In Pennsylvania, chronic diseases are the leading cause of death and disability and account for 80 percent of all health care costs. About half of all Pennsylvanians have a chronic disease, including diabetes, asthma, heart conditions, and others.

While providing some of the best care in the nation, our current health care system is designed to treat acute illness, not manage chronic diseases. Successfully managing chronic diseases requires a system where:

• Patients help to manage their conditions.
• Coordinated teams of providers care for patients.
• Providers use proven guidelines for care.
• Patients are monitored with coordinated electronic record systems.
• Partnerships with community resources are formed that encourage healthy living.
• A payment system for providers is developed to support this new approach.

In May 2007, Pennsylvania Governor Ed Rendell created a Pennsylvania Chronic Care Commission, which is comprised of providers, insurers, state government agencies, organized labor, academia, and consumers. The group issued a strategic plan to improve the quality of care in the state, while reducing avoidable illnesses and their associated costs.

That plan--called a Chronic Care Model--began in 30 Philadelphia-area physician offices. To date, a total of 918 primary care practitioners in 173 practices are caring for 1.1 million patients involved in the effort. Ann Torregrossa, director of the governor's office of health care reform, reports that "It is by far the largest such effort in the country."

The program is showing great promise. The preliminary results of the program show that patients are healthier need far fewer hospitalizations, and doctors and other providers are energized and costs have been reduced.

The three-year project is scheduled to phase out from 2011-2013, but efforts are underway to continue and expand the important work. Torregrossa says, "We have applied for a federal demonstration project that would allow Pennsylvania's Chronic Care Model to continue for another three years. In addition, we're working with hospitals across the state to strengthen the link between hospital providers and family physicians. We're also working with insurance companies across the state to change the way health care providers are reimbursed for the care the provide to patients with chronic conditions. Finally, we're assembling all of our "lessons learned" and making them available to providers across the state."

Carefully building on the groundwork being laid by these providers, health care leaders are now looking to connect these electronic health systems to one another, allowing different providers across the street and across the state to securely exchange important patient information when necessary. With $17 million in federal stimulus funds, Pennsylvania is set to build a statewide health information exchange system, known as the Pennsylvania Health Information Exchange (or PHIX). When completed, the PHIX will give authorized health care providers the information they need to provide appropriate patient care services no matter when or where a patient needs care, improve patient safety, reduce redundant tests and procedures, lead to reduced health care costs while improving public health monitoring and tracking, and enable Pennsylvania to connect to the nationwide health information network.

In addition to the development of the PHIX, a long-awaited "final rule" was recently issued by the Centers for Medicare & Medicaid Services that provides hospitals and physicians with important details about how to become "meaningful users" of certified electronic health record systems within the next five years and receive higher Medicare and Medicaid payments for up to four years. The changes made in the final rule make it more manageable for many hospitals to qualify to receive the payments; however, the hospital community remains concerned with other provisions. Because hospitals have to invest millions of dollars today to implement electronic health systems, the extra payments hospitals may receive in the future are critical to their financial stability.

FMAP is the rate at which the federal government matches states' Medicaid expenditures. As part of the federal stimulus efforts, the rate was temporarily increased for Pennsylvania, but was scheduled to end in December. Because of the continued slow economy, Governor Rendell, the hospital community, and others, urged federal lawmakers to extend the payment increase beyond December.

The Pennsylvania hospital community played a critical role in what became a national advocacy effort to get legislation passed that would extend the enhanced FMAP payments. Pennsylvania hospital employees sent more than 8,000 messages to Capitol Hill, and hospital leaders participated in meetings with members of the state's congressional delegation in their Washington D.C. and home offices. As a result, 12 Pennsylvania lawmakers (including Senators Casey and Specter) supported the bill. Seven Pennsylvania lawmakers did not support the bill. You can see how your lawmaker voted and send them a follow-up email in the Take Action area at CareforPA.

Though the original FMAP proposal would have brought $850 million to Pennsylvania, a scaled-back version was passed, bringing between $630 and $660 million to Pennsylvania. The difference in funding, some $200 million, will have to be removed from the state's budget that was finalized in late June.

