of these were healthcare workers– 2 physicians and employees of a hospital and electronic health record provider (p.11-13). Throughout its exhaustive commentary, the Commissioners took issue with assertions by healthcare organizations about the potential negative consequences of the rule citing lack of empirical evidence to justify opposition claims. References to tax-exempt hospitals, their for-profit activities and their employment arrangements with physicians are frequent in the commentary justifying the application of the rule as follows:
“Many commenters representing healthcare organizations and industry trade associations stated that the Commission should exclude some or all of the healthcare industry from the rule because they believe it is uniquely situated in various ways. The Commission declines to adopt an exception specifically for the healthcare industry. The Commission is not persuaded that the healthcare industry is uniquely situated in a way that justifies an exemption from the final rule. The Commission finds use of non-competes to be an unfair method of competition that tends to negatively affect labor and product and services markets, including in this vital industry; the Commission also specifically finds that non-competes increase healthcare costs. Moreover, the Commission is unconvinced that prohibiting the use of non-competes in the healthcare industry will have the claimed negative effects.” (p.303)
Not surprisingly rule, responses from the hospital trade groups were swift, direct and harshly critical:
- American Hospital Association (www.aha.org):” The FTC’s final rule banning non-compete agreements for all employees across all sectors of the economy is bad law, bad policy, and a clear sign of an agency run amok. The agency’s stubborn insistence on issuing this sweeping rule — despite mountains of contrary legal precedent and evidence about its adverse impacts on the health care markets — is further proof that the agency has little regard for its place in our constitutional order. Three unelected officials should not be permitted to regulate the entire United States economy and stretch their authority far beyond what Congress granted it–including by claiming the power to regulate certain tax-exempt, non-profit organizations. The only saving grace is that this rule will likely be short-lived, with courts almost certain to stop it before it can do damage to hospitals’ ability to care for their patients and communities.”
- Federation of American Hospitals (www.fah.org): “This final rule is a double whammy. In n a time of constant health care workforce shortages, the FTC’s vote today threatens access to high-quality care for millions of patients.”
By contrast, the American Medical Association (www.ama-assn.org) response was positive, linking its support for the rule to AMA’s ethical principles of physician independence and clinical autonomy.
Four implicit messages to healthcare are evident in the rule
It is unlikely the rule will become law in its current form. Opposing trade groups, employers dependent on non-competes for protections of trade secrets and business relationships and many others will actively pursue its demise in courts actions. But a review of the text makes clear the FTC is intensely focused on competition and consumer protections in healthcare akin to its ongoing challenges to hospital consolidation.
Four messages emerge from the text of the rule:
1-‘The healthcare industry is a business which needs more regulation to protect consumers and its workforce by lowering costs and stimulating competition. ‘
“Many commenters representing healthcare organizations and industry trade associations stated that the Commission should exclude some or all of the healthcare industry from the rule because they believe it is uniquely situated in various ways. The Commission declines to adopt an exception specifically for the healthcare industry. The Commission is not persuaded that the healthcare industry is uniquely situated in a way that justifies an exemption from the final rule. The Commission finds use of non-competes to be an unfair method of competition that tends to negatively affect labor and product and services markets, including in this vital industry; the Commission also specifically finds that non-competes increase healthcare costs. Moreover, the Commission is unconvinced that prohibiting the use of non-competes in the healthcare industry will have the claimed negative effects.” (p.373)
2-‘Physicians play a unique role in healthcare and deserve protection.’
