15 July 2010
California Edition
Calendar
July 19-21
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July 22-24
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July 25-28
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E-Mail
info@payersandproviders.com with
the details of your event, or call
(877) 248-2360, ext. 3. It will be
published in the Calendar section,
space permitting.
Mostly Winners For Meaningful Use
Hospital Like Final Rules; Medical Groups Want More
California’s providers are breathing a sigh
of relief as the U.S. Department of Health
and Human Services has issued less
stringent “meaningful use” rules for
hospitals and physicians to receive
financial incentives to ramp up their usage
of electronic medical records and related
applications.
The HHS received more than 2,000
comments on it’s interim final rules that
were released earlier this year, many from
physician organizations and hospitals.
“We have sought and received
extensive input from the healthcare
community, and we have drawn on their
experience and wisdom to produce
objectives that are both ambitious and
achievable,” said David Blumenthal, M.D.,
the national coordinator for health
information technology.
The California Hospital Association
lauded the relaxation of a guideline that
would have originally required all hospitals
to meet 23 specific requirements in order
to qualify for incentive payments that will
be dispensed beginning next year. Now, the
hospitals have to meet 19 guidelines.
Fourteen of those are mandatory, along
with five others from an additional list of
10.
Moreover, critical access hospitals –
those facilities at least 25 miles away from
the nearest acute care facility and less than
25 beds in size – may also qualify for
NORTHERN & SOUTHERN CALIFORNIA
HFMA CHAPTERS hfma-cafallconf.org
20th Annual California Fall Conference
Hyatt Regency Long Beach, Long Beach, CA
Sunday, September 19 - Tuesday, September 21, 2010
California
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incentive payments. They were previously
excluded.
In another big change, hospitals and
physicians have to use computer
physician order entry for 30% of
medication orders. That’s down from the
previous mandate of 80%.
“We’re pleased with the changes. We
requested more flexibility, and generally
received it,” said Pam Lane, a CHA vice
president in charge of healthcare
informatics.
The California Association of
Physician Groups mostly concurred with
the CHA. Physicians, for example, now
have to meet 20 criteria, 15 of which are
mandatory and five out of a group of 10.
That’s down from a previous mandate of
25 objectives.
However, most physicians have to
apply for incentive payments individually,
even if they practice within a group.
“They built this on the old cottage
industry model. However, large groups
are where it’s at. The fact that a medical
group can’t apply as an entity, but a
hospital can is silly,” said William
Barcellona, CAPG’s vice president of
government affairs. He added that
Congress may be lobbied to draft
appropriations-oriented legislation that
Continued on Next Page
 Payers & Providers
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In Brief
Molina Healthcare to
Expand into Wisconsin
Long Beach-based Molina
Healthcare Inc. has expanded its
operations in the Midwest,
acquiring a Wisconsin-based
Medicaid managed care insurer.
Molina will pay about $16
million for Abri Health Plan, based
in the Milwaukee suburb of West
Allis. Abri has about 16,000
enrollees in 23 counties, primarily
through Badger Care, Wisconsin’s
Medicaid managed care plan. Abri
recently won a contract that will go
into effect during the third quarter
of 2010 that will further expand its
enrollment.
The deal will expand Molina’s
market presence in the Midwest to
four states. It currently operates in
Ohio, Missouri and Michigan.
“Once this transaction closes,
our company will provide health
plan services in ten Medicaid
markets throughout the country, we
will be further diversified, and our
Wisconsin health plan will have
significant potential for future
growth,” said Molina Healthcare
Chief Executive Officer J. Mario
Molina, M.D.. The plan has 1.5
million enrollees nationwide.
Kaiser Links Childhood
Obesity to Esophogeal
Disorder
Extremely obese and obese children
run a much higher risk of
gastroesophageal reux disease than
their thinner counterparts, according to
a study by Kaiser Permanente
researchers of its Southern California
enrollees.
Kaiser studied the electronic
medical records of more than 690,000
enrollees between the ages of 2 and 19
Continued on Page 3
NEWS
Meaningful Use (Continued from Page One)
would relax the individual physician
requirement.
Although the guidelines are less
stringent than what the HHS originally
sought, the rules drafted by the agency are
so lengthy – 864 pages – that it is likely to
take weeks for providers to fully assess
what compliance will mean, Lane said. And
the dense reading the rules represent does
not even include a second set of rules
issued by HHS this week specifying the
acceptable hardware and software
applications currently being pored over by
relevant industry vendors.
DMHC Resurrects Solvency Board
Shift From Medical Groups Toward Impact of Reform
The Department of Managed Health Care has
revived its Financial Solvency Standards Board
after a nearly four-year hiatus, ostensibly to
study and report on how healthcare reform
will affect California.
The board was originally convened in 1999
to create solvency standards for the state’s risk-
bearing medical groups after two larger
entities, HealthPartners and KPC, collapsed in
a spectacular fashion, leaving thousands of
patients with gaps in their continuity of care.
