Last July, President Biden issued Executive Order 14036 to promote competition (and eliminate anti-competitive practices) across a number of industries, including health care, with the hopes of lowering prices, increasing growth and wages, and promoting innovation. The order includes 72 initiatives, including four specifically focused on health care.

In this post, we explore what has happened since the executive order was issued and what’s expected to happen next in relation to the health care initiatives.

Lowering prescription drug costs

Two months after the executive order was issued, the Department of Health and Human Services (HHS) released, “A Comprehensive Plan for Addressing High Drug Prices.” A recent Congressional Budget Office report on prescription drug costs and spending indicate cost increases are slowing but that’s only after seeing spending increase from $30 million in 1980 to $335 million in 2018.

In 2021, 20 states enacted 43 laws to lower costs that included establishing Prescription Drug Affordability Boards (PDABs); regulating Pharmacy Benefit Managers (PBMs); limiting out-of-pocket  insulin costs; and promoting cost transparency. According to the National Conference of State Legislators Bill Tracking Database, New York State introduced 69 bills related to lowering prescription drug costs last year; another 20 have been introduced since the start of this year.

Allow hearing aids to be sold at drug stores

The Food and Drug Administration (FDA) proposed a rule creating a category of hearing aids that could be sold over-the-counter at drug stores without a prescription. The rule was up for public comment during a 90-day period ending January 18 of this year.  According to Harvard Health, approval is expected some time this year and manufacturers are already moving ahead with production that will give consumers access to a $600 on-average device (versus the $5,000 average at a doctor’s office).

Still, 42 states are asking that as part of the rule the FDA preserves related state consumer protection laws. At the same time, the Federal Trade Commission  indicates that, in part, some of those laws hurt competition and access to affordable hearing aids. Several governors are asking that the FDA finalize the rule without delay. 

Stop the negative impacts of healthcare industry consolidation

The Justice Department and Federal Trade Commission (FTC) are encouraged to review merger guidelines to ensure patients are not harmed by hospital mergers, which have traditionally driven up prices and left rural areas without adequate access to care. As a first step, the FTC restored a policy where it could restrict two merging parties from moving forward if it would have anti-competitive impacts on the community. Courts seem to align with this position. However, the American Hospital Association disagrees, asserting current practices actually boost competition and help the economy. Also, a study by the American Medical Association shows mergers actually result in better patient outcomes – something the medical community asserts the political establishment is ignoring.  The FTC is currently soliciting public comments on the issue. So, stay tuned.

Address surprise bills from hospitals

Even before President Biden’s executive order, actions were underway to promote hospital price transparency and eliminate surprise bills for care. This past January 1, new rules took effect under the No Surprises Act requiring uninsured patients receive good faith estimates for the cost of care and insured patients don’t receive surprise bills for emergency care and treatment by an out-of-network provider at an in-network facility.

What’s more, with the Consolidated Appropriations Act of 2021, health plans and health plan issuers are required to track and submit certain prescription drug and health care costs starting December of 2022 (for 2020 and 2021 data) and every June thereafter to help promote price transparency.

Going forward

For decades, addressing escalating health care costs in the U.S. has been the focus of legislation, corporate board rooms, and individuals, and it looks like it’s going to remain a hot topic with both the FTC and the HHS identifying actions related to Executive Order 14036 a priority for 2022.

We’ll keep you updated as the story continues to unfold. In the meantime, RBT CPAs does have staff specializing in accounting and taxes for health care. Should you need advice or assistance, please give us a call.

NOTE: RBT CPAs is an accounting and tax firm – not a law firm. In no way should information in this article be construed as legal advice or direction. For that type of assistance, we encourage you to contact your legal advisor.

Healthcare and the delivery of healthcare services is often a matter of life and death and there has been an increased intensity of those in need of medical help and, as a result, a significant increase in the demanding workload on the healthcare workforce.

Patients deserve quality care and healthcare employees deserve on-the-job satisfaction to provide quality care.  Thoughtful considerations must go into how stressful and challenging the work of a healthcare provider is and how it impacts patients with either a negative or positive outcome as it links to public investment in hospital care. To succeed in 2022, healthcare organizations must address this concerning connection to sustain high-quality healthcare readiness and the funding that makes access possible.