“Some healthcare businesses and trade organizations opposing the rule argued that, without non-competes, physician shortages would increase physicians’ wages beyond what the commenters view as fair. The commenters provided no empirical evidence to support these assertions, and the Commission is unaware of any such evidence. Contrary to commenters’ claim that the rule would increase physicians’ earnings beyond a “fair” level, the weight of the evidence indicates that the final rule will lead to fairer wages by prohibiting a practice that suppresses workers’ earnings by preventing competition; that is, the final rule will simply help ensure that wages are determined via fair competition. The Commission also notes that it received a large number of comments from physicians and other healthcare workers stating that non-competes exacerbate physician shortages.” (p.157)
“Hundreds of physicians and other commenters in the healthcare industry stated that non-competes negatively affect physicians’ ability to provide quality care and limit patient access to care, including emergency care. Many of these commenters stated that non-competes restrict physicians from leaving practices and increase the risk of retaliation if physicians object to the practices’ operations, poor care or services, workload demands, or corporate interference with their clinical judgment. Other commenters from the healthcare industry said that, like other industries, non-competes bar competitors from the market and prevent providers from moving to or starting competing firms, thus limiting access to care and patient choice. Physicians and physician organizations said non-competes contribute to burnout and job dissatisfaction, and said burnout negatively impacts patient care.” (p.202)
“…the Commission notes that while the study finds that non-competes make physicians more likely to refer patients to other physicians within their practice—increasing revenue for the practice—it makes no findings on the impact on the quality of patient care. The Commission further notes that pecuniary benefits to a firm cannot justify an unfair method of competition.” (p.206)
3.’Tax exempt hospitals that operate like for-profit entities deserve special scrutiny from regulators and are thus subject to the rule’s provisions.’
“Merely claiming tax-exempt status in tax filings is not dispositive. At the same time, if the Internal Revenue Service (“IRS”) concludes that an entity does not qualify for tax-exempt status, such a finding would be meaningful to the Commission’s analysis of whether the same entity is a corporation under the FTC Act.” (p.53)
“As stated in Part II.E, entities claiming tax exempt status are not categorically beyond the Commission’s jurisdiction, but the Commission recognizes that not all entities in the healthcare industry fall under its jurisdiction. “(p.374)
“While the Commission shares commenters’ concerns about consolidation in healthcare, it disagrees with commenters’ contention that the purported competitive disadvantage to for-profit entities stemming from the final rule would exacerbate this problem. As some commenters stated, the Commission notes that hospitals claiming tax-exempt status as nonprofits are under increasing public scrutiny. Public and private studies and reports reveal that some such hospitals are operating to maximize profits, paying multi-million-dollar salaries to executives, deploying aggressive collection tactics with low-income patients, and spending less on community benefits than they receive in tax exemptions.943 Economic studies by FTC staff demonstrate that these hospitals can and do exercise market power and raise prices similar to for-profit hospitals.944 Thus, as courts have recognized, the tax-exempt status as nonprofits of merging hospitals does not mitigate the potential for harm to competitive conditions.” (p.383)
“Conversely, many commenters vociferously opposed exempting entities that claim tax exempt status as nonprofits from coverage under the final rule. Several commenters contended that, in practice, many entities that claim tax-exempt status as nonprofits are in fact “organized to carry on business for [their] own profit or that of [their] members” such that they are “corporations” under the FTC Act. These commenters cited reports by investigative journalists to contend that some hospitals claiming tax-exempt status as nonprofits have excess revenue and operate like for-profit entities. A few commenters stated that consolidation in the healthcare industry is largely driven by entities that claim tax-exempt status as nonprofits as opposed to their for-profit competitors, which are sometimes forced to consolidate to compete with the larger hospital groups that claim tax-exempt status as nonprofits. Commenters also contended that many hospitals claiming tax-exempt status as nonprofits use self-serving interpretations of the IRS’s “community benefit” standard to fulfill requirements for tax exemption, suggesting that the best way to address unfairness and consolidation in the healthcare industry is to strictly enforce the IRS’s standards and to remove the tax-exempt status of organizations that do not comply. An academic commenter argued that the distinction between for-profit hospitals and nonprofit hospitals has become less clear over time, and that the Commission should presumptively treat hospitals claiming nonprofit tax-exempt status as operating for profit unless they can establish that they fall outside of the Commission’s jurisdiction.” (p.377-378)
“After carefully considering commenters’ arguments, the Commission declines to exempt for-profit healthcare employers or to exempt the healthcare industry altogether.” (p.380)
4. ‘The net impact of non-compete agreements is harmful to the workforce and the public. ‘
“The Commission finds that with respect to these workers, these practices are unfair methods of competition in several independent ways:
- The use of non-competes is restrictive and exclusionary conduct that tends to negatively affect competitive conditions in labor markets.