The board will again revisit nancial
solvency of the state’s more than 200 medical
groups, according to Grant Cattaneo, a
healthcare consultant in Northern California
and a holdover from the prior board.
“I’m not sure if they (the DMHC) has been
letting things go in terms of solvency, and I
want to hear from the medical groups about
that,” Cattaneo said.
However, the FSSB will also study concepts
being pushed by the Obama Administration in
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Page 2
The HHS will dispense as much as
$27 billion in incentive payments over the
next decade. It’s part of the Health
Information Technology for Economic and
Clinical Health (HITECH) Act of 2009, a
stimulus program intended to speed up
the adoption of advanced information
technology among hospitals and
physicians. Individual physicians can earn
as much as $107,350 from Medicare and
Medicaid in meeting all the rules, while
hospitals can earn millions. Conversely,
providers that don’t update their systems
will begin facing payment cuts from
federal programs beginning in 2015.
the wake of sweeping healthcare reforms
signed into law earlier this year. Included are
medical homes, bundled payments,
accountable care organizations and
healthcare exchanges.
“Federal healthcare reform is creating new
scal models of health care that will need
much thought and the DMHC has been
working to proactively address its implications
for the California healthcare landscape,
trends, and regulations,” said DMHC Director
Cindy Ehnes. “It is imperative that we
understand and inuence the impact on our
state’s delivery system and health care
providers, many of whom are already
struggling due to the economic situation.”
William Barcellona, a deputy director at
DMHC between 2001 and 2005 and now a
vice president with the California Association
Continued on Next Page
Payers & Providers
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In Brief
in its health plan in Southern
California between 2006 and 2008.
Researchers determined that children
who are extremely obese have a 40%
higher chance to suffer GERD than do
children of a normal weight, while
those who are moderately obese have
a 30% greater chance of contracting
the condition.
GERD is characterized by the
liquid contents of the stomach owing
back into the esophagus. The
condition can lead to coughing,
asthma and an inamed larynx. If the
condition persists for years, it can lead
to a precancerous state in the
esophagus, and eventually esophageal
cancer. Up to a quarter of the children
in the U.S. may be affected by the
condition, with increasing obesity
rates a contributing factor.
“The takeaway message of our
study is that GERD now also is one of
the conditions associated with
childhood obesity," said study co-
author Corinna Koebnick, a Kaiser
research scientist. “Beyond counseling
for weight loss, obese children who
report symptoms of GERD may need
to be treated for the underlying
reasons to help avoid persistence of
GERD into adulthood and to prevent
its complications.”
The study was published in the
most recent issue of the International
Journal of Pediatric Obesity.
CHW Exec To Head
Advocacy Group
Californians for Patient Care has
named former Catholic Healthcare
West executive Carmella Gutierrez
as its president.
The 44-year-old Gutierrez
previously served as a public
affairs director at CHW. She had
previous experience as a regional
affairs manager in the U.S.
Department of Health and Human
Services.
The Sacramento-based CPC
advocates on behalf of the state’s 8
million uninsured.
NEWS
DMHC (Continued from Page Two)
of Physician Groups, believes that reform will
bring new pressures on medical groups.
“We’re not moving patients out of dead
medical groups, but there’s going to be a lot of
change,” he said. In particular, a huge
expansion of Medi-Cal patients will put a
burden on a lot of groups to treat them while
accepting razor-thin operating and prot
margins.
“The DMHC is going to have to keep a
much closer eye on solvency in that
situation,” Barcellona said.
The board last met in October 2006. Three
of its eight members served during the board’s
previous incarnation: Cattaneo; Keith Wilson,
M.D., chief executive ofcer of the Talbert
More Delays For Palmdale Regional
Hospital’s Projected Opening Now Two Years Late
The end of 2010. Maybe.
That’s the latest projected opening date
for Palmdale Regional Medical Center, one
of few hospitals built in California during the
past decade from the ground up.
“It looks hopeful for this year, but the bottom
line is that we don’t have any idea,” said
Julie Montague, spokesperson for Lancaster
Community Hospital, a nearby facility
whose management will oversee the new
hospital once it begins operations.
The project, undertaken by Pennsylvania-
based for-prot hospital operator Universal
Health Services, has been bedeviled by
construction-related delays that now total
nearly two years and counting. The hospital
is planned for 127 beds at opening, with an
eventual expansion to 239 beds. It was
originally scheduled to open in late 2008.
Payers & Providers reported in April that the
Ofce of Statewide Health Planning and
Development (OSHPD) could have issued a
certicate of occupation for the hospital as
early as late spring. However, that timetable
has vanished, according to both Montague
and OSHPD ofcials.
Montague noted that the current delays
center on inspections of the hospital’s drop
ceilings and its re-suppression system, both
of which are being undertaken by OSHPD.
Project planners previously had to replace
some 160 windows due to leaks.
In an e-mailed statement, OSHPD
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Page 3
