15 from 2015: Stories that defined the year

A look back at 15 of the year's most interesting and powerful events.

What happened in 2015?

Things spiked, like the price for a Daraprim pill, which grew 5,000 percent overnight.

Things stopped, like low-volume surgeries at three prestigious academic medical centers.

Some things exceeded estimates, such as the price of EHR rollouts, while others fell short, such as the acuity of the physician shortage.

2015 was a year marked by supersized insurers, goals for interoperability and payment, cyberattacks and hacks, oral arguments, star ratings and 70,000 new diagnostic codes.

Here's a look back at the year's most interesting and powerful events.

 

1. New goals and deadlines for value-based care
By Molly Gamble

When it comes to value-based healthcare, January 2015 was a month for the books.

Late that month, HHS released a series of goals and deadlines in its plan to shift from volume- to value-based payments. By 2018, the government wants to make half of all Medicare payments under an alternative model, which includes accountable care organizations, patient-centered medical homes or bundled payments. By 2016, the benchmark is to have 30 percent fit that bill.

At the time HHS Secretary Burwell made the announcement, about 20 percent of Medicare payments were made under an alternative model.

Further, HHS rolled out another goal for "virtually all" Medicare fee-for-service payments to be tied to quality and value through programs such as the Hospital Value Based Purchasing and the Hospital Readmissions Reduction Programs. This amounts to 85 percent in 2016 and then 90 percent in 2018.

Only a couple days after, a powerhouse of the biggest health systems in the country pledged to shift 75 percent of their business to value-based payment arrangements by 2020. The 28-member Health Care Transformation Task Force includes 20 insurers and provider organizations such as Boston-based Partners HealthCare, Livonia, Mich.-based Trinity Health and Downers Grove, Ill.-based Advocate Health Care.

An official with Advocate said the timing of the announcement and its proximity to HHS' new goals to move Medicare more toward value-based reimbursement was coincidental, as the task force began strategizing in summer 2014. Nonetheless, the timing reinforced the conventional wisdom that commercial payers take Medicare's lead.

The news made a splash for several reasons. First, it was the first time in the history of Medicare that HHS set explicit goals for the rollout of certain payment models. Second, the developments were not relative to one sector of the industry. The Health Care Transformation Task Force includes payers such as Aetna, Blue Cross Blue Shield of Massachusetts and Blue Shield of California, along with policy groups like Dartmouth Institute for Health Policy and Clinical Practice and Leavitt Partners. HHS also created a learning and action network, through which it will "intensify its work with states and private payers to support adoption of alternative payment models through their own aligned work, sometimes even exceeding the goals set for Medicare."

More provider organizations began characterizing their maturity in accountable care by stating the percentage of business that stemmed from value-based care arrangements in 2015. Advocate, for instance, stated it was poised to beat that 75 percent goal by year's end. (In January 2015, nearly 65 percent of the system's business stemmed from alternative contracts.) It will be interesting to see what numbers other systems cite in the next 12 months.

2. Hackers break into Anthem
By Akanksha Jayanthi

In late January, Indianapolis-based Anthem discovered its network had been compromised by hackers. The breach affected 78.8 million individuals, making it the biggest healthcare data breach disclosed to date.

Anthem learned of the attack Jan. 29 when a systems administrator noticed a database query was running even though the administrator had not initiated it. Compromised information included names, birth dates, addresses, phone numbers, email addresses, employment information and Social Security numbers of former and current customers and employees of Anthem, one of the largest health benefits companies in the United States.

Investigations into the breach determined hackers obtained the credentials of five Anthem technology workers and then used phishing campaigns, which prompted network administrators to either reveal their login information or click a link that granted hackers access to their computers. Additionally, reports indicated Anthem's customer data was not encrypted.

As the largest licensee of the Blue Cross and Blue Shield Association in 13 states and specialty plans in other states, the ripple effects of this data breach were felt across the U.S. Within 24 hours of reporting the breach, Anthem faced class-action lawsuits from California and Alabama accusing the payer of failing to properly secure and protect its customers' personal information. More lawsuits trickled in from across the country as individuals learned their data was involved in the breach, stemming from Colorado, Connecticut, Missouri and Ohio, to name a few. The lawsuits are ongoing.

