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Morning Briefing

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Monday, Mar 23 2015

Full Issue

Tenet Nearing Deal To Buy United Surgical

A deal between the companies, which could be valued at more than $2.5 billion, including debt, might be announced as early as Monday, the Wall Street Journal reports. Other stories analyze the move away from fee-for-service medicine and whether it will improve quality of care, as proponents argue, and the evolution to today's complex hospital bill.

Tenet Healthcare Corp. is nearing a deal to buy United Surgical Partners International Inc., as a number of hospital networks seek mergers amid sweeping changes in the U.S. health-care system. A deal between the companies, which could be valued at more than $2.5 billion, including debt, might be announced as early as Monday, according to people familiar with the matter. It is also possible the deal could fall apart at the last minute. (Tan and Cimilluca, 3/22)

Fee-for-service medical care, in which providers charge fees for specific services, is a prime battleground for policy makers in health care. If providers stand to make more money the more tests and procedures they perform, critics of the system say it’s no wonder that health-care costs have skyrocketed in recent years. Efforts are under way to reimburse providers based on the value, not the volume, of care—including paying doctors to keep patients healthy. Medicare plans to shift 50% of its payments to such programs by 2018. (3/22)

The push to pay for quality, not quantity in health care is rapidly accelerating. Doctors and hospitals are being evaluated on myriad quality metrics by rating services, insurance companies, professional groups and government programs—with results increasingly tied to financial penalties or bonuses. But payers, providers and patients don’t always agree on what quality means, and there is no official set of standards. (Beck, 3/22)

As recently as 1969, delivering a baby in Morristown, N.J., could cost parents as little as $235.65 — a flat, all-inclusive rate for a three-day hospital stay and doctors' fees. I know this because that was the price on the receipt from my birth at Morristown Memorial Hospital. My father recently found it in a pile of old papers. ... The simple, one-page document lists my parents' names, the total cost of care and just three options for payment: cash, check or money order. There were no co-pays, co-insurance or deductibles to meet. My parents didn't receive an onslaught of bills once they left the hospital. (Zamosky, 3/22)

Over the past three years, the number of people covered under Eastern Maine Healthcare Systems' value-based payment contracts has swelled from 9,400 to 100,000. In that period, the eight-hospital not-for-profit system has seen emergency department visits decline 2.8 percent, admissions drop as much as 21 percent, and primary-care visits jump 23.7 percent. The system calculates that it has lowered its per-member, per-month Medicare cost trend by 4.7 percent, and healthcare costs for its employees have grown less than 5 percent. (Kutscher, 3/21)

This is part of the Morning Briefing, a summary of health policy coverage from major news organizations. Sign up for an email subscription.
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