Medical Group in Costa Mesa; and Edward
Cymerys, senior vice president and chief
actuary of Blue Shield of California.
The new appointees include Larry
deGhetaldi, M.D., head of the Santa Cruz
division of the Palo Alto Medical Foundation;
Ann Pumpian, chief nancial ofcer of Sharp
Healthcare; Dave Meadows, vice president of
California health programs for Health Net;
Tom Williams, Executive Director of the
Integrated Healthcare Association; and Rick
Shinto, M.D., president and chief executive
ofcer of IPA operator Aveta, Inc.
spokesman David Byrnes said that “a schedule
is difcult to project until the re damper issue
is resolved.” He noted there were issues in
terms of how the re suppression system was
installed and functions.
Byrnes did add that most other issues – such as
the leaky windows – have been resolved, but
that the re suppression issue is particularly
challenging. “The mitigation work could be
substantial,” he wrote. “Identifying and
resolving the issue in one of our highest
priorities.”
Sources have told Payers & Providers that
Universal is using a building contractor and
architect that have never worked on a hospital
in California before, and are therefore
unaccustomed to working with OSHPD, whose
planning and certication processes are
formidable.
A Universal manager overseeing the
construction project did not respond to a
phone call and e-mail requesting comment.
Palmdale Regional Medical Center’s opening
does not represent the only difculty Universal
has had with California’s regulators. Its two-
hospital Southwest Healthcare System came
close to losing its certications to receive
Medicare and Medi-Cal funding earlier this
year due to persistent quality-of-care problems
at its facilities. It is working on implementing a
corrective plan to improve Southwest’s
operations.
Payers & Providers
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OPINION
Healthcare Gold From Data Mining
Long Used Elsewhere, it Can be a Boon For Hospitals
Most hospital information systems are
designed with an emphasis on daily
operations. The electronic medical record
system is used primarily to care for the
current clinical needs of the patient
population. Over time, hospital
information systems compile tremendous
amounts of clinical data, however, this
information is rarely given a
comprehensive, retrospective
analysis to spot long-term
trends. Medical executives
want at-a-glance, “dashboard”
information to gauge
organizational performance,
but they also need root-cause
analyses of longer-term trends. !
Data mining technology is
now being used to provide
reports across various
healthcare data sets including
pharmacy, lab, admission/
discharge and medical
transcripts.! It has been used for many
years by business and government to
analyze trends in massive blocks of
data such as airline passenger records,
census data and supermarket scanner
information. !
By applying algorithms, association
rules and regression analysis to identify
patterns and meanings, hospital
executives can spot trends that would
otherwise be hidden
Traditionally, when the hospital IT
department is asked to answer specific
business questions, too often its staff
responds with raw files – endless rows of
undigested numbers.! With data mining
tools in place, it is possible to transform
the filing cabinet into a “smart”
information repository which can provide
actionable reports for clinical and
business decisions. !
For example, most California hospitals
have Pharmacy and Therapeutics
Committee guidelines on reduced use of
antibiotics. Hospital leaders want to know
how well the guidelines are being
followed. Now, data mining software can
evaluate antibiotic usage across several
departments or different facilities.. ! !
In a similar manner, many hospitals
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Page 4
would like to track the productivity of their
clinical pharmacists, who have the
responsibility of monitoring a patient’s
changing lab results and adjusting his
medication accordingly. By analyzing drug
orders, lab results and pharmacist
intervention documentation, advanced
software can report on how individual
pharmacists performed in meeting this task or
how they contributed to meeting other quality
metrics. !
In California, hospitals are
required to report healthcare-
acquired infections (HAIs).
However, making the
differentiation between
healthcare-acquired versus
community-acquired infections
can be very time consuming
because it involves reviewing
many data points in a patient’s
clinical profile.! Advanced data
mining software can calculate the
By proper HAI rate and create comparison
Chun or benchmark reports. !
Another capability provided by this
Wong advanced software is automatic
surveillance for infection control. In
the past, infection control practitioners such
as pharmacists or epidemiologists had to
manually review hundreds of patient medical
records to identify at-risk individuals. Now
software can enable automatic surveillance of
the entire patient population and quickly
identify individuals requiring attention. !
One of the key trends in healthcare
reform is more transparency, meaning more
reports for consumers and regulators. Data
mining is the next, evolutionary step in
hospital information systems. It can help
prepare the basic reports and provide a
valuable analysis of the trends behind the raw
data. !
Chun Wong is chief executive officer of
Asolva, a Los Angeles-based firm that
designs streamlining software for a variety
of businesses.
Op-ed submissions of up to 600 words are
welcomed. Please e-mail proposals to
editor@payersandproviders.com, or call
(877) 248-2360, ext. 3.
Payers & Providers MARKETPLACE/EMPLOYMENT Page 5