Despite the severity of the event, Anthem did garner some positive feedback for how leadership handled the breach. Much of the praise was focused on Anthem CEO Joe Swedish, who informed the public of the breach Feb. 4, just six days after learning of the attack. For comparison, Mountlake Terrace, Wash.-based Premera Blue Cross waited seven times as long. It reported a data breach affecting 11 million customer records March 17, but it learned of the attack on its systems Jan. 29. (That both companies learned of their respective cyberattacks on the same day is a coincidence, as they are two separate organizations.)

2015 was projected to be wrought with data breaches as the number and intensity of such incidents climbs. So far healthcare has lived up to these expectations — especially breaches stemming from malicious intent. In May, the Ponemon Institute released a report identifying criminal attacks as the leading cause of data breaches in healthcare, up 125 percent since 2010.

3. U.S. spends more on prescription drugs — and a 5,000% price hike heats up the debate
By Tamara Rosin

When 32-year-old Turing Pharmaceutical Founder and CEO Martin Shkreli raised the price of Daraprim, an antiparasite medication developed 62 years ago, jaws dropped among physicians, politicians, the public and even other pharmaceutical company executives. That's because the price of Turing's recently acquired drug shot up by 5,000 percent overnight, from $13.50 per pill to $750.

Mr. Shkreli defended the move, saying at $750 per pill, Daraprim is still at the low end what orphan drugs cost. He said the drug is rarely used, so the impact of the price hike on the healthcare industry would be minimal. He also said his company needed to raise the price to fund research and development for a better version of the pill, which is used to treat toxoplasmosis. After days of international media attention and backlash in September, Mr. Turing said he would lower the price of Daraprim to an undisclosed amount.

News of Turing's pricing strategy hit a nerve. Soaring prices of specialty prescription drugs has been a growing problem in the U.S., one gaining attention throughout 2015.

According to CMS' Office of the Actuary, retail prescription drug spending accelerated in 2014, rising 12.2 percent to $297.7 billion compared to 2.4 percent growth in 2013. The rapid growth in 2014 was due to increased spending for new medications, especially for specialty drugs, such as treatments for hepatitis C. Patent expirations and brand-name drug increases had a smaller impact on the increased spending. 

The problem of out-of-control drug prices persists without an agreed-upon solution. For one thing, Medicare can't legally negotiate with drug companies for lower prices under the current law, though doing so could save the federal government between $15.2 billion and $16 billion each year, according to a report published by Carleton University and Public Citizen, which cited research from Avalere Health.

Ezekiel Emanuel, MD, raised another point in a New York Times op-ed. He said the biggest problem with "stratospheric" drug prices is value — expensive drugs that do not provide a cure. For example, Opdivo adds an average of 3.2 months of life to cancer patients even though it costs $150,000 per year for treatment, according to Dr. Emanuel. On the other hand, some drugs have through-the-roof price tags but are cost effective. Solvadi costs $1,000 per pill but helps cure hepatitis C, for instance.

Presidential candidates Sen. Bernie Sanders (I-Vt.) and former Secretary of State Hillary Clinton have both taken a stance against rising prescription drug costs.Sen. Sanders and Representative Elijah Cummings (D-Md.) proposed a bill that would enable Medicare to negotiate drug prices, permit consumers to import less expensive drugs from Canada and require companies to disclose the prices they charge in other countries. Ms. Clinton discussed a plan in which out-of-pocket drug expenses would be capped at $250 per month.

4. Supreme Court upholds federal premium subsidies in King v. Burwell
By Tamara Rosin

The U.S. Supreme Court issued its highly anticipated opinion on King v. Burwell June 25 in a 6-3 ruling supporting the provision of tax subsidies under the Affordable Care Act to all eligible Americans — even those who reside in states that did not establish their own health insurance exchanges.

