Healthcare Roundup: Hospital Losses, Dental Tourism, Kaiser Health IT Success, and More

Physician payments weigh down hospitals – The Maryland Hospital Association reported that the state’s hospitals are in worse shape than the average hospital nationwide. Nearly 60 percent of Maryland hospitals sustained losses in the fourth quarter of 2008. Total margins dropped to a negative 13.5 percent, compared with a 7.8 negative margin for hospitals nationwide. With bad investments accounting for the majority of losses, operating margins remained in the black, although just barely. But what really stuck out in the association’s report was that Maryland hospitals paid $210 million in 2008 to physicians to keep them on staff; that was twice the level of five years earlier. While it’s unclear what services the hospitals were paying for, it’s likely that these were payments to specialists who treat poor and uninsured emergency-room patients, especially in inner-city and rural areas. Without additional hospital reimbursement, these physicians would not come to the hospital to treat patients for low Medicaid payments or for free. But this is a problem across the country, not just in Maryland. [Sources: Maryland Hospital Association, Baltimore Sun]

Medical tourism goes dental – Medical tourism, which has been growing in recent years, has now expanded into the dental field. The Chicago Tribune reported that there are 350 dentists in Los Algodones, Mexico, a small town just across the U.S. border. Most of their business come from Americans who drive or fly to Mexico to get dental procedures that cost 75 percent less than in the U.S. A Phoenix company called Dayo Dental even organizes van rides to Algodones. Naturally, the Arizona Dental Association expresses concern that Mexican dentists may not do right by their patients. While that may or may not be true, more people would probably go abroad if they could be assured that the quality of care was comparable to that in the U.S., according to McKinsey & Co. [Source: Chicago Tribune]

Kaiser scores another success with health IT – A Colorado disease management program piloted by Kaiser Permanente has reportedly lowered the mortality rate of patients with coronary artery disease by 73 percent. A dedicated care team employed Kaiser’s electronic health record and an electronic disease registry to keep track of what had been done for patients and what services they needed. This is not a new approach, but Kaiser showed that a technology-enabled, integrated health system could use it to make a tremendous difference. [Source: Healthcare IT News]

Getting on the technology bandwagon – Since the passage of the federal HITECH Act, a plethora of studies about the potential cost savings of information technology are suddenly emerging. One study from the University of Maryland estimated that hospitals lose $12 billion a year, or about 2 percent of revenues, because of poor communication. The solution? Why, more health IT, of course. But let’s not forget that it costs the average hospital $20 million to $100 million to implement an electronic health record system.[Source: University of Maryland]

UConn and Hartford Hospital update – Connecticut Governor Jodi Rell has, in effect, vetoed the plan of the University of Connecticut to build a new hospital with state funds, saying that the state couldn’t afford it. Under the plan proposed by UConn, its Health Center would have merged with Hartford Hospital and would have built a $475 million hospital to replace John Dempsey Hospital, an aging facility used in UConn’s medical training and research programs. The plan was expected to cost Connecticut $605 million over the next 10 years. UConn officials predicted that as a result of the governor’s decision, the old hospital would continue to decline and that the state would lose an opportunity to create thousands of new jobs. [Sources: Hartford Courant, BNET Healthcare]