VENTURA COUNTY
MEDI-CAL
MANAGED CARE
COMMISSION
vchca.org/cohs

VENTURA COUNTY HEALTH CARE SYSTEM is a new organization in Ventura County, CA with ofces located
in Oxnard. This new agency is building its organization starting at the top. There are immediate openings in the
following areas, with other management-level positions being announced soon. All employees will work for Regional
Government Services, assigned to the Ventura County Organized Health Care System. For more and specic details,
go to www.rgs.ca.gov/jobopportunities.

CHIEF EXECUTIVE OFFICER – Salary up to $200,000; apply with a resume and cover letter by July 18, 2010 at
applicants@rgs.ca.gov. The CEO develops, manages, and leads this new organization. Under the authority of the by-
laws and the policies of the board, this position implements strategic goals and objectives by leading and directing staff
to achieve the organization's philosophy, mission, strategy, annual goals, objectives, and nancial targets. This is a key
role in developing metrics to measure performance; serves as a liaison with the public, governmental organizations,
afliated organizations, and other stakeholders. Appropriate education with at least 10 years of progressively more
responsible executive level experience, in health care or managed care.

CHIEF MEDICAL OFFICER – Salary up to $200,000; apply with a resume and cover letter by August 18, 2010 to
applicants@rgs.ca.gov. This position is the principal manager of medical care, and is responsible for the
appropriateness and quality of medical care delivered and for the cost-effectiveness of service utilization. MD/DO
degree from an accredited program preferably in a primary care specialty; minimum two years experience in a
managed care plan preferred with duties comparable to those listed in the brochure, and experience administering
medical programs. Board certied in specialty and a minimum of 5 years clinical/medical practice experience;
knowledge of QI and UM resources management procedures; experience with and acceptance of managed health care
delivering systems and philosophy; and meets all criteria required of particular physicians, including a local medical
license.

CHIEF FINANCIAL OFFICER – Salary up to $175,000; apply with a resume and cover letter by August 4, 2010 to
applicants@rgs.ca.gov. The CFO’s responsibilities include the nancial analysis, budgeting, productivity,
benchmarking, reimbursement cost analysis, managed care risk report and analysis. The CFO must perform nancial,
business, and strategic goals; nancial analysis, budgeting, productivity, benchmarking, reimbursement cost analysis,
and managed care risk reporting and analysis; improve organizational productivity and cost-control; manage cash ow,
purchasing, invoices, and expenses; and meet the requirements of contracted entities, and state and federal government
regulations. It reports directly to the Chief Executive Ofcer and partners with department directors on strategic and
tactical matters relating to budget management, cost benet analysis, forecasting, and securing of new funding sources;
is responsible for providing nancial leadership and nancial management in business planning, accounting,
budgeting, scal management of organization’s operations, and protection of organization’s assets. This position
provides both operational and programmatic support, supervises the nance unit, and is the organization’s chief
nancial spokesperson. Appropriate education, and completion of 10 years of progressively more responsible
experience in nancial accounting and reporting for a health care organization, with at least 5 years at an executive
level with a proven track record of successful nancial management in healthcare, managed care insurance, or
nancial services.

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Payers & Providers MARKETPLACE/EMPLOYMENT Page 6

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*New England Journal of Medicine, 2004.

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