The ACA states subsidies for health insurance premiums are to be provided "through an exchange established by the state." David King and his fellow plaintiffs argued the language of the law stipulated premium tax credits could only be offered to qualifying low-income Americans in states that had launched their own insurance exchanges. The government argued offering subsidies to people in all states is lawful because the law should be interpreted to include federal exchanges.

The majority of the court found the petitioners' argument feeble. "The argument that the phrase 'established by the State' would be superfluous if Congress meant to extend tax credits to both the State and Federal Exchanges is unpersuasive," Chief Justice John Roberts wrote in the majority opinion.

Chief Justice Roberts focused his comments on the greater purpose of the ACA. "Congress passed the Affordable Care Act to improve health insurance markets, not to destroy them. If at all possible, we must interpret the Act in a way that is consistent with the former, and avoids the latter," he wrote.

Dissenting justices included Antonin Scalia, Samuel Alito and Clarence Thomas.

The debate surrounding King v. Burwell was highly contentious and largely split down the partisan divide. It represented Republicans' most forceful attack on the Obama administration's signature healthcare law, as a win for King would have collapsed the individual mandate — an essential pillar of the ACA — effectively dismantling the rest of the law.

By late June, when the Supreme Court delivered its opinion, Republicans had tried and failed 50 times to repeal the ACA. An attempt to defund the law through a spending battle resulted in a two-week government shutdown in October 2013.

Since the Supreme Court decision in June, Republicans in Congress have continued in their crusade against the ACA. Nearly all of the Republican presidential frontrunners have outlined plans to repeal or replace the law.

5. EHR rollouts bleed over budgets
By Carrie Pallardy

EHR implementations are invariably expensive, and often pricey enough to surprise healthcare organizations. A Capterra survey of 400 EHR users found providers spend an average of $117,672 per year on EHR software, or $31,710 more (37 percent higher) than their expected cost. This year was marked by several EHR implementation stories with even bigger sticker shock and, correspondingly, big consequences.

Lahey Health, based in Burlington, Mass., reported losing $21 million for the six months ended March 31, and part of those losses could be traced back to the health system's Epic EHR and patient portal implementation. The two-year implementation process was wrapping up in 2015, but the $160 million price tag was more than anticipated. Coupled with lost business due to harsh winter weather, Lahey Health needed to take action to stabilize its financials. In May, the system announced layoffs affecting 130 people at three of its hospitals. To further recoup from the financial losses, the system's executives took a 10 percent pay cut for the remainder of the year.

Southcoast Health, based in New Bedford, Mass., had a similar experience since the system rolled out Epic's EHR three years ago. The health system went live on Epic's EHR in three hospitals, two urgent care centers and more than 400 physician offices, and the health system ran into financial straits since then. Between October 2014 and January 2015 the health system laid off 105 employees. In a report of its fiscal year ended in September 2014, Southcoast Health indicated its $30 million operating loss was due in part to its Epic implementation.

Over-budget EHR implementations not only contributed to employee layoffs, but also reached the executive level. In January 2013, NYC HHC signed a contract, worth $302 million over 15 years, to implement Epic's EHR. But, the implementation and maintenance costs over six years are $764 million. The system planned for the EHR to be live at 11 of its hospitals, four long-term care facilities, six diagnostic treatment centers and more than 70 clinics by 2017.

Though enterprise-wide go-live date was pushed back to 2018, NYC HHC officials maintain the project remains on budget. A number of New York City and Health and Hospitals Corp. executives were fired or resigned amidst an investigation of the system. HHC Inspector General Norman Dion has been investigating allegations of improper billing and misconduct since August 2014. In February, CIO Bert Robles was forced to resign, CTO Paul Contino left his post during the summer and two administrators and seven consultants were fired.

Despite the EHR's implementation delay, NYC HHC comments indicated the shakeup in executive leadership was not related to the Epic rollout. "Paul Contino was terminated … for reasons unrelated to Epic. Bert Robles and several other members of the Epic implementation team have been terminated for reasons related to personal behavior and conduct that did not affect the Epic implementation project, which remains on schedule and on budget," the hospital told Becker's Hospital Review.