According to News: Medical Life Sciences, 2021 studies show that there is a critical link between hospitals’ healthcare compensation, healthcare workers’ well-being, and patient satisfaction surveys. It is impossible to separate this idea from The Center for Medicare and Medicaid Service (CMS), whose goal is to empower consumers and hold hospitals accountable for improving care by implementing the Medicare payment system that ties patient care experiences with hospital reimbursement rates.  Since 2008, CMS endorses the publishing of the Hospital Consumer Assessment of Healthcare Providers and Systems (HCAHPS) scoring system that provides qualitative data to rate patient experiences using Value Based Performance Standards (VBP). Specifically, all the dimensions surveyed are consumer-driven factors that contribute to well-being and satisfaction, such as the conditions of the hospital environment (noise level, cleanliness), the social climate (interactions, responsiveness), and information access (discharge, care transition). When any of these factors are receiving unsatisfactory or poor scores, it can negatively affect healthcare employees’ job satisfaction due to significant stressors, thereby affecting customer satisfaction–and hospital funding. Let’s face it, there are billions of dollars from Medicare at stake.

Certainly, the stressors of the still raging pandemic in the healthcare field highlight the need to address and prevent undue burdens on our healthcare professionals as we move into 2022. The real burdens of occupational pressures on the healthcare providers on the front lines translate into their ability to provide quality care experiences.  Patient experiences of care across the nation certainly reflect the caregiver’s burden in the HCAHPS VBP scores so healthcare leaders can utilize this data in practical and useful ways. Healthcare organizations have an obligation to fundamentally do good by their healthcare professionals and consequently increase positive outcomes for patients.

What steps can you take to boost patient satisfaction and secure healthcare funding?

• Ensure adequate funding and allocate funding resourcefully
• Elicit feedback from healthcare professionals to allow for emerging new ideas
• Provide empowerment opportunities to those who feel a lack of control over their work
• Be transparent; share knowledge
• Establish systems or support from senior staff
• Let employees know they are valued
• Create equitable engaging training to keep up to date
• Foster healing and recovery for healthcare providers

• Approach care from an honest, open, empathetic stance
• Encourage healthcare professionals to invest in patients

The satisfaction of the patients is largely dependent upon the healthcare workforce they encounter in adverse situations.

The perceptions of patients are key to acknowledge as it influences healthcare funding as we head into 2022. KFF offers an overview and funding facts on Medicare spending, showing that Medicare was 15% of the total federal spending in 2018 which totaled $605 billion; further, Medicare spending is projected to rise to 18.3% percent from 2019 to 2029, increasing spending to $1.3 trillion in 2029. By enhancing the well-being of healthcare workers, hospitals will be better able to retain and recruit healthcare workers, provide quality care, increase customer satisfaction, and plan to respond to future public health threats.

Here at RBT CPAs, we understand the diverse and complicated world of healthcare. Our team of healthcare experts brings industry expertise in reimbursement, regulatory compliance and audit, accounting, and tax services. We will continue to keep you notified of timely news that matters to you and your team, but if you’d like to connect and receive individualized services, please contact us today. If you would like to submit feedback or topic ideas for future articles our team produces, please feel free to contact us at TLideas@rbtcpas.com.

Sources: News-Medical, News-Medical, CMS, CMS, Relias, AMA, News-Medical, KFF

With December just one calendar page turn away, it’s a good time to consider ways your organization excelled this year, as well as areas your team fell short of. Reflecting on the past year, healthcare workers across the state were tested beyond limits and proved that this industry is more resilient than any of us could have imagined. Just like at RBT, the people you hire to be a part of your team are truly the lifeblood of your organization – they are what make your operation remarkable. But while the threat of the COVID-19 pandemic may finally be waning, other threats are lurking. With escalating cyberattacks on hospitals and health systems and the continued spread of health misinformation online, the healthcare industry is headed for an exit from the “trusted category” next year, according to a recent Forrester report. Why is distrust eroding the healthcare industry and what can your team do to protect your brand as we enter 2022?

Forrester examined the state of healthcare in the U.S. and how threats like misinformation and increasing cyberattacks will affect public trust for its Predictions 2022: Healthcare report. Misinformation has permeated social media and even platforms built for clinicians, and the true industry cost just might be immeasurable. The spread of false health information, shortcomings in data integrity, and the politicization of science will unseat healthcare from its standing as a trusted industry according to Forrester’s 2022 projections. Continued erosion of trust in healthcare institutions will force more clinics to close and threaten population health as patients avoid treatment for their conditions.

