Becker's Hospital Review

17 CFO / FINANCE Mercy CFO: Medicare Advantage is a good model 'when structured appropriately' By Alan Condon M edicare Advantage provides coverage to more than 51% of the nation's seniors, but many hospitals and health systems are pushing back against commercial programs, with some dropping contracts with private plans altogether. Excessive prior authorization denial rates and slow payments from insurers are some of the biggest challenges providers face with MA programs, but St. Louis- based Mercy CFO Cheryl Matejka maintains that MA is a good model when structured appropriately. "It helps keep incentives aligned if commercial contract terms are appropriate. Patients like the model in our markets and, I would argue, across the country," Ms. Matejka told Becker's. "We want to adapt to serve our communities, and our patients that like those models. at being said, the model needs some tweaks." e infrastructure to manage Medicare risk can be daunting, especially for health systems that are new in the MA space or if a particular MA model is new in their market. "If you're just starting down that road while the entire healthcare industry is in the process of financial recovery, building that model can be a daunting cost," Ms. Matejka said. "Mercy has been building its structure since the late 1990s related to the physician demonstration projects with one of the early models in our Springfield market. We believe it's a model that can help us as the nation reduces the overall cost of care, but only if it's structured appropriately and when there's a win-win for everyone involved." Beginning in 2024, MA plans must provide coverage for an inpatient admission when the admitting physician expects the patient to require hospital care for at least two midnights — otherwise known as the two-midnight rule. Under CMS' final rule, published April 5, inpatient admissions are covered for traditional Medicare beneficiaries who require more than a one-day stay in a hospital or who need treatment specified as inpatient only. However, several MA plans continue to disregard this directive, according to Ms. Matejka. "When we bill for something, whether it's inpatient or outpatient, we need to be paid for that," she said. "e government is also trying to address some of the challenges around preauthorization. With preauthorizations or authorizations for post-acute care — whether that be home care or skilled nursing care — it's clear there are some challenges with that happening efficiently within the system." Addressing these issues is critical so that MA works for all involved: patients, providers and payers. "We're trying to do the right thing for the patients: making sure they're getting the right level of care and getting care when they need it. To enable the timely care that patients need, payers need to address the timeliness of the authorization process and correctly pay versus deny appropriate levels of care," Ms. Matejka said. "As many of our communities age, we need a financially sustainable model to care for them. Medicare Advantage has a lot of promise there," she said. "Fortunately, we've already built that infrastructure to manage risk but some of those other issues around denials need to be addressed." n UC Davis Health added C-suite role to 'accelerate revenue opportunities' By Laura Dyrda L ast April, UC Davis Health added a new C-suite role to lead its Ventures Office, and the role is quickly becoming more essential to the system's long term success. Life sciences industry veteran Don Taylor, PhD, stepped into the inaugural chief ventures officer role almost a year ago, overseeing partnerships with innovation, entrepreneurship and industry engagement for the system. His team supports the development and commercialization of intellectual property and advanced research. But the role's influence goes beyond theoretical innovation to have a dollars-and-cents impact on the bottom line. "We have recently added a chief ventures officer to develop new, external and diversified revenue for our health system, and explore things such as partnering with industry to accelerate revenue opportunities and mitigate financial risk," David Lubarsky, MD, CEO and vice chancellor of human health sciences at UC Davis Health, told Becker's in a recent interview. Dr. Taylor has previous experience as executive director of licensing at The Ohio State University and assistant vice chancellor for commercial translation in the health sciences at the University of Pittsburgh. He is also an entrepreneur and led corporate development for drug discovery company Cellumen. The Ventures Office has multiple focus areas, including cell and gene therapy, neuroscience, oncology and food technology. These efforts, along with UC Davis' Venture Catalyst and InnovationAccess programs, are an increasingly important part of the health system's strategy as healthcare organizations face the tough economic reality of costs growing faster than reimbursements. "As health system margins continue to tighten, and the mission of healthcare continues to expand, we have to be looking for better ways to monetize products we have developed, commercialize what we can, provide health- adjacent services to expand revenue sources, and manufacture those things we are best positioned to create," said Dr. Lubarsky. n

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