EHRs and financial concerns were not limited to the United States this year, either. In the United Kingdom, amidst the country's first Epic EHR implementation, a CEO and CFO stepped down. CEO Keith McNeil and CFO Paul James of Cambridge University Hospitals NHS Foundation Trust left two their positions two months after Monitor, the country's health industry regulator, began an investigation into the system's finances. The implementation project included $45 million for Epic software, $212 million for a Hewlett-Packard hardware upgrade and $30 million in additional costs.

6. Stars, grades and Yelp reviews — for hospitals
By Emily Rappleye

The lights were flipped on in healthcare this year as a plethora of provider ratings, rankings and reviews hit the Web. In the push for transparency, rankings were slammed by some and lauded by others. Naysayers assert online reviews are skewed, flawed or focus on the wrong information. Advocates say they empower patient decision-making and hold providers accountable.

Regardless of stance on provider rankings, one thing is certain: They came out full force in 2015.

Online reviews sprouted from all different corners of the industry. CMS released a five-star rating system in April to its Hospital Compare website, with the number of stars determined by HCAHPS scores. More than 3,500 hospitals were given 12 star ratings — one summary star rating and 11 sub-ratings specific to HCAHPS measures.

In July, nonprofit investigative newsroom ProPublica launched a searchable database of nearly 17,000 surgeons based on Medicare data from 2009 to 2013 called the Surgeon Scorecard. It provides patients a snapshot of a surgeon's performance and complication rates on specific surgeries. ProPublica also pulled Yelp into the ring by partnering with the consumer review site to augment user reviews with CMS data from 4,600 hospitals, 15,000 nursing homes and 6,300 dialysis centers.

Consumer Reports diversified its resources for patients choosing a provider by publishing infection rates this summer of more than 3,000 hospitals and ratings that include patient safety scores, patient experience, patient outcomes and other metrics.

And to keep pace, many hospitals and health systems also added reviews of their physicians this year, including Pittsburgh-based UPMC, Little Rock-based University of Arkansas for Medical Sciences, San Diego-based Scripps and Great Neck, N.Y.-based North Shore-LIJ Health System.

The ranking trend even got meta when Press Ganey released a seal in June to validate review systems. Regardless of whether providers are for or against publicly reported data, it can help motivate improvement, and as meta-review systems like Press Ganey's grow along with the data, it will become increasingly reliable and comprehensible for consumers.

7. Insurer mega-merger frenzy: The big 5 become the big 3
By Erin Marshall

At the beginning of 2015, the traditional big five insurers included Aetna, Blue Cross Blue Shield — which includes 36 companies, the largest being Anthem — Cigna, Humana and UnitedHealthcare. But a fast twist of summer events turned the big five into the big three.

Hints of mega-mergers began in late May when there was talk of Cigna or Aetna acquiring Humana. Humana quickly went into a "quiet period," refraining from discussing the potential merger. But by July, Aetna and Humana struck a $37 billion deal: Aetna will take over Cigna, and Aetna Chairman and CEO Mark Bertolini will serve as the chairman and CEO of the new company.

Meanwhile, another insurer was jumping at the opportunity to acquire. Anthem made numerous takeover bids for Cigna in June, all of which Cigna rejected. Eventually the two insurers reached a consensus in late July. Anthem inked an agreement to acquire Cigna in a deal valued at over $54.2 billion.

UnitedHealthcare also wanted to get in on the madness. In mid-June, the health insurer approached Aetna about a takeover deal, but nothing came of the proposal.

Just when the merger mania died down, a series of lawsuits and defenses arose. The Aetna-Humana deal faced multiple lawsuits from investors and shareholders seeking to prevent the acquisition. Nevertheless, shareholders voted to approve the deal in late October. CEOs of the insurers also defended the deals. Cigna CEO David Cordani told Reuters Anthem's takeover of Cigna would help consumers, while Aetna CEO Mark Bertolini and Anthem CEO Joseph Swedish defended their deals before a Senate Judiciary subcommittee.