As far as cybersecurity is concerned, the report indicates that healthcare is the most attacked industry and has the highest average cost of a data breach as well as the slowest incident response time. Cybersecurity investment initiatives are expected to hit $125 billion between 2021-25 in response to the increasing number of threat actors and weak digital systems.

What can your team do today, to stay protected? The financial risk and the health of your patients are at stake if you don’t have full control over the information being shared with the public. Righting the ship in 2022 will require an all-hands-on-deck approach, including coordination between those working in public health research and practice, public policy, and cybersecurity. Ensuring you have a reliable communications department is key to getting your patients access to accurate, reliable information about your organization. Think about your social media strategy. When was the last time you updated the way you connect with clients? On the cybersecurity front, make sure you reassess your 2021 defense plan and determine whether or not your team is doing enough to protect your data. Ensure that everyone on your staff is up to speed on the plan. Simple team-wide reminders, like creating complex, unique passwords with frequent updates, encrypting patient data and medical files to avoid data leaks in ransomware, and using a VPN for a safe internet connection can help to avoid outside risks. Like misinformation, cybersecurity awareness and education will help your team recognize problems before they evolve into crises. As always, we are rooting for your success. Our trusted team of healthcare specializing RBT professionals are here for you, to navigate the diverse and complex world of healthcare. If you would like to submit feedback or topic ideas for future articles our team produces, please feel free to TLideas@rbtcpas.com.

Source: Forrester

It feels like bad déjà vu, but the reality is that once again the majority of New York healthcare systems are battling the perfect storm of challenges amid a resurgence of COVID-19 cases statewide. The rising risk of the delta variant, combined with staffing shortages, and mounting mandate pressure to get vaccinations in the arms of more staff members are creating a mess for officials. Over 450,000 New York hospital workers became eligible for vaccination under Phase 1A of New York’s COVID-19 vaccination program. Hospital worker vaccination progress is self-reported by individual hospital facilities weekly via the New York State Department of Health’s HERDS survey. Currently, 79% of Mid-Hudson area hospital workers have received a complete vaccine series, with the highest percentage reported in Westchester County (85%) and the lowest (55%) reported in Putnam County. With so much information constantly fluctuating, what do you need to know about state and federal vaccination mandates, and what are the financial implications for your healthcare system?

New York State’s public health and health planning council approved emergency regulations on August 26 requiring that hospital workers be vaccinated for COVID-19, while removing religious exemptions. Vanessa Murphy, a DOH attorney said they are not constitutionally obligated to provide a religious exemption, which is also the case for the Measles and Mumps vaccine. This will be in effect for 90 days before it’s either renewed or expires.

So, what is a valid medical reason to make an accommodation for a medical worker?

For a valid medical exemption, a licensed physician or certified nurse practitioner must certify that immunization with a COVID-19 vaccination is detrimental to the health of a member of a covered entity’s personnel, based upon a preexisting health condition, and ceases to be effective if it is later found that vaccination would not be detrimental to that personnel member’s health. The nature and duration of the medical exemption must be documented in the personnel file of the member of the organization in accordance with the same timeline for the vaccination requirements, along with documentation of whatever reasonable accommodations are granted in conjunction with the exemption.

What entities does this apply to in New York State?

The requirement approved by the public health and health planning council applies to hospitals, nursing homes, diagnostic and treatment centers, adult care facilities, certified home health agencies, hospices, long-term home health care programs, AIDS home care programs, licensed home care service agencies and limited licensed home care service agencies. So, who falls under New York State’s definition of health care “personnel” in the new regulation requirements? It’s pretty all-encompassing, covering employees, students, volunteers, and any other affiliates of the organization who “engage in such activities such that if they were infected with COVID-19, they could potentially expose other covered personnel, patients or residents to the disease.” According to the state health department, these institutions are tasked with developing a plan for implementation of the mandate and any actions it will take regarding non-compliant employees. This could include firing non-compliant workers.

What’s the COVID-19 vaccination deadline for staff?