- The use of non-competes is restrictive and exclusionary conduct that tends to negatively affect competitive conditions in product and service markets.
- The use of non-competes is exploitative and coercive conduct that tends to negatively affect competitive conditions in labor markets.
- The use of non-competes is exploitative and coercive conduct that tends to negatively affect competitive conditions in product and service markets.” (p.105)
“The Commission notes that the vast majority of comments from physicians and other stakeholders in the healthcare industry assert that non-competes result in worse patient care. The Commission further notes that the American Medical Association discourages the use of non-competes because they “can disrupt continuity of care, and may limit access to care.” In addition, there are alternatives for improving patient choice and quality of care, and for retaining physicians, that burden competition to a much less significant degree than non-competes…commenters asserted that a ban on non-competes would upend healthcare labor markets, thereby exacerbating healthcare workforce shortages, especially in rural and underserved areas. A medical society argued that non-competes can allow groups to meet contractual obligations to hospitals, as physicians leaving can prevent the group from ensuring safe care. As the Commission notes, there are not reliable empirical studies of these effects, and these commenters do not provide any. However, the Commission notes that the rule will increase labor mobility generally, which makes it easier for firms to hire qualified workers.” (p.208)
“The Commission also noted that in three States—California, North Dakota, and Oklahoma—employers generally cannot enforce non-competes, so they must protect their investments using one or more of these less restrictive alternatives…Commenters provide no empirical evidence, and the Commission is unaware of any such evidence, to support the theory that prohibiting non-competes would increase consolidation or raise prices. “384
The bottom line:
Odds are this rule will not become law anytime soon allowing healthcare organizations to consider alternatives to the non-competes they use. Work-arounds for protection of intellectual property, talent acquisition, employment agreements are likely as HR professionals, benefits and compensation consultancies huddle to consider what’s next.
Those that operate in 3 states (CA, ND, OK) already face state reg’s limiting non-competes and more states are adding measures. As noted in the rule, the health systems in these states have not been debilitated by non-compete limitations nor empirical evidence of public/worker harm produced, so no harm no foul.
The bigger takeaways from this rule for healthcare—especially hospitals—are 2:
The rule may fuel already growing antipathy between the workforce and senior management. Physicians are frustrated and burned out. Mid-level clinicians, techs and nurses are not happy. The hourly workforce is insecure. The hospital workplace—its clinics, programs and services—is not a happy place these days. The rule might fuel increased union organizing activity among some work groups at a critical time when demand is high, utilization is increasing, resources are stretched, reimbursement is shrinking and conditions for solvency and sustainability in question for rural, safety net and community hospitals in areas of declining population. And employed physicians will push-back harder against pressure from their hospital and private equity partners to work harder and produce more. The rule gives physicians a moral premise on which to oppose employer demands, whether the rule is implemented in its current form or not.
And the second equally notable takeaway is the rule’s specific attention to tax-exempt hospitals that operate as “for-profit” organizations. The FTC Commissioners question their tax exemptions and their investor-owned competitors are happy they noticed. They’re joined by investigations in 5 Committee’s of Congress with Bipartisan support for a fresh look at their bona fide eligibility despite strong pushback by the American Hospital Association and others.
This rule was introduced as a proposed rule last year with a comment period of 90 days allowed. Fifteen months and 26,000 comments later, it’s the latest reminder that the future of healthcare is everyone’s business and hospitals and physicians see that future state differently.
In its summation, the FTC estimates that this final rule will lead to new business formation growing by 2.7% per year, create 8,500 additional new businesses annually, produce 17,000-29,000 patents for innovation, increase earnings for workers and lower health care costs by up to $194 billion over the next decade. Maybe.
What’s clear is that the FTC and regulators in DC and many states are watching the industry closely and many aren’t buying what we’re selling.
