News briefs

Poll indicates hospitals feeling HIPAA burnout

Some hospitals are experiencing Health Insurance Portability and Accountability Act (HIPAA) burnout as the April 21, 2005, deadline for compliance with the legislation’s security rule approaches, a recent American Hospital Association (AHA) survey suggests. A poll of AHA’s 475 member health care organizations found that, while more than 40% had begun their security risk analysis, only about 25% had begun to implement the other provisions of the security rule, published in February 2003 by the Centers for Medicare & Medicaid Services (CMS).

Many hospitals still are focused on ensuring their compliance with the HIPAA electronic transactions and code set standards, and do not have the energy or resources to concentrate on the newer security standards, says Roslyne Schulman, an AHA senior associate director of policy development. As a result, many hospitals are experiencing burnout, she said, adding that CMS needs to ensure that its enforcement of the security rule is consistent with the principles of flexibility and scalability laid out in the rule. Schulman also emphasized that consistent interpretation is needed across CMS regions.

In other HIPAA news, CMS has instructed Medicare carriers and intermediaries to slow payment of electronic claims that are not compliant with the HIPAA transactions standard as an incentive to increase compliance. CMS instructed the carriers and intermediaries to pay such "legacy" claims no earlier than 27 days after receipt instead of the current 14, beginning July 1, and called the change "a measured step toward ending the contingency plan completely." The operational change does not require regulatory approval.

Charity, bad debt costs up by almost $1 billion

U.S. hospitals provided $22.3 billion in uncompensated care in 2002, up from $21.5 billion in 2001, according to the latest American Hospital Association Annual Survey of Hospitals. The survey measure includes charity care and bad debt, valued at the cost to the hospital of the services provided. Meanwhile, a report recently released by the Robert Wood Johnson Foundation’s State Coverage Initiatives program found that states struggled to maintain or expand coverage to low-income individuals for the third consecutive year in 2003.

The ongoing struggle was attributed to the lingering budgetary crisis, increased demand for health insurance and rising health care costs. Many states were forced to reduce benefits and eligibility for both the Medicaid program and the State Children’s Health Insurance Program in 2003, the report noted.

Act provides relief

However, the federal Jobs and Growth Relief Reconciliation Act of 2003 provided some relief, providing up to $20 billion in fiscal relief for Medicaid and other programs, the authors add.

In another report on hospitals’ financial problems, a preliminary analysis by the Pennsylvania Health Care Cost Containment Council revealed that 48% of the state’s acute care hospitals lost money in fiscal year 2003, up from 42% in 2003 and 34% in 2001.

Carolyn Scanlan, president and CEO of the Hospital and Healthsystem of Pennsylvania, said, "High medical liability insurance costs, regulatory compliance costs, disaster preparedness costs, and persistent shortages of key health care professionals — along with historically inadequate Medicaid and Medicare reimbursements and persistently high levels of uncompensated care — will cause significant harm to our hospitals and our communities."

The council is an independent state agency that addresses health care cost and quality.

CMS quality initiative participation increasing

The number of hospitals displaying at least one of 10 quality measures on the Centers for Medicare & Medicaid Services (CMS) web site as part of a CMS quality initiative more than tripled — to 1,400 — between October 2003 and February 2004, CMS has reported.

More than 3,000 hospitals — about 75% of those eligible — have pledged to participate in the initiative. Nancy Foster, senior associate director of health policy for the American Hospital Association, said she expects the number will continue to rise as the web site is updated each quarter. "This large increase is really reflective of hospitals’ desire to have a solid, standardized vehicle to share information with the public," Foster said.

The CMS web site is at More on the quality initiative is available at

ED volume increasing, most hospitals report

Some 68% of hospitals responding to a recent survey by the Schumacher Group said patient volume in their emergency department (ED) had increased in the past 12 months, with most reporting an increase from 1% to 10%. Only 18% of respondents said overcrowding had caused them to divert patients to other hospitals, down from 36% in 2001. Seventy-six percent said a lack of coverage by physician specialists had caused them to divert patients, up from 65% who gave that response in 2001.

About 31% of respondents had lost some specialty coverage in the past year, with 33% citing uncompensated care and 26% citing medical liability concerns as factors. About half of respondents said the number of uninsured patients in their ED had increased in the past 12 months, and 77% said their ED was a major provider of primary care for the indigent and uninsured in the community.

The Schumacher Group is an ED management firm. More information is available at