Becker's Spine Review

6 Becker's ASC 22nd Annual Meeting - The Business and Operations of ASCs – Call (800) 417-2035 6. Great Systems Build Much of Their Talent Organically. Great teams build around talent that joins them early and then combines that with leaders who come in laterally. Lateral hires are critical and sometimes needed to grow or fill gaps, it is very hard to succeed if you don't have a base of great home-grown talent. Recruiting leaders from other organizations can be ef- fective. We are aware of few successful organizations that don't build much of their talent internally. Organic growth also provides a base of leadership with institutional knowledge. is can allow the group to grow and rebuild without major setbacks. 7. Great Teams Make Changes and Move People Out to Unleash and Develop New Talent. Great systems and teams constantly aim to develop junior leaders, and sometimes they must nicely and professionally rotate people out of leadership roles to let others thrive and grow. e NHL and NBA have a salary cap that in part forces this, and hospitals and health systems have budgets that can essentially force this to happen as well. In es- sence, when a person has met their ceiling and cannot perform where a sys- tem needs them to perform, great systems find ways to professionally move others into those positions. is takes a great deal of discipline and is oen not pleasant. 8. Outstanding Teams Need Players who are Stars in Various Roles. Great basketball teams need scorers, passers, rebounders, players who can hit three-point shots and players who can play defense. Hockey teams need players that can handle different roles. is same concept holds true of hospitals. Not everyone can be or needs to be a CEO. But every en- tity needs great IT people, great strategy people, great service line leadership, great patient care leadership and more. Here, it is critical that people know their role and their strengths and also work together well. The 8 Biggest Healthcare Issues in 2015 So Far As we move into the second half of the year, this article examines some of the biggest issues that have emerged so far. 1. Healthcare Costs for the Average Family are Going Up. Over the past two to four years, something fascinating happened. First, healthcare insurance costs stayed largely the same. is gave some people the illusion that family healthcare costs might be staying flat. In reality, the consumer portion of costs went up very substantially. "Healthcare costs for this family have doubled in the past decade, and tripled since we began tracking this in- formation in 2001," said Sue Hart, co-author of the Milliman Medical Index. "As has been the case throughout the time we have studied costs for this fam- ily, the rate of increases far outpace the consumer price index." e concept where employers shi more of the costs to employees and insurance com- panies offer more high deductible and similar types of plans is not abating. Rather, insurers are preparing for another set of significant increases in costs. 2. Consolidation Continues at a Fairly Rapid Pace; Will Regional Systems Consolidate; Will Payors Consolidate. It has become in- creasingly clear that rural hospitals and independent hospitals may have a very hard time surviving in the future. us, more and more of those are looking to align with bigger systems. And on the other hand, bigger systems are eagerly searching for hospitals that can expand their market reach. A fascinating issue will be whether the regional systems, and there are in- creasingly great regional systems in the country, will start to align with each other. ese types of deals, oen referred to as "mergers of equals," can be transformative for organizations and their markets. A second fascinating issue has emerged this past month. Here, it seems as if a merger frenzy or bubble is heating up among the big five insurers as (1) Humana puts itself in play, and (2) Anthem and United make bids for Cigna and Aetna and vice versa. 3. State Budgets, Whether States Picked up Medicaid Expansion or Not, Are Being Shellacked. State budgets are now in trouble on two different fronts. ey are, in many states, overwhelmed by the cost of pen- sions and healthcare responsibilities to former state government employees. Second, they are increasingly overwhelmed by Medicaid expenditures, and in some states the decision about whether to expand Medicaid is a messy one. In Florida, the Senate is deeply divided from the House and governor are deeply divided about a plan to expand the program. Medicaid expenditures, and the burden they bear on state budgets, will get worse as, under the healthcare law, more costs are shied to states under Medicaid programs. Paul Volcker, the former chairman of the Federal Reserve, recently issued a report that said neither Democrats nor Republicans can claim to have supe- rior budgeting practices at this point. He criticized states for kicking the can down the road, living beyond their means year aer year in a "never-ending sense of crisis" that results in "stop-and-go funding of vital programs," such as those for infrastructure, education, pensions and city and county services. As 45 states prepare their budgets for the fiscal year beginning July 1, many are facing significant shortfalls and calling for special legislative sessions. A survey by Associated Press reporters found 22 states were projecting short- falls for the coming fiscal year, with Illinois leading the way with the largest budget gap. 4. Healthcare Exchange Enrollments See Fewer Sign-ups Than Expected. To bolster enrollment numbers, the government provided subsi- dies to people in states that did not add their own healthcare exchanges, even though the law seems to have said something different. Of those who gained coverage through the exchanges, roughly 6.4 million of them are receiving government subsidies. Supporters of the healthcare law point to the amount of people enrolled through healthcare exchanges under the healthcare law. Earlier this month, HHS announced 10.2 million people purchased coverage during the most recent enrollment period. at's a drop-off from the 11.7 million people who enrolled for coverage, a decrease that was expected since some people did not pay their premiums. Yet the Obama administration is on track to meet its goal of having 9.1 million people paying for coverage under the exchanges, the administration's 2015 goal. 5. The PPACA Has a Few Great Points; Note, However the Bal- ance Between Taxes and the Costs of Government Versus the Increased Coverage Remains Unclear. ere are a couple great points in the healthcare law that should not at any cost be repealed. In essence, the ability for people to obtain coverage even if they have preexisting conditions and other certain other concepts are critically important. Despite its lack of popularity, polls have highlighted a complicated relationship between the American public and the ACA, suggesting many people see the value in cer- tain provisions of the law while not supporting the legislation in full. For instance, a Washington Post-ABC News poll found 54 percent of Americans oppose the ACA, but 55 percent think the Supreme Court should not block federal subsidies in King v. Burwell. However, the total billions of dollars spent by the government and the in- crease in taxes that comes with it compared to the benefits of the healthcare law thus far seem out of balance. In essence, the costs seem high and the benefits may be low. e impacts of these changes can have an overriding effect on the American economy. e increased taxes plus increased insurance costs mean a double hit to American incomes. In 2014, the percentage of money consumers spent on healthcare rose to a record high of 20.6 percent. Healthcare's piece in the consumer spending pie has grown for years, up from 15 percent in 1990, and it remains a big concern especially as baby boomers enter their retirement years. In the long run, higher taxes and greater insurer costs can harm con- sumer spending, which is a big part of the economic strength of the country, accounting for 70 percent of economic activity. 6. Epic Seems to be Taking Over the World. Each day, we read about a different contract between a provider and Verona, Wis.-based Epic Systems, the largest provider of EMR services in the country. e company recently signed a $1.2 billion contract with Boston-based Partners HealthCare, mak- ing it the academic health system's biggest single investment to date. In Feb- ruary, Rochester, Minn.-based Mayo Clinic announced it selected Epic to

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