Governor Rendell met with state lawmakers to discuss changes to the 2010-2011 budget to address the FMAP shortfall. The Governor indicated that he believes a 1.9 percent reduction across agencies, a reduction of $50 million in basic education funding, and new revenues from the Marcellus Shale tax would address the revenue gap.

The statewide advocacy group for Pennsylvania's hospitals, The Hospital & Healthsystem Association of Pennsylvania (HAP), told lawmakers that payments to Pennsylvania's hospitals should not be cut because the hospital community contributed significantly to help the state's budget problems by developing a new hospital payment plan for Medical Assistance that brings an additional $121 million that was critical to the overall state budget.

Approvals on the Rise

According to key findings from the Kaiser Family Foundation's June health tracking poll, about 48 percent of the public said they have a generally favorable view of the new law, up from 41 percent last month. Provisions receiving strong bipartisan support include the law's health insurance exchanges, tax credits to small business; help with the Medicare prescription drug "doughnut hole," high-risk pool for those with pre-existing conditions, and insurance subsidies for individuals. Overall, about 70 percent of Americans reported feeling they "understand what the impact of the health reform law will be" on themselves and their families, up from 61 percent last month.

The June Associated Press-GfK poll on health reform found support for the new overhaul has risen to its highest point since the periodic survey began in September, six months before the law was enacted. Support increased among men (from 36 percent to 46 percent) and people in their prime working years (from 35 percent to 49 percent among 30 to 49 year-olds). Among people 65 and older, however, about 60 percent didn't like the new law.

Share Your Thoughts

To express your insights on health reform and its impact on health care delivery, please complete our brief, four question health reform reader poll. We'll share the results next month in the Know the Issues newsletter and on the CareforPA.org website. 

How the Hospital Community Can Help

The general public often receives information about the new health reform law from friends and family. Members of the hospital community have a special role to play in educating those around them on the legislation's goals, such as increasing the number of Americans who have health insurance coverage and improving access to primary care and preventive care. With so many people depending on friends and family for information about reform, you might want to take a few minutes to learn more about the legislation and share this information with others.

To stay current with the latest information about health reform and other issues important to the hospital community, sign up to receive updates through CareforPA.org's Know the Issues monthly e-newsletter.

Each year, the association honors innovation, creativity, and commitment to patient care through its annual award program, which showcases Pennsylvania hospitals' best practices in areas of workforce, community outreach and engagement, patient safety, patient care, and operational excellence.

This year, more than 130 entries were received from hospitals across the state. Entries were evaluated by a 19-judge panel representing the public and private sectors, health care and business organizations, the media, and for-profit and nonprofit entities.

"These programs are examples of the commitment hospitals and health systems make--every day, in good times and bad--to their patients, communities, and employees," said HAP President and CEO Carolyn F. Scanlan. "They are among the most innovative and creative in the health care field, and we salute their accomplishments."

Congratulations to the 2010 Achievement Award winners:

Workforce

• Magee Rehabilitation Hospital, Philadelphia--Creation of a "Culture of Excellence" Customer Service Improvement Program 
• Grand View Hospital, Sellersville--Tackle the Flu: Improvement of Seasonal Influenza Vaccination Rates Among Employees 
• St. Luke's Hospital & Health Network, Bethlehem--Developing Insightful Leaders: A Customized Leadership Support/Development Program

Community Outreach and Engagement

• Charles Cole Memorial Hospital, Coudersport--Community Benefit Advisory Committees: Advancing Community Partnerships
• Bryn Mawr Hospital, Bryn Mawr--It Takes a Community to Raise the Community
• Heritage Valley Health System, Beaver--Pediatric Asthma Care Protocol Project

Patient Safety

• St. Luke's Hospital-Allentown Campus--Nurse Practitioner-Led Rapid Response Team Reduces Unanticipated Transfers to the ICU
• The Lankenau Hospital, Wynnewood--Robust Feedback to Reduce Ventilator-Associated Pneumonia 
• St. Clair Memorial Hospital, Pittsburgh--Improving Patient Safety Through Standardization of Anticoagulation Processes

Patient Care

• St. Luke's Quakertown Hospital, Quakertown--Championing Core Measures 
• St. Christopher's Hospital for Children, Philadelphia--Rapid HIV Testing in a Pediatric Emergency Department 
• VA Pittsburgh Healthcare System, Pittsburgh--Lung Cancer Collaborative Improves Patient-Centered Care and Decreases Time to Treatment