Paul
Resources
FTC Announces Rule Banning Noncompetes | Federal Trade Commission
Non-Compete Clause Final Rule (ftc.gov)
The End of Non-Competition Agreements? Not so Fast! | Baker DonelsonThe FTC’s new non-compete regulations will affect hospital agreements with physicians, unless courts intervene | HFMA
Do nonprofit hospitals sidestep FTC’s noncompete ban? (beckershospitalreview.com)
The FTC’s ban on noncompete impacts the health care industry (axios.com)
Sections in today’s Report
- Quotables
- Consumers
- Hospitals
- Physicians
- Polling
- Workforce
Quotables
Re: FTC Non-Compete ban: “Noncompete clauses keep wages low, suppress new ideas, and rob the American economy of dynamism, including from the more than 8,500 new startups that would be created a year once noncompete are banned. The FTC’s final rule to ban noncompete will ensure Americans have the freedom to pursue a new job, start a new business, or bring a new idea to market.”
FTC Chair Lina M. Khan. www.ftc.gov
Re: value-based purchasing design flaws: “Given the slow pace of VBP expansion, new strategies are needed to achieve CMS’s goal of 100 percent VBP coverage for Medicare beneficiaries by 2030. Addressing the three design flaws delineated in this article—avoiding forgone revenue, ghost savings, and voluntary participation—will help to better align VBP incentives and accelerate its adoption. “
Expanding VBP: Fixing Design Flaws | Health Affairs
Re: value-based model implementation: “CMS, health policy experts, and many providers, payers, and employers believe VBP is essential for a better functioning health care system. Yet, uptake of VBP options have slowed substantially. Implementing three recommendations—real-time, low-cost financial performance data; low-cost sophisticated financial modeling of VBP; and global reinsurance—will reduce important barriers to VBP implementation and set providers up for financial success in VBP. But these recommendations are not merely financial. They will also incentivize and facilitate the only proven innovation strategy: data-driven experimentation, translating financial success in VBP to improved outcomes for patients and reduced costs for all Americans.”
Expanding VBP: Overcoming Implementation Barriers | Health Affairs
Re: Congressional Republican role on healthcare reforms: “Exactly how far reform-minded Republicans can go will get a near-term test after the November election, when Congress faces numerous end-of-year healthcare program deadlines. Among them are funding federally qualified health centers, preventing steep cuts in disproportionate share Medicaid payments, and renewing enhanced payments for rural providers. Lawmakers tried several times in the past six months to attach conservative-backed bipartisan healthcare bills to those so-called extenders. Legislation on PBMs, price transparency, site neutrality, anti-competitive contracts and more all fell out of final bills amid the difficult negotiations to keep government funded.
After the election is over, most observers believe Congress members will again try to advance a big healthcare bill that at a minimum reflects the Lower Costs More Transparency Act of 2023, which passed the full House and included various transparency measures, PBM reforms and a tightening of some site-neutrality rules. “
Vertical integration in healthcare under fire from Republicans | Modern Healthcare
Re: retail pharmacy workforce: “A CVS in Las Vegas has w that launched in the wake of nationwide walkouts by pharmacists and pharmacy technicians last year. Thirty staff members at CVS Omnicare Las Vegas — which fills prescriptions for Nevada’s nursing homes — voted 26-4 to join the Pharmacy Guild, according to from the National Labor Relations Board. CVS acquired the long-term care pharmacy chain in 2015.
The move follows nationwide walkouts w last fall from pharmacists and technicians at some of the biggest drugstore chains in the U.S. over what they described as unsafe working conditions — what organizers had called “Pharmageddon.” Other pharmacies across the nation are expected to join the new pharmacy union as well.”
CVS Pharmacy Location Becomes the First to Join New National Union | MedPage Today
Re: McKinsey criminal investigation: “The Justice Department is conducting a criminal investigation into consulting firm McKinsey related to its past role in advising some of the nation’s largest opioid manufacturers on how to boost sales.