Another major player in the healthcare world, the American Hospital Association, took its own stance on the mega-mergers. The AHA outlined its fierce opposition to insurer consolidation by submitting letters to the Department of Justice and HHS, noting "The size, scope and enduring impact of the announced deals far surpass any hospital merger." AHA and AMA representatives later appeared before a U.S. Senate antitrust panel and called on Congress to intensely examine the proposed mergers.

Though they're still undergoing review processes with the Federal Trade Commission and the Department of Justice, both the Anthem-Cigna deal and the Aetna-Humana deal are expected to close in the latter half of 2016.

8. How many physicians will the U.S. need? AAMC unveils new estimates
By Emily Rappleye

Ongoing coverage of the national physician shortage was punctuated by a report released in March by the American Association of Medical Colleges. This report garnered quite a bit of attention because it lessened the projected physician shortage from its 2010 estimate.

The new forecast puts the U.S. need for physicians between 46,100 and 90,400 over the next decade, whereas the 2010 estimate projected a shortage of 130,600 physicians by 2025.

The shortage was adjusted down from 2010 due to changes made by the U.S. Census Bureau to the projected population, in addition to growing ranks of physicians graduating from medical education programs. It estimated the primary care physician shortage to range between 12,500 and 31,100 and the nonprimary care shortfall between 28,200 and 63,700. The lower range estimates account for the increasing supply of advanced practice nurses, whose ranks are expected to increase by nearly 115,000.

Despite the somewhat more optimistic outlook, the AAMC warned the projections still indicate a critical issue in healthcare. It said the shortage requires increasing the capacity of graduate medical education as well as finding more efficient ways to deliver care and maximize the available workforce.

9. Congress passes permanent 'doc fix' legislation
By Ayla Ellison

One of the most closely watched stories in the early part of 2015 was passage of legislation that permanently eliminated the sustainable growth rate — a flawed physician payment formula that Congress had prevented from going into effect since 2002.

Designed to restrict growth in Medicare Part B spending by establishing targets for expenditures, the SGR formula was enacted by Congress as part of the Balanced Budget Act of 1997. The formula's methodology, which the Medicare Payment Advisory Commission told Congress is "fundamentally flawed," limited spending for physicians' services by linking updates to target rates of spending growth. It automatically reduced Medicare physician fees across the board if physician spending exceeded a target based on overall economic growth.

Using the SGR methodology, Congress allowed a 4.8 percent reduction in Medicare payments to physicians to take place in 2002. However, Congress enacted a short-term legislative patch, or "doc fix," to avoid SGR cuts every year after that until 2015.

With physicians facing a 21 percent cut to their Medicare payments, permanent "doc fix" legislation was introduced by bipartisan committee leaders in the House and Senate in March. Major healthcare groups, including the American Hospital Association and the American Medical Association, showed strong support for the bill.

The House passed the legislation in a vote of 392-37 in March, and the Senate passed the bill in a vote of 92-8 on April 14 — just in time to prevent the cut to physicians' Medicare payments scheduled to take effect April 15.

President Barack Obama, who recognized the need for a permanent solution to the SGR and even proposed repealing the SGR formula in his 2016 budget, signed the "doc fix" legislation and hailed it as a "significant bipartisan achievement."

Although the law, known as the Medicare Access and CHIP Reauthorization Act of 2015, is most widely known for repealing the SGR, it contains many other policy changes. It also made significant modifications to the way Medicare pays physicians and included a two-year extension of the Children's Health Insurance Program.

10. ONC rolls out interoperability roadmap
By Max Green

Unveiled Oct. 6, the final version of the Office of the National Coordinator for Health Information Technology's interoperability roadmap outlines exactly how the federal government plans to achieve secure, nationwide healthcare information exchange by 2024.

"Our long-term goal is simple: to build a strong foundation of health IT in our healthcare system, equipping every person with a long-term, digital picture of their health over their lifespan," Karen DeSalvo, MD, National coordinator for health IT, wrote in a statement included with the roadmap. "We are closer than ever before."