Operational Excellence

• St. Luke's Hospital-Allentown Campus--Bariatric Patient Access Improvement Project
• Holy Redeemer Hospital and Medical Center, Meadowbrook--Reducing Emergency Department Patients Left Without Treatment 
• Hospital of the University of Pennsylvania, Penn Medicine, Philadelphia--Improving Quality and Safety Through the Implementation of a Unit-Based Clinical Leadership Model

Honorable Mention for Innovation Award

• Temple University Hospital, Philadelphia--A Proactive Hospital-Based Approach to Inner-City Violence

Innovation Award

• Heritage Valley Health System, Beaver--Mobile Clinical Access Portal (M-CAP) Enabling Physician Workflow

Act 49 of 2010 allows the state to adopt a new payment formula that recognizes and supports Medical Assistance patients' needs and access to appropriate levels of service, by updating the payment methodology and improving the overall amount of Medical Assistance payments available to hospitals by capturing additional federal money through an assessment on hospital net inpatient revenues.

The act also enables the restoration of $66 million in state and federal funding cuts to hospital supplemental payments that were proposed in the 2010-2011 state budget through funding from the Quality Care Assessment. Other existing supplemental payments--trauma, burn, obstetrics and neonatal services, and critical access hospitals--were funded at the 2009-2010 level.

"The passage of Act 49 is major step in protecting access to quality care for Medical Assistance patients and improving inadequate Medical Assistance payments to hospitals," said Scott A. Becker, FACHE, chief executive officer, Conemaugh Health System.

Pennsylvania's hospital community developed the plan in response to inadequate Medical Assistance payments that were based on a 20-year-old formula, a growing number of patients covered by Medical Assistance, and proposed cuts in Medical Assistance payments in the state budget for the last several years. The assessment is based on similar programs in more than 20 other states.

The next steps include approvals from the Centers for Medicare & Medicaid Services (CMS) on a waiver to allow the hospital assessment, a State Plan Amendment on payment systems changes, and Medicaid managed care organizations' contracts. Representatives from The Hospital & Healthsystem Association of Pennsylvania (HAP) are hopeful that the plan can be fully implemented in early 2011.

Lawmakers have expressed their appreciation for the hospital community's work on the initiative, particularly for developing a unified plan to pay for the new payment program and their willingness to provide additional money for the state.

Finalizing the budget was difficult for the Governor and lawmakers as it comes at a time when Pennsylvania remains challenged by the economic recession. The bill includes cuts to most programs and likely state employee layoffs. Cuts in hospital payments were spared, however, thanks to a plan proposed by Pennsylvania's hospital community that improves and stabilizes hospital reimbursements and generates approximately $1.6 billion in higher payments over the next three years.

"This budget is a 'win-win-win' for patients, hospitals, and the commonwealth," said HAP President and CEO Carolyn F. Scanlan. "Better and more stable Medical Assistance funding for hospitals will help to preserve and enhance patient access to care, provide hospitals with additional funding needed to improve quality and safety for all patients, and contribute approximately $246 million in revenue to the state over the next three years."

The budget counts on Pennsylvania receiving $850 million in federal Medicaid assistance money (known as FMAP) that Congress has been unable to pass. The hospital community continues to urge Congress to act on this important issue and has sent more than 8,000 messages to Capitol Hill urging that funding be approved. In addition, Governor Rendell traveled to Washington with governors from across the nation to urge Congress to approve the funding. If they money is not approved (or is approved at a lower level), Rendell said he would work with legislative leaders to decide where cuts would occur, but said that it would result in serious cutbacks in education and social services and result in thousands of layoffs in these sectors.

The hospital community will continue to advocate for Congressional action to extend the Federal Medicaid assistance money and will carefully monitor how Pennsylvania legislators and the Governor approach adjustments in state spending should funding not be approved or approved at a lower level.  

Please email your U.S. Representative and U.S. Senators and ask them to pass legislation that extends enhanced FMAP and send it to the President for signature without further delay. Pennsylvania and 20 other states are counting on this funding. Without it, critical hospital funding will be cut.