Federal prosecutors are also probing whether McKinsey or any of its employees may have obstructed justice in relation to records of its consulting services for opioid producers, according to people familiar with the investigation, which has been ongoing for several years…
In 2021, McKinsey reached a settlement with all 50 states, five U.S. territories, and Washington, D.C., to pay $642 million to resolve civil opioid-related litigation against the firm, without admitting wrongdoing. The firm in 2023 reached separate deals totaling $347 million with Native American tribes, public school districts, insurance companies and municipal governments, also without admitting wrongdoing.”
McKinsey Under Criminal Investigation Over Opioid-Related Consulting – WSJ
Re: global drug access, affordability:” I am writing to urge you to reconsider your opposition to proposed measures in the World Health Organization’s Pandemic Accord that would help make tests, treatments, and vaccines available to everyone who needs them. As leaders of the pharmaceutical industry, you play a critical role in making sure new tests, treatments and vaccines are created. The success of your scientists is humanity’s success. But your responsibility does not end with inventing breakthroughs. The products you develop must be made available around the world quickly and affordably. At the very least, you should not challenge governments negotiating new rules to make medicines more accessible.
We must learn the lessons from the COVID-19 pandemic. Consider Pfizer, the drug company you lead, Mr. Bourla. While Pfizer doubled its profits in 2021 and made a record $100 billion in revenue in 2022, millions of people in low-and-middle income countries died as a result of not having access to vaccines. Pfizer repeatedly put profit above public health. By the end of 2021, even the former head of the International Federation of Pharmaceutical Manufacturers and Associations was forced to acknowledge that everyone was “ashamed and embarrassed” by the inequality in access to COVID vaccines.”
Letter from Senate HELP Chairman Bernie Sanders to CEOs of Pfizer and Int’l Federation of Pharmaceutical Manufacturers and Associations 4.25.2024-Chairman-Sanders-Letter-to-IFPMA.pdf (senate.gov)
Consumers
HCCI report: commercially insured adult healthcare spending: “From 2018 to 2022, per-person health care spending among people with employer sponsored insurance (ESI) grew by nearly 19%. This period includes 2020, when we saw the first decline in per person health care spending in our organization’s history. It also includes the dramatic rebound in spending that followed in 2021. Despite those fluctuations, the five-year spending trend in the 2022 report continues upward. In 2022, per person spending among people with ESI exceeded $6,700, and average out-of-pocket spending was more than $850.” Other findings:
- Healthcare spending among those insured through an employer was $6,711 per person in 2022, an increase of 18.7% from 2018.
- The average person’s healthcare out-of-pocket spending was $866 in 2022. The average out-of-pocket spending in 2018 was $804.
- The average healthcare spending per person increased by $1,055 — 18.7% — from 2018 to 2022.
- Overall healthcare prices increased by 14% from 2018 to 2022, and prices increased over all service categories in the same period.
- Overall healthcare utilization, which includes outpatient, physician and prescription drug categories, grew by 4%; however, average inpatient admissions decreased by 11% from 2018 to 2022.
- The average point-of-sale prices for prescription drugs increased by 21% from 2018 to 2022. The HCCI notes that rebates likely offset a meaningful amount of this growth.
PowerPoint Presentation (healthcostinstitute.org)
Hospitals
Study: FTC enforcement in hospital consolidation: “From 2002 to 2020, there were over 1,000 (1164) mergers of U.S. hospitals. During this period, the Federal Trade Commission (FTC) took enforcement actions against 13 transactions. However, using the FTC’s standard screening tools (Herfindahl-Hirschman index (HHI), we find that 20% of these mergers could have been predicted to meaningfully lessen competition. We then show that, from 2010 to 2015, predictably anticompetitive mergers resulted in price increases over 5%. We estimate that approximately half of predictably anticompetitive mergers had to be reported to the FTC per the Hart-Scott-Rodino Act. We conclude that there appears to be underenforcement of antitrust laws in the hospital sector.
