In November 2019, CMS issued its final hospital price transparency rule. To comply, hospitals must disclose their negotiated rates with payers online, beginning in 2021. In response, the American Hospital Association, Association of American Medical Colleges, Children’s Hospital Association, and the Federation of American Hospitals sued HHS.
The argument from the organizations was that HHCS lacked statutory authority to demand such disclosures. The court ruled in favor of HHS, meaning hospitals must comply. Compliance with the hospital price transparency rule is likely to impact healthcare IT budgets and systems significantly.
Hospital Price Transparency Rule Specifics
The final rule requires hospitals to post their “standard charges” online in a machine-readable file. Standard charges include:
Gross charges
Discounted cash prices
Payer-specific negotiated charges
De-identified minimum negotiated charges
De-identified maximum negotiated charges
The disclosure must cover all items, services, supplies, facility fees, and professional charges.
Hospitals also must post payer-specific negotiated rates so that they are searchable and consumer-friendly for 300 services. This essentially allows patients to “shop around” for the best prices. The rule defines 70 of those services. The other 230 are of the organization’s choice.
Noncompliance with the rule can lead to fines of up to $300 a day.
The Impact on Healthcare IT
The stain on healthcare IT relates to the disclosure specifics. The lawsuit against the rule argued that hospitals would have to create files with hundreds to thousands of columns for rates. These spreadsheets would have to include descriptions, codes, gross charges, and columns for each health plan issuer contract.
Some hospitals could have over 100 contracts with health plans and multiple negotiated rates. Hospitals argue that the size of such files could cause websites to crash. An outage of their public-facing websites could cause a host of problems.
Large healthcare systems likely have site reliability engineers (SREs) to bolster the continuity of their websites. However, smaller ones probably don’t. In either case, healthcare IT bandwidth is already a challenge.
What’s Next?
The plaintiffs are reviewing the appeals court decision and are urging the new administration to review the rule. Hospitals will also have to increase IT budgets to comply and formulate a user-friendly “shopping” experience that doesn’t take down their network.
We’ll continue to follow this rule and the possible solutions. Organizations that need data support should contact our healthcare data experts to see how we can help.
Keeping patient data safe and accessible is critical for every healthcare organization. Problems often occur when you keep a legacy system running to store your patient data archive. It seems like an innocuous decision. But as many have learned too late, it heightens the risk of a cyberattack.
Colorado Hospital Loses Records After Ransomware Attack
This scenario played out for a Colorado hospital. A ransomware attack wiped out over five years of patient medical records.
The incident was specific to their legacy EHR. It didn’t infect the EHR database bur rather the proprietary software required to read those records.
The hospital announced the breach to its patients and its new protocols on security. They were able to recover some files via backups. Other records remain lost at the time.
This story illustrates the threat of legacy systems. The consequences include the breach, which could mean exposure of personal information. In addition, the loss of records may impact continuity of care.
What’s Wrong with Legacy Systems?
It’s common practice for entities to keep legacy systems running as a means of storage. Medical record retention laws define how long you need to preserve certain records. To make it “easier” during a data conversion, many opt not to migrate all data.
Converting all data when you switch to a new health information system (HIS) is understandable. Why drag old files to a new system? Except, depending on a legacy system as a secure custodian of records leaves you open to cyberattacks.
If you don’t continue to update and maintain legacy systems, there will eventually be cracks. Cybercriminals only need a slight one to find a way to penetrate.
On top of the security risk, legacy systems are expensive and hard to navigate. It’s not an ideal solution. Many believe it’s the only one.
There’s a Better Way to Archive Patient Data
To avoid a ransomware attack and data breach, you should know two things.
First, you need to ditch your legacy system. Instead, you should seek a medical record archiving application. With a web-based system, it’s accessible from any browser. Such a tool should follow all compliance mandates. It should also be easy to use.
With this transaction viewing solution, you can search and filter. It provides a way to run reports for audits or record requests. Further, it must use advanced information security protocols like encryption.
Second, you need to have a third-party, cloud-based backup of historical data. The hospital, in question, does remark there was a partial recovery via backups. However, the story suggests its backup policies may not have been consistent.
Backup shouldn’t be something you have to worry about. It should be part of your archiving solution. Anybody can offer you a backup product. Scrutinize your options, asking things like:
Does the cloud storage use encryption?
Does the data center undergo regular risk assessments?
What is the uptime average?
Does the data center meet certain certifications? (HIPAA, HITRUST, SOC 1, 2, & 3, etc.)
Ensure the Security of Your Patient Data Archive with ViewMaster
ViewMaster, our proprietary transaction tool, makes archiving simple. Its intuitive design means it’s user-friendly, so you can find what you need fast.
Unlike legacy systems, ViewMaster doesn’t have maintenance fees. It’s a platform that helps you meet record retention requirements and is completely secure. Plus, it comes with offsite backup in the cloud.
It solves all the problems of traditional patient archives. We invite you to see how it. Watch the video and request a five-minute demo today.