Go to the "Take Action" area of this website and select the "Action Alert" button on the middle of the page. Fill in your name, address, and email address, and click "send." An urgent email will be sent to your lawmakers. Urge Congress to pass hospital funding now!  

Have a story of your own to share? Share it now!

Get to Know Candidates, Positions

Now is the time to learn more about the candidates and their positions, especially as it relates to important health care issues. You can start right here at CareforPA. Go to the "election area" at the bottom of the Take Action page. Click on Pennsylvania on the U.S. map and you'll find information on all the candidates, including a link to their own websites, contact information, and a brief profile.

In addition, CareforPA will continue to provide you with timely information in the form of articles and videos.

Democrat Dan Onoroto, currently serving as Allegheny County Executive, and Republican Tom Corbett, Pennsylvania's Attorney General, are vying to become Pennsylvania's next Governor. Their policy positions say little about health care, although Corbett cites hospitals as important economic drivers and supports medical liability reform. In addition, Corbett, along with other state attorneys general nationwide, is challenging the constitutionality of the Patient Protection and Affordable Care Act.

With the defeat of Senator Specter in the primary, Pennsylvanians will choose a new U.S. Senator this fall. The Democratic candidate, Joe Sestak, voted for the Patient Protection and Affordable Care Act, and he says that reforming the health care system is a priority. The Republican Senate candidate, Pat Toomey, advocates reducing government's role in health care, giving patients more choices, and implementing medical liability reforms.

There also are numerous candidates running for Lieutenant Governor, U.S. House and state Senate, and House offices that are not listed here. To learn more about these candidates--as well as those running for Lieutenant Governor, U.S. House, and state Senate and House--visit CareforPA's election area. 

Leaders in Public Reporting

"Those of us who work to improve the quality and safety of health care have a saying: If you can't measure it, you can't move it," says Lisa A. Brosey, MSN, RN, CPHQ, Patient Safety Officer at Lancaster General Health. "The key to improving the delivery of  care is to measure how we are doing in order to figure out where and how we can do better."

As a result of this commitment to track and advance quality and safety, Pennsylvania hospitals in 2006 became the first in the nation to report infection rates publically through the Pennsylvania Health Care Cost Containment Council.

To gather even more detailed infection data, Pennsylvania hospitals in 2008 began reporting health care-associated infections to the National Healthcare Safety Network, a web-based health care safety information system developed by the Centers for Disease Control and Prevention. Hospitals are using the system to provide comprehensive infection information to all Pennsylvania agencies that have a stake in tracking or preventing infections.
 
Based on the information submitted to the Centers for Disease Control and Prevention for 2009, Pennsylvania's health department is preparing its first annual report on two kinds of health care-associated infections: central line-associated bloodstream infections and catheter-associated urinary tract infections. The health department also plans to release a pilot report on surgical site infections.

This annual report will establish a baseline for hospitals to compare their infection rates to the overall state average and to begin to measure improvement. Over time, the goal is to improve the state infection rate, demonstrating that Pennsylvania patients are receiving care delivered in a safer manner, with less of a chance of exposure to health care-associated infections, regardless of where they are being cared for.
 
Working Together to Prevent Infections

Pennsylvania hospitals' intensive care units are currently collaborating on an ambitious, three-year project to reduce central-line associated bloodstream infections, one of the most serious kinds of health care-associated infections. Funded by the Agency for Healthcare Research and Quality, the initiative provides hospital staff with clinical education, checklists, feedback on unit-level infection rates, and opportunities to share challenges and solutions.

Hospitals across the state and regionally also have worked together to:

• Prevent ventilator-associated pneumonias and surgical site infections.
• Reduce infection rates through improved hand hygiene and other measures.
• Foster environments that support high-reliability patient safety.

Share Your Hospital's Efforts to Prevent Infections

Are different clinical disciplines, such as pharmacy, respiratory care, and ICU staff, collaborating to reduce infections? Is your hospital measuring its progress toward specific patient safety goals?

Learn about, and share with others, the many efforts underway at your hospital to prevent infections and improve patient safety. You'll be reinforcing important safety messages that will benefit coworkers and their patients. 