Some stakeholders are less optimistic than Dr. DeSalvo. The ONC accepted public comments on the draft version of the roadmap until April 3 and published them in May — they run the gamut from whole-hearted support to skepticism about the government's ability to fix the interoperability problem. However, the ONC has support from key industry partners, including the American Health Information Management Association, the College of Healthcare Information Management Executives, the American Hospital Association and a handful of other vendors and interoperability alliances. These statements of support and an overview of the feedback from public comments was included along with the final roadmap.

The ONC wants the roadmap to be a "living document," one that will be updated over time and change as new milestones are met and challenges emerge. It is currently organized into three sections, starting with "Drivers," which are the mechanisms that will establish a supportive payment and regulatory environment. Next is "Policy and Technical Components," which comprises the essential items, such as standards, stakeholders will need to implement in compatible ways to achieve secure interoperability. Lastly, the "Outcomes" section covers the metrics by which stakeholders will measure collective progressive on implementing the roadmap.

Each section includes specific calls to actions, commitments and milestones. Here is the rough outline of major milestones spread over the next 10 years the ONC includes in the final version:

· 2015-2017: Send, receive, find and use priority data domains to improve healthcare quality and outcomes.
· 2018-2020: Expand data sources and users in the interoperable health IT ecosystem to improve health outcomes and lower cost.
· 2021-2024: Achieve nationwide interoperability to enable a learning health system, with the person at the center of a system that can continuously improve care, public health, and science through real-time data access.

To achieve these milestones and the overall goal of seamless interoperability, the roadmap includes a number of strategies for change that must work in tandem to produce results, according to Erica Galvez, portfolio manager for the ONC.

"In the roadmap we talk about those policy levers at a federal level, at a state level, but also at a commercial level," Ms Galvez said at the HIMSS15 conference. "It's important to align all of those pieces so that we work in sync together over time."

11. Nearly 2,600 hospitals dinged in year 4 of CMS' Readmissions Reduction Program
By Heather Punke

2015 marked the fourth year of CMS' Hospital Readmissions Reduction Program, and just shy of 2,600 hospitals were penalized with cuts to their Medicare reimbursements due to high readmission rates. The financial penalties are expected to cost hospitals a combined $420 million.

Of the 2,592 hospitals facing penalties in fiscal year 2016, which runs Oct. 1 through Sept. 30, 2016, 38 hospitals are receiving the maximum penalty of 3 percent reduction in Medicare payments. The average penalty for each hospital is a 0.61 Medicare payment reduction, although 506 hospitals will lose 1 percent or more of their Medicare payments.

The goal of the program is to improve care quality and reduce unnecessary readmissions to hospitals, and in a sense, the program has been a success. Readmission rates have dropped in hospitals since the program started penalizing them.

However, even hospitals that lower their readmission rates year over year can face penalties under the program, according to Kaiser Health News. That's because penalties are based on the difference between a hospital's projected rate of unplanned readmissions (based on national trends) and the actual rate of readmissions.

Controversy and outrage surrounding the Hospital Readmissions Reduction Program is nothing new, but a major study released by Harvard Medical School researchers published in JAMA Internal Medicine in September provided the most recent ammunition in the war against the penalties. The study found the CMS-imposed penalties unfairly punish safety-net hospitals that provide care for the country's most vulnerable patients.

"The readmissions reduction program is designed to penalize hospitals for poor quality of care, but our findings suggest that hospitals are penalized to a large extent based on the patients that they serve," said J. Michael Williams, MD, PhD, an associate professor at HMS and physician from Boston-based Brigham and Women's Hospital. That's because CMS' formula to predict readmission rates does not factor in social and clinical characteristics of a particular hospital's patient population.

Not only are the hospitals that treat the sickest of the sick more likely to be penalized, cutting funding can have unintended consequences, the study found, since the money that they no longer receive due to the program could be put toward quality improvements. "Our findings suggest that the hospitals…are being deprived of resources that they could use to take better care of their communities," Michael Barnett, MD, the study's lead author, told The Washington Post.