Hospital bankruptcies are becoming more modern, even in a
world where there are more patients, more treatments, and more medications.
According to Bloomberg, 30 hospitals entered bankruptcy in 2019. But why is
this becoming an epidemic, and what happens to patient data once facilities
shutter?
Deciphering the Rise in Hospital Bankruptcies
There are multiple causes for the collapse of hospitals;
like anything in healthcare, it’s complicated. Overall, many hospitals are
thriving and profitable, but it’s not across the board. So, what’s driving the
trend?
Shift to Value-Based Care and Meeting Federal Mandates
CMS initiated this transformation from fee-for-service to
value-based care in 2015. In the past, providers were paid for the amount of
services performed. This model incentivized providers to order more tests and
procedures. Spending was up yet had no real positive impact on patient
outcomes.
To course correct, the federal government developed
value-based care structures, which, in theory, focused on improving the quality
of care and accounting for the price at the point of care. In this model, physicians
are encouraged to use evidence-based medicine, engage their patients, invest in
health IT, and leverage data analytics to get paid for services.
This shift sounds like a winning proposition for all, but it
put enormous stress on the industry, leading to less revenue and more spending.
The American Hospital Association (AHA) found that community hospitals spend an
average of $7.6 million each year on administrative costs to meet
federal regulations related to quality reporting, record-keeping, and
meaningful use compliance. This increase in spending doesn’t exactly correlate
to reducing costs or improving care, making many hospitals vulnerable to collapsing.
Americans Are Leaving Rural American in Droves
According to the U.S. Census Bureau, approximately 80% of U.S. citizens live in urban areas. That number
has continued to rise because urban areas offer jobs, amenities, and better
schools. Employment opportunities in small-town America are drying up, with the
local county hospital often being the biggest employer. With fewer people and
businesses in rural areas, community hospitals are struggling to stay afloat.
Medicare and Medicaid Reimbursement Rarely Covers the Cost of Treating the Patient
The AHA found that CMS paid 90 cents for every dollar a
hospital spent on Medicaid beneficiaries, while it was only 88 cents for
Medicare patients. This inequity leads to a shortage of $41.6 billion for
Medicare providers and $16.3 billion for Medicaid providers. Eventually, these
shortfalls catch up to hospitals and leave them drowning in debt.
Complicating the matter is that the Affordable Care Act
(ACA) cut disproportionate-share hospitals (DSH) payments. The assumption was
that under the ACA, hospitals would no longer need DSH payments. The problem is
that some states did not choose to expand Medicaid under the ACA, leaving them
financially vulnerable.
Urgent Care Facilities Taking a Cut from Hospitals
Years ago, if you need immediate care, the only option was
the ER. The ER was once filled with patients with “minor” injuries like a
slashed finger or a broken arm. Now, patients have more options that are less
expensive and quicker. Urgent care facilities have expanded considerably, often
staying open late and offering services on the weekend.
While this new type of care does reduce some of the costs
across the entire healthcare ecosystem, it means hospitals lose patients. Most
hospitals only considered competition to be the other healthcare system; now,
the competition is much closer and offers more convenience to the average
consumer.
Hospital Closures: What Happens to Patient Data?
Not all hospitals that file bankruptcy disappear. Many are
sold to larger health systems that consolidate and initiate strategies to go
lean like laying off workers. However, some completely liquidate. The question
is, what happens to patient records?
Federal and state laws impose mandatory medical record
retention requirements on hospitals and physician practices. The Medicare
Conditions of Participation, for example, require hospitals to retain records
for five years (six years for critical access hospitals). HIPAA and HITECH have
included new requirements on top of this, while states also have their own
requirements.
Thus, whether that hospital is sold or closed forever, those
records have to be kept and be accessible to patients. In many cases, if a
healthcare system takes over a hospital, they may choose to add the data to
their EHR system, which would require a data
conversion.
However, since the buyer doesn’t have insights into the
quality or relevancy of the data, they may choose to keep it separate, opting
for a data archiving solution. Archiving can be a low-cost,
compliant way to retain access to the data.
Who Becomes the Holder of Records with Closures?
If a hospital closes, records management planning must take
place, and typically the organization is still held liable for keeping PHI safe
and secure. A closed hospital can transfer its patient records to another
entity, which then agrees to accept responsibility. Like in the scenario of a
hospital being sold, the new holder of the data could choose to convert them to
their system or archive them.
Should there be no healthcare organization that wants to
take ownership, a reputable commercial storage firm can then hold those
records. It’s also critical that any impacted patients be formally notified of
the closure and how they can access their records. Bankruptcy doesn’t protect
these entities from doing their due diligence when it comes to maintaining and
providing access to the data.
Hospital Bankruptcies Have Significant Impacts
Unfortunately, the trend of hospital bankruptcies isn’t
projected to decline. The lasting effects of these bankruptcies is felt by the
community, patients, and medical professionals. As the ecosystem of healthcare
continues to evolve in this country, having access to care and medical records
will continue to be a concern and challenge.
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