For eight years running--even before the current revenue crisis--the Governor's budget proposals have included Medical Assistance cuts for hospitals.

Cuts to Hospitals Are Not the Solution

Despite a growing number of patients covered by Medical Assistance, the Governor's budget proposal reduces hospital Medical Assistance payments by $25.7 million. With matching federal funds eliminated by these cuts, the total impact would be a loss of $66 million. Currently, Pennsylvania's general acute care hospitals are paid, on average, less than 80 cents for each dollar of care for Medical Assistance patients, creating a loss for each patient treated. When these losses are combined with the Governor's proposed cuts to hospitals, access to care for everyone may be threatened. That's why the hospital community is advocating for a solution used in 20 other states that would improve inadequate Medical Assistance payments and help to protect access to care for all patients. 

A Month Out, And No Balanced Budget in Sight

A month away from the deadline on June 30, 2010, Harrisburg does not yet have any balanced budget proposals on the table.

In February, Governor Rendell proposed a budget for 2010-2011 that included a $29-billion spending plan. The revenue side of the budget included a tax on natural gas extraction, enhanced matching federal funds for Medicaid, and a tax amnesty program.

In March, Pennsylvania's House of Representatives passed the Governor's spending plan without offering revenue proposals to offset the expenditures. Meanwhile, revenues included in the Governor's budget are not materializing as projected.

Shortfalls and Delays Stymie Lawmakers

Revenue from state taxes is still not rebounding from the recession as projected. For the first ten months of this fiscal year, tax revenues are $1.1 billion lower than expected. As a result, the commonwealth has significant shortfalls to make up in closing out this year and creating a balanced budget for next year.

The Governor's budget proposal also relies on $850 million that the federal government has yet to deliver. Most states are facing budget crises like Pennsylvania's. To provide relief, Congress is considering extending for six months the temporary increase in the federal funding match for Medicaid (or Federal Medical Assistance Percentage). State lawmakers are waiting for Congress to pass the extension before they count on this extra revenue for next year's budget.

Also unknown at this point are:

• The results of Pennsylvania's tax amnesty program, expected to recoup $190 million in unpaid, back taxes by June 18, 2010.
• Whether the legislature will enact a tax on natural gas extraction, projected to generate about $160 million in revenue in 2010-2011.

These uncertainties, along with the tax shortfall, are holding up progress on the state budget.

What You Can Do

Your hospital leadership and The Hospital & Healthsystem Association of Pennsylvania are urging state and federal lawmakers to take the actions needed so that Pennsylvania can develop a balanced budget without cutting payments to hospitals. Take a moment to learn about this process and how you can support it.

It's a Big Deal 

It's important to know who is running for public office in your area because these are the individuals who will decide how much money hospitals will receive for delivering care, how federal health reform gets implemented, and how many more regulations hospitals will have to wrestle with.

Your participation is critical to ensure that Pennsylvania elects lawmakers that understand and support the work of Pennsylvania's hospital community.

How to Learn More

To find out which candidates are running for office in your area, click on the "Take Action" page and scroll to the bottom. There you'll find a link to the election area.

Once you type in your street address and zip code, you'll see a list of candidates for Governor, the U.S. Senate and House, and the State Senate and House.

You can learn more about the candidates by reading their biographies, checking out the candidates' own websites, and if they are running for re-election, see how they voted on key hospital issues.

The voice of Pennsylvania hospitals has never been more important. With some 300,000 employees, volunteers, and trustees, Pennsylvania's hospital community will make a real difference in the upcoming elections. Take a moment to use CareforPA's election area to learn more about the candidates and make an informed decision at the ballot box on May 18 and November 2.

Fewer Resources, More Needs

Like many states across the nation, Pennsylvania is collecting less in taxes because of the long economic recession and slow recovery. For this and next year's state budget, Pennsylvania simply has fewer dollars than expected.

With unemployment at the highest level in the past 25 years, more Pennsylvanians are without jobs or health insurance. As a result, more people are enrolling in Medical Assistance, Pennsylvania's health insurance program for low-income children, families, older adults, and people with disabilities.

Enrollment in Medical Assistance is expected to grow further as a result of the new national health reform law. In 2014, states must expand their coverage to include all those with low incomes up to 133 percent of the federal poverty level. Nationwide, enrollment could grow by about 30 percent.