Healthcare workers at hospitals and nursing homes must receive their first vaccine dose by Sept. 27. Workers at additional entities covered by the mandate, including diagnostic and treatment centers, home health agencies, long-term home health care programs, school-based clinics, and hospice care programs, must have at least one dose by Oct. 7. Documentation of proof of vaccination must be maintained in the personnel files of each employee/affiliate of the organization.

What about federal updates?

In a bold move, President Joe Biden announced in August that he is directing all nursing homes to require their staff to be vaccinated against COVID-19 in order to continue receiving Medicare and Medicaid funding. Over 130,000 nursing home residents and 2,000 employees died due to COVID-19, according to the most recent CDC data. However, vaccination rates among nursing home workers remain low. As of mid-August, about 60% of staff per facility were vaccinated, compared to 82.8% of residents per facility.

What are the financial and emotional consequences your system could face?

Here at home, HealthAlliance of the Hudson Valley, a three-hospital system in the Westchester Medical Center Health Network, laid off an undisclosed number of workers on June 14, according to the Daily Freeman. This is just one local example of shrinking medical staff at a time when facilities are overloaded with cases and patients. Tension is running high for medical professionals on both sides of the issue. The New York State Nurses Association (NYSNA) representing more than 42,000 members in New York State, last issued a statement in mid-August. “Overall, we are seeing a crisis in hospital emergency departments that indicates a general lack of preparedness. The DOH should listen to the frontline this time not just hospital CEOs. Our healthcare workers are exhausted and traumatized. Their voices should be heard – not denied or characterized as vectors of infection- which is exactly what we are trying to avoid. When healthcare workers document what they are experiencing they must be believed. Hospitals must also ensure that new mandates do not contribute to already problematic staffing shortages. We do not want a situation where patient care is compromised because the pool of nurses and other healthcare workers continues to shrink.” Only time will tell whether or not our care system can sustain itself if healthcare organizations continue to face the arduous task of firing staff for vaccination refusal.

Sources: Daily Freeman, CDC, Health.ny.gov

The COVID-19 pandemic highlighted the critical importance of a resilient U.S. healthcare manufacturing sector.

While healthcare leaders have made remarkable scientific strides to combat the pandemic by developing and distributing lifesaving vaccinations, critical issues remain. In fact, some issues existed long before the pandemic, but we have recently been confronted with the gravity of the challenges we face. the United States remains critically dependent on imports for a range of key pharmaceutical products and APIs—the primary ingredients of generic drugs—which represent 90 percent of all prescription medications filled. About 87 percent of API facilities for generic drugs are located overseas which has left U.S. supply chains of essential medicines vulnerable. The lesson? Instead of waiting for the next crisis to strike, leaders should act now to identify strategies and solutions for their organizations.

China and India are estimated to control substantial parts of the supply chain where there have been issues with shortages because of disruptions that have impacted supply as well as quality, and safety.

The drive toward lower costs as well as unfair trade practices has led to a hollowing out of domestic production. The Food and Drug Administration (FDA) has been tracking and reporting to Congress on the drug shortage crisis since 2014, in response to drug shortages that had impacted hospitals for years. In 2019, the FDA created an inter-agency task force to study the problem, determine the root causes and recommend solutions. The report recommends enduring solutions:

• Creating a shared understanding of the impact of drug shortages on patients and the contracting practices that may contribute to shortages
• Developing a rating system to incentivize drug manufacturers to invest in quality management maturity for their facilities
• Promoting sustainable private sector contracts (e.g., with payers, purchasers, and group purchasing organizations) to make sure there is a reliable supply of medically important drugs

Earlier this month, the Biden-Harris Administration announced the first step in a whole-of-government effort to strengthen domestic competitiveness and supply chain resilience.

To address vulnerabilities in the supply chain, the Biden-Harris Administration will immediately support the domestic production of critical medicines. The Department of Health and Human Services (HHS), under the Defense Production Act (DPA) and building on current public-private partnerships, will establish a public-private consortium for advanced manufacturing and onshoring of domestic essential medicines production. The consortium’s first task will be to select 50-100 critical drugs, drawn from the FDA’s essential medicines list, to be the focus of an enhanced onshoring effort. HHS will make an initial commitment of approximately $60 million from the Defense Production Act appropriation in the American Rescue Plan to develop novel platform technologies to increase domestic manufacturing capacity for API. The goal? Greater API production domestically will help reduce reliance on global supply chains for medications that are in shortage, particularly during times of increased public health need.