“It is plainly clear that there has been underenforcement of antitrust laws in the hospital sector. We show that about 20% of hospital mergers from 2002 to 2020 could have been easily predicted to increase concentration, lessen competition, and raise prices. Since 2000, hospital prices have grown faster than prices in any other sector of the economy. We need to be doing more to preserve competition in U.S. hospital markets.” Study co-author Zack Cooper, Associate Professor of Health Policy, Yale School of Public Health; and of Economics, Yale’s Faculty of Arts and Sciences
Study: impact of hospital consolidation on prices: UC-Berkeley researchers analyzed commercial claims from the Health Care Cost Institute (HCCI) and quality measures from Hospital Compare for 214 hospitals acquired by other hospitals more than 50 miles away compared to 955 hospitals that operated independently in the same period (2009-2017). Findings:
“Six years after acquisition, cross-market hospital mergers had increased acquirer prices by 12.9% relative to control hospitals, but had no discernible impact on mortality and readmission rates for heart failure, heart attacks and pneumonia.
For serial acquirers, the price effect increased to 16.3%. For all acquisitions, the price effect was 21.8% when the target’s market share was greater than the acquirer’s market share versus 9.7% when the opposite was true. The magnitude of the price effect was similar for out-of-state and in-state cross-market mergers.
Our study is the third to find a positive price effect associated with cross-market mergers and the first to show no quality effect and how serial acquisitions contribute to the price effect. More research is needed to identify the mechanism behind the price effects we observe and analyze price effect heterogeneity…
Funding from The Commonwealth Fund (Grant no. 20202666) and Arnold Ventures (Grant no. 20-04101) for this research is gratefully acknowledged. “
Study: Patient discharge planning: Two in 5 US hospital stays result in rehabilitative post-acute care, typically through skilled nursing facilities (SNFs) or home health agencies (HHAs). However, a lack of clear guidelines and understanding of patient and caregiver preferences make it challenging to promote high-value patient-centered care.
Researchers analyzed patient preferences and willingness to pay for facility-based vs home-based post-acute care among patients and caregivers by surveying U.S. adults 45+ in September 2022. Findings:
“Patients and caregivers showed a substantial willingness to pay for home-based and high-quality care. Patients and caregivers were willing to pay an additional $58.08 per day and $45.54 per day for HHA care compared with a shared SNF room, respectively. However, increased demands on caregiver time within an HHA scenario and socioeconomic challenges, such as insecure employment, shifted caregivers’ preferences toward facility-based care. There was a strong aversion to below average quality. To avoid below average SNF care, patients and caregivers were willing to pay $75.21 and $79.10 per day compared with average-quality care, respectively. Additionally, prior awareness and experience with post-acute care was associated with willingness to pay for home-based care.
The findings of this survey study underscore a prevailing preference for home-based post-acute care, aligning with current policy trends. However, attention is warranted for disadvantaged groups who are potentially overlooked during the shift toward home-based care, particularly those facing caregiver constraints and socioeconomic hardships. Ensuring equitable support and improved quality measure tools are crucial for promoting patient-centric post-acute care, with emphasis on addressing the needs of marginalized groups.”
Preferences for Post acute Care at Home vs Facilities | JAMA Health Forum | JAMA Network
Study: prevalence of housing insecurity in hospital ED: Researchers analyzed is the scope of housing insecurity for 23,795 patients presenting to the Vanderbilt University Emergency Room from January 5 to May 16, 2023. Finding:
“…in 1185 (5%), patients screened positive for current homelessness or housing insecurity (660 unique patients) …. Of visits with positive results, the median age of patients was 46 years and 829 (70%) were among male patients. Suicide and intoxication were more common chief concerns among visits at which patients screened positive (132 [11%] and 118 [10%], respectively) than among those at which patients screened negative (220 [1%] and 335 [2%], respectively). Visits with positive results were more likely to be among patients who were uninsured (395 [33%] vs 2272 [10%]) and had multiple visits during the study period. A higher proportion of positive screening results occurred between 8 pm and 6 am. The social work team assessed patients at 919 visits (78%) with positive screening results.”