There is growing concern about how this health care will be paid for or whether hospitals will be expected to shoulder increasing underfunded care.

Currently, Pennsylvania's general acute care hospitals are paid, on average, less than 80 cents for each dollar of care for Medical Assistance patients, creating a loss for each patient treated. These aggregate losses are expected to grow as more people get Medical Assistance coverage. When these losses are combined with hospital Medical Assistance payment cuts in the proposed state budget of $25.7 million (with matching federal funds eliminated by these cuts, the total impact would be a loss of $66 million), access to care for everyone may be threatened.

"Pennsylvania's hospitals remain open 24 hours a day, seven days a week to provide healing, health, and hope to every patient that enters. However, if changes are not made to ensure improved payments for these vital community resources, access to care and services may be lost. We're at a tipping point. Hospitals that serve our state's most vulnerable patients cannot continue to operate without adequate payment for the services that they provide," said Carolyn F. Scanlan, president and CEO, The Hospital & Healthsystem Association of Pennsylvania.

That's why Pennsylvania's hospital and health system community is encouraging lawmakers to provide fair and adequate payments to hospitals caring for Medical Assistance patients by updating the state's outdated Medical Assistance payment system.

Modernizing Medical Assistance Payments

How the state government pays hospitals for patients with Medical Assistance coverage is based on a 20-year-old formula. This outdated method no longer reflects the way hospitals provide care. That, combined with the fact that hospitals have been faced with proposed cuts in payments in the state budget for the last several years, has spurred the hospital community to support the following changes:

• Adopt a new payment formula for the care that Medical Assistance patients receive. The new formula would update the obsolete formula by recognizing and supporting patient needs and appropriate levels of service.  This will enable Medical Assistance patients to retain access to needed and appropriate quality health care.  
• Increase the overall amount of Medical Assistance payments available to hospitals by capturing additional federal money in the form of an assessment on hospital net inpatient revenues. Similar approaches have been used by 20 other states, allowing states to receive more money from the federal government, called a federal match.  While a portion would be used by the state to fund other programs, the majority of the federal match would be used to modernize hospital payments. 
• Restore $66 million in state and federal funding cuts in the proposed 2010-2011 state budget.
• Maintain current level of state Medical Assistance funding for hospital care.

Next Steps

Outdated payment systems, repeated proposed payment cuts, and increasing financial pressure on the state government to do more with less, has led the hospital community to advocate for a sound approach to creating a modernized payment system for the hospital care provided to Pennsylvanians with Medical Assistance coverage.

As the hospital community continues to work with state government and lawmakers to implement such a system, hospital support will be critical. Additional information on this important issue will be here in the coming weeks.

Studies have shown that when people have insurance, they are more likely to seek the care that they need. Hospitals in Pennsylvania have long advocated for expanding access to health insurance. "More extensive availability of health insurance is one step toward improving the health of Pennsylvanians," said Paul Bacharach, President and CEO of Uniontown Hospital. "Access to primary care, better management of chronic conditions, and coordination within the continuum of care should become more feasible within the Commonwealth."

Paying for the Plan

The Congressional Budget Office (CBO) estimates that the legislation will cost $940 billion over ten years. The hospital community has provided leadership in this effort by making a meaningful contribution toward helping to achieve savings as its part of the shared responsibility to expand coverage, as have other stakeholders in this process. The national hospital community agreed to accept lower Medicare payment increases from the Federal government, called payment updates. (Like cost-of-living increases, these payment updates are intended to adjust for hospitals' rising operational costs.)  According to preliminary estimates, the reductions to hospitals in Pennsylvania could total $6.8 billion over ten years.

As the number of uninsured Americans falls, so will a second, separate Medicare payment to hospitals that was designed to offset the cost of caring for uninsured patients. From 2014 to 2019, these payments to hospitals in Pennsylvania are expected to drop by about $500 million.

Fewer Uninsured Patients

By 2014, all Americans must have insurance. The government will provide tax credits and financial assistance to help make coverage affordable for small businesses and low wage earners, creating a number of opportunities to obtain coverage. States also will create insurance exchanges--online marketplaces where consumers can compare plan benefits and costs. Insurers must stop denying coverage based on pre-existing conditions and implement other changes designed to expand coverage and reduce consumers' insurance costs.