Many within the healthcare field believe this is the moment to reimagine and rebuild a new American healthcare system, not go back to the way things used to be.

The current system is not sustainable, and to ensure more resilient supply chains we need to develop an approach that includes improving transparency, building emergency capacity, and investing in domestic production. At RBT, we pride ourselves on assisting healthcare professionals to build more sustainable organizations with our comprehensive services. But most importantly, we aim to pass along useful, relevant information to help our communities succeed, grow, and prosper. As we continue to dedicate time and resources to help our healthcare clients achieve success, we look forward to connecting with you and your team.

Sources: The White House, HFMA, FDA

The COVID-19 pandemic highlighted many cracks in our healthcare system. If we take the “glass-half-full” approach, we can appreciate how the pandemic exposed our industry-wide weaknesses, so we can get to work making efficient and effective improvements for future public health crises. One healthcare game-changer that’s emerging as the dust begins to settle, is Blockchain technology. While Blockchain is still in its early stages of development and implementation, (think “the internet” in the late 1990s) you can expect to hear more about strides in Blockchain technology. It’s already transforming the financial world, and health authorities like the Centers for Disease Control (CDC) have been advocating the benefits of this modernization tool for years. The application of Blockchain in healthcare represents the potential to reduce costs, streamline business processes, and improve access to information across diverse stakeholders working toward a common goal: patient-centered care.

Wait, what is Blockchain again?

Blockchain is a system of recording information in a way that makes it difficult or impossible to change, hack, or cheat the system. A Blockchain is essentially a digital ledger of transactions and it is ideal for delivering information because it provides immediate, shared, and completely transparent information that can only be accessed by permission network members. It is also the underlying technology behind the cryptocurrency known as Bitcoin.

What are examples of how it can impact healthcare?

• Identity Management – Patients, Providers
• Medical Record Management
• Medicaid Management Information Systems
• Benefits Administration
• Data Security
• Reimbursement
• Clinical Trial Management
• Pharmaceutical Supply Chain

What are some important factors to consider when implementing Blockchain technology?

Reducing Costs: While organizations can expect some added upfront technology costs that are common in the adoption of any new technology, Blockchain can streamline the supply chain and administrative processes in healthcare, which may decrease costs.

Increasing Patient Control: Blockchain technology may have the potential to empower patients with greater control of their data and privacy. For example, the technology could enable patients’ access to their medical records across providers.

Improve Transparency/Security: While Blockchain is transparent it is also private, concealing the identity of any individual with complex and secure codes that can protect the sensitivity of medical data. The decentralized nature of the technology also allows patients, doctors, and healthcare providers to share the same information quickly and safely.

Security Vulnerabilities: While the technology provides resilience to certain types of attacks, nothing is ever entirely secure. It is still susceptible to zero-day attacks and technical bugs. Also, because this technology is almost always accessed by people, it is susceptible to one of the greatest risks in information technology: social engineering.

So, where does New York stand with this technology?

This past March, The New York Department of Financial Services (NYDFS) organized a techsprint (a sort of extended hackathon with participation by both industry and regulators) to learn how to become better at regulating crypto companies. That the techsprint occurred at all is a signal of the evolution of the crypto industry, said Sandra Ro, the CEO of the Global Blockchain Business Council and one of the event’s judges. Ro said it was significant that NYDFS is not only looking at how it can parse information it collects but also how it can integrate technologies like Blockchain into its supervisory process. “I think it is a testament to how far the crypto community has come from an industry standpoint to work with regulators and legislators and various bodies, to solve for critical problems in order for the industry to grow and scale, and become mainstream within regulation and guidelines,” Ro said.

Final Thoughts

Ultimately, the healthcare industry is constantly evolving and improving, and putting the patient in control with Blockchain technology would also make switching between healthcare providers a far simpler process than presently while ensuring that any information provided is complete and verifiably accurate. Reflecting on the pandemic, this could be incredibly transformative for future illness prevention, vaccination campaigns, wellness programs, and health training. At RBT, we understand the diverse and complicated world of healthcare, and we understand the first step to a brighter financial future is having important conversations about industry-specific topics that matter to you. Feel free to contact our team today, we hope to help your team succeed.

Sources: CDC, Coindesk, NYDFS, BuiltIn