Currently, the program examines readmissions of patients originally admitted for heart attack, heart failure, pneumonia, chronic obstructive pulmonary disease or elective hip and knee replacements. Looking into FY 2017, the program will expand to include coronary artery bypass grafting as well.

12. ICD-10 finally rolls out
By Carrie Pallardy

Oct. 1 was viewed with much trepidation, but the ICD-10 go-live day came and went quietly compared to the events leading up to it. 

After delays in 2009, 2012 and 2014 it seemed possible the coding system's go-live date could be pushed back again, and there were legislative efforts geared toward just that. Efforts included the Cutting Costly Codes Act of 2015, sponsored by Rep. Ted Poe (Texas-2), and an Alabama Senate Joint Resolution called for Congress to delay IDC-10. Additionally, Rep. Gary Palmer introduced the Protecting Patients and Physicians Against Coding Act of 2015, which would have provided physicians a two-year grace period during which they could not be penalized for ICD-10 coding errors.

These efforts were ultimately unsuccessful, but in July CMS announced its own changes to help ease providers into the transition. CMS is allowing for a one-year transition period; no Medicare claims will be denied or audited based solely on code specificity. But, codes must still come from the appropriate ICD-10 code family. Physicians will not be subject to Physician Quality Reporting System penalties related to ICD-10 diagnosis code specificity during the one-year period. CMS also established the "Road to 10" guidance tool to help providers through the transition.

Nine days before official implementation, Navicure released its Healthcare Organization ICD-10 Readiness Survey. Of the survey respondents, 85 percent were optimistic they would be prepared for the switch. The biggest concerns focused on revenue cash flow; 94 percent of survey respondents reported anticipating an increase in denials.

The full aftermath of ICD-10 has yet to be assessed, but most providers seem relieved the transition, mostly uneventful, actually took place. "We didn't see anything major or out of the blue happening. It's still too early to say whether we are in the safe zone or not from ICD-10. From a system standpoint, we were ready with the upgrades and updates in the ICD-10 platforms," Suma Gaddam, vice president and CIO of Care New England in Providence, R.I., said in an interview with Becker's Hospital Review.

13. Major health systems move to end surgery programs with low case volume
By Shannon Barnet

Patient safety has always been the No. 1 priority of hospitals and health systems, but research and reports constantly change what healthcare providers consider risky for patients. In May, an analysis released by U.S. News & World Report found having a low volume of cases for certain surgical procedures is one of the risk factors hospitals should take into account.

According to the report, as many as 11,000 patient deaths in the U.S. from 2010 through 2012 could have been prevented if those patients who had gone to the fifth of hospitals with the lowest volume had gone to the fifth with the highest volume for five common procedures and conditions: hip replacements, knee replacements, heart failure, heart bypass surgery and chronic obstructive pulmonary disease.

Following the release of the report, three major academic health systems — Dartmouth-Hitchcock Medical Center in Lebanon, N.H., Baltimore-based Johns Hopkins Medicine and Ann Arbor-based University of Michigan — barred member hospitals from performing certain low-volume procedures.

Peter Pronovost, MD, PhD, a critical care physician, senior vice president for patient safety and quality and director of the Armstrong Institute for Patient Safety and Quality at Baltimore-based Johns Hopkins Medicine, read the U.S. News & World Report and felt compelled to act.

Together, he and the executives from DHMC and University of Michigan identified 10 high-risk procedures with the strongest correlation between volume and mortality and agreed to bar them if their hospitals and surgeons fell into the lowest fifth by volume.

While some hospitals and health systems immediately made changes to their surgical programs, others continue to deal with patient safety issues surrounding their low-volume surgery programs.

St. Mary's Medical Center in West Palm Beach, Fla., made headlines this summer when a CNN report criticized the hospital for its lack of transparency regarding patient deaths linked to its pediatric heart surgery program. Industry experts weighed in, saying the hospital's low volume indicated the surgical team could not have dealt with enough cases to build skill or maintain proficiency in the complex pediatric procedure. Although St. Mary's argued the mortality rate was exaggerated in the CNN report, the hospital suspended and eventually closed its pediatric cardiothoracic surgery program permanently.