Study: 340B repayment program: Researchers analyzed Hospital Cost Reports and HRSA Office of Pharmacy Affairs data to identify characteristics of hospitals participating in the 340B program for at least 1 year between 2018 and 2022. Findings:
“Among 1673 OPPS 340B hospitals, 1325 (79%) received payment (median [range], $1.8 [4.0-17.0] million). Hospitals receiving payment had higher operating revenues (mean [SD], $2.34 [3.06] billion vs $1.22 [1.78] billion), were less likely to be rural (24.8% [329/1325] vs 56.6% [197/348]) or publicly owned (20.2% [268/1325] vs 28.7% [100/348]), and were more commonly teaching hospitals (56.2% [744/1325] vs 20.4% [71/348]). No difference was found in uncompensated care burden and operating margin by expected payment status. However, a 1% increase in repayments as a proportion of operating revenue was associated with a 2.1% in uncompensated care burden and a 2.6% increase in operating margins.). The nondrug share of total Part B reimbursements was negatively associated with repayment as a proportion of operating revenue.
One-fifth of OPPS 340B hospitals are not expected to receive a lump sum payment under CMS’s remedy for 340B-specific cuts to drug reimbursement. Disproportionately rural, publicly owned, and nonacademic hospitals will face cuts to nondrug Medicare Part B reimbursement without an offsetting lump sum repayment… Overall, these data suggest that the CMS repayment proposal may unintentionally harm vulnerable 340B hospitals while rewarding less vulnerable ones.”
Physicians
Study: physician sex and patient outcomes: Researchers examined the association between physician sex and hospital outcomes for hospitalized patients treated for medical conditions between 2016 to 2019 using Medicare claims data. Findings:
“Of 458 108 female and 318 819 male patients, 142 465 (31.1%) and 97 500 (30.6%) were treated by female physicians, respectively. Both female and male patients had a lower patient mortality when treated by female physicians; however, the benefit of receiving care from female physicians was larger for female patients than for male patients (difference-in-differences, −0.16 percentage points [pp] [95% CI, −0.42 to 0.10 pp]). For female patients, the difference between female and male physicians was large and clinically meaningful (adjusted mortality rates, 8.15% vs. 8.38%; average marginal effect [AME], −0.24 pp [CI, −0.41 to −0.07 pp]). For male patients, an important difference between female and male physicians could be ruled out (10.15% vs. 10.23%; AME, −0.08 pp [CI, −0.29 to 0.14 pp]). The pattern was similar for patients’ readmission rates.”
Study: drug company marketing to physicians: “Physicians commonly receive marketing-related transfers from drug firms. We examine the impact of these relationships on the prescribing of physician-administered cancer drugs in Medicare. We find that prescribing of the associated drug increases 4\% in the twelve months after a payment is received, with the increase beginning sharply in the month of payment and fading out within a year. A marketing payment also leads physicians to begin treating cancer patients with lower expected mortality. While payments result in greater expenditure on cancer drugs, there are no associated improvements in patient mortality.”
Re: concierge primary care: “When people ask Dr. Jordan Shlain to describe his medical practice, he says simply: “It’s a family office for your health…
As depressing as that sounds for patients, Shlain’s strategy is paying off as a business model. His company, Private Medical, is at the forefront of a new type of health care for the ultra-wealthy that has taken concierge medicine to a whole new level. Rather than simply offering on-call doctors and faster visits, Private Medical has pioneered a highly personalized, all-in-one service that’s more akin to the most sophisticated family offices for investments.
Like family offices, Private Medical has an in-house team to manage a family’s entire health portfolio – from fitness and dietary tracking to longevity research, surgeries and medical emergencies. It now serves more than 1,000 wealthy families, with offices in California — San Francisco, Silicon Valley, Santa Monica and Beverly Hills — New York and Miami, and more offices on the way.
Private Medical’s team of 135 physicians, nurses, clinical staff, pharmacists and medical support professionals provides 24/7 on-call service, including home and office visits when needed. Private Medical doesn’t advertise and gets most of its business through referrals. It prefers to call patients “members.”