With more people covered, hospitals will have fewer losses from care provided to uninsured patients. In fiscal year 2008, Pennsylvania hospitals provided $753 million in uncompensated care. Much of this care was for people who had no insurance.

More Medicaid Patients

In 2014, states must provide Medicaid health insurance to all those with low incomes up to 133 percent of the federal poverty level (or about $14,400 for one person in 2009). This Medicaid expansion includes adults without children or disabilities. Pennsylvania's Medicaid program, called Medical Assistance, currently covers low income adults only if they are taking care of children. Nationwide, this change could result in 12 to 16 million or more new Medicaid enrollees, covering about half of the total number of uninsured the law promises to cover.

One concern with this is that in Pennsylvania, general acute care hospitals are paid, on average, less than 80 cents for each dollar of care for Medical Assistance patients. To address this payment gap, Pennsylvania hospitals are asking that the state's outdated Medical Assistance payment system be updated to provide fair and adequate payments to hospitals for providing care to Medical Assistance patients.

More Physicians Needed

As more people get coverage, more physicians will be needed to provide the primary and preventive care expected to keep down the climbing cost of health care.

The new law calls for more funding for training, scholarships, and loan repayments for doctors entering primary care. To train more primary care doctors and general surgeons, unused residency training program positions will be redistributed to hospitals that can make use of them. Qualified hospitals can request up to 75 of these unused positions.

A Focus on Quality, Safety

The new law includes provisions to reduce hospital "readmissions" and prevent certain health care-associated conditions, such as infections.

A readmission occurs when a patient who is admitted to the hospital receives treatment for a health problem, is sent home, and then comes back to the hospital for a related problem within a certain time period. Starting in 2013, the number of hospital readmissions for heart attack, heart failure, and pneumonia will be evaluated, with hospital receiving fines for higher-than-expected numbers of patients being readmitted.  By 2019, Pennsylvania hospitals are projected to receive $383 million less in Medicare payments as a result of these fines.

Many Pennsylvania hospitals have already begun their own programs to reduce the number of readmissions. However, many readmissions can't be prevented or happen because of factors beyond hospitals' control, like when patients don't take their medications or go to follow-up visits. The American Hospital Association and The Hospital & Healthsystem Association of Pennsylvania (HAP) are continuing to work to make sure that readmission provisions in the new law are implemented in a way that is fair to hospitals.

Pennsylvania hospitals also have had a head start in the prevention of health care-associated conditions, also called preventable serious adverse events. As a state, Pennsylvania was the first to implement many quality initiatives designed to improve safety and avoid errors.

Shaping Future Health Delivery, Payment

The new law also provides for several kinds of pilot projects to improve care and achieve savings. These "test projects" could hold significant implications for hospitals over the long-term.

Beginning in 2012, the federal government will launch a "value-based purchasing program" that links Medicare payments to hospitals to their quality performance. Another pilot project will use "bundled payments" to compensate hospitals, paying one lump-sum amount for all services needed to treat an episode of care (such as bypass surgery) to encourage hospitals to improve coordination and eliminate unnecessary care.

The law also allows a variety of providers to come together and form "accountable care organizations" that would work together to improve care management and coordination.

In addition, the growth of physician-owned hospitals, often called ambulatory surgery centers, will be limited by new regulations.

What's Next

Even with all these changes, the enactment of this far-reaching law is just the beginning of health care reform. Many provisions don't even begin until 2014 or beyond. Many will require numerous regulations before the legislation's broad vision can be put into action. Some states, including Pennsylvania's Attorney General, are challenging whether the federal government even has the authority to require people to purchase health insurance. Despite these uncertainties, Pennsylvania hospitals are forging ahead, making sure that as many Pennsylvanians as possible have access to the best health care available.

Pennsylvania's hospital community has much at stake in how the broad outlines of health care reform will be implemented. By learning about the legislation and its implications, you will play an important role at a very important time in health care.

Please be ready to advocate on behalf of your hospital. Hospitals across the state and nation may be asked to speak out to ensure that as changes are made, that they help--not hurt--the health and well-being of patients and communities.