The news from St. Mary's may be troubling, but progress is being made in the area of patient safety and low volume surgeries. The industry will likely see more and more hospitals follow the footsteps of Dartmouth-Hitchcock, Johns Hopkins and University of Michigan and bar surgeons from performing procedures with low case volumes.

14. Patients die from superbug outbreaks
By Shannon Barnet

In February, two patients at Ronald Reagan UCLA Medical Center in Los Angeles died after contracting carbapenem-resistant Enterobacteriaceae infections.

UCLA discovered the CRE outbreak in late January and began notifying nearly 200 patients who could have been exposed to the deadly bacteria. The L.A. hospital was not the only one faced with the deadly bacteria, however, Seattle-based Virginia Mason Medical Center linked 39 infections and 18 deaths to the outbreak between 2012 and 2014 and Los Angeles-based Cedars-Sinai Medical Center saw four patients contract CRE between August 2014 and January 2015.

Investigations conducted by local, state and federal health officials linked many of the infections to improperly cleaned duodenoscopes, prompting inquiries into the manufacturers of the medical devices.

In addition to dealing with federal investigations, some scope manufacturers faced legal ramifications. Virginia Mason joined a lawsuit against Olympus America, saying its devices were "badly designed and poorly regulated." Olympus countersued, arguing the hospital failed to clean the device and use it properly.

In May, the Food and Drug Administration released a report that revealed the agency had received 142 reports of patient infection or device contamination associated with duodenoscopes since 2010. Shortly thereafter, a USA Today investigation found the FDA was aware duodenoscopes posed a risk for harboring organisms and spreading infections for nearly six years before issuing a warning.

Meanwhile, the Justice Department subpoenaed three duodenoscope manufacturers — Olympus, Pentax and FUJIFILM — and Virginia Mason Medical Center to obtain thousands documents relevant to their investigation into the deadly series of superbug outbreaks that affected hundreds and may have killed 18 people.

Ultimately, issues regarding who is at fault for the outbreaks and the eventual patient deaths have remained largely unresolved. That said, regulatory officials, healthcare providers, medical device manufacturers and clinicians alike have boosted efforts to improve duodenoscopes disinfection and prevent the spread of superbugs, like CRE.

For instance, in early October, the FDA ordered the three duodenoscope manufacturers to perform postmarket surveillance studies to increase their understanding of how the devices are reprocessed in real-world settings, after which they would have 30 days to submit a report to the federal agency outlining their improvement plans.

15. Adventist Health System's record-breaking $118.7M settlement for improper physician compensation
By Ayla Ellison

There were a flurry of healthcare fraud settlements in 2015, including the largest one ever made involving physician referrals to hospitals.

In September, the Department of Justice and a handful of states reached an agreement with Altamonte Springs, Fla.-Adventist Health System, settling allegations the 44-hospital system had maintained improper compensation arrangements with referring physicians since the early 2000's.

The allegations against the nonprofit system stem from claims made in two qui tam lawsuits: One brought in 2012 by three whistle-blowers who worked at an Adventist hospital in Hendersonville, N.C., and another filed in 2013 by a whistle-blower who worked at the system's corporate office.

The complaints alleged Adventist paid physicians above fair market value and paid bonuses to employed physicians based on a formula that improperly took into account the value of their referrals to Adventist hospitals. The health system allegedly compensated physicians with perks, such as car payments. Adventist also allegedly submitted false claims to the Medicare and Medicaid programs for services rendered to patients by the physicians who received the improper bonuses, according to the complaints.

The whistle-blowers further alleged the health system submitted bills to Medicare for its employed physicians' professional services that contained certain improper coding modifiers.

Under the settlement agreement, Adventist agreed to pay $115 million to the federal government and an additional $3.7 million to the states of Florida, North Carolina, Tennessee and Texas.

Note: This article was updated to reflect CMS' most recent figures on prescription drug spending.

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