Shlain declined to give specifics on price, but clients of Private Medical say it charges $40,000 a year for each adult patient and $25,000 per patient under the age of 18. The annual fees cover the cost of visits, tests and procedures in the office, but not hospitalization….
The market for concierge and personalized medical services for the wealthy is expected to grow by more than 50% by 2032, to nearly $11 billion a year, according to Precedence Research.
Meet the private doctor to the wealthy — at $40,000 a year (cnbc.com) CNBC April 22, 2024
Polling
EBRI survey: retirement for workers: Employee Benefit Research Institute (EBRI) surveyed.2,521 U.S. adults 25+ January 2 through January 31, 2024. Findings:
- 42% of retirees said their health care and dental costs were higher than expected, making it the biggest unexpected cost of retirement.
- 40% of working adults and 46% of retirees said they’d calculated how much money they and their spouse would likely need to cover health expenses in retirement.
- Of the retirees still holding down a job, 13% said they’re working to keep health insurance.
Retirement Confidence Survey (ebri.org)
Workforce
Survey: Factors Prompting Nurses to Consider Leaving Field: Incredible Health’s 2024 State of US Nursing Report found that 23% of surveyed nurses are very likely to leave their roles in 2024. 32% of those planning to quit are pursuing roles outside of healthcare entirely. Primary factors prompting nurses to consider leaving the field:
- 63% of nurses feel unsupported by their health systems
- 79% of nurses pointed to staffing as an area they want more support in from their health system
- 63% of nurses noted that the economic climate has impacted their career or career choices
- 64% of nurses don’t feel they are fairly compensated
- 56% of nurses in California (highest paid nurses in the US) feel they are not compensated fairly
Incredible Health 2024 State of US Nursing Report, March 2024
CMS Nursing Home Staffing Final Rule: “This final rule was informed by the feedback CMS received from over 46,000 public comments submitted in response to the proposed rule. Central to this final rule are new comprehensive minimum nurse staffing requirements, which aim to significantly reduce the risk of residents receiving unsafe and low-quality care within LTC facilities. CMS is finalizing a total nurse staffing standard of 3.48 hours per resident day (HPRD), which must include at least 0.55 HPRD of direct registered nurse (RN) care and 2.45 HPRD of direct nurse aide care. Facilities may use any combination of nurse staff (RN, licensed practical nurse [LPN] and licensed vocational nurse [LVN], or nurse aide) to account for the additional 0.48 HPRD needed to comply with the total nurse staffing standard.
CMS is also finalizing enhanced facility assessment requirements and a requirement to have an RN onsite 24 hours a day, seven days a week, to provide skilled nursing care…Therefore, CMS is finalizing, with revisions to its proposal, the requirement for an RN to be onsite 24 hours a day, seven days a week, and available to provide direct resident care. The 24/7 RN onsite can be the Director of Nursing (DON); however, they must be available to provide direct resident care.”
Gallup Study: workforce engagement: Continuing a downward trend, employee engagement in the U.S. has dropped to its lowest level in more than a decade.
Last year, Gallup found U.S. employees were increasingly detached from their employers, with the workforce reporting less role clarity, lower satisfaction with their organizations and less connection to their companies’ mission or purpose. Employees were also less likely to feel someone at work cares about them.
The drop in these employee engagement elements was particularly acute in remote, hybrid and younger workers. By the end of 2023, 33% of U.S. employees overall were highly engaged, meaning they were highly involved and enthusiastic about their work and workplaces.
Unfortunately, the first quarter of 2024 continued this downward trend, with engagement dropping three percentage points to 30% among both full- and part-time employees. This decline represents 4.8 million fewer employees who are engaged in their work and workplace, marking the lowest reported level of engagement since 2013. (17% actively engaged) 26% in 2000, 36% peak in 2020
Employee engagement trends are significant because they link to many important performance outcomes crucial to organizational leaders such as productivity, employee retention, customer service, safety incidents, quality of work and profitability.
U.S. Engagement Hits 11-Year Low (gallup.com)
